Accounting consultancy

In today’s rapidly-changing market conditions, company success depends on the ability to gain and retain business advantages. Ensuring high competitiveness and achieving strategic goals require constant improvements in business processes, organizational structure, accounting systems, and information technologies - in other words, the whole management system!

FBK’s accounting advisory services therefore go far beyond traditional accounting and auditing. We offer new accounting methods employing state-of-the-art approaches to the organization of corporate management systems and then implement these approaches using advanced management techniques and bundled software.

Modernizing accounting systems while implementing corporate management systems

When implementing ERP-systems, we usually revise the methodology for accounting organization and operation in order to optimize organizational business processes. We then integrate these with accounting processes and the new possibilities offered by information systems from the standpoint of accounting and reporting.

As part of this service, we develop or improve the corporate methodology for accounting organization and operation, as well as for financial and tax reporting (RAS, IFRS, US GAAP, tax returns).

We are then able to generate the following documents:

>  detailed accounting policy, including an exhaustive description of the accounting and reporting design, technology and methodology

>  working chart of accounts for the formation of individual and consolidated financial, tax, and management reports within a single information space

>  charts of correspondence between RAS, IFRS and US GAAP accounts, tax accounts, and management accounts - depending on the methodological and systemic volumes of the management information systems implementation

>  parallel accounting methodology (RAS, IFRS, income tax-based tax accounting)

>  corporate accounting standards, journals of bookkeeping entries, workplace charts, tax ledgers, procedures for period-end closing and drawing up reports and tax returns

>  document flow system for the preparation of individual and consolidated reports (forms for non-unified source documents, charts, diagrams, procedures, etc.)

All this work is carried out by integrated teams of consultants/methodologists who implement corporate business applications and have extensive up-to-date knowledge of the theoretical and industrial methodologies for accounting and reporting and for linking up such reporting to other types of reporting within the corporate management framework. Our teams are also very familiar with both the possibilities and the limitations of management information systems.

This approach to designing complex projects facilitates strict control over the whole process integration and ensures a high-quality accounting processes methodology, as well as its autonomy and priority in making decisions concerning specific system setups in which the system’s possibilities and specific requirements are taken into consideration.

A fundamental approach towards improving accounting systems on projects to implement corporate business applications is to integrate them closely with logistics, production, management, and financial systems.

Developing a methodology to reduce reporting timeframes

Reducing financial and tax reporting timeframes is directly associated with improving the company’s manageability and is above all of primary importance for holdings and multidivisional enterprises with a branched territorial structure. The following steps reduce financial and tax reporting timeframes:

>  defining the key parameters of the reporting process

>  analyzing period-end closing and identifying difficult accounting areas which cannot be closed within the target timeframes

>  developing the organizational, methodological, and technical solutions for difficult accounting and reporting areas and developing and implementing unified accounting methodologies, policies and procedures

>  developing a system of estimated values to be reflected in the accounting of financial and business transactions, estimates accounting regulations and an estimates-based reporting procedure

>  developing general procedures for managing the formation of the target and actual reporting

>  developing systems for monitoring the significance of deviations of target reports from actual reports

>  defining requirements for IT solutions

>  providing training for key personnel

>  support and monitoring system implementation

Reorganizing the accounting function as part of business restructuring and/or expansion

Reorganizing the accounting function is usually conducted as part of projects to reorganize individual enterprises or groups of enterprises, unify and optimize business processes, implement corporate applications, partially or totally centralize accounting processes, outsource accounting processes to external organizations or the holding enterprise and decentralize the accounting process.

The reorganization of the accounting function includes the following steps:

>  Developing and justifying the concept for modifying the accounting office operations model within the framework of company reorganization/expansion:

•      >  approaches towards the separation of accounting processes and functions
•      >  legal support
•      >  organizational and functional structure
•      >  communication procedures
•      >  internal control and risk management system
•      >  general requirements for IT solutions

>  Developing the accounting office operations model:

•      >  listing and description of accounting processes
•      >  organizational and functional structure
•      >  cooperation procedures
•      >  document flow systems
•      >  methodology for accounting organization and operation, developing reporting and tax returns
•      >  requirements for the internal control and risk management systems associated with the development of financial and tax reporting
•      >  integration with the corporate logistics, production, and management processes/systems
•      >  key personnel training

>  Developing detailed requirements for IT solutions

>  Implementation support and monitoring

Outsourcing accounting, recovering accounting records

Outsourcing ancillary business process to an outside organization has a number of indisputable advantages:   

>  management can then focus on the company’s core activities in the sure knowledge that they have delegated all the work and responsibility for ancillary business processes to FBK - a professional consulting company with highly competent personnel and vast experience in methodological and industrial work

>  as a professional consulting company, FBK can draw on best practice and various approaches to accounting organization and operation, provide a rapid response to complicated problems, and mitigate tax risks arsing as a result of constantly changing regulation

>  the client is not distracted by personnel problems and can optimize training, insurance, and other administrative costs concerned with accounting specialists

The main outsourced accounting functions include: accounting and financial reporting compliant with RAS, IFRS and US GAAP; income tax-based tax accounting; drafting tax returns for all taxes paid by the organization; preparation of other management data based on accounting data.

FBK offers its clients different approaches to the organization of accounting outsourcing processes: 

>  accounting functions performed at the client’s office. This involves providing consultants to take full responsibility for a range of functions, especially book-keeping and tax accounting, payroll accounting, cash and banking transactions and the preparation of the different types of external and internal reporting. The head of the group of consultants exercises the functions of the client’s chief accountant

>  accounting functions performed at the consultant’s office. In this case, FBK employs its own information resources, performs all book-keeping and tax accounting functions, provides payroll accounting and prepares the different types of external and internal reporting based on the client’s source documents as delivered to the consultant’s office. Delivery of the client’s source documents to FBK and return of the current accounting data to the client can be done in a variety of ways.

FBK provides the following services as part of this work:

>  preparing financial and tax reporting based on accounting registers formed by the client’s own experts

>  express-diagnostics of book-keeping and tax accounting and a proposal for the recovery of accounting data, accounting organization and operation, depending on management’s objectives, accounting status, and financial risks

>  recovery of book-keeping and tax accounting data, drafting revised tax returns

>  preparing the necessary documents and reconciliation of calculations with the budget and with the client’s counterparties

Evaluating the efficiency of the accounting function at holdings

The management of large companies with branched territorial structures, such as holdings and multidivisional enterprises, face problems regarding the efficiency of their accounting office organization and operation.

This issue can arise both before and after the reorganization of the accounting function of the whole holding structure. Reorganizing the accounting function can be part of projects to reorganize the individual enterprises/groups of enterprises, unify and optimize business processes, implement corporate applications, partially or totally centralize accounting processes, outsource accounting processes to an external organization or a holding enterprise and decentralize the accounting process.

Evaluating the accounting function should be done with regard to achieving the goals of such an evaluation. The following groups of relevant goals can be identified:

>  Quality of the outputs from the accounting function operation: 

•      >  validity and reliability of the reporting data (acceptable level of data validity and reliability)
•      >  presence in the reports of the information necessary for justified decision making

>  Duration of the reporting generation and the guarantee of its timely completion

>  The costs of the accounting function operation and accounting processes efficiency. The following tasks must be performed to improve accounting function efficiency:

•      >  elimination of procedure duplication
•      >  elimination of redundant procedures
•      >  improvement of available resources utilisation
•      >  standardization of similar processes in the holding’s various divisions

We take into account the following parameters in evaluating the efficiency of the accounting function organization at holdings and multidivisional enterprises:

>  industrial specifics of the enterprise

>  the enterprise’s geographical location

>  the enterprise’s organizational design, including the current set of regulations governing the organizational units, key performance indicators, job descriptions and regulations

>  organizational and functional structure of the accounting function

>  division of responsibilities between the accounting function and the organizational units

>  numbers and professional competence of accounting specialists

>  required forms of book-keeping, tax and managerial recording

>  document flow schedule

>  employed ITs, company’s IT strategy

Evaluating and improving internal control systems

Internal control systems are very important for a company’s management because of the need to provide reasonable guarantees that the company’s goals will be achieved. With regard to the financial function, such goals include the following: 

>  financial and business operations efficiency

>  financial stability

>  timeliness, validity and reliability of financial and managerial reporting

>  assets and information security

>  compliance with legislation

>  compliance with internal procedures and regulations

FBK evaluates your company’s internal control system based on an integrated analysis of its individual elements:  

>  presence of control environment

>  organization of information flows

>  control procedures employed

>  risk identification and management

>  impact on financial reporting

These elements are analysed in the context and through the assessment of the main operational areas of the company’s activities (sales, procurement, production, finance management, investments etc.).

This analysis focuses on identifying any absent key control elements, estimating the probability and significance of emerging risks, and developing compensatory control procedures.

The main tools used in this analysis are a description of the relevant business processes and the development of instructions for their operation, an analysis of regulatory documents, interviews with the company’s personnel, observation and piloting of the processes and control procedures.

Consulting on accounting and reporting issues

Methodological support for your accounting experts includes the following services:

>  providing written answers to questions concerned with complicated or controversial situations in book-keeping and tax accounting that are not unequivocally regulated by the current legislation

>  justifying the possibility to employ IFRS-compliant approaches within the framework of current legislation related to accounting

>  evaluating the enterprises’ accounting policies and developing recommendations for bringing such policies into compliance with the current legislation

>  methodological support for complicated operations and types of activities, controversial situations, particularly with regard to accounting organization and operation (reorganization of companies, leasing operations, foreign trade activities etc.). This is provided by developing the appropriate regulating documents and delivered as replies to the questions involved 

>  provision of ad hoc informational and analytical comments to the new regulatory documents and other materials concerned with book-keeping and tax accounting and taking into account the company’s industry specialization.

Contacts:

For more information on our accounting advisory services please contact:

Irina Yutskovskaya, Director of the Accounting Advisory Department, FBK
e-mail: UtskovskayaI@fbk.ru

You are also welcome to leave your inquiry on-line

Tel.: +7 (495) 737-5353