Post on 04-Jan-2020
Financial Accounting Advisory Services Accounting policy manual solution May 2013
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Agenda
About EY 3
Accounting policy manual solution 5
Automated accounting policy manual 11
Appendix 20
Credentials 21
Contacts 22
About EY
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EMEIA Sub-areas
EY Global
Countries worldwide
140
Employees worldwide
167,000
US$ revenue (2011-12)
24.4b
Africa Angola, Botswana, Republic of Congo, Equatorial Guinea, Ethiopia, Gabon, Ghana, Guinea, Ivory Coast, Kenya, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Nigeria, Rwanda, Senegal, Seychelles, South Africa, Tanzania, Uganda, Zambia, Zimbabwe
Belgium and Netherlands
Germany, Switzerland and Austria
Commonwealth of Independent States Azerbaijan, Belarus, Georgia, Kazakhstan, Russia, Ukraine, Uzbekistan
Central and Southeast Europe Albania, Bulgaria, Croatia, Cyprus, Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, FYR of Macedonia, Malta, Moldova, Poland, Romania, Serbia, Slovakia, Slovenia, Turkey
France, Maghreb and Luxembourg France, Luxembourg, Algeria, Morocco, Tunisia
Financial Services Organizations Belgium, Channel Islands, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Switzerland, UK
India
London
Mediterranean Italy, Portugal, Spain
Middle East and North Africa Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Oman, Pakistan, Palestinian Authority, Qatar, Saudi Arabia, Syria, United Arab Emirates
Nordics Denmark, Finland, Norway, Iceland, Sweden
UK and Ireland UK, Isle of Man, Republic of Ireland
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Accounting policy manual solution
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Birth Sustained operations Rebirth | evolution
Accounting policy need triggers Accounting policy need across the corporate life cycle
Major transaction: Driven by changes in capital structure, new regulatory oversight and other major organizational changes.
Remediation or improvement projects: Driven by a need to remedy risk events or improve efficiency in organizations. These can occur in any phase of the corporate life cycle.
Business as usual: Driven by changes in accounting standards, regulations and business processes throughout the corporate life cycle.
Organization and incorporation
IPOs and other capital
markets activity
M&A activity
Performance improvement: ► Shared service
center implementation
► Process improvement
Risk: ► Internal
audit ► ERM
Investments, divestitures, restructurings and M&A
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How we view things Four pillars, many options
Policies Policy function
Rapid assessment Focus: library
Governance Focus: process
Optimization Focus: content
Education and deployment Focus: education
IT-based solution: automated accounting policy manual (AAPM)
► Does your organization have all the policies it needs?
► Are there redundant policies or gaps, or inconsistencies across geographic or business lines?
► Are internal customers satisfied with policies?
► How do your policies compare to those of industry peers?
► Does your organization have a “policy on policies” that defines when to create, revise or decommission policies, identifies process owners and sets approval requirements?
► How is consensus and stakeholder alignment achieved?
► How are policy changes communicated to the organization, and implemented?
► When are external resources used to aid with drafting?
► Do your organization’s policies comply with GAAP, IFRS, and/or prevailing regulatory requirements?
► Are they user-friendly? ► Are they the right length? ► Are they written in plain
language? ► Are they linked to standard
operating procedures (and desk instructions), to form a policy framework that supports the control environment?
► Are your policies centrally accessible to employees?
► Is training provided? ► Is employee learning
monitored? ► When are external resources
brought in to assist in the creation and delivery of training?
Corporate governance
Enterprise risk management
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How we view things Four pillars, many options (contd)
Policies Policy function
Rapid assessment Governance Optimization Education and deployment
Key activities: ► Review policy library ► Conduct end-user interviews
and/or surveys ► Perform peer benchmarking ► Establish current state and
desired future state ► Communication on new or
revised standards and impact on policies or other aspects of your business
Deliverables: ► Project charter ► Interview or survey results ► Findings and
recommendations
Key activities: ► Identify key gaps related to
technical or regulatory adequacy, user-friendliness and overall structure
► Conduct interviews with process owners, technical accounting personnel and other stakeholders, to understand concerns and potential issues
► Develop policy prototype ► Draft new or refreshed policies
and procedures
Deliverables: ► Project charter ► Findings and
recommendations ► Policy prototype for approval ► New and refreshed policies
and procedures
Key activities: ► Review existing policy
governance framework and discuss leading practice governance
► Develop work plan to implement leading practice governance recommendations
► Draft new or refreshed policy on policies
► Create future state process flow
► Establish ongoing communications with company on new or revised standards and impact on policies
Deliverables: ► Project charter ► Findings and
recommendations ► New or refreshed policy
on policies ► Future state process
flowchart
Key activities: ► Develop work plan to implement
leading practice deployment, education and communication recommendations
► Determine whether manual or technology-enabled deployment is preferred
► Co-develop and deliver education sessions on recent accounting developments, regulatory areas of focus or the policies developed
Deliverables: ► Project charter ► Findings and recommendations ► New or revised training
materials, co-developed with management
► Education sessions and materials
► Listing of technology-enabled solutions for consideration
► Assistance in implementation of technology solution
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Benefits Organizations can reduce costs
Organizations can reduce costs, improve efficiency and reduce risk by implementing clear and transparent accounting policies.
Benefits Why EY?
Critical success factors: catalyst for change, executive sponsorship, stakeholder buy-in, efficient and effective methodology, PMO and third-party support.
Outcomes: ► Accounting and finance policies remain current and in compliance
with rules, regulations and business processes. ► Accounting policies are applied consistently within the
consolidated, global group. ► Benchmarking with leading practices and peers when adopting
new policy positions. ► Design and deliver the most efficient and effective policy and
procedure framework to internal customers and stakeholders.
Value: ► Lower regulatory risk ► More effective financial statement close process:
► Reduced close time ► Fewer errors ► Lower costs
► Increased compliance and consistency ► Focus corporate energy on strategic and high-risk areas ► More educated and flexible workforce
Teaming and collaborative approach Our success with clients is attributable to our flexibility: ► We can be co-sourced with your team. ► We can operate with minimal disruption to you.
Strategic insights Our broad experience gained from other projects enables us to bring high-level strategic insights and a commercial approach.
Global network We use our global network and draw on the diverse and in-depth skills of teams in more than 75 countries.
Proven tools and methodologies Our robust methodologies and technology solutions allow us to hit the ground running, and provide tailored cost-effective strategies.
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Leading practice policies Sample accounting policy contents
2
1
3
4
5
1. Table of contents
2. Scope and purpose
3. Hedge accounting requirements
Providing background of company and policy issue helps frame policy and provide context.
Policy includes “plain language” examples and definitions that are specific to the industry.
The audience is considered throughout the policy (i.e., does the audience have significant accounting expertise, or will additional examples be required to explain key concepts?).
4. Regulatory reporting consideration
5. Authoritative guidance
Leveraging GAAP and regulatory expertise during policy drafting and creation can assist in efficient incorporation of such information. Including relevant disclosure requirements can help financial reporting employees to meet GAAP and regulatory disclosure requirements.
Including authoritative guidance references helps users to bridge the gap between guidance and company finance policy.
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Automated accounting policy manual
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Automated accounting policy manual (AAPM)
► Web-based accounting policy manual ► Features views of client products and processes ► Cross-references between all areas and sites ► Easy-to-update content ► Non-sophisticated base technology ► Easy user and rights management ► Browse through profit and loss (P&L) and financial statement policies ► New way of presenting different dimensions of a company’s business ► Integration into existing ICS (internal control system)
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Automated accounting policy manual
Highly customizable, up-to-date content, constant availability, easy access and low maintenance costs
A widely accepted, easy-to-use consistent manual
Offers a complete overview of the business
Search and find functionality
Simple intranet integration
No additional desktop-software (SaaS) needed
Cross-links to other programs
Reports to track and analyze the manual utilization
Benefits
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Automated accounting policy manual Tool presentation
Overall entry page with the manifold possibilities: ► Quick references to all possible views ► Display recently modified pages ► Display recently visited sites ► Display own favourites
View of a statement of financial position structured in: ► Accounting policies ► Accounting instructions ► Affected IT systems ► Affected products ► Affected processes
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Automated accounting policy manual Tool presentation (contd)
Products entry page: ► Quick references to all products
Manufacturing and revenue recognition of a specific product, including the following information: ► Posting records ► Affected balance sheet items ► Affected P&L items
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Automated accounting policy manual Tool presentation (contd)
Changemode: ► Easily insert tables, images and documents ► Four-eyes principle ► Versioning
Reporting functionality to track and analyze tool utilization
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Automated accounting policy manual Using simple, readily available technologies
EY delivers
Client SharePoint
EY provides a web-based platform which hosts the accounting manual for you, working with you to develop and update the content.
SharePoint makes it easy to store, synchronize and share important content. A simplified user experience helps streamline common tasks, and creates sites to keep teams in sync.
MediaWiki MediaWiki is a free wiki software application developed by the Wikimedia Foundation and others to power their websites.
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Sustain
Project setup
Automated accounting policy manual Project schedule
Activity Department External support EY
Business IT
Tool
Content
Schedule
Resources and organization
Software selection
Check for integration in IT landscape
Scope of application
Source and format of existing content
Integration process Manually
Automatically
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Identify Diagnose Design Deliver
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IT infrastructure
Automated accounting policy manual Project schedule (contd)
Installation
User management
Content Gathering
Input
Process Definition of further maintenance
Definition of content delivery
Preparation and processing
Rollout Testing
Workshop
Integration
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Activity Department External support EY
Business IT
Sustain Identify Diagnose Design Deliver
Appendix
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Financial Accounting Advisory Services credentials
Client Country Sector or industry Service Service description
Listed multinational
Italy Food and beverages
Accounting manual Improvement of internal processes and accounting systems, accompanied by the development of new accounting guidelines and reporting manuals.
Listed multinational
France Oil and gas Accounting manual and benchmark analysis
Compilation of a complete accounting manual (collection of existing documentation, interviews with stakeholders, and benchmarks of companies in the oil and gas sector).
Listed multinational
Netherlands Media and entertainment
Compliance analysis
Client redesigned its accounting manual and the accounting plan to reflect revenue recognition issues. We reviewed its IFRS compliance and tested its implementation in overseas subsidiaries.
Multinational – not listed
Germany Industrial products
IFRS conversion and related accounting manual
In the course of an IFRS implementation at the group, we supported the preparation of an accounting manual.
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Financial Accounting Advisory Services contacts – EMEIA
Andreas Muzzu Partner andreas.muzzu@de.ey.com + 49 231 55011 22126
Dr. Detmar Ordemann Executive Director detmar.ordemann@de.ey.com + 49 711 9881 15438
EY | Assurance | Tax | Transactions | Advisory About EY
EY is a global leader in assurance, tax, transaction and advisory services. The insights and quality services we deliver help build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In so doing, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com. © 2013 EYGM Limited. All Rights Reserved. EYG no. AU1784
EMEIA Marketing Agency 1000307 ED None This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. Please refer to your advisors for specific advice. ey.com