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LogicaCMG 2006. All rights reserved
Finance and Accounting Business Processing in the Philippines
New York Outsourcing SummitNew York Outsourcing SummitNew Directions in Offshoring and Outsourcing in the Philippines
September 27 th 2007
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Finance and Accounting in the Philippines
Accounting andAccounting andProcurement BackProcurement BackOfficeOffice
- Chevron Texaco, Shell,Deutsche Bank
Industry FinancialIndustry FinancialProcessingProcessing
-- AIG, Manulife, HSBC, JPMorgan Chase
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Why Philippines?
The Philippines has more than 100,000licensed accountants
Every year there are 3,000 CPAsqualified
Filipino accountants are well versed in
GAAP and International Accountingstandards used in the United States
Good customer service mindset andstrong affinity with western culture
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What services areoffered?
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F & A services
Documentmanagementtotal invoice management(scanning invoices, OCR,workflow), printing & postingAR invoices & AP remittances,cheques
F&A shared servicemanagementcommercial, HR,Service improvement,client management,service management, training
Help desk/customer managementcall logging, resolution,incident reporting, outboundcalling
Systems supportERP and other systemsupport & maintenanceliaison with vendor report development
Accounting and business support
Financial Planning Services
Accounts Payable
Accounts receivable
Treasury and cash management
General accounting
Reporting
Financial analysis, accounting support, change governance,project accounting, audits
Budgeting and financial planning, forecasting
Invoice processing, credit note processing, paymentprocessing, supplier administration, payroll service,expense management, project specific accounting &reporting
Customer invoice processing, cash application, credit &collections
Payment management, cheque processing, receiptallocations, standing order mandate, bank reconciliation
General ledger, inter/intra company, fixed assets, financialreconciliations, monthly/ quarterly/ annual close
VAT reporting, management reporting, s tatutory & reporting,performance management
Finance and Accounting services
Financial planning services
Accounts payable
Services typically retained in-house
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The Levels of Service approach
Services are provided based on a tiered approach varying from basic to complex F&Aprocesses based on the client requirements and extent of outsourcing.
Core transaction processing and reports generation,supported by a transaction information desk.
Ancillary services which, together with the foundationlevel, provide high levels of user support.
Complex accounting services which demandspecialist skills.
Foundation
Foundation Plus
Enhanced
High value services such as financial and marketanalysis, budget process administration, andConsultancy.
Enhanced Plus
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Case Study: F&A process efficiencies
Business case requirementover 35 per cent operating costreduction
payback under 2 years
on time delivery
no impairment to financial control.
Metrics
supplier invoices from 7 to 3 days
customer invoices 100% on time
management reports 20%quicker
staff debtors reduced by 70%
missing timesheets reduction - 40%
Controls
duplicate invoice detection
high value reviews
removed duplicate suppliers
removed duplicate customers.
Knowledge
policy
methodology
system
performance based
strong European language skills.
Automation
18 process automations
390 man-hours savings per month
F&A
Systems upgrade6%
Improvement
60%
Operationalchanges
16%
Process transitionchanges
18%
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Case Study: Procurement
Efficiency outcomes reduction in average lead time by 50 per cent. reduced inactive supplier database by 15 per cent implementation of Immediate monthly reporting.
Business targets achieved
reduction in operating cost by 30 per cent
payback within one year consistent on-time delivery internal control strengthened.
Off-shored processes
vendor management quotes and ordering through platform
and quote builder system
negotiations fulfillment inventory management reporting to RPM/VRM/VPP non-cost of sales support quality procedures training.
Requisitionentry
Requisitionapproval
Purchaseorder eCommerce
eCommerce
Supplier
Invoicematching
AP/GL
Posting
Invoiceapproval
Match
Not match
Archive
E-procurement using ERP platform
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Case Study: Offshore Insurance Centre in the Philippines
What they do: Set up transaction processing and call centre in early 2003
Provided Quality Management and project work in 2005 for the parent
Fully USA focused
Benefits:
Improvement in productivity over 10% by year 2 Quality improvement and consistency weighted average transaction quality at
98%
Lower attrition and higher level staff than the industry norms
Savings over US at 50% per employee
Metrics (see next slide): 482 positions transferred with work done by 462 Philippine staff. Volume
increase over two years of 6%, giving a total 10% improvement in productivity
Actual costs almost USD400,000 less than planned as training was handled bylocal employees not travellers from US
Fully USA focused
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Case Study: Actual Customer Savings
49% hard dollar savings
66% totalsavings
Cost Savings
US Baseline Costs Fully-LoadedCosts (including customer's
expenses)
US Project Office & Remote I/TDeliverySG&A
International Telecom
I/T Equipment & Maint.
Facility
Indirect Labor
Direct Labor - Supervision
Direct Labor
49% hard dollar savings
66% totalsavings
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Case Study: Financial Services Management
PRODUCTIONSYSTEM
E-FAXWEB
EMAILMANAGEMENT
INTERNET
FUND MANAGER (I.O.M)
LOGICACMG BPO(PHILIPPINES)
$
BANK (VARIOUS)
128-bit encryption
FUNDADMINISTRATION
(USA)
DISTRIBUTORS(VARIOUS COUNTRIES)
`
`
`
`
`
ADMIN SYSTEMSA.S.P. (USA)
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LogicaCMG has taken reasonable care to ensure that the information contained herein is correct at the time of publication. Before using or relying on any
content in this presentation, independent verification should be obtained. LogicaCMG accepts no liability nor responsibility for any use of or reliance upon thecontent of this document.
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