Background
It is impossible to promptly obtain management reports on insurance activities
There is no possibility to analyse analytical data in different sections (divisions, products, policies, objects, partners)
Incomplete and false data in the InsCom accounting system
The company has no unified register of payments
There is a need for flexible multi-scenario budgeting
Shareholders demand IFRS reporting
Project
The main objective of the project was to produce consolidated management accounts in accordance with IFRS on a monthly basis, with the ability to perform financial analysis by insurance type, branch and agent from the beginning of 2009. It was also important to automate the process of flexible planning for different scenarios, as well as the centralised process of approving claims for cash payments.
Setting up a management accounting methodology
Regulations on the Financial Structure, Budget Structure and Reporting, and Management Accounting Policy were developed in accordance with IFRS. They regulate the distribution and assignment of responsibility for financial results, management accounting principles and the format of management reporting in the company.
Consolidated income statement by insurance performance
This block consisted of linking ABM Finance with the InsCom accounting system. We developed an XML data exchange format and a mechanism for automatically downloading detailed data from InsCom. Actual management documents on policy sales, termination, and insurance payments are generated, which form a set of management postings on the chart of accounts.
Full income statement and cash flow statement
Docking of 1C Accounting and ABM Finance was carried out by processing "Data Conversion" through the XML data exchange format. As a result, the data was transferred one-to-one to the management loop on the accounting chart of accounts with the same analytics as in accounting. Thanks to the configured translation of the fact, ABM Finance displayed the postings on the management chart of accounts for reporting. Also at this stage, a macro for automatic uploading and downloading from several 1C databases was set up.
Budgeting
A planning procedure has been developed that describes the business planning process with a one-year horizon and a monthly planning step. A mechanism is provided for updating the annual plan on a quarterly basis by the end of the current year. The process includes: who (CFO), when (timeframe), on the basis of what (information/document) plans and to whom (CFO) transmits the information (budget). Classically, the planning process is completed by the budget committee and the approval of the budget, which is then passed on to everyone for implementation. Scenarios for planning and the sequence of flexible planning from fait accompli were identified.
Payment calendar
The block consisted of several stages:
- description of the business process "Movement of an application for payment of funds"
- automation of the business process "Payment calendar"
- development of a regulation on the automated payment calendar
- launching the business process.
Results of ABM Finance implementation
A unified automated information system was created
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The ability to accurately assess and compare the profitability of branches, points of sale, insurance products by different classifications
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Increased efficiency of receiving reports, which improved business management
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Budget planning has been automated, and budget formation is carried out in a single database
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Implemented rolling planning of income and expenses (plan is visible based on the fait accompli)
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Speed of approval of cash withdrawal applications increased
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Ensured effective cash flow management and financial control in the company
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Limits on cash items are controlled within the established limits
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Management reporting within the company began to coincide with the reporting used by shareholders
