KMG Kashagan B.V. imroves the efficiecy of funds management with «1C-Rating: Comprehensive funds management and budgeting»

Date of publication: 16.07.2015

«1C-Rating» company specialists completed the automation project of «KMG Kashagan B.V.» company with «1C-Rating: Comprehensive funds management and budgeting for Kazakhstan» industry solution. Functions of treasury and budgeting departments were automated and integrated in a unified infobase within the project. As a result collecting time of managerial reporting was reduced and financial activities control was improved.

«KMG Kashagan B.V.» was established by KazMunayGas National Company in October 2005 under the jurisdiction of the Kingdom of the Netherlands. This company has a branch in the Republic of Kazakhstan, located in Astana. "KMG Kashagan BV" is a member of "Samruk-Kazyna" companies group and is active in of hydrocarbons exploration and production in the Caspian Sea.

The main purpose of "KMG Kashagan BV" is the management of the Kazakhstan interests in the Production Sharing Agreement for the North Caspian Sea dated 18 November 1997 (hereinafter PSA).

The PSA is signed between the Government of the Republic of Kazakhstan and the consortium, members of which are: Agip Caspian Sea BV, INPEX North Caspian Sea Ltd., KMG Kashagan BV, CNPC Kazakhstan BV, Total EIT Kazakhstan, Shell Kazakhstan Development BV AT. and ExxonMobil Kazakhstan Inc.

Priority objectives of «KMG Kashagan B.V.» in the PSA:

  • strengthening the role of the company in all activities within the PSA for the sustainable development of "KMG Kashagan BV" and its human resources competence;
  • "KMG Kashagan BV" becoming a world-class company for the purpose of independent implementation of large oilfield development projects.

«1C:Accounting for Kazakhstan 8» application was used as enterprise accounting system before 2013. Due to the passage of time it was decided to perform the following changes: automation of treasury and budgeting departments functions and its integration into a unified info base.

The main automation purpose: improvement of reporting transparency and shortening of reporting collection time.

Due regard was paid the process of selecting a contractor. As a result of offers monitoring, «1C-Rating» company was chosen as a reliable business partner in the Kazakhstan market with many years of experience in large-scale project implementations, proved by the customer letters and has a staff of highly qualified specialists, as well as has ISO 9001 the certificate of quality management system compliance.

«1C-Rating» company performed the impact analysis. During the analysis the specialists of the treasury and budgeting departments were interviewed to identify the needs of the enterprise. «1C-Rating: Comprehensive funds management and budgeting for Kazakhstan» software product was chosen as the base of developing information system.

Stages and key results of the information system implementation project

STAGE 1. Impact analysis report preparation.

Key results:

  • Business processes analyzed, individual customization offered;
  • Modification of enterprise bi-currency accounting offered. The necessity of bi-currency accounting was conditioned by the fact that the company is headquartered in the Netherlands, and "KMG Kashagan BV" presented by branch in Kazakhstan. This imposes specific requirements for accounting and managerial reporting. Functional and main currency is US dollars.

STAGE 2. Transfer of document turnover for 2013. Commissioning of requests for funds expenditure in the Treasury subsystem and automation of signatures collection in a request agreements due to the «Documents agreement and approval» subsystem performed.

Key results:

  • All the document turnover of 2013 was transferred to a new system. This ensured the continuity of annual accounting and avoided the inconvenience of reporting collection;
  • Operation of requests for funds expenditure in the Treasury subsystem was commissioned.
  • Storage configuration of original documents scanned copies (the grounds for the application) and their binding to the request for funds expenditure in the accounting system;
  • Electronic requests for funds expenditure implemented. The agreement process became faster and business processes were improved. Uninterrupted operation in the event of an employee’s business trip or vacation was ensured due to the connection of responsible substitute person. Request agreement routes email notifications were configured;
  • The feature to mark in 1C the absence of members in the workplace configured. In case of business trip, vacation or unforeseen absence of person responsible for the task, the task can be transferred by agreement to a substitute person.

3 ЭТАП. Configuration of budgeting actual data collection and monitoring of budget performance.

Key results:

  • Configuration of facts collection for the budget of expenditure and revenue and cash budget;
  • «Comparative report of cash budget performance» developed. This report has the following features: an opportunity to check the posting of primary documents, to compare the accounting entries. This allowed to reduce by 3 times the validation time of primary data input;
  • Technical error level was lowered, reliability of the results increased due to the automation of the reports collection;
  • Modification of bi-currency accounting system. Structured and convenient report can be generated in the accounting currency (USD), and the national currency (KZT) at the actual exchange rate.

SATGE 4. Automation of payments long-term planning block.

Key results:

  • Special entry form developed for input of request for cash from each department. Agreement route of cash request configured. «Payment Calendar» specialized report form developed in accordance with the regulated form.

1C users amount increased from 15 to 42 employees. Major part of new users were specialists not familiar with 1C. New users training was performed and guide for new functionality developed.

System operation initiated in November 2013. The project completed successfully, the main implementation plans completed within the performed activities.

USEr feedback

Utezhanova Zhuparhan, head of treasury:

«Inclusion of Treasury department to the unified info base allowed to receive operative information and to reduce the time of payment order formation.

Automation of request agreement subsystem improved the process of request for funds expenditure agreement. Now the required time is 2 times shorter than manual processing. Agreement transparency was improved and users always know the stage and the responsible person of the agreement.

The feature in 1C to attach any document to a «Request for funds expenditure» document allowed to store the documents scanned copies of the basis of expenditure. This saves time for to raising the basis of expenditure document copies, for example, for processing the payment to the bank over a certain amount».

Utepov Mirat, treasurer:

«Previously requests for payment were made by hand. An administrator of article used to create and fill a request, to collect necessary signatures and visas manually. Personal processing was necessary with manual agreement. In case of the right person absence, request should be reprinted with the removed or replaced man in signatures. Presently the work with requests is much easier with 1C, manual processing avoided. In case of the agreeing person absence, the request can be transferred to his deputy. The time of request agreement were reduced by 3 times due to the automation. Guidelines for completing applications were prepared by the specialists of «1C-Rating». In case of queries is possible to contact the «1C-Rating» company.

Another advantage of electronic requests for the funds expenditure is the collection of the original documents scanned copies in one place, as an annex to the electronic request.

Before the automation the department of treasury used to send requests for cash to article administrators by Microsoft Excel document. Data from article administrators were collected into one document manually. Now article administrators provide the data by filling in a 1C special entry form. Employees fill out data entry forms, which pass shorter route of agreement. At the end I receive the database of cash requests, in which I do additional adjustments to finally get a full picture in the form of "Payment Calendar". The rate increased significantly, drawing up the final picture takes only 10-15 minutes. This so reduced my work and I'm thinking about giving more time to the article administrators for cash requests».

Темирбаева Алмагуль, head of treasury:

«Collection of cash budget facts was configured during the new accounting system implementation. Previously the collection of cash budget facts was performed manually and its formation could take up to a single day. Now this report is generated in 1C software within minutes.

«Comparative report of cash budget performance», developed specially for our company, is very convenient. Due to this report, posting of primary documents can be checked: make comparison of accounting entries by bank and DDS articles, find the difference / distinctions, etc. This report allowed to reduce the validation time of primary data input form 3 to 1 day.

Any defects were eliminated operatively by the specialists of «1C-Rating».

Erzhigitova Ayman, general manager of business planning:

«Efficiency improvement due to the automation of reporting generation certainly saves time and allows to devote more time to the report analysis. Previously, the report were proceed by turnover and balance statement manually in Microsoft Excel documents. The fact manual collection of budget revenue/cost could go up to 3-4 hours. Now the report is generated in a few minutes.

Fast report generation in 1C allowed to generate a report within a month to verify the entered data. This saves time for the report verifying at the end of a month. Scope of report preparation routine work was reduced. Technical errors level was reduced and results reliability was improved due to the automation of report collection.

The report is generated structured generated in the accounting currency (USD), and the national currency (KZT) at the actual exchange rate, what is very convenient».

«KMG Kashagan B.V.» was established by KazMunayGas National Company in October 2005 under the jurisdiction of the Kingdom of the Netherlands. «KMG Kashagan BV» is a member of «Samruk-Kazyna» companies group and is active in of hydrocarbons exploration and production in the Caspian Sea.

Address: 18 floor, 18 Dostyk street, Astana, the Republic of Kazakhstan, 010000

Tel: 7 (7172) 97 41 79

Email: admin@kbv.kz

Website: www.kbv.kz