Gigaset

About Gigaset

Gigaset Communications (prior to October 2008 it was a division of Siemens AG) is the world's largest producer of DECT telephone equipment, the leader of the European market.

#1

producer of DECT telephone equipment

70

offices all over the world

22

years of in Russia and the CIS         

Duration: 2008 - present

Industry: telecommunications

Service provided: statutory accounting, payroll and HR administration set-up; statutory accounting & tax compliance; payroll; HR administration; consulting 

Software: 1S 8.0, SAP R/3

Challenges:

• Setting financial and tax accounting, payroll accounting and HR administration from scratch
• Preparing accounting reports according to both the Russian and international standards

Solution:

1. A trilateral cooperation model using SAP и MS SharePoint
2. The methodological support while switching from the 1S software platform to SAP R/3

 Result:

• Performing statutory and payroll accounting in SAP R/3
• Preparing accounting reports according to the Russian and international standards
• Closing reporting periods in the shortest possible time
• Maintaining HR documentation in two languages 
  

Challenges:

In Russia, the Gigaset company was officially registered in 2008, Siemens AG having decided to detach its DECT telephony division. The Gigaset Communications company intended that it should concentrate on basic business, that is promoting and selling goods under its own brand, all its secondary functions to be outsourced. Those were:

• financial and tax accounting,
• payroll accounting,
• HR administration.

A tender was held in order to select a service provider. Admitted were companies meeting certain criteria. Firstly, these had to be global players with offices in Germany, Gigaset's home country, and wherever else Gigaset has offices. To be selected, a service provider had to be knowledgeable in international business standards and the German corporate culture. Besides, the client found it important that the contractor had a good methodological base, was vastly experienced and knew the particulars of Russian legislation.

The tender resulted in Gigaset's selection of Unicon Outsourcing to do its financial and tax accounting, payroll accounting and HR administration.

Solution:

The project included two stages:

1. In 2008, financial accounting for Gigaset's Russian office had to be set up. At that time, the office performed a limited number of marketing and representative functions. The principal processes were handled by Gigaset's home office through its partners.
2. In 2010, Gigaset decided to pass a maximum set of its functions onto the Russian branch. The functions were as follows:

• the forming of a matrix of products to be sold in Russia,
• purchasing the products of the mother company in Germany,
• customs clearing,
• storage and warehouse management,
• selling goods to sales partners and promoting the Gigaset brand.

This did not just mean changing the business model but also elevating financial and tax accounting to an all-new level. The attainment of the objective was complicated by not just the change in the business model but also by changing accounting software. At that time, Gigaset in Russia switched from 1S: Accounting to the SAP R/3 system.  In order to implement the project, a team was created that included the following:

• employees of the Russian and German Gigaset offices,
• employees of the Unicon Outsourcing,
• representatives of the system integrator

In this project, Unicon Outsourcing employees functioned as consultants as concerned financial accounting and document circulation. They successfully helped to set up the accounting, safekeeping and processing of documents in accordance with the Russian legislation. After that, the Unicon Outsourcing team continued cooperating with Gigaset as its outsourcing service provider. The client assessed the implementation as successful.

Result:

The set up trilateral model of cooperation includes Unicon Outsourcing, the Russian office of Gigaset and the latter's German office. All operations are done in the SAP system accessible to all the three parties.

The two Gigaset offices and their service provider resolve current problems and coordinate important decisions communicating through email. Besides, the Russian and German Gigaset offices interact, exchanging and storing data, through a Microsoft SharePoint-based portal (see Diagram 1).

According to Maxim Alexeichuk, the financial director of Gigaset in Russia, this communication mode is very convenient for the Russian and German Gigaset divisions and for their outsourcing provider. Besides, this allows to efficiently handle large amounts of data and improves the quality of provided accounting services.

One of the most difficult problems that the company successfully resolves together with its outsourcing partner is preparing financial reports, according to the Russian and international standards, in the shortest possible time. For instance, Gigaset summarizes the results of the intermediate reporting periods by the sixth day of each next one and the results of the fiscal year by January 11. By that time, technically, there is no way to perform any accounting operations for the past period. The situation is further complicated by that Russian suppliers are not easily persuaded to supply concluding documents in such a short time. However, by the efforts of all the participants of the process of concluding and, to a large degree, by the efforts of the Unicon Outsourcing reports for Gigaset are prepared exactly on time and with minimum discrepancies (difference between Russian and international reports stay within 5%).

Tax and financial accounting is done according to both Russian and international financial reporting standards. As to HR administration, employment agreements must be made out in Russian and English. All staff changes are coordinated with the German Gigaset office.