A PROJECT REPORT ONCHANNEL ACCOUNTING FOR

SUBMITTED BY ANKUSH KHANNA FINANCEIN PARTIAL FULFILLMENT OF POST GRADUATE DIPLOMA IN MANAGEMENT (BUSINESS MANAGEMENT) (2009-2011) SINHGAD BUSINESS SCHOOL PUNE

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DECLARATION

I Ankush Khanna hereby declare that the project report titled channel accounting submitted for the partial fulfillment of the requirement for the award of the post graduate diploma in management is my original project work and has been carried out under the guidance of Mr. A.D. Kale (Finance Lecturer) Sinhgad Business School and Mr.VIJAY SHUKLA, (Senior Manager, Finance at Airtel UPU Circle).

Place: SBS Date: Pune. Ankush Khanna

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LETTER FROM ORGANIZATION HEAD

This is to certify that Mr. Ankush Khanna is a bonafide student of Sinhgad Business School (PGDM batch 2009-2011) and has successfully completed his summer internship project in Airtel UPU circle in finance stream.

..

Place: Sr. Manager (Finance) Date: Lucknow

Mr. Vijay Shukla

Airtel UPU Circle

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ACKNOWLEDGEMENTI consider it my privilege to express few words of gratitude and respect to all those who guided and inspired me in the successful completion of the project. I wish to take this opportunity to express my deep sense of gratitude and thanks to Mr. Vijay Shukla (Manager Finance Department UPU Circle) and my guide and reporting officer Mr. Shiv Bharti (Assistant Manager Finance Department UPU Circle) for their valuable guidance throughout my project. I sincerely thank AIRTEL for providing me with an opportunity to work in the Finance Department. A special thanks to my senior Mr. Vikas Chandra (executive), Mr. Rais Khan (senior executive), and Mr. Balram Mishra (executive) for their painstaking effort in helping me in every step of my work. I would also take this opportunity to thank my seniors Mr. Saurabh Mishra (Associates), Mr. Abhinav Jain (Associates), Mr. Rahul Sharma (Associates), Mr. Suresh Vaid (Associates), Mr. Vikes Saxena (Associates), Mr. Ajaj Ahmed (Associates), Mr. Piyush Mittal (PNG Supervisor HR), Mr. Pankaj Srivastav and Ms. Shruti kapur who supported me in my endeavours and from whom I have learnt a lot. I also convey my sincere gratitude to my faculty guide Mr.A.D. Kale (Finance Lecturar) Sinhgad Business School and all my friends and my family and especially GOD; for their encouragement and support extended to me during the course of my project. At the end I would not forget to thank other members of airtel who treated me with respect and helped me in the best of their capacity. Ankush Khanna PGDM (finance) SBS (Pune)4

CONTENTS

S.NO1. 2. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17.

TOPICS

PAGE NO.9-10 11 11 12-13 14-15 16-17 18-30 31-42 43-44 45-47 48-57 58-59 60-63 64 65-69 70-73 74-75 76-79 80-83 84

About the Organisation Vision of the Company Mission core value Sales accounting Working of finance department at Airtel UP EAST Circle Prepaid Services Lapu Transfer Paper recharge coupen Month End Easy Recharge Month end working of paper recharge coupen Post paid billing Month end working of post-paid billing Airtel with bank Airtel with other service provider Pre-paid sales payout Post-paid sales payout Fund forecasting Card Movement Comparison between sales of easy recharge and paper recharge coupon 18. Summary

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LIST OF PICTURESTOPICSE-Statement provided by bank Bank MIS Zone order sheet Reconciliation between zone and bank sheet Lapu master sheet Reconciliation between order sheet and master sheet Data received after oracle entry Reconciliation between amount at oracle and amount at bank Lapu billing sheet Reconciliation between billing sheet and utiba billing Lapu primary report E-Statement provided by bank Bank MIS BOTREE order sheet Zone order sheet Reconciliation between botree order sheet and zone order sheet PRC master sheet Reconciliation between order sheet and master sheet Reconciliation between bank and order sheet Reconciliation between finance botree and order sheet Delivery challan generated by warehouse Reconciliation Between Oracle Primary and UTIBA primary PRC server report, ORACLE sheet Activation report Pay report provided by CAD Reconciliation between activation and CAD report Dash board of daily collection report of post paid parties Compiled MIS Aging Drop box collection Bounced cheques Collection report of the month Bank Entry Forecast of all the Zones Daily wise Card Movement New Card movement6

S.NO.1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36.

PAGE NO.19 20 21 21 22 23 24 25 26 28 30 32 33 34 35 36 37 38 39 40 41 44 48 51 51 52 53 54 56 57 58 59 64 76 79 80

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LIST OF TABLESS.NO1. 2. 3. 4. 5. 6. 7. 8.

TOPICSLapu comparison between April and May months for east circle RCV comparison between April and May months for east circle SUK comparison between April and May months for east circle OVERALL comparison between April and May months for east circle Lapu comparison between April and May months for west circle RCV comparison between April and May months for west circle SUK comparison between April and May months for west circle OVERALL comparison between April and May months for west circle

PAGE NO.81 81 82 82 82 83 83 83

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About the Organization:-

1.1 Bharti AirtelAirtel comes to us from Bharti Airtel limited, one of Asia leading integrated telecom services providers with operations in India, Sri Lanka and Bangladesh. Bharti Airtel since its inception has been at the forefront of technology and has pionnered several innovations in the telecom sector. The company is structured in four strategic business units Mobile, Tele media, Enterprise and Digital TV. The mobile business offers services in India, Sri Lanka and Bangladesh. The Telemedia business provides broadband, IPTV and telecom services in 89 Indian cities. The digital TV business provides Direct- to Home TV services across India. The enterprise business provides end- to-end telecom solutions to corporate customers and national and international long distance services to Telcos.

1.2 Highlights1. Bharti Airtel enters into a strategic partnership with Novatium to help expand the broadband market. 2. Bharti Airtel and Radio Mirchi Mobile on Airtel. 3. Bharti Airtel launches Airtel World SIM for international travelers at the onset on the travel season.

1.3 Business Divisions

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Business Divisions Mobile Services Tele Media Services Enterprise Services Digital TV Services

1. Mobile Services:Bharti Airtel offers GSM mobile services in all the 23-telecom circles of India and is the largest mobile service provider in the country based on the number of customers.

2. Airtel Tele Media Services:The group offers high speed internet with a best in class network. With landine services in 94 cities they help you in touch with your friends and family and the world. World gets class entertainment with Indias best direct to home (DTH) services digital TV in more than 150 cities.

3. Enterprises Services:Enterprise services provide a broad portfolio of services to large Enterprises and Carrier customers. This division comprises of the Carrier and Corporate business unit. Enterprises Services provides is regarded as the trusted communications partner to Indias leading organizations, helping them to meet the chalanges of growth.

4. Digital TV Services:Discover the magical experience of digital entertainment with Airtel, from DVD quality picture and sound, the best and widest variety of channels and programmes to the best on

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demand content on Airtel Live, your TV viewing experience change forever with digital TV from Airtel.

1.4 Vision Of the CompanyTo make mobile communications a way of life and be the customers' first choice.

1.5 Mission Of the CompanyWe will meet the mobile communication needs of our customers through : 1. Error-free service delivery 2. Innovative products and services 3. Cost efficiency 4. Unified Messaging Solutions

1.6 Core Value1. We will delight our customer with our simplicity, speed & innovation. 2. We will honour our commitment. 3. We will follow the highest standard of professional integrity & behaviour. 4. We will respect individual, build winning teams and lead by example. 5. We will create a fun filled and friendly workplace.

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2.1 Sales accounting / Channel accounting

pre-paid Billing

Sales AccountingPostPaid Billing

In bookkeeping, accounting, and finance, Net sales are operating revenues earned by a company when it sells its products. Revenue (net sales) are reported directly on the income statement as Sales or Net sales.

In financial ratios that use income statement sales values, "sales" refers to net sales, not gross sales. Sales are the unique transactions that occur in professional selling or during marketing initiatives.

Revenue is earned when goods are delivered or services are rendered. The term sales in a marketing, advertising or a general business context often refers to a contract in which a buyer has agreed to purchase some products at a set time in the future. From an accounting standpoint, sales do not occur until the product is delivered. "Outstanding orders" refers to sales orders that have not been filled.

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General Journal Date Description of entry 7-7 Cash Sales Sell 10 books at 20% discount. 7-10 Accounts receivable Services Consulting fee. 125.00 125.00 Debit 200.00 200.00 Credit

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2.1.1 Working of Finance Department at Airtel UPU Circle:Airtel provides Tele-communication services to their customers by providing Air time services. Here the UP-U states are divided into two circles East circle with five cities and West circle with four cities.

UP East1. Allahabad 2. Gorakhpur 3. Kanpur 4. Lucknow 5. Varanasi

UP West1. Agra 2. Dehradoon 3. Bareilly 4. Meerut

Finance department of both the services uses CHANNEL ACCOUNTING also called as SALES ACCOUNTING as there tool for maintaining the accounts of there distributors of different zones. As distributor is the only point of contact for the company for the services. Both the services are different from the others so there accounting is also different and uses several methods.

2.2 Types of Distributors:

1. HUB:They are the big dealers. They have some normal distributors with them. They have to deposit Rs. 100000/- as a security money.

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2. Normal Distributor:They are just Normal distributors and have to deposit Rs. 50000/- as a security money.

3. Collection AgencyThey are responsible for collecting Post-paid bills from Airtel Relationship Connect; they have to deposit Rs. 50000 as security money.

Airtel Relationship Connect: These are the people allotted by Airtel, these are indirect link with Airtel and Customers. Airtel Finance Department is not in direct contact with customers.

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3.1 Pre-Paid Service:In pre-paid services the channel is:

Airtel

Distributor

Retailer

Customer

Airtel Finance Department manages the account of distributors, takes payment from them against the services to be provided to them, provides recharge and gives them commission for their services, taxes are deducted accordingly. a. Easy Recharge or Lapu transfer.

b. PRC / SUK Paper Recharge Coupon and Subscriber User Kit

Three types of servers are used for the accounting services. 1. ORACLE Accounting Server 2. UTIBA -- For Easy Recharge Transfer 3. Botree -For Placing PRC / SUK / Easy Recharge Order

Every Distributor has been given unique codes for their identification; these are: ORACLE Code Provided by Finance Department, unique and different code for their identification of distributors.

UTIBA Code Provided by Finance i.e. Customer Service Department, given to distributors who deals with easy recharge only.

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BOTREE Code is provided by finance department. Code is provided to those people who deal Paper Recharge Coupon and easy recharge.

ORACLE Code is used in accounting server where as BOTREE code is used for PRC/SUK and UTIBA code for Lapu Transfer.

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3.2 Lapu Transfer or Easy Recharge:The process followed over here is first the distributors deposit money in his bank through net banking and Chandivili branch of HDFC Bank confirm the same amount with party Oracle Code / Virtual A/c no. / Account details like RTGS number and others are provided to their respective zones and the same order is placed on behalf of the bank details to the Finance department.

The initial step is that the supervisor for the pre-paid services checks the details provided by the bank ie. Which distributor has deposited sum of amount into the bank for their business and tallies with zones order sheet. All the bank orders and zones orders is placed one day before and processed another day.

Step 1:The supervisor first checks that whether they have the same amount in Airtel Bank

account, as provided by bank or not. Report provided by bank is called as Bank MIS, if it is correct the process is continued and if some ambiguity is there it is again sent back to bank for rectification.

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Picture 1: e-statement provided by bank. Step 2:MIS is provided by bank and it contains the details like Date, Time of deposit, RTGS number, Distributor Oracle code, Distributors name, Account Number and Account.

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Picture 2: Bank MIS Step 3:Order sheet provided by the zone is compiled. The sheet contains the details like RTGS number which is unique and different; Purchase Order, Party Name, ORACLE Code, BOTREE Code, UTIBA Code, Zone, Amount for LAPU and RCV. Mapping is done between Zone Order Sheet and Bank MIS, to check same amount is in bank as provided by Zone, against the same RTGS number with Party Code. RTGS is the base for the reconciliation process, Reconciliation is done using excel command =VLOOKUP (lookup_value, table_array, column_index_num, [ range_lookup]) and Pivot Table. Reconciliation is done so as to get assured that the particular distributor has deposited the same amount in bank and same order is placed by zone to us for the business process. Amount is extracted by using Vlookup command from Zone Sheet and from Bank MIS. And then a pivot table is drawn against RTGS, Bank amount and Zone amount.

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Picture 3: Zone Order Sheet

Picture 4: Reconciliation between Zone and Bank Sheet.21

Step 4:Next Reconciliation is done between Order Sheet provided by Zone and Master Sheet so as to know that the distributor who has placed the order is the same in our records or not , because zone may provide details with some error, so rectification is necessary. Master Sheet is a Sheet which carries details of all the distributors like Name, Oracle Code, Utiba Code, lapu number, Botree Code, Zone. It is made to keep records and is updated as a new distributor joins Airtel and wants to continue the business.

Picture 5: Lapu Master Sheet

The process over here is, UTIBA code is taken and since it is unique, it is made as a base for the Lapu transfer. Reconciliation is done between Zone Order Sheet and Master Sheet using Excel22

command =VLOOKUP (lookup_ value,table_ array,column_index_num, extracted from both the sheets.

Picture 6: Reconciliation is done between Order Sheet and Master Sheet

Step 5:All the recipt is loaded into the server using Oracle server, so that all entries should enter into the server. A special type of loader is used with all the commands which directly enter the receipt into the Oracle server. Receipt is the amount on which the business is to be done today.

Accounting Entry:23

Distributor Account To Correspondance Bank Account (Being money deposited by distributor to Bank) Cr.

Dr.

Correspondance Bank Account To Airtel Bank Account Cr.

Dr.

(Being money transferred from correspondence account to Airtel account)

Airtel Bank Account To Distributor Account Cr.

Dr.

(Being money transferred to distributors account as service)

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Picture 7: Data received after Oracle entry. Step 6:Reconciliation is done between Amount at Oracle and Amount at Bank, so as to check same entry has been entered into the Oracle server as it was in bank. A Pivot table is drawn between RTGS, Oracle Code, Amount at Bank and Amount at Oracle.

Picture 8: Reconciliation between Amount at Oracle and Amount at Bank

Step 7:

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After receipt entry billing sheet is prepared. Billing sheet contains the details of a distributor its Oracle Code, Utiba Code, Distributor name, Amount, Commision, Service Tax, Education Cess, Higher Education CESS, Recharge Value, RTGS Number, Bank, Lapu Amount, Purchase Order Number.

Picture 9: Lapu Billing Sheet

Invoicing is done all the billing line items are loaded into the server using Oracle server, so that all entries should enter into the server. A special type of loader is used with all the commands which directly enter the invoicing into the Oracle server. Invoicing is done for all the line items. Commission is given on the business amount, and calculated as :

Commission = 4.46% (West Circle) and 4.16% (east Circle) of business amount. This commission is added in the business amount and is given to the distributors.26

Top-up = Business Value + Commission. This Top-up Value is the amount a distributor gets against the business amount.

Service Tax is calculated on the top-up value. Since Airtel has to pay service tax to the Government of India. Service Tax is calculated as:

Service Tax = 10% of the Top-up value

Education CESS = 2% of Service Tax

Higher Secondary CESS = 1% of Service Tax

Recharge Value = Business amount (RTGS Amount) + Commission Service Tax Education CESS Higher Secondary CESS.

The Recharge Value is the revenue generated by the Airtel.

Accounting Entry:

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Distributors account To Service Tax To Recharge CESS To Recharge Higher CESS To Recharge Value Cr. Cr. Cr. Cr.

Dr.

(Being Invoicing is done against various heads)

Step 8:After Invoicing reconciliation is done between billing sheet and the amount which is entered into the Utiba server. This is done to check whether the same amount is entered into the server as it was billed for the particular distributor, and initialized into the Utiba Server, side by side all the distributors are informed through sms that there business amount will be transferred to them on the current day.

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Picture 10: Reconciliation is done between billing sheet and Utiba billing.

Step 9:After this report is send to the senior for approval where again reconciliation is done between top-up Utiba amount and top-up billing and bank amount is checked, if no error is found Lapu is transferred to the distributor using Utiba server.

Generation of Primary Report (A to D)Primary report is a report generated by server also called as transaction file Airtel to Distributor (A to D). It is downloaded by server WinScp. This report contains all the details of a distributor its Name, Utiba Code , RTGS amount, Commission, Service Tax, Recharge Value, Status, Wallet 1 and Wallet 2.29

Wallet 2 is the amount deducted by the server automatically from the RTGS amount deposited by the distributor; if a distributor has paid any post paid bill on that amount commission is not given to the distributor. Wallet 1 = (RTGS amount Wallet 2)* (commission%) Recharge Value = Top up value service tax cess higher cess.

Picture 11. Lapu primary report or A to D report.

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3.3 Paper Recharge Coupon:

The process followed over here is first the distributors deposits mony into the bank through net banking at the Chandivili Branch of HDFC Bank, the same amount and details like RTGS number, Name, Zone, and Oracle Code etc. are provided to their respective zones and the same order is placed in the finance department. The initial step is that the supervisor for the prepaid services handling Paper Recharge Coupon checks the details provided by the Bank i.e. which distributor has deposited sum of amount into the bank for their and tallies with zones order sheet. All the Bank Order and Zones order is placed one day berore and processed another day.

Step 1:The supervisor first checks that whether they have the same amount in Airtel Bank account, as provided or not. Report provided by bank is called as Bank MIS. If it is correct the process is continued and if some ambiguity is there it is again sent back to the bankfor retificatation.

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Picture 12: e statement provided by the Bank.

Step 2:MIS is provided by Bank and it contains the details like Date, Time of Deposit, RTGS number, Distributors Oracle Code, Distributors Name, Account number and Amount.

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Picture 13: Bank MIS

Step 3:Supervisor handling Paper Recharge Coupon uses Commerical id to enter into the BOTREE server, where order is placed by Zone. Order sheet provided by the Bank is mapped with BOTREE order sheet. Order Sheet contains details of PRC. Since paper recharge coupon is available in different format ( like Rs. 15/-, Rs. 35/-, Rs. 50/-, Rs. 100/- etc.), Tarrfs vouchers, GPRS plan, Advantage (SIM) Starter Pack, Free of Cost SUK ect are ordered by distributor in different quantity. Both the sheet contains Purchase Order (PO) number which is unique and different so assumed as base for mapping; it is present in both the sheets, other details like Name, BOTREE Code, Oracle Code ect. PO number is base for the reconciliation33

process, Reconciliation is done using excel command = VLOOKUP ( lookup_value, table_array, coloum_index_num, [range_lookup]). Reconciliation is done to check the same order has been placed in the order sheet as it is on the BOTREE server by particular distributor of that zone.

Picture 14: Botree Order Sheet

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Picture 15: Zone Order Sheet

Activation Fees = Overall Activation Fees Distributors Margin(Calculated on SIM)

Processing Fees = Overall Processing Fees - Distributors Margin( Calculated on Paper Recharge Coupon)

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Picture 16: Reconciliation between BOTREE ORDER Sheet and Zone Order Sheet Step 4:Next we do Reconciliation between Order Sheet provided by Zone and Master Sheet so that we are assured that the distributor who has placed the order is the same in our records or not, because may provide details with some error, so rectification is necessary. Master sheet is a sheet which carries details of all the distributors like Name, Oracle Code, Utiba Code, Contact number, Botree Code, Zone. It is made to keep records and is updated as a new distributor joins Airtel and wants to continue the business.

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Picture 17: PRC Master Sheet

The process over here is , Botree Code is taken and since it is unique, it is made as a base for the Paper Recharge Coupon. Reconciliation is done between Zone sheet and Master Sheet using Excel command = VLOOKUP ( lookup_value, table_ array, coloum_index_num, [ range_ lookup]). Using this command Botree Code, Oracle Code, Distributors Name and Zone is extracted from both the sheets.

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Picture 18: Reconciliation between Order Sheet and Master Sheet

Step 5:Next step, is to check the duplicacy of the order sheet. 1. Some Zone have placed an order which have already processed or that distributor does not have balance in their account that order is deleted and Zone is informed about that. 2. Since a distributor places only one RTGS amount in which bifurcation is made for easy recharge and for Paper Recharge Coupon, so it might be possible that amount placed for easy recharge might be showing into the PRC side or vice-versa. This is rectified by both the supervisior handling easy recharge and PRC by their order sheets. 3. Duplicacy is also checked for the balance amount. Since a distributor must have placed an order before but might have asked for less amount so some balance is there

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and now they have asked for the business amount again. So it is rectified and processed. Now the amount left is for PRC and now mapped with Bank MIS.

Step 6:Bank sends a report daily three times a day, at different time interval which is mapped with order sheet. RTGS is mapped, party code is mapped and amount is mapped. This is done to chek whether same distributor is getting the order or same ambiguity is there. If reconciliation is correct billing is done and if some ambiguity is there it is rectified.

Picture 19:Reconciliation between Bank and Order Sheet

Step 7:39

If Bank report is found correct billing is done for the distributor, the process followed over here is Supervisior handling PRC approves the Purchase Order (PO) using commercial id, these purchase order comes directly into the finance for approval and after approval the report is send to the warehouse for delivery of the PRC to the distributor. A series is made available by Supply Chain Management department. Before approval reconciliation is done again by the senior. This reconciliation is done between finance Botree and Order Sheet.

Picture 20: Reconciliation between Finance Botree and Order Sheet

Step 8:In UPU state warehouse is divided according to circle. A report is send to warehouse of respective circle i.e. for East the warehouse is in Lucknow and for West it is in Ghaziabad and Dehradun. Warhouse gets a report from Finance department for processing the respective purchase order. Warehouse sends one delivery challan (DC) to finance department if that particular is processed, the entire product is given to the courier company and delivered directly to the distributor.40

Picture 21: Delivery Challan generated by Warehouse.

Step 9:After receiving the DC, from warehouse, reconciliation is done between invoice report and billing sheet so as to get confirmed that, the same Purchase order as it was in the order sheet ,is cleared. After reconciliation invoicing is done using ORACLE server and that report is directly entered into the server. Invoicing is done directly by server, no manual entries are made.

Step 10:41

Invoicing is done of whatever business is done on the current day. Here the ledger is maintained of the distributor, with respect to Purchase Order, Quantity and Amount against the RTGS of the distributor. All the taxes and charges are deducted by the server automatically and report is generated next day by the server.

Accounting Entry:

Distributors account To Activation Fees To Processing Fees To Calling Value To Service Tax To Recharge CESS To Recharge Higher CESS (Being invoicing is done against various heads) Cr. Cr. Cr. Cr. Cr. Cr.

Dr.

4.1 Generation Of Delivery Challan:Delivery Challan is a Sheet generated by the server one day after the processing. This report contains all the details of a distributor its Name, Oracle Code, Botree Code, Business amount, Purchase Order number, Quantity etc. This report provides the information that business has been provided to all the distributors.

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5.1 Month End Working of Easy Recharge:Month end working is matching all the working of the whole month. Since all the entries are made into the General Ledger (GL) with specific codes so at the end of the month all codes are matched. If all the entries are matched throughout the month is correct, and if some ambiguity is there it has to be justified. Here Utiba Primary (billing) is mapped with Oracle Primary (server report). Five line items are entered into the GL. They are:-

Line Items 1. Recharge Value 2. Service Tax 3. Education CESS 4. Higher Secondary Education CESS 5. Wallet 2

Codes 1221021 1221024 1211006 1211015 1221056

For recharge value all the consolidate entries of the whole month are entered into the GL Code 1221021. UTIBA Sheet is tallied with the server report and Ledger is mapped. For Service Tax all the consolidate entries of the whole month are entered into the GL Code 1221024. UTIBA Sheet is tallied with the server report and Ledger is mapped. For Education CESS all the consolidate entries of the whole month are entered into the GL Code 1211006. UTIBA Sheet is tallied with the server report and Ledger is mapped. For Higher Secondary Education CESS all the consolidate entries of the whole month are entered into the GL Code 1211015. UTIBA Sheet is tallied with the server report and Ledger is mapped.

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For Wallet 2 all the consolidate entries of the whole month are entered into the GL Code 1221056. UTIBA Sheet is tallied with the server report and Ledger is mapped. Order is calculated on the basis of RTGS amount, the RTGS amount was provided by the Distributor, order is placed on that amount. Scheme is calculated on the Top-up Value, if any incentive, commission, payout credit note or debit note is to give to the distributor it is given on the top-up value, as this is the value obtained by subtracting the commission, Service Tax, CESS and Higher Education Cess from RTGS amount, debit note and credit notes.

Picture 22: Reconciliation between Oracle Primary and Utiba Primary

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5.2 Month End Working of Paper Recharge and SUK:

Month end working is matching all the working of the whole month. Since all the entries are made into the General Ledger (GL) with specific codes so at the end of the month all codes are matched. If all the entries are matched throughout the month is correct, and if some ambiguity is there it has to be justified. Here Botree Server is mapped with Oracle General Ledger Codes. For SIM line items are

Line Items 1. Activation Fees 2. Service Tax 3. Education CESS 4. Higher Secondary Education CESS

Codes 1213006 1221024 1210006 1220015

Activation Fees is calculated as

Activation Fees = Overall Activation Fees Distributors Margin For SIM:All the Activation Fees charges for one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1213006.

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Service Tax for one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1221024. Education CESS for one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1220006. Higher Secondary education CESS for one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1220015. Service Tax = M.R.P.* 10% CESS = Service Tax * 2% Higher Secondary Education CESS = Service Tax* 1% For Paper Recharge Coupon line items are:

Line Items 1. Processing Fees 2. Service Tax 3. Education CESS 4. Higher Secondary Education CESS 5. Calling Value

Codes 1213009 1221024 1211006 1210015 1213016

Here instead of Activation fees processing fees and calling value is provided to the customer. All the processing fees charges of one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1213009. Service Tax one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1221024.46

Education CESS of one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1211006. Higher Secondary Education CESS of one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1210015. Calling Value of one whole month is calculated in BOTREE server and mapped with Oracle Server with code 1213016. Processing Fees is calculated as

Processing Fees = Overall Processing Fees Distributors MarginSupervisor responsible for PRC has to maintain the records with General Ledger. These Ledgers have the entries of all the line items of one complete month. these records are mapped between BOTREE server and Oracle server. If all the entries are correct then this entry made into the ledger and if some ambiguity is found it is rectified and submitted. BOTREE entries are directly entered into the server through interface.

Picture 23: PRC server report, ORACLE Sheet47

6.1 Post Paid Billing:In Post Paid Billing the channel is:

Airtel

Airtel Relationship Connect

Customer

Post paid is one of the services provided by AIRTEL. They provide services before and take payment from their customer later. Just opposite to that of Pre- Paid services. Here Finance Department does not directly involve the customers same at that of pre-paid services. Here Airtel has:

ARC DSA CSA

AIRTEL Relationship Connect Direct Selling Associate Customer Selling Associate

These are the people who are directly involved with the customers. They provide services to the customers and takes payment from them.

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ARCs are allotted by Customer Activation Department (CAD). CAD of Airtel with some legal working and after deposition of security money; an ARC, DSA, CSA are allotted. Like Pre- Paid services accounting server used here is Oracle. Post Paid service is divided into two parts:

UP front Collection

Drop Box Collection

post-paid services

6.2 Up Front collection:Since CAD department is directly in contact with ARC, DSA, CSA and not with the customers, and ARC, DSA,CSA is connecting link between Customer and Airtel, CAD department provides details of their Respentative ARCs day by day. Report provided by them is compiled one day after.

Step 1:Server Report that is pay report of previous day is downloaded and compiled from the server WinScp. This report is provided by CAD department called as Collection Report. This Report contains the details of ARC, like:

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1. Activation Report: This contains the details like :a. Activation Fees: A new distributor has to pay activation fees for using services ARC has to activate the account. Activation fees is Rs. 500/-. Reconciliation is done between Activation Fees and CAD report.

Picture 24: Activation Report or Pay report provided by server.

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Picture 25: Pay Report provided by CAD

Picture 26: Reconciliation between Activation and CAD Report

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b. Premium Fees: If asks for a Premium number then Premium Fees is to be paid to Airtel. These numbers are called as price tag number.

2. CPS: Customer Payment System Mode of payment of customer throuchcah or credit.

3. LBX: Log Box: It is type of software used for posting bulk amount inCustomers account.

4. Deposit Payment (Security): Amount deposited by customer to ARC.

Picture 27: Dash Board of Daily collection Report of Post Paid Parties52

Step 2:An MIS is Prepared with the same report and provided to the other authorities of the post-paid services. This MIS contains the details like Oracle Code, Connect Code and Name of the parties, Transaction date, LBX, CPS, Security Amount, Activation, Account Number, Mobile number, and Customer city.

Picture 28: Compiled MIS

Step 3:Ledger entry is made into the ARCs account. Finance Department already have Post Dated Cheques (P.D.C.)of ARCs; as they keep on using services the supervisor responsible for Post53

Paid service uses P.D.C. of ARC and deposit into the bank account of Airtel. All ARCs whose Cheques gets bounced have to pay pelalty of Rs. 2000/-.

Accounting Entry:Party account To Subscriber Collection Clearing account (Being services provided by party) Cr. Dr.

Bank account To Party account Cr.

Dr.

(Being amount received in cheque mode for party against provided services)

6.2.1 Outstanding Amount:Since Finance Department keep on depositing Post Dated Cheques into Airtels account, and if these billings are not paid by the ARCs it comes under outstanding amount, it can be charges for activation not paid or security not paid or cash payment of customer bill (CPS), particular party is informed and if payment is not done in due time, activation rights are barred. Particular ARC is informed and grace period is given that is 1-30 days, 31-60 days, 61-90 days, 91-120 days, 121-150 days, 151-180 days. This pattern is calledas Aging. After 90 days the amount comes under bad debts and assumed that it canot be recovered.

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Picture 29: Aging

6.3 Drop Box CollectionPost paid customers pay their bill through cheques, cash or through net banking. All these cheques and net banking are deposited in CITI BANK account and all the net banking bills are deposited into ICICI BANK and CITI BANK. Airtel has placed many drop box for collection of cheques of there customers. Both the bank sends MIS report to Airtel about their transaction and provide cheques which are deposited into Airtel Bank account. Subscriber Collection Clearing account of Airtel which is debited and credited for all the transactions related to collection. All the entries rotate through this account. cheques which are cleared and invalid cheques are those cheques which are not passed for clearing because of any reason. An MIS is prepared for both the cases Valid/ Invalid and cheque bouncing entries are made.

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Accounting entry: For valid cheques

CITI BANK account To Subscriber Collection Clearing account (Being cheques deposited into the Airtel Account) Cr.

Dr.

Picture 30: Drop Box Collection

6.4 Bounced Cheques:Since all the customers billed cheques are deposited into bank where its get cleared or gets bounced. Its entry is made into the books and MIS is prepared.

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These MIS are called as return MIS.

Accounting Entry:Here entry gets reversed as the entry of deposit chequeis made into the books, but if cheque gets bounced; entry is reversed.

Subscriber Collection Clearing account To CITI BANK account (Being Reversed entry is made into the Airtel Account) Cr.

Dr.

Picture 31: Bounced Cheques

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7.1 Month End Accounting of Post Paid ServicesOur Roamers: When a customer moves from its state to other state is called as out roamers. When out roamers pay their post paid bill at other state, that state is liable to pay the income back to the state where the customer belongs to. This report is generated by server and provided to every state called as pay report. Every state pays the income of other state at the end of the month. This activity is called as CROSS CIRCLE.

Picture 32: Collection Report of the monthServer Report is mapped with Collection Report. Collection Report provided by the CAD gives the details of total collection of one circle; which includes income of UPU circle and if a customer of other circle has paid its bill then its payment details. Server report gives the details circle wise and provides the details of payment of the circle and if customer has paid its bill in other state than details of that.58

Example:CAD report shows a collection of Rs. 1000000/- in which Rs. 8000000/- belongs to the UPU circle and Rs. 2000000/- belongs to the other states. This amount is called as PAID AT. Through inter unit Transaction a debit note is raised by the liable state and same amount is credited to UPU circle. Through Inter Unit Transaction the details are transferred to other circle and payment is taken. States does not keep income of the other state and has to return back at the end of the month. All the collection are then entered into the Subscriber Collection Clearing account and ledgers are maintained. All the incomes are then registered in various heads of General Ledger.

Accounting Entry: Paid At:Subscriber Collection Clearing account To Other State account (Being payment done to other state) Cr. Dr.

Paid By:Other State account To Subscriber Collection Clearing Account (Being payment received from other state) Cr. Dr.

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8.1 Airtel with Bank:Airtel has different account:

Collection Account

Payment Accounta. Collection Account1. Channel Account 2. Subscriber Account

b. Payment AccountAccording to rules of Indian Government a Corporate cannot have Saving Bank Account so, Airtel has all its account as Current account.

Collection Account:Collection Account of Airtel has all receivables entries. There is no limit for collection account. It is of two types:

1. Channel Account: In which all the distributors makes their payment for the services like easy recharge, Paper Recharge, etc. The Bank which is made responsible for all

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the collection is HDFC Bank, payment comes in the form of net banking Real Time Gross Settlement (RTGS). 2. Subscriber Account: In which all the payment is made by customer through Drop Box, Mainly by Post paid customers. Collection comes in the form of Cash, Cheque, Demand Draft, Credit Card and Net Banking. Collection of Cash, Cheque , and Demand Draft comes in HDFC Bank whereas collection of Credit Card, Net Banking comes into ICICI Bank.

Payment Account:All the payment made from Airtel is done from HDFC Bank. There is a fixed limit from payment account. If payment increases from the limit; bank starts dishonouring the cheques and asks for an approval from treasury department to issue that amount.

8.2 Cash Management System at Airtel:Airtel has a master account in which all the entries are registered, of all the collection and payments. All the collection of one whole day is entered into the collection account and transferred into the main Bank account through SWEEP entry. Sweep entry is a new facility provided b the bank to big corporate in which all the collection amount is transferred from the collection account to main account of Airtel at the end of the day.

Accounting Entry for Collection Account:Circle Account To Fund Account Cr. Dr.

(Being money is transferred into APO account from Circle Collection Account) All payments are made from the payable account and at the end of the day whole amount is transferred from yhe main Bank account to Circle Account through sweep entry.

Accounting Entry for Payment Account:61

Fund Account To Circle Account Cr.

Dr.

(Being payment is done from APO account to Circle payment account) Thus at the end of the day the net balance is zero at circle account. Airtel also has SWEEP FDR account in its bank in which all the funds deposited or collection entered into the bank, a fixed amount automatically gets converted into Fixed Deposited and this fixed deposit is withdrawn accordinglyif the amount which is to be paid exceeds a certain limit at the end of the day. So Airtel gets some rate of interest on their fixed deposit amount in their SWEEP FDR account.

BookDate

Descriptio n

Book Balance

Credit

Debit

Value Date

Ref/Ch q No.

Transaction Branch

11/5/2010

Opening Balance

0

I

CMS-BULLACK100125056017/MO D TRFRM024009200 023156 3,15,154,380 11/5/10 0 2,00,000 11/5/10 0

CHANDIVALI

CHANDIVALI

12/5/10

Opening Balance

515,154, 380

E0DSWEEP62

-

DELHI

00030310005471

515,1 54,38 0 Closing

11/5/10

12/5/10

Balance

0 Total 515154380 5151 5438 0

Picture 33: Bank Entry

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9.1 Airtel with Other Service Provider

According to the Directorate of Tele Communication (DOT) and Telephone Regulatory Authority of India (TRAI) every communication services provider has to pay a fixed sum of money to the other service provider for using their services of Tele Communication. This is done with respect to an effective call rate applicable to all service providers. This call rate is 20 paise per minute. This is applicable to others service providers as well. An account is maintained for all the service providers and at the end of the month one report is send to the others service providers fortheir net billing amount which is to be paid or to be received. A difference is calculated on net bill payable and receivable and is paid to other.

Seprate bill is issued for Post paid and Pre Paid bills. The other service providers are: 1. BSNL 2. Vodafone 3. Reliance 4. IDEA, etc.

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10.1 Prepaid Sales PayoutPre-Paid Distributors are divided into two types:

1. HUB:HUB is the large scale prepaid distributors, basically provided in the upcountry region. They are large scale Pre-Paid distributors and are spoke distributors.

2. Normal Distributor:They are located in the towns or cities and have Retailers under them. These Retailers are in direct contact with the customers and distributors.

Three types of reports are made and used for the payout to the distributors and retailers they are:-

Primary Report:Primary report is generated by Airtel Finance office which shows all the details of a distributor like Oracle Code, Utiba Code, Distributors Name, Amount, Commission, Service Tax, Education CESS, Higher Education CESS, Recharge Value, RTGS Number, Bank, LAPU Amount, and Purchase Order Number.

Secondary Report:The Secondary report is the report which contains the details of the transactions between HUB and Spoke, and Distributor and Retailer.

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Tertiary Report:This report is the Payout report; according to this report only payout is transferred from Airtel to Distributor at the end of the month. All the commission entries are credited in case of payout and debited in case if particular distributor is liable to pay any bil.

10.2 Retailers CommissionRetailers are given commission on making any new connections, since retailers is in direct contact to the customer; they are given benefits for providing an additional customer to Airtel. Retailers are large in number so their commission is channeled through distributor or that area. Retailers Commission is of two types:

1. Upfront Activation:This is given to the retailer for making new customers to Airtel. Since Retailers are large in number so this weakly SLTV is given to the retailers through the route of Distributor. Retailers gets Rs. 50/- as commission on every new activation made by the retailer. So retailer try to increase the number of customers for Airtel, thus in turn increasing the revenue for the company, so they are given benefits for their services.

2. On the Fly Commission:This is an advantage given to the retailers if they made a recharge of Rs. 100/- or more on a new activation, or with some additional schemes, or some other tariff vouchers, caller tunes or other activations. Example: Customer gets a recharge of Rs. 100/- on top up but only Rs. 70/- is deducted from retailers account.

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All the details are provided by the server. A report is generated known as inventory report (IVR). Reconciliation is done using the same report and proper incentives and commission is given to the retailers base on number of new connections and services. Retailers commission is provided to Distributors through Lapu Transfer or through Cash into the Distributors account and ledger is maintained showing a credit not in distributors account. All the payout is transferred to the distributor by Airtel; Distributor transfers all the payout schemes to their retailers, retailers are informe about their commission and incentives by sales team.

10.3 Distributors Commission:Distributors are given a commission of 4.46% in West Circle and 4.16% in East Circle. They keep their 1% commission and rest they transfer to retailers account. HUB Distributors are given additional 0.63% commission as they provide services in the upcountry region. A runner boy is allotted by Airtel to Distributors; they collect Personal Enrollment Form (PEF) of new connections from retailers. A Tele- calling girl is allotted by Airtel who calls and cross checks the details and address of the customers. Salaries of both the Runner boy and Tele girl is paid by Airtel. Their salary is based on the basis of collecting total number of forms.

HUB Rs. 12/- per form

Normal Distributor Rs. 8/- per form

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On the basis of their performance Distributors are given some Gifts, Vouchers, Travel Packages etc.

10.4 ActivationA connection is said to be active on the basis of forms collected by the Distributors and after address verification of the customers. If anything is found wrong particular form is rejected and all the commission is taken back from the retailer and distributor for that particular form. It is divided in two types:

1. Form Collected beyond Due Date:Rs.25/- is debited from retailers account, as commission is given at the time of Activation. This is called as Non- Compliance.

2. Form Deleted:If address is found wrong that particular form is deleted and nearly Rs. 80/- is debited from retailers account.

10.4.1 Address Verification:A Tele-company is hired for this purpose and right is given is given to it for the address verification. At random 10% of the forms collected is taken and address is verified. If address is found to be wrong particular retailer is penalized for that. It is done according to:-

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0 - 2 % - Nothing is charged

2 3 % - Rs. 500/- is charged

3 5 % - Rs. 1000/- is charged

5 8 % - Rs. 1500/- is charged

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11.1 Post Paid Sales PayoutSales Commission to be divided into three parts Upfront Commission, Tailing Commission and Target Incentive.

Upfront Commission to be based upon Rental of the acquired of the acquiredcustomer.

Tailing Commission afternetwork.

3rd to ensure ARC focus on Customer induction in

Target Incentive based upon target achievement, to motivate channel forachieving Sales target.

11,1 Upfront CollectionIt is given on the basis of acquiring as many customers by any ARC, CSA, and DSA and second is given on per customer basis.

Upfront CollectionAdvance Rental Plan

ARC400

DSA/CSA400

Bill Plan upto 200 Rental

300

300

200 and 500 Rental

400

400

> 500 Rental Plans

450

450

70

Pre to Post

200

200

Post to Pre

50

50

Add On (any Plan)

200

200

No post to pre incentive will be paid if Age on Network (AON) of Post paid customer is less than three months and recharge within 7 days and value as per current policy. Upfront commission will be debited in case of AV failure, First bill churn and sales return. Debit will be made on month end data, and will be non refundable (50% claw back of upfront commission for churn up to third biller churn).

11.2 Tailing Commission:Tailing Commission is given to those ARCs who retains the customers at least for three months and this commission is given to the ARC, CSA and DSA after the third month of the customers bill.

TailingCommissionThird Bill

ARC150

DSA/CSA150

No tailing commission is given to the ARC, DSA and CSA in case of advance rental sales as in advance rental plan will make a person to be a customer of Airtel for few months.

Tailing commission is paid on Active Subscriber only.

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Target Incentive:Target Incentive is given to ARC, CSA and DSA for achieving a target given by Post Paid Head.

Target v/s Achieved slabs100% to 105%

ARC50

DSA/CSA50

105% to 110%

100

100

110% to 115%

125

125

> 115%

150

150

11.2.1 Conditions for this Incentive:1. Target incentive is on achievements of gross targets. 2. Same Would be applicable if no addition scheme is running by default, if scheme is proposed this incentive shown will be null and void. 3. No incentive will be paid if Gross Adds targets are not achieved.

11.3 Pick Up Model:The ARC will act as a pick-up agency for the leads generated through Airtel Call centre. The ARC will get 1% flat on the amount collected. No extra payment is paid on this activity.

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11.4 Collection Payout at 1%On Cash, Cheque and Credit Card payments received by ARC through walk in customers as well as pick up.

11.5 Prepaid Servicing Payout:A fixed payout of Rs. 3000 per ARC to be given towards Pre-paid servicing on 80% interaction captured in PACS of the monthly average walk-in (walk-in no to be decided by circle)

11.6 Provisioning Payout:1. No payout will be given on provisioning request of existing base. 2. Payout will be on new activation Provisioned in the month by ARC ECRM ID only. 3. Revised Empowerment matrix for provisioning will be provided by SMG team. 4. Rs. 50 for every post to Pre connection Rs.25 per SIM swap down.

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12.1 Fund Forecast:Forecast is a process of predicting or working out something that is likely to happen for these days ahead, it is an advance indication of something which is likely to happen. Since Airtel gets all its money into their collection bank account by their distributors through the sale of SIM, Easy Recharge, Paper Recharge and other services like Tarrif vouchers and Value Added Services (VAS). So a forecast is given by Zonal Finance Officer (ZFO) of all the zones of UPU circle that are Lucknow, Gorakpur, Kanpur, Allahabad, Merrut, Bareilly, Agra, Dehradoon for the next 3 days including current day. The forecast is calculated by ZFOs by several measures based on: a. Historic record of sales b. Statistical and calculative measures.

This report send by ZFO is compiled and compared with actual sales of the day. Variation expected is zero but it is not possible always, so net variation is calculated which may be positive or negative. This net variation is calculated and a MIS is prepared and is send to higher officials for the knowledge process.

12.2 Purpose of Fund Forecast:1. It is to get knowledge that what is the business amount in particular zone will be able to transact and what would be the revenue of Airtel on the upcoming days. 2. If variation is found more than a threshold, measures should be taken for the increase in sales in that particular zone so as to increase the business of Airtel.

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3. Amount of sales forecast and actual sales is compared for all the zones; it becomes easier for the manager to make quick decisions for increasing the sales and to flip up the gap.

Picture 34: Forecast of all the Zones

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13.1 CARD MOVEMENTCard Movement is basically done for keeping the track of PRCs that has been billed till the last billing day. Files used Billing data (e) Billing data (w) New card movement 10 (e) New card movement 10 (w) Rc_ter (e) Rc_ter (w) Card movement consists of a series of processes. First and foremost, we download the report from the server. REFL report winscp server (tertiary) V-SAT report FTP server (damage and made available)

The PRC cards that have been billed on the last billing day (say yesterday), those series of cards are made available on the next day by the CSD department because by the next day, the cards that are billed reach the distributors.

Basic purpose of preparing or maintaining the card movement is to keep a check on the status of the cards billed and control the fraudulent activities, such as illegal usage of cards, to check whether anybody in the firm is using the cards without the consent or knowledge of the company. If we do not track the card movement, anybody from the CSD or warehouse can easily use the card without letting the company know, which would consequently lead to loss of the company.76

If there creeps any differences in the data downloaded from the server and the data compiled manually. Then in that case we refer to our primary file which includes the daily activation report, there we check the series whether its available or not or whatever its status is.

Our servers may also sometimes give an error prone report, which could lead to difference in the Daywise Card Movement Sheet. Daywise Card Movement Sheet contains all the necessary details for Card Movement such as Derived Stock, which is derived by using formula upon various other entities which are as follows: Opening stock, damaged stock, inactivated series, sales return, Tertiary (Coupons used by the customers), Difference in last months inactivated series.

Opening Stock: This is the last months closing stock, which is used as the opening stock for the next month. When the billing of PRC is done and the coupons are sent to the distributors, the next thing that is done is that they are made available and the particular series that is made available is mentioned into the server and named as activation report which is later downloaded by the finance associates for updating the records manually like primary and billing data sheet.

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Picture 36: Day wise card movement.

Damaged Stock: This Stock is considered as unusable and sent back to the company and destroyed. Sometimes happens that the coupon series is lost or stolen then it is considered as damaged and they are deactivated so that no one is able to use them

Inactivated Series: This series of coupons are already billed to distributors but somehow they remain inactivated, left out. CSD department does all the activation of coupons but sometimes a series or few coupons are left inactivated then server shows them as inactivated series in a file named as activation report, Rc_detail This file shows the details for the column unactivated series. This details is also downloaded from the winscp server.

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Sales Return: In this column, comes the stock that has been returned by the distributors to the Warehouse, so the stock that comes back to the warehouse is again available for billing, in the meantime its status is changed to unavailable (inactive) and when they are again billed then they are again made available.

Tertiary: In the tertiary, the used stock is maintained, i.e., the coupons that are used by the end customers are shown under this head. Last Months Inactivated Series: Sometimes there are some series of PRC which are pending for activation due since last month or more.

Picture 37: New card movement.79

14.1 Comparison between Easy Recharge and Paper Recharge Coupon:The report is made by finance departments a MIS and to check which circle is generating higher revenue. Easy Recharge and PRC is in demand in the market and business plans are made.

LAPU comparison Report DescriptionPrimary Order Count Average Order Per Day Maximum Order Count Maximum Order Party

EAST CIRCLE

April 10141000000 2304 110 25 Vishu agencies

May10154100000 2579 117 30 Vishu agencies

Trend(-)/+13100000 275 7 5

Table 1: Lapu Comparison between April and May months for the East Circle.

RCV comparison Report EAST CIRCLE DescriptionPrimary Order Count Average Order Per Day Maximum Order Count Maximum Order Party

April 10110000000 5018 239 44 Gul Agencies

May10112420000 5334 242 50 Gul Agencies

Trend(-)/+2420000 316 3 6

Table 2: RCV Comparison between April and May months for East Circle.80

SUK Comparison Report

EAST CIRCLE April 10430000 1443 69 21 Vishu agencies

DescriptionPrimary Order Count Average Order Per Day Maximum Order Count Maximum Order Party

May10461000 1927 88 15 Vishu agencies

Trend(-)/+31000 484 19 5

Table 3: SUK Comparison between April and May months fot East Circle.

Total (Lapu+RCV+SUK) Lapu% RCV% SUK%

251430000 56% 44% 0

266981000 58% 42% 0

15551000 2% 2% 0

Table 4: Overall Comparison between April and May months for East Circle.

LAPU comparison Report

WEST CIRCLE April 10121000000 1719 82

DescriptionPrimary Order Count Average Order Per Day

May10138400000 1829 83

Trend(-)/+17400000 110 1

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Maximum Order Count Maximum Order Party

14 India Agencies

16 Hind Gencies

2

Table 5: Lapu Comparison between April and May months for the West Circle.

RCV comparison Report DescriptionPrimary Order Count Average Order Per Day Maximum Order Count Maximum Order Party

WEST CIRCLE

April 10102000000 2627 123 36 Good work agencies

May10103980000 2696 125 45 Good work agencies

Trend(-)/+1980000 69 2 9

Table 6: RCV Comparison between April and May months for West Circle.SUK Comparison Report

WEST CIRCLE April 10470000 757 36 11 India agencies

DescriptionPrimary Order Count Average Order Per Day Maximum Order Count Maximum Order Party

May10477000 773 37 15 Hindi agencies

Trend(-)/+7000 16 1 4

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Table 7: SUK Comparison between April and May months fot West Circle.

Total (Lapu+RCV+SUK) Lapu% RCV% SUK%

223470000 54% 46% 0

242857000 57% 43% 0

19387000 3% 3% 0

Table 8: Overall Comparison between April and May months for West Circle.

Comparison between Easy Recharge LAPU and Paper Recharge Coupon PRC:Comparing the above table the conclusion is derived: 1. Sale of Easy recharge is more in demand then PRC and has increased from the previous month within 56% to 58% in East Circle and 54% to 57% in West Circle. 2. Sale of Easy Recharge has increased by 13.1 Million in East Circle and 17.4 million in West Circle. 3. Average Order per day and maximum order per day has also increased in both the circles. 4. An increase in sale is there for PRC by 2.42 million in East circle and 1.98 million in West circle. 5. Sale of RCV has decreased in both the Circles in comparision to Lapu from 44% to 42% in East circle and 46% to 43% in West Circle. 6. Sale of Subscriber Unit Kit (SUK) has also increased in both the circles but nominal in comparison to Lapu and PRC.83

15.1 Summary:Working at finance department of airtel, I got to know about the sales accounting of Airtel. Airtel provides Air- time for tele- communication. The services provide by then is pre-paid and post-paid. The process followed over here, is to manage the account of distributor and ARC. This accounting is known as channel accounting. For pre-paid services a distributors are allotted and they deposit business amount into the bank through net banking and an order placed to particular zone. Payment is taken before and services are provided afterwards. Zone provides a list of order to finance department and that order is processed after various reconciliation and billing sheet is prepared by the executive and all the data is loaded into the server and ledger is maintained for the distributor. For post-paid services ARC is allotted for customers and account of ARC is maintained by post dated cheques. Services are provided before the payment is taken afterwards. ARCs are charged for new activations and have to pay accordingly. Ledger is maintained accordingly and data is entered into to server. Bank is the most important part for any organization, at airtel different accounts are made for collection and payment. All the collection are made into collection account of HDFC, CITI bank and ICICI bank. At the end of the daycomplete amount is credited into the main account from circle account through entery. For payables, all the payment is made through HDFC bank, and at the end of the daycomplete amount is automatically debited from main account through sweep entery. Fund forecasting is done to predict something which is likely to happen for the days ahead;here it is done to know that airtel will be doing business of what amount in ipcoming days. Payout is the method of giving benefits to the distributors, retailers, ARC, CSA and DSA for providing services for airtel; they are given incentives and commission for providing new customers and retaining old customers to airtel.

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