Financial Reporting Advisory

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Where Expertise Meets Precision in Financial Accounting Advisory Services

Financial statements are the ultimate report card of a company’s fiscal performance. They enable owners and managers to pursue their business objectives, raising capital, acquisition, divestiture, or restructuring. Therefore, through the company’s lifecycle, every business activity impacts the financial statements and hence needs to be carefully examined and analyzed.

Our FRAS group is a set of professionals who have significant hands-on experience in providing Financial Accounting Advisory Services such as INDAS/IFRS/US GAAP services, end-to-end solutions, and support services relating to complex financial requirements in a wide range of scenarios.

GAAP Conversions

With global corporate integration enabling exponential growth for Indian companies, corporate financial reporting in an internationally accepted framework is inevitable. For dynamic Indian businesses, the challenge to catapult into the next phase of growth magnifies with the ever-increasing focus on the quality and transparency of financial reporting by various stakeholders. On 16 February 2015, the MCA notified the Ind AS and roadmap for implementation thereof.

At SBC, we understand the importance of aligning Corporate Financial Reporting with regulatory changes and the need for accurate financial reporting.

Our professionals of financial management consultancy services are experienced in the following GAAP conversions

  • IGAAP to Ind AS
  • IGAAP/ IFRS to USGAAP
  • IFRS/ USGAAP to IGAAP/Ind AS

Group Consolidation

Investors prefer to see consolidated financial statements, driving listed companies to increasingly move in that direction for their quarterly reporting. In India, preparing annual consolidated financial statements is a statutory requirement.

Consolidation as a process has multiple challenges, specifically dealing with different reporting formats and methods used by different group entities. Our Financial Consultancy Services also include consolidation solutions to make sure that your consolidation process is as streamlined as regular financial reporting. We offer an in-house developed consolidation tool as well as professional services to prepare a structured set of consolidated financial statements.

  • Standard reporting templates for all group companies
  • Aligned chart of account (CoA)
  • Professionally prepared consolidated financial statements, with a complete audit trail
  • We also offer an automated consolidation tool, which has the following key features

IPO Support

Raising capital is inherent to any growing and expanding business. While narrating the future growth story of an investor’s capital is one part of capital raising, it is equally important to show the history, which is best told by a set of financial statements.

Most companies that raise capital for the first time do not have adequate financial reporting processes and experience to handle public financial reporting. Moreover, at the time of capital raising, the existing finance teams are already stretched to their extreme. It is wise to take help from financial advisory services in India. This is where our team of professionals can help, by handling the pressure and helping companies in telling their financial reporting story through high-quality financial statements.

  • Preparation of restated financial statements as per applicable GAAP (based on capital market requirements)
  • Preparation of Pro-forma and/or combined financial statements
  • Use of standard reporting templates for efficient and scalable reporting
  • Use of an automated consolidation tool with the matching of inter-company transactions/balances, etc., for timely reporting.

Hedge Accounting Advisory

With global corporate integration enabling exponential growth for Indian companies, exposure to global economic factors is inevitable. Companies engage in global trade or foreign currency transactions to benefit from arbitrage. However, this may have a long-term impact on the economic results of business transactions. Some of the common risks that companies face include foreign currency risk, commodity price risk and interest rate risk among others.

While companies’ risk management strategies limit the impact on cash flows, it is the P&L that is considered the pulse of financial health. The accounting technique to link the risk management strategy to the P&L is called ‘hedge accounting’, a privilege accounting under the accounting standards (Ind AS 109 or IFRS 9). When correctly applied, hedge accounting and valuation techniques can smoothen the P&L and maintain parity between cash flows.

  • Comprehensive Bouquet of Corporate Finance Advisory Services that includes:
  • Defining hedge management strategies and documentation
  • Hedge effectiveness testing at inception and periodically
  • Valuation of hedging instruments
  • Accounting for hedging transactions and financial reporting on a periodical basis
  • Making standard templates for effectiveness testing, accounting, and disclosures, for scalable and recurring reporting.

Accounting Manuals

Successful organizations are founded on people who are efficiently organized with processes and documented knowledge. The accounting manual is a critical part of the finance function of a company, as it ensures that the risk of over-reliance on a single individual does not harm the company. An accounting manual is a critical control in the overall finance function, and we believe an effective accounting manual is that which can be as dynamic as the organization itself. We offer an in-house developed accounting manual solution that is robust as well as dynamic, detailed as well as flexible, and a must for growing companies.

Our approach

  • Understanding current accounting processes
  • Documenting best practices
  • Possibility to include chart of accounts and accounting entries
  • Hosts dynamic accounting guidance to ensure consistency in accounting practices with technical practice alerts to guide users at each step as a part of our Finance Advisory services.
  • Allows for real-time updates, due to changes in technical requirements and business needs
  • Flexible structure and easy to read with structured navigation links
  • Ease of use due to features such as search and query
  • Identifies training needs of each user using online tests and quizzes
  • Features an online feedback system to track change requests
  • Includes a discussion forum to discuss, document, and conclude accounting matters
  • End-user updatable to minimize the involvement of information technology teams
  • Capable of being integrated into the company’s intranet
  • Logs to enable tracking of usage by accounting teams

Financial Statement Preparation

Companies in India transitioned to Ind AS in a phased manner. Likewise, companies worldwide are moving to IFRS. With Ind AS/IFRS evolving GAAPs, there are bound to be reporting challenges for companies. Our financial consultancy services in India boasts of a team of professionals who take the pressure away from in-house finance teams by preparing a set of compliant financial statements.

  • Prepare ready-to-use templates
  • Map chart of accounts
  • Make financial statement structures (including consolidation workings)
  • Structured templates for GAAP adjustments/major accounting computations
  • Financial reporting templates.

Transaction Accounting

Complex transactions often require documented analysis, GAAP interpretation, and some judgment. An inexperienced finance team makes the accounting for these non-routine/complex transactions prone to errors. Our team of professionals deals with such transactions regularly. In addition, we offer our transaction accounting services for the specific needs of companies that have either entered into or are contemplating entering into a complex transaction:

Typical examples of complex transactions we regularly deal with:

  • Business combinations
  • Financial instruments
  • Debt v equity classifications
  • Embedded derivatives
  • Modification of financial instruments
  • Shareholder agreements with investors
  • Joint venture agreements
  • Power purchase agreements
  • ESOP schemes
  • Assessment of control over an investee
  • Recognition of deferred taxes
  • Complex leasing arrangements/embedded leases
  • Service concession arrangements
  • Revenue recognition, assessment of performance obligations

As a part of our corporate finance advisory services for transaction accounting, we offer:

    • Advice on structuring transactions
    • Technical accounting memos
    • Accounting opinions.

New Standard Implementation

IFRS is a continuously evolving GAAP, Ind AS, drawing its dynamism from IFRS. In the recent past, GAAPs have seen significant new changes, with the coming of IFRS 9 and IFRS 15, which impacted most companies’ financial statements in ways that mattered. Moreover, IFRS 16 and IFRS 17 are all set to impact financial statements again in the near future.

Our team of professionals tracks development in accounting standards from the exposure draft stages and prepares for its implementation long before they are applicable. We help companies prepare for these new accounting changes and implement them.

  • Detailed diagnostic report
  • Process design for sustainable reporting
  • Implementation support
  • Automated template designs
  • Preparation of disclosure and updates to financial statements

IND as Advisory

Global capital markets are increasingly getting integrated, and businesses are growing internationally. International expansion plans may involve cross-border acquisitions or joint ventures abroad, raising international debt finance, developing relationships with private equity houses, or raising capital from the equity markets, whether in India or abroad.

In India, the Ministry of Corporate Affairs (MCA) has notified phase-wise convergence of Indian Standards with IFRS, known as Indian Accounting Standards (Ind AS). These standards have become effective from 2016-17 and are applied to all listed companies with a net worth exceeding Rs.500 crores. Experience in working on Ind AS conversion of more than 100 companies in Phase I. Any company may voluntarily comply with Ind AS for accounting periods beginning or after 1 April 2015.

  • Assistance in the analysis of the difference between Indian GAAP (generally accepted accounting principles) and Ind AS
  • Assistance in identifying/deciding new policies/procedures required to be implemented of under Ind AS
  • Assistance in the implementation of identified changes for convergence to Ind AS
  • Training your staff on key Ind AS concepts and requirements
  • Assistance in the compilation of financial statements under Ind AS
  • Ind AS consultancy on technical issues
  • Ind AS Advisory – Advantage Steadfast:
  • Steadfast in India is consistently ranked amongst India’s top six accounting and consulting groups
  • Well-experienced and skilled professional staff with proven project management skills
  • International orientation and best practices with respect to financial reporting
  • Local and global financial reporting servicing capabilities are part of the Steadfast network
  • Utmost emphasis on the confidentiality of your financial and other strategic information
  • Process orientation with emphasis on well-defined and documented procedures.

Audit and Assurance

We deliver tailor-made assurance services accentuated by impeccable quality to our clients in the local and global marketplace. Our focus is on assisting our clients in steering through complex professional requirements with clarity and agility through our financial reporting services for small businesses, and companies. Our partner-led approach helps navigate complexities to provide insights into your business with customized solutions. SBC delivers tailor-made assurance and auditing services in India accentuated by impeccable quality to our clients in the local and global marketplace. We aim to assist our clients in steering through complex professional requirements with clarity and agility.

  • Attest services under Indian and international standards (ISA, IFRS, PCAOB, AICPA)
  • Auditing services in India and reviews of local GAAP/ US GAAP/ IFRS financial statements
  • SOX attestation
  • Agreed-upon procedures
  • Certification services
  • Financial Reporting Advisory services.

ESG Analysis

SBC, through its role as a rating agency, addresses investors and issuers. Our ESG strategy focuses on three areas: integration of ESG into risk, impact, and performance considerations. Our range of solutions is based on a strong analytical foundation, a data-driven approach, and a particular focus on the measurement and materiality of ESG criteria. Our ESG solutions are tailored to the diverse needs of financial players, from capital market desks to risk teams and asset managers.

  • Screening of ESG risks and opportunities.
  • Identifying existing and potential ESG liabilities and prioritisation.
  • Assist in formulating ESG risk mitigation roadmap.
  • Post deal support – setting up ESG integration systems and periodic assessments.
  • Development of credit rating framework.
  • Portfolio risk analysis.
  • Conduct ESG impact assessment to identify the value created.
  • Integrating ESG into the business through ESG roadmap including relevant policy development.
  • Define ESG governance structure.
  • Design ESG action plan and function-specific Key performance indicators (KPIs).
  • Design ESG linked financial instruments
  • Design product and services with E&S Impact.
  • Develop ESG management system framework.
  • Design customised ESG risk assessment tools.
  • Implementation support.
  • Capacity building workshops.
  • Design customised ESG training modules.
  • Identify reporting standards relevant to business.
  • Design data collection and disclosure systems.
  • Develop ESG/sustainability reports.
  • Assist in market indices participation such as Dow Jones Sustainability Index (DJSI), Carbon Disclosure Project (CDP), etc.
  •  Conduct third party review and validation of risk management and ESG performance.
  • Third-party assurance of ESG disclosures.

About Financial Risk Advisory

Today’s digitized environment is evolving day by day, so risks do. Today’s complex risk environment places extraordinary demands on organizations. Risk management helps you protect your valuable assets, trade secrets, employee information, Organization good name, intellectual property. Working with the SBC risk experts team enables you to address risks associated with increased regulatory oversight and competition.

Our team works with clients proactively to help them identify and mitigate business and functional risks, optimize costs, build efficiencies in processes by strengthening internal controls and systems.

We have an expert team of qualified professionals with diverse knowledge and industry experience working with leading companies, both listed and unlisted, having a domestic and multinational presence.

At SBC, our endeavor is not to sell you yet another run-of-the-mill financial advisory but help you with a comprehensive, tailored financial solution. We customize the financial plan to suit your requirements.

financial risk

GOVERNANCE, RISK, AND COMPLIANCE SERVICES

In today’s business environment, regulators, investors, and independent directors are focusing on corporate governance. Organizations need to fine tune their processes and controls. Many organizations are recognizing the need to transform their internal audit and risk management functions to turn these challenges into opportunities.

Consolidation as a process has multiple challenges, specifically dealing with different reporting formats and methods used by different group entities. Our Financial Consultancy Services also include consolidation solutions to make sure that your consolidation process is as streamlined as regular financial reporting. We offer an in-house developed consolidation tool as well as professional services to prepare a structured set of consolidated financial statements.

  • Enterprise risk management
  • Internal audit transformation
  • Outsourcing or Co sourcing
  • Control testing
  • SOP development
  • Business process improvement

FINANCIAL RISK MANAGEMENT

Today’s world is more concerned about increasing financial risk. Various investigations are ongoing on multinational enterprises. Enterprises of all kinds and sizes want robust financial risk management framework to meet compliance demands.

  • Assist clients in cash-flow modelling, structural and document review
  • Operational risk assessment
  • Market and Liquidity risk assessment
  • Capital analysis and review
  • Structured finance deals

FORENSIC AUDIT AND INVESTIGATIONS

Financial scandals have been increasing at a rapid phase over the past decade. Competitor and regulatory pressures are challenges business leaders take in stride, what they often do not expect is misconduct from internal or external perpetrators who can severely damage a company’s reputation. SBC forensic professionals provide strategic consultation to organizations, helping them resolve high state matters including corruption, fraud, and accounting irregularities.

  • Financial data analysis
  • Damage assessment
  • Business valuation
  • Writing reports
  • Maintaining documentation
  • Tracing illicit funds
  • Due diligence reviews
  • End-use monitoring of funds

OTHER SERVICES

In today’s business environment, regulators, investors, and independent directors are focusing on corporate governance. Organizations need to fine tune their processes and controls. Many organizations are recognizing the need to transform their internal audit and risk management functions to turn these challenges into opportunities.

Our Internal Audit Consulting team performs internal audits to provide an independent and objective review on the functioning of an organization’s systems, processes, and controls to management. We identify risks in each business function, perform process walkthroughs, documentation review, data analytics, identifying areas of risk due to gaps in the process and scope of improvement in operations. Based on this, we suggest practical recommendations to management to introduce relevant controls, improve operational efficiency, and minimize risk.

As part of our Risk Advisory Services, we assess, develop and document Standard Operating Procedures (SOPs) and Policies for organizational functions based on the facts of the client, their risk profile, and management objectives. Our SOPs introduce best business practices based on our diverse exposure and knowledge pool created over decades of professional practice.

We help our clients in complying with IFC requirements for financial reporting as per applicable guidelines of Companies Act 2013. We perform design and testing of IFC Framework which includes documenting Risk & Control matrices, testing, and validating controls from a design and effectiveness perspective to safeguard the interest of various stakeholders.

We evaluate critical processes as identified by the management of the Company and assist the clients in eliminating activities that don’t create value, enhance process optimization, and identify areas and tools for saving cost.

We provide support to our clients in assessing the performance and health of a store/outlet by conducting store/outlet audits based on the parameters agreed with the management. This includes surprise physical verification, store controls review, mystery audits, physical stock count, store performance review, etc.

We provide support to our clients in assessing the performance and health of a store/outlet by conducting store/outlet audits based on the parameters agreed with the management. This includes surprise physical verification, store controls review, mystery audits, physical stock count, store performance review, etc.

We engage with clients to carry out a risk assessment of the critical process, preparation of process risk registers, categorization of risks, drafting and deployment of detailed risk mitigation plan. Such Risk Advisory Services enable us to support the client in long term monitoring of operating effectiveness of risk mitigation plans.

We carry out special reviews as directed by the management of the client to appraise the effectiveness, efficiency, and sufficiency of systems and controls of a specific process or division of the Company. Accordingly, based on observations, the risk is assessed, gaps are identified, and suggestions are discussed with management to minimize these risks.

Our team of Risk Advisory Consultants help our clients in identifying the root cause of key challenges faced by the business as identified by the management and identify key management initiatives required to address these challenges and enable optimism growth. We conduct interviews with key personnel, review documentation, perform process walkthroughs to identify the gaps in strategy, systems, team, etc., perform root cause analysis and accordingly share recommendations for improvement, with management.

This supports businesses to implement and monitor new processes, policies and mitigating controls for new emerging risks post COVID situation for business continuity.