revenue assurance


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revenue assurance

  1. 1. Revenue Assurance – Punctured profits & Fraud Management Presentation by Anil Kumar
  2. 2. What impacts profits? <ul><li>Shrinking of the Top Line – loss of revenues </li></ul><ul><li>Increase in Cost lines </li></ul><ul><li>Impact = A Hole in the company’s profits </li></ul>
  3. 3. Examples….. <ul><li>Enron, Worldcom and many more </li></ul><ul><li>Impact…… collapse of organisations </li></ul><ul><li>Also collapse of Audit & Consulting firm </li></ul><ul><li>Impact = A Big Hole in the company’s profits </li></ul><ul><li>Investors losing their money, people rendered </li></ul><ul><li>jobless </li></ul>
  4. 4. Cycle of Telecom Services Develop and price products Manage Network Infrastructure Manage receivables and fraud Rate and Bill Provide service Manage customer & carrier relations Sell products Market products Account and report
  5. 5. Revenue Leakage Possibilities <ul><li>Developing and pricing of Products </li></ul><ul><li>Launch of products without adequate testing in a hurry to launch first e.g VAS. </li></ul><ul><li>Launch products without technology support to ensure there is no revenue leakage. </li></ul><ul><li>Tariff changes at short notice to counter competition. </li></ul>
  6. 6. Revenue Risk Opportunities <ul><li>Selling of Products </li></ul><ul><li>Sales without adequate verification of customers. </li></ul><ul><li>Re entry of fraudulent customers. </li></ul><ul><li>Fictitious activations/sales to earn more commissions. </li></ul><ul><li>Provision of services without corresponding checks and balances to prevent high exposures. </li></ul>
  7. 7. Revenue Risk Opportunities <ul><li>Network infrastructure </li></ul><ul><li>Inadequate capacity deployment of sites at high contribution areas like roaming. </li></ul><ul><li>Inaccurate usage capturing. </li></ul><ul><li>Inadequate control over switch databases </li></ul><ul><li>Inadequate controls over provisioning </li></ul><ul><li>Fraudulent usage of test SIMS/phones </li></ul>
  8. 8. Fraud Opportunities <ul><li>Manage Carrier Relations </li></ul><ul><li>Roaming frauds </li></ul><ul><li>Carrier contracts and billing </li></ul>
  9. 9. Fraud Opportunities <ul><li>Service Provisioning </li></ul><ul><li>Launch of new products/Value added services </li></ul><ul><li>Inadequate controls over SIMS and recharge coupon pins. </li></ul><ul><li>Recharging frauds. </li></ul>
  10. 10. Revenue Risk Opportunities <ul><li>Rating and Billing </li></ul><ul><li>Inaccurate configuration of tariff tables. </li></ul><ul><li>Inadequate Controls over Bill plan changes </li></ul><ul><li>Weak Controls over free airtime connections </li></ul><ul><li>Inadequate Controls over rating of CDRs </li></ul><ul><li>Weak Controls over bill generation </li></ul><ul><li>Controls over customer files/balances </li></ul><ul><li>International Long distance grey calling. </li></ul>
  11. 11. Collection Fraud possibilities <ul><li>Manage Receivables </li></ul><ul><li>Credit limit fixation </li></ul><ul><li>Non-adherence to credit policy </li></ul><ul><li>Non monitoring of high usage </li></ul><ul><li>Cash management through Collection agencies </li></ul><ul><li>Payments through credit cards </li></ul><ul><li>Non allocation of cases to collection agencies. </li></ul><ul><li>Non Barring of services to defaulting customers. </li></ul>
  12. 12. Revenue Reporting Risks <ul><li>Account & Report </li></ul><ul><li>Improper subscriber nos. reporting </li></ul><ul><li>Inflating revenue figures </li></ul><ul><li>Under-reporting of bad debts </li></ul>
  13. 13. Risks to Costlines <ul><li>Payments for leased lines not in use. </li></ul><ul><li>Deployment of network elements with inadequate utilization. </li></ul><ul><li>Inadequate controls over energy costs. </li></ul><ul><li>Inadequate verification of Interconnect charges payable to other operators. </li></ul><ul><li>Overcharging by content providers and call center agencies. </li></ul>
  14. 14. Fraud Opportunities <ul><li>Account & Report </li></ul><ul><li>Improper subscriber nos. reporting </li></ul><ul><li>Inflating revenue figures </li></ul><ul><li>Under-reporting of bad debts </li></ul>
  15. 15. Fraud illustrations <ul><li>Non rating of “Zero Duration Calls” </li></ul><ul><li>Non configuration of certain destinations in the IN platform </li></ul><ul><li>Subscribers not billed for considerable period of time </li></ul><ul><li>Free airtime given to distributors/subscribers without adequate authority </li></ul><ul><li>Unauthorised bill plan changes </li></ul><ul><li>Configuration checks </li></ul><ul><li>Rejected call analysis. </li></ul><ul><li>Reconciliation of active customers vs. billed </li></ul><ul><li>Regular review of FAT connections. </li></ul><ul><li>Control log for bill plan changes </li></ul>Area of Risk Prevention techniques
  16. 16. Fraud illustrations <ul><li>Activating roaming with call conferencing facility without proper credit verification </li></ul><ul><li>Leakage of information regarding prepaid customer database to the competitors </li></ul><ul><li>1. Keeping activation of VAS as centralised. </li></ul><ul><li>2. No VAS activation without credit verification. </li></ul><ul><li>1. Stringent IT controls over data copying, mailing & printing </li></ul><ul><li>2. Confidentiality clause with outsourced agencies </li></ul>Area of Risk Prevention Techniques
  17. 17. Fraud illustrations – NLD/ILD <ul><li>High termination charges in the case of Sex lines paid by the ILD operators for traffic on international lines. e.g. Deigo Garcia. </li></ul><ul><li>Call routing </li></ul><ul><li>Specific clauses in the agreement. </li></ul><ul><li>Regular monitoring of high traffic to few numbers. </li></ul><ul><li>Review of Least call routes and data analysis of call carrying. </li></ul>Area of Risk Prevention Techniques
  18. 18. <ul><li>How frequently are the IT security compliance results measured by your organisation? </li></ul><ul><li>Source: KPMG India Fraud Survey Report 2006 </li></ul>
  19. 19. <ul><li>How was it detected? </li></ul><ul><li>Source: KPMG India Fraud Survey Report 2006 </li></ul>
  20. 20. <ul><li>In which of these areas did the majority of Rupee losses occur? </li></ul><ul><li>Source: KPMG India Fraud Survey Report 2006 </li></ul>
  21. 21. <ul><li>What is the medium available to employees to report wrongdoing in the organisation? </li></ul><ul><li>Source: KPMG India Fraud Survey Report 2006 </li></ul>
  22. 22. QUESTIONS ?
  23. 23. THANK YOU