2. Introduction
Siemens is a global powerhouse focusing
on the areas of electrification, automation
and digitalization. One of the world’s
largest producers of energy-efficient,
resource-saving technologies, Siemens is
a leading supplier of systems for power
generation and transmission as well as
medical diagnosis. In infrastructure and
industry solutions the company plays a
pioneering role. As of September 30, 2014,
we had around 343,000 employees in more
than 200 countries. In fiscal 2014, they
generated revenues of €71.9 billion from
continuing operations.
3. RESEARCH METHEDOLOGY
Nature of Data
The data collected is Secondary in nature. This
is due to the nature of analysis, which only call for
secondary data.
Source of Data
1. Observation
2. Questionnaire
3. Editing
4. Channel Partners (CP’s)
Channel Partners (CP’s) are our extended arms.
CP is a middleman between Siemens and
customer.
They are authorized to stock and sell our products
in line with the terms and condition governing in
the Channel distribution Agreement.
IMP Note:
Distribution Agreements & Web based Agreements
are entered once in 3 years
Channel Policy is signed Annually (at the
beginning of new FY)
5. Check list for attachments.
PAN Certificate copy
Auditor certificate Balance sheet for last three year.
Auditor certificate profit and loss Accounts statement for
last three years
It Returns for last three year
Customer Appreciation letters
Bank Certificate. Current & permanent Residence
Address proof.
In case of sale proprietorship firm, shop industry
establishment license
In case of partnership partnership Deed.
In case of privet company Ltd. Firm memorandum of
articles of Association.
Certificates of Association from other non-competing
principal.
6. Credit Rating
1. Last Year Business Volume
2. Current Year Business Plan
3. Association with the Siemens
4. Receivable and Profit
Receipt of Purchase Order from the CP
Industry Mall- CP UFD orders
ERP2 Mall- CP Special price order
7. Documents required for order booking.
• Purchase Order
• Order Booking sheet to be
prepared by CP
• Price approval/ Discount
approval
• Damex-E
•Damex-P
8. Various Cases of order:
1) Form H Order
2) Form C order
3) High Seas Sale Order
10. Flow chart of Sales process
End Customer
Dealer
Negotiation of Dealer & Sales engineer for discount
Finalization of order
Dealer send order to Siemens Sales Eng.
Engineer send order to BA (PO, OBS, Damax E, price Approval)
BA verifies the PO & Price Approval
Send Order on Industry mall for booking
Sales order number gets generated
Material gets picked as per availability (Delivery note no gets generated )
Billing by logistics
11. Flow Chart of Collection Process
Debtors get created in system
Setting Collection Target as per Due Date
BA send O/S statement to Dealer
Follow-up for payment(as per payment terms)
Adjustment of payment against open Debtors
(as per payment adjustment from CP)
If CP delay in making the payment 18%
Interest is charge
12. Receivable Management
1) Generating GG wise, age wise customer outstanding statement
2) Downloading, preparing individual customer wise outstanding
statement at the beginning of the month
3) Setting Collection Target for the month
4) Emailing the outstanding statement to customers( CP)
5) Follow up for payment through reminders (telephone, email, letter)
6) Draft to stage wise sample reminders.
7) Following the customer, bank and CF in case of payment against L/c.
8) Weekly Review of receivable/collections.
9) Receipt of payment from customers:
10) Posting of cheque in Nexus and maintain copy of deposit slip
11) Issuing credit notes: towards price difference, incorrect discount,
incentive credit notes etc.
13. Channel Finance
Channel financing is service offered by bank like
Standard Chartered Bank, Axis Bank to Siemens
Channel partners.
All Channel Partners of Siemens are suggested to opt for
Channel financing at the time of their appointment as a
“Channel Partner” for assurance of receivables and for
security purpose. Siemens acts as a guarantor between
Bank & the CP.
On the due date BA follow up for the payment with CP. On
receiving the instructions from CP (For making the payment)
Bank processes the payment. Subsequently Dealer makes
payment to Bank within the credit period (90 days). If CP fails
to pay the bank within the credit period of 90 days bank will
inform to Siemens to stop dispatches. Subsequently credit
limit of the CP will be reduced to Rs.1 in the system of
Siemens.
14. Credit Notes
A credit note could be issued for any
one of the following reason:
1) Return of goods.
2) Unrecoverable receivable.
3) Incorrect invoicing.
4) Goods or service not received.
5) Goods or service not received.
6) Goods or service not received.
15. Debtor’s Aging schedule
Aging schedule shows a list of accounts receivable that has
remained uncollected from the dates of issuing the invoices.
“0 Days”, “1 – 15 days”, “16 – 30 days”, “31 – 60 days”, “61 -
90 days” and “ > 90 Days”.
16. Incentives
Incentive is offer to CP for attracting to make early
payment Make it easy for customers to pay early.
EPI ( Early Payment Incentive)
PPI ( Prompt Payment Incentive)
17. Provision
It is the setting aside of foreseen losses or
expenses which may occur in the future.
Provision vouchers have to be initiated by BA
1) Provision for Debtors
2) Provision for Loss on Orders
3) Provision for Liquidated Damages
4) Provision for Incentives to CP
18. CONCLUSION
1)Receivable management is the key area of the working
capital management.
2)Accounts receivable management includes determining
an appropriate credit policy as well as investigating ways
of speeding up collections and reducing bad debts.
3) I analyzed the structure of receivables, accounts
receivable levels expressed in terms of financial ratios
along with a dependence between accounts receivable
levels and profitability and we also analyzed changes in
credit policy as an important activity in management of
accounts receivable.
4) Channel financing is a way through which problems of
dues can be controlled to a great extent but it should be
taken care that the company won’t be liable for any
default made by the Channel Partner.
19. BIBLOGRAPHY
1. Commercial manual of business administration
of Siemens.
2. Various agreements.
3. www.google.com
4. www.siemens.com
5. Guidance form Business administration
Siemens Team.
6. Guidance from Sales Engineer of Siemens.
7. Guidance from Project Guidance.
