ITU-T D 195 SUPP 2-2013 Time-scale for settlement of accounts for international telecommunication services Guidelines for day sales outstanding (DSO) management (Study Group 3)《国际电.pdf

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1、 International Telecommunication Union ITU-T D.195TELECOMMUNICATION STANDARDIZATION SECTOR OF ITU Supplement 2(05/2013) SERIES D: GENERAL TARIFF PRINCIPLES General tariff principles Service and privilege telecommunications Time-scale for settlement of accounts for international telecommunication ser

2、vices Guidelines for day sales outstanding (DSO) management Recommendation ITU-T D.195 Supplement 2 ITU-T D-SERIES RECOMMENDATIONS GENERAL TARIFF PRINCIPLES TERMS AND DEFINITIONS D.0 GENERAL TARIFF PRINCIPLES Private leased telecommunication facilities D.1D.9 Tariff principles applying to data commu

3、nication services over dedicated public data networks D.10D.39 Charging and accounting in the international public telegram service D.40D.44 Charging and accounting in the international telemessage service D.45D.49 Principles applicable to GII-Internet D.50D.59 Charging and accounting in the interna

4、tional telex service D.60D.69 Charging and accounting in the international facsimile service D.70D.75 Charging and accounting in the international videotex service D.76D.79 Charging and accounting in the international phototelegraph service D.80D.89 Charging and accounting in the mobile services D.9

5、0D.99 Charging and accounting in the international telephone service D.100D.159 Drawing up and exchange of international telephone and telex accounts D.160D.179 International sound- and television-programme transmissions D.180D.184 Charging and accounting for international satellite services D.185D.

6、189 Transmission of monthly international accounting information D.190D.191 Service and privilege telecommunications D.192D.195Settlement of international telecommunication balances of accounts D.196D.209 Charging and accounting principles for international telecommunication services provided over t

7、he ISDN D.210D.269 Charging and accounting principles for next generation networks (NGN) D.270D.279 Charging and accounting principles for universal personal telecommunication D.280D.284 Charging and accounting principles for intelligent network supported services D.285D.299 RECOMMENDATIONS FOR REGI

8、ONAL APPLICATION Recommendations applicable in Europe and the Mediterranean Basin D.300D.399 Recommendations applicable in Latin America D.400D.499 Recommendations applicable in Asia and Oceania D.500D.599 Recommendations applicable to the African Region D.600D.699 For further details, please refer

9、to the list of ITU-T Recommendations. Rec. ITU-T D.195/Suppl.2 (05/2013) i Supplement 2 to Recommendation ITU-T D.195 Time-scale for settlement of accounts for international telecommunication services Guidelines for day sales outstanding (DSO) management Summary Supplement 2 to Recommendation ITU-T

10、D.195 is intended to assist telecommunication operators interested in developing guidelines for day sales outstanding (DSO) management. Since an operators decision to establish prepayment mechanisms is an internal commercial matter (with terms negotiated between operators), the guidelines in the pre

11、sent supplement are voluntary and meant to be illustrative in nature. Their objective is to help operators formulate new (or update existing) DSO guidelines according to their own needs, business strategy and headcount pressures. History Edition Recommendation Approval Study Group 1.0 ITU-T D.195 20

12、03-11-21 3 2.0 ITU-T D.195 2006-06-27 3 3.0 ITU-T D.195 2008-04-04 3 4.0 ITU-T D.195 2011-04-01 3 5.0 ITU-T D.195 2012-11-20 3 5.1 ITU-T D.195 Suppl. 1 2013-05-31 3 5.2 ITU-T D.195 Suppl. 2 2013-05-31 3 5.3 ITU-T D.195 Suppl. 3 2013-05-31 3 ii Rec. ITU-T D.195/Suppl.2 (05/2013) FOREWORD The Internat

13、ional Telecommunication Union (ITU) is the United Nations specialized agency in the field of telecommunications, information and communication technologies (ICTs). The ITU Telecommunication Standardization Sector (ITU-T) is a permanent organ of ITU. ITU-T is responsible for studying technical, opera

14、ting and tariff questions and issuing Recommendations on them with a view to standardizing telecommunications on a worldwide basis. The World Telecommunication Standardization Assembly (WTSA), which meets every four years, establishes the topics for study by the ITU-T study groups which, in turn, pr

15、oduce Recommendations on these topics. The approval of ITU-T Recommendations is covered by the procedure laid down in WTSA Resolution 1. In some areas of information technology which fall within ITU-Ts purview, the necessary standards are prepared on a collaborative basis with ISO and IEC. NOTE In t

16、his publication, the expression Administration is used for conciseness to indicate both a telecommunication administration and a recognized operating agency. Compliance with this publication is voluntary. However, the publication may contain certain mandatory provisions (to ensure, e.g., interoperab

17、ility or applicability) and compliance with the publication is achieved when all of these mandatory provisions are met. The words shall or some other obligatory language such as must and the negative equivalents are used to express requirements. The use of such words does not suggest that compliance

18、 with the publication is required of any party. INTELLECTUAL PROPERTY RIGHTS ITU draws attention to the possibility that the practice or implementation of this publication may involve the use of a claimed Intellectual Property Right. ITU takes no position concerning the evidence, validity or applica

19、bility of claimed Intellectual Property Rights, whether asserted by ITU members or others outside of the publication development process. As of the date of approval of this publication, ITU had not received notice of intellectual property, protected by patents, which may be required to implement thi

20、s publication. However, implementers are cautioned that this may not represent the latest information and are therefore strongly urged to consult the TSB patent database at http:/www.itu.int/ITU-T/ipr/. ITU 2013 All rights reserved. No part of this publication may be reproduced, by any means whatsoe

21、ver, without the prior written permission of ITU. Rec. ITU-T D.195/Suppl.2 (05/2013) iii Table of Contents Page 1 Introduction 1 1.1 Objective and scope 1 1.2 Benefits of benchmarking DSO management guidelines . 1 1.3 What is DSO? . 1 1.4 Key factors surrounding DSO and DSO indicators 2 1.5 Key obje

22、ctives of DSO management . 2 1.6 Collection department goals . 2 1.7 DSO management strategies . 3 1.8 Core activities and key responsibilities to reduce DSO and DSO management 3 1.9 Measurable goals 5 2 Best practices in DSO management . 5 3 A summary DSO management checklist 5 Rec. ITU-T D.195/Sup

23、pl.2 (05/2013) 1 Supplement 2 to Recommendation ITU-T D.195 Time-scale for settlement of accounts for international telecommunication services Guidelines for day sales outstanding (DSO) management 1 Introduction 1.1 Objective and scope The objective of this supplement is to assist telecommunication

24、operators that are interested in the development of guidelines for the management of day sales outstanding (DSO). These guidelines are illustrative and voluntary as the development of DSO processes is an internal corporate matter and the terms between operators are commercially agreed. 1.2 Benefits

25、of benchmarking DSO management guidelines It is intended that these guidelines will bring the following benefits to telecommunication operators: Professionalism and proficiency: Create a benchmark of a traditional collection of key performance indicators (KPIs). Organizational status: Take a snapsho

26、t of payment terms driven by history, legacy and diverse global ways of working. Alignment: Assist telecommunication operators in formulating a set of guidelines and industry best practices according to their own needs, strategies and headcount pressures. Operational quality: Encourage a review of e

27、xisting ways of working and enhance carrier processes according information exchange between carriers; Ensure efficiency in reducing accounts receivable; Ensure efficiency in managing accounts payables; Pre-empt impact of diversification of telecoms product; Pre-empt impact of changing industry: fra

28、ud, prepayment and payment terms. Knowledge sharing: Share best practices on optimizing processes, resources, systems, off-the-shelf and in-house. Guidelines driven by the telecommunication operators financial community itself, so that best practices are real versus conceptual. 1.3 What is DSO? DSO

29、measures the time it takes for a company to collect accounts receivable (AR) from credit sales. It provides an average effectiveness of AR collection policies and the resource in charge of implementing and managing the contract payment terms. The formula to calculate DSO is: DSO = (Receivables/Sales

30、) Days in Period 2 Rec. ITU-T D.195/Suppl.2 (05/2013) For example: Total receivables = $ 5,000,000.00 Total credit sales = $ 10,000,000.00 Number of days in period = 90 (5,000,000.00/10,000,000.00) 90 = 45 days (DSO) 1.4 Key factors surrounding DSO and DSO indicators AR balances are among the larges

31、t and most liquid holdings. A well-managed DSO helps optimize cash flow, supports corporate cash requirements and boosts working capital. DSO management plays a vital role in the overall health of a company: DSO is considered an important tool in measuring liquidity DSO tends to increase as a compan

32、y becomes less risk averse Team efficiencies and performance issues: Increasing DSO can also be an indication of poor follow up on delinquencies OR of bad billing function High risk defaulters: Increasing DSO might be the result of inadequate credit risk analysis Increasing DSO can result in cash fl

33、ow problems, and may compel companies to increase the creditor companys bad debt reserve Billed revenue movement: Highlight changes in selling or trading activity Seasonal business cycle: Pre-empt cash gaps and foreign exchange impacts Organization unaligned: Contract terms within commercial teams a

34、nd finance management. 1.5 Key objectives of DSO management The key objectives of DSO management are, but not limited to, the following: Cash in: Improve cash inflow in a timely manner. Reduce DSO, maintain days payable outstanding (DPO) and reduce aged debt percentage. Business development: Enable

35、sales and profits; enable business for the company if it takes the build your business with you approach. Enforce contractual terms: Monitor, protect and manage the companys AR. Execute netting and statement proposal process. Provisions: Reduce financial exposure and minimize bad debt losses. Reduce

36、 net credit exposure (credit risk). Training: Build and develop collection resources, use the right skill set, highlight gaps in knowledge. Automation: Can we collect faster if we automate a part of the chain? Organizational coordination: Commercial and trading to ensure correct contractual and pric

37、ing input Correct reference data in the system interfaces Billing to send correct invoices in order to produce a collectable bill or validate an incoming invoice. Information gathering and networking with partners in order to assess the upcoming impact of any funnel activity on DSO vs. revenues. 1.6

38、 Collection department goals Meet customers needs Rec. ITU-T D.195/Suppl.2 (05/2013) 3 Meet management expectations Bridge the gap on sales needs Satisfy audit and accounting requirements Achieve operational requirements. 1.7 DSO management strategies Operational evaluation: Cash flow management (ac

39、tual cash in/out) Clear escalation policy Top escalation efficiencies Monthly credit management review on insured and uninsured Quarterly credit limit review management. Financial forums: Alignment of activities across financial teams and carrier community: Greater emphasis on sharing collection KPI

40、s DSO shaped by regional nuances Use the industry knowledge at hand versus static credit rating information Forum for improvements, ideas and general trouble shooting of the daily operation. A segmentation approach to portfolio management: enables focus on key operator relationships in line with the

41、 commercial organization allows the regional collector through to the management to follow a clear policy agreed throughout the financial and commercial environment allows a high level of prioritization and alert system across departments. Automation: Internal labour intensive tasks to be automated

42、to free up time to ensure better quality Actual collection task can be automated Transfer to prepayment. 1.8 Core activities and key responsibilities to reduce DSO and DSO management Collection managers and collection resource: Cash collection is the point at which all activity with the customer mus

43、t be concluded promptly until the following cycle: Accuracy Proactivity Transparency Negotiation of shorter billing cycle Prepayment system Participation with commercials in customer meetings or conferences Customer visit when collection (or dispute) is at stake. Commercial teams: High-level busines

44、s case in line with credit risk approval process Prior approval of appropriate members of the finance team on financial clauses of contracts Regular cooperation with sales is necessary to succeed 4 Rec. ITU-T D.195/Suppl.2 (05/2013) Rules and commitments on collection between sales and finance to be

45、 respected Provide regional financials. Billing: Invoice on time Validate on time Resolve dispute promptly and in harmony with collections Send disputes on time. Credit risk management: Risk-aware top-down: Clear credit policy: Follow the processes and procedures encompassing all credit functions an

46、d activities adopted by the business. Conduct a credit check and evaluation of existing and new customers regularly Company history (legal, corporate and capital structure, balance sheet) and background of principal/owners/officers) Financial condition and operating results (financial statement and

47、ratio analysis) Establish credit lines, terms or limits with internal information and rating agencies Gather credit information (internal and external sources) Networking Define target, owner and action for making a credit decision and recommendation (escalation and hierarchy) Decision and recommend

48、ation to management: Revenue the business is estimated to generate or the overall margin that the service contributes to the bottom line vs. risk Alignment with the collection process Strength or weakness of the product or service that is being sold Degree of competition or opportunities in the mark

49、etplace; the changing nature of the industry Regional implications of risk or future business. Reporting: Credit file archive maintenance Reporting to upper management (status alerts and monitoring reports) Sharing of credit information with other business units within the company while ensuring compliance with national legislation and agreements