Cerebra executed the finance functions of a foreign client and then restructured them inhouse

SITUATION

A French company, one of the world’s leading road operating companies, established a company (“Company”) in Turkey in 2012 to carry out the operation and maintenance works of one of Turkey’s leading tunnels. The challenges faced by the Company related to its operations were as follows:

• They needed an independent service provider to handle their accounting, payroll, tax compliance and reporting processes. Which company would carry out these processes and how?
• In 2018, the Company decided to take these processes in-house due to its growing transaction volume, but the General Manager of the Company at that time needed guidance on what kind of structure he should establish and what duties the people he would hire would perform. For example, who would do IFRS reporting and who would prepare tax/social security returns?
• How would the General Manager make sure that the people hired were doing their jobs correctly?
• Which accounting software would the company use internally? Would the new hires be able to operate this program?
• After the company took over the accounting and reporting processes inhouse, some of the newly hired Financial Affairs Managers and accounting staff left after a while. Who would handle their responsibilities until new personnel were hired?

OUR SOLUTION

Cerebra first met the General Manager of the Company as soon as the Company was established, and the needs were determined as a result of the meeting.  Cerebra presented its solutions based on the identified needs.

All accounting, payroll and reporting processes of the company would be carried out by the Cerebra team.

 In this context, Cerebra proposed the followings:

• Providing services under the umbrella of Cerebra for accounting, issuance of sales invoices, reporting, payroll, tax compliance, payment management and execution of financial affairs with third parties such as banks/lawyers/CPA, and to provide these services by establishing a team of six people consisting of a manager having Certified Public Accountant (CPA) licence, Reporting and Consultancy Manager and chiefs and assistants to support them,
• Performing IFRS reporting,
• Keeping all accounting records of the company in the Logo accounting program used by Cerebra.

 These suggestions offered by Cerebra were evaluated in detail in the first meeting with the company management. In a short time, the Cerebra team received data from the Company management regarding the transaction volume of the Company subject to the process, and the proposal, prepared as a result of the analysis, was presented to the Company management. The above suggestions were implemented after the company management accepted the offer.

Cerebra provided the aforementioned services from the year 2012 to 2018. After the Company decided to handle these processes in-house in 2018, Cerebra developed a business plan to separate the tasks into those to be performed internally by the Company and those to be handled by Cerebra, and provided the following recommendations:

• Accounting records and closing transactions are performed by the accounting officer to be hired by the Company, and Cerebra controls these works,
• Preparation and submission of tax returns are performed by Cerebra,
• Issuing sales invoices, payment, cash flow, and debt/receivable follow-up are performed by the Company’s accounting officer,
• Payrolls are prepared by the human resources officer hired by the company and checked by Cerebra,
• SSI notifications are prepared by the human resources officer hired by the company and checked by Cerebra,
• Preparation of monthly IFRS management reporting by Cerebra.
• Preparation of annual activity and affiliation reports by Cerebra,
• Cerebra supports the preparation of the company budget,
• Cerebra supports during the independent audit process of annual IFRS financial statements.

After the business plan was developed, the Company’s General Manager began searching for personnel who could handle these tasks and shared the resumes of applicants with Cerebra to obtain independent opinion on the suitability of these candidates for the positions. Subsequently, one of Cerebra’s partners interviewed the candidates and informed the General Manager of their recommendations, providing support to ensure the General Manager selected the right individuals for the hiring process.

As the software to be used internally by the Company, Logo, which is also used by Cerebra, was recommended. The service provider working with Cerebra supported the Company with the installation of the software, provided the necessary training, and assisted in transferring records from Cerebra’s Logo software to the Company’s own software.

The company experienced several changes in the accounting supervisor initially hired and the Financial Affairs Managers later appointed to oversee these tasks. Until replacements were found, Cerebra took over the responsibilities, ensuring that the tasks were carried out smoothly.

Cerebra continues to provide services to the Company, including reviewing records maintained by the Company’s accounting officer, overseeing closing procedures and prepared tax returns, preparing inflation adjustment entries, and offering additional support to the team as needed.

 OUR IMPACT

 Cerebra’s solutions have helped the Company avoid the following costs during the establishment phase:

• Team setup costs,
• Employee payroll costs,
• Cost of purchasing/installing new accounting software.

 Cerebra has also provided the following benefits since the establishment:

• Cerebra’s solutions ensured that the General Manager could be confident in the accurate management of accounting, payroll, tax compliance, and reporting processes, allowing for proper management of the Company based on the results.
• It enabled them to work with a business partner they could trust as an independent and competent company. 

After the decision to handle financial operations in-house, Cerebra provided the following benefits:

• Ensured that the process was managed correctly with their suggestions.
• Supported the General Manager by ensuring that the right people were selected during recruitment process.
• By controlling the work done, they eliminated the General Manager’s concern about whether the work was done accurately or not.
• With their competence in IFRS reporting, they ensured that reports were prepared accurately and on time and used in decision-making mechanisms.
• The CPA and reporting and advisory team (having independent audit experience) of Cerebra, kept the Company informed about developments in the Tax Procedure Law/SSI Regulations/IFRS, ensuring that the Company remained up-to-date.
• Cerebra facilitated a smooth transition by enabling the Company to use Logo, the accounting software also utilized by Cerebra, as its internal software.
• Until new employees were hired to replace those who left the Company, Cerebra took over the tasks to ensure that operations continued smoothly.
• Cerebra’s accumulated knowledge since the company’s establishment greatly benefited the Company by training and properly guiding new employees.

As a result of all these efforts, the Company management views Cerebra as a reliable business partner they can consult in challenging times, receive support from, and always count on.