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Ernst & Young (Malaysia) Chooses Microsoft Business Solutions – NAV (Navision) to Manage Their Finances

November 22, 2011

A world-leading accountancy firm implementing a new Practice Management Front Office System picks Microsoft Business Solutions - NAV (NAVISION) as the back-office financial system due to its ease of integration, faster and more accurate reporting and future expansion capabilities.

FACTS

Customer Profile

Ernst & Young (Malaysia) is the largest provider of Professional Services with 13 offices and 2500 employees in Malaysia

Business Situation

Acquisition of a competitor doubled staff size and they needed to find a financial solution to integrate with their new front-office system which needed to be up and running in two months.

Solution

  • Microsoft Business Solutions - NAV (Navision)
  • Financial Ledger
  • Accounts Payable
  • Accounts Receivable
  • Cash Manager

Benefits

  • Seamless integration with front office application
  • Faster and more accurate quarterly closing
  • Flexible base for future expansion

Software and Services

  • Microsoft Windows 2000
  • Microsoft SQL Server

Hardware

Compaq Server with Terminal Services

Users

50 user license for Kuala Lumpur Headquarters

The history of Professional Services firms worldwide has been one of growth, acquisitions and mergers. The firm of Ernst & Young can trace their heritage back to AC Ernst and Arthur Young who worked for separate accountancy firms in the United States of America in the late nineteenth century, but surprisingly, they never met!

Ernst & Young (Malaysia) was established in1909 as the country's first internationally linked public accounting firm and today they are the auditors for over 50% of the companies on the KL Stock Exchange. Most recently, Ernst & Young has taken over the practices of Arthur Anderson in many countries across the world, including Malaysia. Here, this recent acquisition caused the company to double in size to over 2500 staff, who operate from offices in each of the country's 13 states.

Their IT functions fall broadly into three main groups. The key front-end is the Practice Management Application (PMA) which is used by the associates to track time and billing.The IT backbone is the financial and reporting system and finally there is a collection of in-house developed applications for more specialized tasks such as tax preparation, claims and payroll.

ACQUISITIONS CHALLENGE INFORMATION TECHNOLOGY

The takeover of Arthur Anderson happened very quickly. Alex Goh, Ernst & Young (Malaysia)'s Administration and Finance Director was faced with a huge challenge! From the announcement of the acquisition to the actual event was a scant three months.The main problem was that their previous systems were only barely able to cope with the E&Y team of 1400 staff, and that was to grow almost immediately by another 1200.(Anderson had used a global IT system that would "disappear" overnight at the take-over.) Obviously a new and more robust system was needed - quickly!

At the end of May 2002, E&Y started to look into new solutions. Their original goal was to get a one-stop solution that covered everything from front-office to back-end, and have it up and running in two months. One of the key needs was for a multi-site system so that each of their 13 offices in East and West Malaysia could function independently as well as providing shared functions.

Their previous Practice Management Application (PMA) had served them well and the new upgraded version was also evaluated for both the front-office and back-office functions.

Alex continued, "We anticipate that we will be moving to a global reporting system sometime in the next two years so we had to bear that in mind as we looked at the new system.We will definitely need a good tool set in the financials."

A key requirement was the ability to report financials based on two different systems.E&Y global uses the "full-accrual" accounting system, whereas for local reporting in Malaysia the "billing-basis" is used.

Although the PMAs included their own back-office financials, Alex "was not convinced by their story. We needed a lot of functionality, much more than the integrated financials could provide-and i am sure that my management will demand more and more as we move to more global reporting."

The financial solution needed to be able to provide 90% of their needs without modification and be used by other Malaysian companies to handle both book-keeping methods. In addition it must support a high degree of customization when needed and be well supported by good partners. Many of the possible alternatives were "too complex-or too expensive!" said Alex.

A reputable and experienced partner was a very important component and he found that with Synergistic Innovations. Sam Yap, their Managing Director said, "after spending time understanding their needs (both immediate and future), we were convinced that Microsoft Navision was the ideal solution. Microsoft Navision is being used by many customers in Malaysia and is fully compatible with the government's reporting needs." Thus the final solution was to use the upgraded front-office PMA integrated with Microsoft Navision for the back-office financials.

AN AGGRESSIVE DEADLINE

With so many system changes needed, a dual time frame approach was taken. Bernadette Chia, E&Y's Finance Manager, continued the story. "Accurately capturing client data was our first priority. So in August, we installed the new PMA systems in the branch offices and had them run in standalone mode. Then we linked those systems together to give us full countrywide roll-ups." The Microsoft Navision implementation, managed by Synergistic Innovations, followed on a separate timeline.

Their deadline was to produce the quarter end reports for July to September. The challenge was that data from the first part of the quarter was still on the legacy system, and the more recent data was coming in from the new PMA. To handle this, Synergistic Innovations created some templates that enabled the thousands of transactions from the other systems to be simply brought in to Microsoft Navision.

Bernadette set an aggressive goal."Previously, the complete quarter-end process took us a month to shut down the legacy system, process the data and then produce a set of reports." As they gained experience and confidence with Microsoft Navision during the implementation stage, they set a target of October 15-just two weeks to close the books-and they met it! With the first quarter end behind them, there are still some pieces left to implement. For example, Synergistic Innovations will be creating linkages to directly import the PMA data into Microsoft Navision in real time.

JUST THE BEGINNING

Alex believes that there is still too much manual work. "Now that we are up and running,we need to take time to learn the system and tools. We have been very happy with Synergistic Innovations; they have quickly attended to our needs and the partnership has kept us on track."

" The result was amazing! We met our two-week closing target, half the time as before, and i was very pleasantly surprised how clean the data was. Microsoft Navision will enable us to Improve our processes and get us ready for whatever global reporting we will need in the future."

Alex Goh Administration and Finance Director, Ernst & Young(Malaysia)


(From left) Alex Goh, administration and finance director and Bernadette Chia, Finance Manager, Ernst and Young (Malaysia)

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