Enterprise asset management for

telecommunications companies

EAM: Supporting the Network fixed-asset lifecycle

For todays telecommunications companies, successful enterprise asset management (EAM) is central
to maximizing return and minimizing operating costs related to capital investments.
EAM involves the management of Network fixed assets across departments, locations, facilities, and business units of an
enterprise. Supporting the fixed-asset lifecycle, EAM incorporates planning, purchasing, controls, receipt of goods, warehousing,
testing and configuration, distribution, installation, maintenance and final disposition of physicalcomponents.

1
Buy
Decision

2
Requisition

3
Controls

4
Purchase
Order

5
Goods
Receipt

6
Warehouse

7
Testing &
Configuration

8
Shipping

9
Field
Install

10
Disposition
$

Data
Supply Chain
Network
IT
Tax
ERP Fixed Assets

The effective integration of people,

Financial Reporting
processes, applications and data provides
Finance & Accounting
the necessary foundation for Enterprise Asset
Management to achieve desired cost savings and
Asset Tracking Application
operating efficiencies.
KPMGs Technology Enablement Solutions practice includes experienced telecom
specialists who can help companies assess, design, and integrate leading EAM
processes, technologies, and controls. We use an operational approach that
integrates people, processes, applications and data to achieve desired cost savings,
operating efficiencies and return on assets. This approach is also used to demonstrate
compliance for Sarbanes-Oxley Act (SOX) reporting requirements and International
Financial Reporting Standards (IFRS) involving revenue and cost recognition.
Why KPMG?
KPMG teams have helped major telecom companies around the world to support
their technology and business objectives. For EAM, we take a multi-disciplinary
approach that involves finance, accounting, risk and compliance, operational controls,
external and internal audits, forensics and other key areas.
Equally important, we develop EAM programs that balance near-term needs with longterm sustainability. Near-term needs include tax savings, appropriate inventory valuation
methodologies, interim compensating controls, and the development of effective ways
to identify assets. Long-term sustainability involves organizational restructuring as well as
change management related to process, technology, risk and compliance.

Enterprise asset management for telecommunications companies

EAM and IFRS

IFRS requires physical assets to be depreciated
at the component level, a key issue for telecom
companies supporting landline systems.
KPMGs EAM programs can help companies
address IFRS recognition and measurement
requirements in a number of ways. Physical
network asset data can be captured in real time
and transmitted directly to the fixed assets
module (ledger) of the enterprise resource
planning (ERP) application. In addition, asset
data in the field can be reconstructed to support
restatement, if required. Assets can also be
identified at the component level to support
depreciation. Finally, KPMGs EAM tested
methodologies are designed to provide data in
the format required for systems supporting IFRS.

IFRS, SOX and other regulatory requirements need to be fully

addressed, including the implementation of key controls for
asset acquisitions approval, the development of appropriate
procurement details to substantiate asset costs, and the discrete
identification of assets acquired to substantiate their existence.

Developing a successful EAM program

Project Life Cycle
Project Management

Strategy
and
Planning

Business
Requirements
and
Vendor
Selection

Design

Configure
/Build
/Implement

Go-Live
Support

Risk and Controls/Security & Resiliency

KPMG can help telecom companies develop an integrated yet

flexible EAM program designed to enable business value and
improve risk management.
KPMG professionals use tested methodologies and leading
practices to support the following project stages:

In addition, the EAM program is designed to verify assets and

linkages between network engineering and finance systems.
A physical inventory is needed to establish a baseline inventory
and provide the ongoing physical verification of assets. The
EAM program should also integrate supply chain, finance and
network management systems, along with bar code solutions
to facilitate asset tracking. Finally, EAM program management
needs to be a priority based on active executive sponsorship.
Benefits with KPMG and EAM
With KPMG specialists, an EAM program can deliver the
followingbenefits:
Tax and operational cost savings through leveraged purchasing
power, improved materials management and forecasting,
enhanced financial controls, and more accurate asset valuation

Strategy and planning, with the development of an

application strategy, a business case, organizational change
management requirements, sourcing strategies, and the
establishment of a project management office (PMO)

Improved reporting to management, investors, and

regulators, including decisions based on more reliable
financial information, enhanced support for regulatory and
tax compliance, reduced audit exposure, and established
processes for IFRSreporting

Business requirements, including the identification of

current-state processes, the development of future-state
processes, a gap analysis, and assistance with the selection of
vendors andsystems

Enhanced asset management, including management

by geographic location, better inventory management and
utilization of spares inventory, and improved management of
warranties andrepair

Design, involving both conceptual and logical design along

with the development of a data management strategy
Configure/build/implement, including system, integration
and user acceptance testing, the assessment of data
conversion, and functional conversion plans

Faster service restoration due to the accurate location of

asset listings, visibility to up-to-date spare/test equipment
inventory by location, visibility down to the part revision level
at a site, and comprehensive listings of regulatory and safety
items by location

Go-live support, involving a pre go-live readiness review,

organizational change management, training, knowledge
transfer, and post go-live support.

More effective decision making with the ability to perform

what-if impact scenarios among available alternatives such as
asset classes, asset valuation, depreciation and tax benefits.

As the project moves through each stage, the KPMG team

pays careful attention to critical factors necessary for success.
For example, key stakeholders need to be involved from the
beginning. These stakeholders can include network engineers,
construction managers, network operations professionals,
field technicians, warehouse managers and representatives
from finance, tax and supply chain management. In addition,
Contact us
Joe Incorvati
Managing Director
O: 973-912-6386
M: 732-241-6578
E: jeincorvati@kpmg.com
kpmg.com

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