ESAB-SVEL (ERP system)

Project Tasks

ESAB-SVEL Ltd is the joint Swedish-Russian venture for production of high-quality welding electrodes of the Russian and Swedish brands. The company is included into ESAB concern – the world leader in equipment manufacturing and supplies for welding.

By a certain moment of development of the company automatic formation of the corporate reporting according to IFRS was required, but the existing system of accounting did not support such opportunity. It became the main premises for transition to new, more productive information system. After the analysis of business processes the management of ESAB-SVEL Ltd came to a conclusion that such software product which would allow to create a common information space where accounting, production and operational account, formation of the corporate reporting and budgeting will be kept is necessary for the company.

Project Steps

• development of model of accounting
• modeling of accounting according to IFRS
• transfer of a remaining balance on accounting
• programming of a system of accounting
• start of a subsystem of accounting and tax accounting in trial operation
• completion of works on automation of formation of the corporate reporting and delivery of a subsystem in commercial operation

Project Effect

30 jobs are automated.

Within the first stage the following sections of accounting according to corporate standards were automated:

1. расчет and charge of inventory reserves
2. расчет and charge of reserves on receivables depending on term
3. учет stocks
4. учет fixed assets
5. учет costs in classification of ESAB corporation
6. расчет cost values of finished goods

Cost accounting of finished goods by the standard-kosting method became feature of a reporting preparation according to corporate standards of ESAB concern. Automation of accounting allowed to analyze efficiency of use of resources, to control product quality and to calculate its cost on several components, significantly accelerated calculation of deviations for inventory cost, direct and laid on costs according to standards of the head company. As a result it is possible to keep track of transparency of formation of cost of finished goods and to see all deviations from its cost value: so the management estimates economy or overexpenditures of the company.

Customer Feedback on the Project

Chief financial officer of ESAB-SVEL Ltd Bunina Natalya Vasilyevna: "Expenses on acquisition of materials at us make 75 percent of product cost, it is essential value. Therefore for us it was very important to implement in a new system a possibility of the analysis of their cost on different components – at the purchase price, currency rate, transportation, customs costs. Now, comparing the actual result to budget, I can see on what components we received deviations and also how effectively we use the purchased materials in production. I expect the project final: an important stage for us is implementation of a budgeting subsystem as it will give the chance to use different scenarios of forecasting and will allow to react to the developed economic situation quickly. In present economic conditions it is especially important".

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