Unilever Revenue Cycle

WORD AUTHOR

We are going to give thanks to our God for all blessing has given. Because

without it we can doing nothing and can’t be able to finished this modul assignment on

time.

And then, we say a big thanks to our lectures Mrs. Idrianita who helped us in so

many times to finished this assignment and give so many advice to make this paper

looking better. We’re not forget to give thanks to all people who help us in thousand

ways because they give us another knowledge we need and build a motivation between

us.

In this paper we know that we have a great teamwork in it because we work and

solve the problems happened together. So it’s realize how important this modul

assignment for us to implementation our learning activities during this time.

Because of we’re on our way to learn, we know that in this paper there are so

many weakness, therefore we need critic and suggestion for the next to be better. Thank

you for your attention.

Jakarta, 07 January 2010

AUTHOR

PT Unilever | Accounting Information System 1

CHAPTER 1

I.1 BACKGROUND

Accounting Information System is from “Accounting”, “Information”, and

“System” word. Accounting is recording economic data. Information is intelligence that

is meaningful and useful to person for whom it is intended. System is unified group of

interacting parts that function together to achieve its purposes. So we can conclude

Accounting Information System is a unfied structure within an entity, such as a business

firm, that employs physical resources and other components to transform economic data

into accounting information, with the purpose of satisfying the information needs of a

variety of users. Accounting Information System was so important because it can support

the day-to-day operation, and to support decision making by internal decision.

In Accounting Information System we can learn the type of the company

transaction, flowchart, the document that we needed, etc which help us to understand the

company activities and to know the weakness and can evaluate the transaction cycle of

the company. In this paper our group will be explain about the one of transaction cycle in

PT Unilever Indonesia, we decide to analyze PT Unilever Indonesia’s revenue cycle as

our topic because as we know PT Unilever Indonesia is a big company in consumer

goods, and off course have own revenue cycle. From this paper we want to learn more

about revenue cycle, and how to analyze it


I.2 METHODOLOGY

The process of making this module assignment is adopted by looking for

all of the information about PT .Unilever.Tbk through internet in several websites.

And made an interview with the people who work at PT Unilever Indonesia who

related with revenue cycle]

Besides that, the method that we use was completed by adopting the

theories in the text book that we usually use for discussing about the objects, that

is Accounting Information System by Wilkinson Cerullo Raval Wong-On-Wing 4th

Edition. Additionally, we also ask to the lecturers who always willingly give the

information to us and help us along the way


CHAPTER II

II.1 THEORIES

The revenue cycle encompasses three key business events or transactions :

solicitation of projects, project execution and delivery (sales), and cash receipts.

Revenue cycles tend to be similar for all type of firms, from merchandising firms to

manufacturing firms to service firms. Howeverr, detils differ with respect to the ways the

products or services are delivered and the timing of the payments by the customers.

There’re two subsystems perform the processing steps within the revenue cycle : (1) the

sales processing system, and (2) the cash receipts processing system

The objectives within this broad purpose are:

1. To record sales orders promptly and accurately

2. To verify that the customers are worthy of credit

3. To ship the products or to perform the services by agreed dates

4. To bill for products or services in a timely and accurate manner

5. To record and classify cash receipts promptly and accurately

6. To post sales and cash receipts to proper customers’ account in the accounts

receivable ledger

7. To safeguard products until shipped

8. To safeguard cash until deposited

But, for the essential purpose of revenue cycle is to facilitate the exchange of products or

services with customers for cash.

This is a process of revenue cycle

1. DATA INPUT


DATA INPUTDATA

PROCESSINGINFORMATIO

N OUTPUT

2. DATA PROCESSING

There’re two kind of systems described in this process : Credit Sales

Processing and Cash Receipts Processing System.

THIS’S PROCESS FOR CREDIT SALES

THIS’S PROCESS FOR CASH RECEIPTS


FOR SALES PROCESSING SYSTEM

Customers OrderSales OrderOrder AcknowledgmentPicking ListPacking SlipBilling of LadingShipping NoticeSales Invoive

FOR CASH RECEIPTS PROCESSING SYSTEM

Remittance AdviceDeposit SlipBack OrderCredit MemoCredit ApplicationSalesperson Call ReportDeliquent NoticeWrite-Off NoticeCash Register Receipts

ORDER ENTRY SHIPPING

PREPARE ANLYZE AND

REPORT

BILLING

HANDLING SALES RETURN &

ALLOWANCE

PROCESSING BACK ORDERS

REMITTENCE ENTRY

DEPOSITING RECEIPTS

POSTING RECEIPTS

PREPARING ANALYZE AND

REPORT

COLLECTING DELIQUENT ACCOUNTS

3. INFORMATION OUTPUT

Reports generated as an integral part or byproduct of revenue cycle processing

are needed to conduct a firm’s operations and to aid in planning and control

decisions. In revenue cycle these output focuses on operational listings and

reports, inquiry display screens, scheduled managerial reports and demand

managerial reports.

Then, we’re going to show several symbol using in revenue cycle

Then, another key which is important is data management. Data management is the data

base which supporting the revenue cycle contains data pertaining to revenue-related

resources, key events and principal agents. It also reflects the relationship among these

basic entities. And to manage the data, a company may employ a file-oriented approach

or data-base approach. And after that, the risk and exposures happen in the company is

related with how can the company managing all the activities in especially in activities

related with revenue-cycle.


HARD-COPY DOCUMENTS MANU

AL DOC.FOLDER

DATA FILE

SOFTWARE

DATA STORED ONLINE

MANUAL INPUT

ONLINE DISPLAY

DATA ON PUNCHED

connector DECISION POINT

II.2 COMPANY PROFILE

Unilever Indonesia has grown to be a leading company of Home and Personal

Care as well as Foods and Ice Cream products in Indonesia. Total of PT Unilever

Indonesia are about 3000 employees and 25000 labor. PT Unilever Indonesia Tbk

engages in the manufacture, marketing, and distribution of consumer goods in Indonesia.

The company’s products include soaps, detergents, margarine, dairy based foods, ice

creams, cosmetic products, tea based beverages, and fruit juices, as well as edible oil and

snacks. It offers food products under the Bango, Blue Band, Royco, Sariwangi, Taro, and

Wall's brand names; home care products under the Rinso and Sunlight; and personal care

products under the Axe, Citra, Clear, Lifebuoy, Lux, Pepsodent, Pond's, Rexona, and

Sunsilk brand names. The Company owns six factories in Jababeka Industrial Estate,

Cikarang, Bekasi and two factories in Rungkut Industrial Estate, Surabaya, East Java,

with its head office in Jakarta. Its products consist of about 32 key brands and 700 SKUs

which are sold through a network of about 370 independent distributors covering

hundreds of thousands of outlets throughout Indonesia. Products are distributed through

its own central distribution centres, satellite warehouses, depots and other facilities.


Purposes and principles of PT Unilever Indonesia are:

Always working with integrity

Positive impact

Continuous commitment

Setting out our aspirations

Working with others

The four pillars of our vision set out the long term direction for the company – where we

want to go and how we are going to get there:

We work to create a better future every day

We help people feel good, look good and get more out of life with brands and

services that are good for them and good for others.

We will inspire people to take small everyday actions that can add up to a big

difference for the world.

We will develop new ways of doing business with the aim of doubling the size of

our company while reducing our environmental impact.


CHAPTER IIIANALYZE

III.1 OPERATIONAL ACTIVITY

PT Unilever Indonesia operational activity dayly:

Manufacturing : its means that PT Unilever Indonesia everday produce the

consumer goods product, such as foods, toiletries, etc. They have six

factories in Indonesia to produce all of their product

Marketing : after produce the product PT Unilever Indonesia will think

how to market the product in all of Indonesia, they have a motto that “how

to make Unilever’s product became closer to the customer” so they think

how to market their product not just for the people who have high income

or middle-up people but Unilever must thinking about how to market the

product to the people in middle-low too, and one of the strategies is they

make a small package or sachet with lower price.

Distribution of consumer goods in Indonesia: as we know there are so

many unreachable area at Indonesia, such as kampung, village, etc. PT

Unilever Indonesia has a motto that they want to “make our product closer

to the customer” so they make a coorporation with distributor, and

distributor will distribute the product to every place in Indonesia.

III.2.2 THE REVENUE CYCLE


As we know there are 6 type of transaction cycle, but in this paper we will explain

about revenue cycle of PT Unilever Indonesia. The conduct of the transaction is first,

logistic will obtain the plan order and will make and enter despact note based on the plan

order to the warehouse, after warehouse take the goods based on the despact note,

warehouse will give the goods to the shipping, the shipper will assemble the goods for

shipment, but before shipping the goods, the shipper will make a delivery plan together

with budgeting and cash planning department (delivery plan happen when first shipping

to the new distributor or there are change of planning because of constraint). After make

delivery plan, the shipper will shipping the goods to the distributor and the inventory

control will maintaining the records pertaining to inventory balances. After the goods has

been received by the distributor the shipper will take back with the POD despact note and

give it to logistic, and logistic will make a casefill and will transfer it to the billing to

make an invoice. After invoice has been sent, account receivable department (accounting)

will maintain the account receivable and send the result to the debt collection, when debt

collection receive bank statement, debt collection will maintain A/R and make a report.

III.3 DOCUMENTATION NEEDED TO SUPPORT THE REVENUE CYCLE

Plan order : Almost same like sales order, but this document is in computer

database and the content is amount the stock that distributor needed

Despacth note : Same with delivery order that the contain is name of the goods

and amount of the goods that order

POD despacth note : the despact note that has been signatured by head shed

Sales Invoice : The document that is sent to the customer to reflect the amount the

sales

Billing statement: The document that content is the amount of distributor bank

guarantee vs the amount of distributor bill

Distributor debt position : the position of distributor’s debt

Cash receipts transaction file (bank statement): contains data relating to the

payment from credit customer

III.4 DATA MANAGEMENT


File-oriented approach

The name of document that fileioriented approach is despacth note, POD despacth

note, sales invoice.

Date-base approach

Plan order, billing statement, distributor debt position

III.5.2 EXPLANATION


Unilever has a different revenue cycle from the other company, especially in their

system like plan order system which is plan order system is the system that the PT

Unilever has a plan for distribution order, PT Unilever can know the amount of the stock

that distributor needed because PT Unilever has a system that can see the distributor’s

warehouse. After logistic department receive the distributor’s plan order, they will sent

the plan order’s copy to distributor by EDI (Electronic Data Interchange) which is useful

for the distributor to compared the despact note that they will be receive. And then they

make 3 copies of despacth note based on plan order. Based on despacth note the

warehouse’s employee take the goods from the warehouse. Two copies of despacth note

will be sent to shipping department to accompany the goods that they will ship to

distributor, and the remains of despacth note (first copy) will be filed. After the shipper

arrive at distributor, the shipper will ask the head shed’s signature, its means that the

goods has approved, or in PT Unilever its called POD (Approved Delivery). And the one

of the despacth note that shipper bring will be given to the distibutor for their file. After

the shipper receive the POD despact note and done to ship the goods, they will take back

the remains of the POD despact note and will be given to the warehouse again. In this

case is POD employee, the POD employee will compare the POD despact note with plan

order based on the plan order number (to the clearly you can see the attachment

“despacth note), in PT Unilever its called “casefill”. After make the casefill the POD

employees will be transfer the casefill result to the billing departement for their activity to

make the invoice. Billing department will make 3-copies of invoice, the first one will be

sent to the distributor, the second one will be filed by the billing departement, and the last

will be sent to the accounting department for journal transaction and make the billing

statement. After accounting employee make the billing statement they will transfer the

data to debt collection department. For the payment the distributor will transfer the

money to PT Unilever’s account. The debt collector employee will be see the payment

with use online way, so PT Unilever can open bank’s website use the password and see

the distributor payment activities. After that debt collection will compare the billing

statement with the bank statement and make the distributor debt position.


III.6 INTERNALCONTROL

Control environment

The Code of Business Principle, which sets standards of professionalism

and integrity for its operations worlwide, is Unilever’s statement of values and

represent the standard of conduct they require from all of their employee. So PT

Unilever will not carelessly when they want to recruit the employee, and there’s

no nepotism in PT Unilever, just the employee who has an integrity, creativity,

profesionalm, and has good attitude and behavior who can work in this company.

PT Unilever strive to create an environment or culture that minimize the

occurence of fraudulent financial reporting and other wrongdoing like setting of

ethical behavior by following a personal code of ethics. In PT Unilver Indonesia

their Code of Ethics applies to the senior executive, financial and accounting

officers. And for the organisational structure, the Board have established a clear

organisational structure which includes a delegation of authorities.

Business Risk assessment

The Audit committe reviews the key risks affecting the bussiness four

times a year and the Board review the risks as a part of the forecast and annual

financial plan. The regions, category and functions provide inputs to this process

and actions are put into place to mitigate the identified risks. Risk reporting covers

the perceived risk, assessed impact and the effectiveness of controls to mitigate

these risks.

Control activities

The implementation of and compliance with their governance structure is

facilitated through a business-orianted policy framework. Unilever policies are

universally applicable within Unilever group. They are mandatory and have been

developed to ensure consistency in all material respects amongst worldwide

operations in key areas. They cover operational and functional matters, and

govern how they run their business, to help ensure they comply with applicable

laws and regulations. Key Unilever policies include the Compliance Manual for


the Listing Rules and Disclosure and Transparency Rules (including the Unilever

Share Dealing Code), the Risk Management Policy, the Corporate Pension Policy

and the Accounting and Reporting Policy

Information and communication

The information flow in PT Unilever Indonesia are flown from up to the

bottom. The information must be effectively communicated throughout the

organization to all appropiate personel

Monitoring

PT Unilever Indonesia do two kind of monitoring, they are ongoing

monitoring activities, such as random check for inventory, monitoring the

employees perfomance, is it good or not. But besides that PT Unilever Indonesia

also do separate monitoring activities, such as use internal or external audit to

check the financial reports, or do the stock opname.


CHAPTER 4

CONCLUSION AND SUGGESTION

So we can get the conclusion that PT Unilever Indonesia as the company which the

activities is in consumer goods, they have 3 operation activity such as manufacturingm

marketing, and distributing. They have good revenue cycle, besides that they have good

internal control too


Unilever Revenue Cycle

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