Intercomp Business Practice Conference held in Moscow

Intercomp, one of the leading accounting outsourcing providers in Russia, held another Business Practice Conference on April 05, 2018. Experts and partners gathered this time in one of the conference halls at Ararat Park Hyatt Hotel in Moscow city center. 

Top managers of Russian and foreign companies exchanged their experience in finance, HR management, IT and also found out about the latest changes in the Russian legislation. Speakers presented to a broad audience trends in the development of the Russian economy and labor market and also gave recommendations based on current circumstances and projected conditions for business development in Russia. 

Daniel Thorniley, founder of CEEMEA Business Group, one of our long-standing partners, opened the conference. His outlook on the development of the Russian economy was unexpectedly optimistic. Mr. Thorniley indeed thinks that the Russian market has the potential to become one of the most effective in the world within the next 5 years. With brilliant humor, Daniel shared personal examples of differences in mentality between Russian and foreign professionals and talked about global conditions for effective growth in the Russian economy: reforms, production diversification, attraction of investments, and introduction of innovations.

Ilya Panteleev, Intercomp General Director, presented his study on New Behavioral Economics. 

“The premise of classical economic theory is that people make decisions logically: they seek the greatest benefit and take into account risks, but real life is much more complicated than this economic model. Our decisions are often unpredictable and irrational. Understanding the reasons for the behaviors of others is necessary for commercial success and confers many practical advantages in everyday life” explained Ilya Panteleev.

Ekaterina Ovchinnik, HR Director at Intercomp, presented Intercomp annual salary review. Overall, wages decreased by 3.9% in 2017 compared to 2016. The fixed part of wages was more often than not kept at the same level as 2016, while the variable part of wages (bonus) increased for some categories of employees, remained the same for others and grew only for certain positions. Staff number also grew in the first half of the year up to 5.2% and varied depending on the industries.

“Employers are increasingly considering issues related to pay rise, favoring particularly specific and one-off increases. In other words, the general indexation of wages applied in the noughties tends to be used currently as an HR tool to retain staff. We do not see at the moment any factors that would change this trend in 2018” summed up Ekaterina Ovchinnik.

Elena Rybnikova, Head of Internal Audit, Expertise and Methodology Department at Intercomp, provided a review of the changes in legislation as well as recommendations on risk-free business in Russia. The conference attendees found out that accounting will not be subject to significant changes in 2018 and that a TaxFree law was adopted in Russia so that Russian citizens working abroad can now receive their salary in foreign currency. Elena also talked about HR recordkeeping, salary indexation and investment deduction. The ins and outs of VAT accounting and withholding in Russia was also the subject of an entire presentation.

Nellya Azizova, Head of Financial Outsourcing Department at Intercomp, spoke about the changes in currency legislation to come about in 2018. Nellya talked about the concept of “currency resident” and the prohibition of currency transactions between residents as well as the prohibition to transfer funds derived from the sale of assets and securities. According to Nellya, the system of currency control administration currently in place in Russia is very complex.

Nellya recommended to the conference attendees to “be aware of any violation of currency control rules as not only companies, but also their general director may be fined as a result of such violations. To avoid currency control sanctions, I recommend tightening control over currency transactions: the dates of currency accounting and currency control must coincide. To this end, it is necessary to review internal processes for document approval as well as conduct reconciliation of balances.”

Oksana Oleksyuk, Head of Business Development Department at Intercomp, touched upon two topics at the conference: protection of personal data and state inspections in 2018. Oksana gave examples of collection and processing of personal data in practice and noted that several state authorities (Roskomnadzor, Rostrud, Federal Service for Technical and Export Control, and Federal Security Service) monitor compliance with the requirements for personal data processing so in any company personal data processing needs to be handled with great care. Practical examples of secure information environment and cross-border transfer of personal data in Intercomp were provided in the final section of Oksana’s presentation together with a number of recommendations to all employers.

Oksana described to the conference attendees the main principles of risk-oriented approach to state inspections as well as what should be ready for such inspections in 2018. She also gave practical advice on how to prepare for inspector’s visits.

“I recommend to be ready for inspections every day. To this end, it is necessary to review policies once a year for compliance with current laws and ensure that conditions are duly reflected in all related documents. It would be useful to audit, at least once year or better still every 6 months, HR documents and compliance with procedures for recording HR events” noted the Head of Business DevelopmentDepartment at Intercomp.

Yuri Kolerov, Director of Strategic Projects at Intercomp, talked about our new service “Legal Support to Employees”.

Yuri noted: “In addition to the traditional benefits package, we introduced this year a new service, which already successfully works internally and with our clients. This new service is part of My Intercomp. After launching Legal Support, our employees will find legal information in articles as well as receive oral and written advice from lawyers. This service is in high demand among our clients as it saves time, money and is as useful as a corporate fitness allowance.”

The presentations at the conference were rounded up by Dmitry Petrov, IT Director at Intercomp, who revealed some secrets on the “inner workings” of outsourcing companies and spoke about the particularities of transferring accounting functions to outsourcing in terms of IT processes.

“In addition to the deconstruction of business processes, a number of other questions arise when accounting and HR functions are outsourced. From an IT standpoint, this is very similar to the implementation of a project although there are some differences. As with project implementation, it is important for companies not to lose their uniqueness which gives them a competitive edge as reflected in their business processes. The main difference from project implementation is that the system is set up at the provider rather than the customer so costs such as, for example, installation, repair and maintenance of servers are covered by the outsourcing provider” noted Dmitry.

We regularly hold conferences at the best venues in Moscow and St. Petersburg. Although the analyses and insights of our Macroeconomic Research Center and the opinions of our experts are published on our website and in the press, live interaction with speakers at our conferences invariably remains in high demand among top managers, financial experts, HR specialists and media representatives.