“RECONCILIATION OF SECURITY DEPOSITS”

An internship report submitted in partial fulfilment of requirements for Masters

of Business Administration (Finance) 2017-2019
 Student Declaration

I hereby declare that this submission is my own work and that, to the best of my knowledge
and belief, it contains no material previously published or written by another person nor
material which has been accepted for the award of any other degree or diploma of the
university or other institute of higher learning, except where due acknowledgment has been
made in the text.

Signature of the student

Acknowledgement

It is my pleasure to be indebted to various people, who directly or indirectly contributed in

the development of this work and who influenced my thinking, behaviour and acts during the
course of study.
I extend my sincere indebtedness to Mr Amit Kumar, Manager Finance at BHARTI AIRTEL LTD.
and Mr Ankit Pandey, Executive Finance BHARTI AIRTEL LTD. who provided their valuable
suggestions and precious time in accomplishing my project.
I also take the opportunity to express my sincere gratitude to each and every person, who
directly and indirectly helped me throughout the project and without anyone of them this
project would not have been possible.
The immense learning from this project would be indelible forever.
Certificate

This is to certify that the summer internship report entitled “RECONCILIATION OF SECURITY
DEPOSITS” submitted by Rishav Sharma to HPUBS, Shimla for partial fulfilment of
requirements for PGDM is a bonafide record to the internship work carried out by his under
my supervision and guidance. The content of the report, in the full or parts have not been
submitted to any other Institute or University for the award of any other degree or diploma.

ss

Amit Kumar
Manager
Bharti Airtel
Table of Contents

1. EXECUTIVE SUMMARY

2. AREA OF INTERNSHIP AND LEARNING OBJECTIVES

3. LEARNING OBJECTIVES

4. INRODUCTION

5. OVERVIEW OF TELECOM INDUSTRY

6. HISTORY OF TELECOM

7. TELECOM SEGMENTS IN INDIA

8. RECENT TRENDS IN THE INDIA TELECOM MARKET

9. An Introduction - SUNIL BHARTI MITTAL

10. COMPANY PROFILE

11. ORGANIZATIONAL STRUCTURE

12. COMPETITORS PROFILE

i. VODAFONE ESSAR

ii. RELIANCE JIO

13. NATIONAL AND INTERNATIONAL IMAGE

14. JOB DESCRIPTION

15. FUNCTIONAL PROFILE

16. GLOBAL PARTNER ACCOUNTING (GPA):

17. FUNCTIONS OF TOCO VENDOR ACCOUNTIG

18. SECURITY DEPOSITS

19. TOWER COMPANIES

20. INVOICE BOOKING

21. PROCESS FLOW

22. VENDOR RECONCILIATION

23. INTERNSHIP AS A LEARNING PROCESS

24. RECOMMENDATIONS

25. BIBLIOGRAPHY
EXECUTIVE SUMMARY

This project was carried out for BHARTI AIRTEL. The objective of the project is to reconcile the
payments of security deposits site wise.

My project topic is “Reconciliation of Security Deposits”. GPA team plays the role of subject
matter expert (SME) within Central shared services (CSS) – Bharti Airtel Limited. Bharti is
having global presence across 20 countries and within India in 23 circles and more than 200
million subscribers and providing these 3G, 2G, 4G, Wi Fi, VAS, etc.

I was given the task of site wise mapping the payments of refundable security deposits. Bharti
Airtel has around 1,80,000 sites. Considering these the volume and diversify of the products
being offered and geographically dispersed business locations. It makes it difficult to have
control and monitoring the varied business transactions. To have better control and
monitoring mechanism Bharti formulated, implemented centralized function and that is
called Central shared service. This model includes a no. of verticals having the central controls
and operating mechanism to address the above challenges with these verticals GPA team is a
vertical which ensures complete analysis of the ToCo partner contracts from implementing
the accounting guidelines as per the professional statutory and regulatory requirements.

GPA vertical looks after end to end Accounting, Analysis, Auditing, Reporting and Presentation
of all the ToCo partners.

GPA team study and analyse the contracts with their ToCo partners. In this capacity GPA team
members needs to analyse, study and understanding the contracts related to the ToCo
partners and the amendments related thereto.

Framing the accounting guidelines and implementation thereof. Based on the end to end
study of the contract accounting guidelines are framed in adherence to IGAP, IFRS, and the
other professional requirements. End to end closure of audit issues are done by GPA team.
All the payments to their partners are done by GPA team.

They follow the process to do this transaction. Before that they do forecasting on monthly
and annually basis.

At the end all the reports of the ToCo partners of Bharti Airtel who supplies equipment and
services to Bharti Airtel are prepared by GPA team. They make a proper format for the
purchase orders, number of sites, payment mechanism, etc. of all their ToCo partners. At the
end GPA team analyse the better cash flow for the Bharti Airtel, network efficiency,
profitability, etc. They make comparison of contractual terms with all their ToCo partners and
analyse which vendor is more profitable for the Bharti Airtel.

AREA OF INTERNSHIP AND LEARNING OBJECTIVES

The field chosen for training is “Account Payables- Global Partner Accounting (GPA)”

The following depicts the area in which internship was being done: -

FINANCE:

All organizations need finance for operating its different activities. So, we can say finance is
just like mind for survival the business in changing economic
environment. Fund, money, saving, cash, reserves and assets are the basic essentials of
finance. Finance word is very deep and in modern age, this word is also known Business
Finance. To create equilibrium in business finance, we used different tools like financial
reporting analysis, financial planning, ratio analysis, cash flow analysis, fund flow
analysis and working capital management analysis.

CORPORATE FINANCE:

Corporate finance includes planning, raising, investing and monitoring of finance in order to
achieve the financial objectives of the company.
1. Planning the Finance
2. Raising the Finance
3. Investing the Finance
4. Monitoring the Finance

Planning the Finance:

The finance management plans the finance of the company. He takes decisions like:
1. How much finance is required by the company?
2. What are the sources of finance?
3. How to use the finance?
4. How to raise the financial profitability?

Raising the Finance:

The finance manager raise (collects) finance for the company. Finance can be collected from
many sources, viz., shares, debentures, banks, financial institutions, creditors, etc.

Investing the Finance:

The finance manager uses the finance in order to achieve the objectives of the company.
These are two types of corporate finance, viz. fixed capital and working capital. Fixed capital
is used to purchase fixed assets like land, building, machinery, etc. While working capital is
used to purchase raw materials. It is also used to pay the day-to-day expenses like salaries,
rent, electricity bills, etc.

Monitoring the finance:

The finance management monitors (i.e. controls and manages) the finance of the company.
He has to minimize the cost of finance. He has to minimize the wastage and misuse of finance.
He has to minimize the risk of investment of finance. He has to get maximum return on the
finance. Monitoring the finance is an art and science. It is a very complex job. There are new
tools and techniques for monitoring funds.
 LEARNING OBJECTIVES

 Learning Network Accounting at Airtel in telecom sector

 Practical aspects of Payable Accounting of ToCo partners
 Analysing and preparing summary for ToCo partner’s contract (Master Service
Agreement).
 Learning Accounting treatment for the transactions made.
 Develop skills required to interact with senior management and staff (for example:
Controller, CFO, managers, senior associates, staff, and office staff) in a professional
manner.
 Develop time management skills and the ability to be responsible for more than one
project at a time.
 Develop organizational skills to complete the project in a timely manner.
 Acquire a broad fundamental knowledge of the theory and practice of business and
corporate finance.
 Develop the skills needed to successfully apply their knowledge in a business
environment.
 Develop the computer skills needed to successfully employ commonly used software
packages (specifically: spreadsheet, word processing and presentation software) in
the performance of their duties as finance professionals.
 Develop the oral and written presentation skills needed to effectively communicate in
a business environment.
  Develop the skills needed to work effectively in a group or task force environment.
 Understanding of all the function processes which is existing at organization.
 Finding the loop holes in the growth of the organization.
 Understanding difference between theoretical knowledge & practical knowledge.
 In the process of training learning more about the AIRTEL, its services, work culture
therein.
 Hoping to become more confident as a professional.

INRODUCTION
OVERVIEW OF TELECOM INDUSTRY

The India telecom market ranks among the fastest growing industries in the country. The
improvement in the standard of living and the development of infrastructure and connectivity
are some of the mains reasons for the significant growth of the telecom industry. The growth
is expected to be more over the years. Presently, there are around 200 million telephone
lines in India which make it the third largest phone network in the world after China and the
US. Today, the telecom market in India enjoys a growth rate of around 45 % which is the
highest in the whole world.

HISTORY OF TELECOM

It was in the year 1851 that the British first introduced telecommunication services in India
through operational land lines near Calcutta. Gradually, the telephone service was made
operational in the year 1881. After independence, the foreign telecommunication companies
were nationalized and the Posts, Telephone and Telegraph (PTT) Company was set up by the
Ministry of Communications. In the year 1985, the Department of Telecommunications (DOT)
was set up to provide domestic and long distance telephone services. In the year 1986, the
government established two companies namely Mahanagar Telephone Nigam Limited
(MTNL) for metropolitan telephone services and Videsh Sanchar Nigam Limited (VSNL) for
international telephone services.
With the economic liberalization in the 1990s, the telecom market in India was also benefited
to a great extent. The service was improved and the tariffs were also significantly lowered.
In the year 1997, the government set up the Telecom Regulatory Authority of India (TRAI) to
provide a comprehensive telecom service in the country. In 1999, modification was brought
to the policy and the cellular services were introduced.

TELECOM SEGMENTS IN INDIA

India telecom market is mainly divided into two major segments namely, the Fixed Service
Provider (FSPs) and the cellular services. Fixed Service Provider network comprises land lines,
basic services, domestic and long distance call service. In most cases, the private basic service
telephone operators cater to offices, business firms, schools and the corporate sector.
In case of the cellular services, there are mainly two sub divisions: Code Division Multiple
Access (CDMA) and Global System for Mobile Communications (GSM). In the GSM sector, the
major players are Vodafone, Airtel, Idea Cellular, and Aircel and so on. The national company
BSNL also has its GSM service named "Cellone" which has a major share in the semi urban
and rural areas. The major companies which dominate the CDMA scenario are Reliance
Communications and Tata Indicom. In both the sectors of cellular services, perfect
competition exists according to the demand supply chain.

RECENT TRENDS IN THE INDIA TELECOM MARKET

The Indian economy is greatly benefited by the growth of the telecom industry in the country.
With the growth in the demand and customer base, more and more multinational companies
are entering the telecom market. Bharti Airtel's net profit dropped by 71.7 per cent to Rs 373
crore in the fourth quarter of 2016-17 as compared to Rs 1,319 crore in the corresponding
period in previous fiscal with the mounting competition from Reliance Jio, a company
statement said.

Bharti Airtel's India revenues dropped by 7.1 per cent, while it gained in the African market
with 2.6 per cent increase in revenue.

For the full financial year 2016-17, its net profit dropped by 37.4 per cent to Rs 3,800 as
compared to Rs 6,077 crore in the previous fiscal.

An Introduction - SUNIL BHARTI MITTAL

Founded the Bharti Group In 1983, Mittal was in an agreement with Germany's Siemens to
manufacture push-button telephone models for the Indian market. In 1986, Mittal
incorporated Bharti Telecom Limited (BTL), and his company became the first in India to offer
push-button telephones, establishing the basis of Bharti Enterprises. By the early 1990s, Sunil
Mittal had also launched the country's first fax machines and its first cordless telephones. In
1992, Mittal won a bid to build a cellular phone network in Delhi. In 1995, Mittal incorporated
the cellular operations as Bharti Tele-Ventures and launched service in Delhi. In 1996, cellular
service was extended to Himachal Pradesh. In 1999, Bharti Enterprises acquired control of JT
Holdings, and extended cellular operations to Karnataka and Andhra Pradesh.

In 2000, Bharti acquired control of Sky cell Communications, in Chennai. In 2001, the company
acquired control of Spice Cell in Calcutta. Bharti Enterprises went public in 2002, and the
company was listed on Bombay Stock Exchange and National Stock Exchange of India.

In 2003, the cellular phone operations were rebranded under the single Airtel brand. In 2004,
Bharti acquired control of Hexacom and entered Rajasthan. In 2005, Bharti extended its
network to Andaman and Nicobar. This expansion allowed it to offer voice services all across
India. In 2009, Airtel launched its first international mobile network in Sri Lanka. In 2010, Airtel
acquired the African operations of the Kuwait based Zain Telecom. In March 2012, Airtel
launched a mobile operation in Rwanda. Today, Airtel is the largest cellular service provider
in India and the third largest in world.

Bharti Airtel Limited is a leading global telecommunications company with operations in 17

countries across Asia and Africa. It was established in July 07, 1995 as a Public Ltd Company.
Headquartered in New Delhi, India. The company ranks amongst the top 3 mobile service
providers globally in terms of subscribers. In India, the company's product offerings include
2G, 3G and 4G wireless services, mobile commerce, fixed line services, high speed DSL
broadband, DTH, enterprise services including national & international long distance services
to carriers. In the rest of the geographies, it offers 2G, 3G, 4G wireless services and mobile
commerce. Bharti Airtel had over 364 million customers across its operations at the end of
December 2016.

VISION
To be globally admired for Telecom Services that delight customers.
MISSION
To meet global standards for telecom services that delight customers through:

 Customer Service focus

 Empowered
 Innovative Services
 Cost Efficiency

VALUES
 Customer- Be responsive towards the needs of the customers.
 People- Trust and respect the employees.
 Learning- Continuously improves services innovatively and expeditiously.
 Community and Partners- Be transparent and sensitive in dealing with all
stakeholders.

COMPANY PROFILE
Date of Establishment - July 7, 1995

Type - Public Limited Company

Revenue - Rs 95,468 (ended March 31, 2017-

Audited)

Chairperson - Sunil Bharti Mittal

MD - Sunil Bharti Mittal

Headquarters - New Delhi, India

Business Operation - Telecommunication - Service Provider

Company Secretary - Mr. Rajendra Chopra

Bankers Auditors - SR Batliboi & Associates

Products - Mobile service, Telemedia Service, Broadband

Internet, Digital Television, E Payment Bank Services

Website - www.airtel.in

ORGANIZATIONAL STRUCTURE
The organizational structure that existed until recently concentrated on the hierarchy of the
operations inside the company as a whole. The structure depicts the corresponding
operation/region of different in-charges and it didn't hold anyone responsible for each of its
services. So, the company found it better to restructure its organizational chart.

The transformed organizational structure will have two distinct Customer Business Units
(CBU) with clear focus on B2C (Business to Customer) and B2B (Business to Business)
segments. Bharti Airtel's B2C business unit will comprehensively service the retail consumers,
homes and small offices, by combining the erstwhile business units—Mobile, Telemedia,
Digital TV, and other emerging businesses (like M-commerce, M-health, M-advertising etc.).
The B2C organization will consist of Consumer Business and Market Operations. It is the
largest telecommunication company in India.

Bharti Airtel organization structure to drive the next phase of company’s growth:-

 Creation of B2C and B2B business verticals for enhanced business efficiency and
employee value.
 Transformation from a ‘technology’ facing organization structure to a ‘customer’
facing one.

 Will provide enhanced empowerment to employees.

PRODUCT
 Landline services

 Mobile services

 Satellite services

 Data and internet services

 E- business services

 Payment Bank Services

COMPETITORS PROFILE

VODAFONE ESSAR

Vodafone Essar, previously Hutchison Essar is a cellular operator in India that covers 16
Telecom circles in India. Despite the official name being Vodafone Essar, its products are
simply branded Vodafone. It offers both prepaid and postpaid GSM cellular phone coverage
throughout India and is especially strong in the major metros.

Vodafone Group is a British multinational telecommunications company headquartered in

London, United Kingdom. It is the world's second-largest mobile telecommunications
company measured by both subscribers and revenues (in each case behind China Mobile)

Vodafone owns and operates networks in over 30 countries and has partner networks in over
40 additional countries. Its Vodafone Global Enterprise division provides telecommunications
and IT services to multinational corporate clients in over 65 countries.

The newly merged Idea-Vodafone(waiting for final approval from DoT) entity will have highest
subscriber base of 41 crore accounting over 35 percent market share and second largest
spectrum holding of 1,850 megahertz in the country. The merger is expected to replace Bharti
Airtel from Numero Uno position which it has maintained in indian telecom market with
highest subscriber at least since last decade4 as per TRAI report.
Reliance Jio

Reliance Jio Infocomm Limited, or Jio, is an LTE mobile network operator in India. It is a wholly
owned subsidiary of Reliance Industries headquartered in Navi Mumbai, Maharashtra that
provides wireless 4G LTE service network (without 2G/3G based services) and is the only
'VoLTE-only' (Voice over LTE) operator in the country which lacks legacy network support of
2G and 3G, with coverage across all 22 telecom circles in India.
The services were first beta-launched to Jio's partners and employees on 27 December 2015
on the eve of 83rd birth anniversary of late Dhirubhai Ambani, founder of Reliance Industries,
and later services were commercially launched on 5 September 2016.
Reliance Jio 4G Broadband

The company will launch its 4G broadband services throughout India in the first quarter of
2016-2017 financial year. It was slated to release in December 2015 after some reports said
that the company was waiting to receive final permits from the government. Mukesh Ambani,
owner of Reliance Industries Limited (RIL) whose Reliance Jio is the telecom subsidiary, had
unveiled details of Jio's fourth-generation (4G) services on 12 June 2015 at RIL's 41st annual
general meeting. It will offer data and voice services with peripheral services like instant
messaging, live TV, movies on demand, news, streaming music, and a digital payments
platform.

The company has a network of more than 250,000 km of fiber optic cables in the country,
over which it will be partnering with local cable operators to get broader connectivity for its
broadband services. With its multi-service operator (MSO) licence, Jio will also serve as a TV
channel distributor and will offer television-on-demand on its network.
NATIONAL AND INTERNATIONAL IMAGE

Bharti Airtel limited is a leading global telecommunications company with operations in 19

countries across Asia and Africa. The company offers mobile voice & data services, fixed line,
high speed broadband, IPTV, DTH, turnkey telecom solutions for enterprises and national &
international long distance services to carriers. Bharti Airtel has been ranked among the six
best performing technology companies in the world by business week. Bharti Airtel had 200
million customers across its operations.

Market share of telecom industries

Bharti Airtel reported strong results for Q4FY18 on the EBITDA and Net Profit front. Revenue
de-grew by 10.5% yoy to Rs19,634cr (expectation Rs19,897cr). EBITDA stood at Rs7,034cr,
down 10% yoy against estimates of Rs6,936cr. EBIDTA margin rose by 21bps yoy to 35.8%.
Net Profit stood at Rs83cr against an expected loss of Rs94cr.
“The management stated that the domestic business remained under pressure due to
reduction of IUC rates as well as competition from Jio. The management aims to address
this revenue shortfall by offering value through content partnerships as well as increasing
data usage. The expansion of VoLTE services is on track and is expected to go nationwide
soon.”

"The deteriorating health of the industry was compounded by the tsunami of incoming voice
traffic from the new operator as a result of which significant investments had to be made just
to carry the incoming traffic on our network," Gopal Vittal, MD and CEO, India and South Asia,
said in a statement.
"Our long term commitment to provide the best experience to our customers continues to
drive all our actions in every single aspect of the business. This belief coupled with brilliant
execution of our people has led to acceleration in market share in an industry that is now
rapidly consolidating," he added.
Domestic mobile user base increased by 11.2% yoy in Q4FY18 to 304.2mn users. Mobile user
base in Africa grew by 11.5% to 89.3mn users.
The consolidated total revenues in the quarter ended March 31, 2017, was at Rs 21,935 crore,
down 8.8 per cent as compared to the corresponding period in 2015-16.
Airtel’s African business reported an ARPU of $3 per user a decline of 5.6% qoq. Data usage
for the African business rose by 6.3% qoq to 69,705mn MB.
For the full financial year 2016-17, its net profit dropped by 37.4 per cent to Rs 3,800 as
compared to Rs 6,077 crore in the previous fiscal.
The management has stated that the merger between Bharti Infratel and Indus Towers is
expected to be value accretive for Bharti Infratel shareholders. The company also stated that
they are still exploring the option of unlocking value through listing of the Africa business.
 JOB DESCRIPTION

Job Title: Intern Job Code:

Recommended Salary Grade: Exempt/Non Exempt Status:
Job Family: Finance EEOC:
Division: Higher Education Reports To: Finance Manager
Department: Vendor Accounting- GPA Location: Gurgaon
role
Date: Feb 2019

Summary: The responsibilities undertaken by an intern under Global Partner Accounting

Team (GPA) are as follows:-
 Study of the new contracts.
 Preparing synopsis of the contracts.
 Assigning and preparation of accounting guidelines.
 Monthly closing of the books of accounts.
 Quarterly closing of the books of accounts.
 Quarterly Audit of the books of accounts.
 Payment processing to ToCo partners.

 Review of the journal, ledgers.

Scope and Impact of Job:

The job assigned above will be used for maintaining the books of accounts along-with making
the payments to various partners, Monthly closure as well as for the quarter.
 Required Knowledge and Experience:

 Related Work Experience: Fresher in the field of finance with strong skills in hard core
accountancy. The person may have a prior experience as an intern or in job in finance
department only.
 Formal Education or Equivalent: Bachelor’s degree in commerce and pursuing post-
graduation.
 Skills: Strong Organizational and Persuasive Skills. Excellent Verbal and Written
Communication Skills. Process driven. Goal oriented and ability to work in a target based
environment. Strong skills for MS-Office.

Primary Responsibilities:
 To analyse the contracts of ToCo partners within a given period of time with full efficiency.
 To cope up with the team and work accordingly.
 To sort the financial and nonfinancial terms from the contracts.
FUNCTIONAL PROFILE

Airtel has agreement with telecom tower companies (like Indus towers, Bharti Infratel limited
etc) whereby Airtel takes tower sites from these companies on standalone/sharing basis along
with other operators. Under this agreement, Airtel has to pay rent, energy and other charges
as mentioned in respective agreements on a monthly basis.

GLOBAL PARTNER ACCOUNTING (GPA):

GPA stands for Global Partner Accounting team. As is implies from its name itself. Bharti is
having global presence across 20 countries and within India in 23 circles and more than 273.65
million wireless subscribers and providing these 3G, 2G, 4G, Wi Fi, VAS, etc Considering these
the volume and diversify of the products being offered and geographically dispersed business
locations. It makes it difficult to have control and monitoring the varied business transactions.
To have better control and monitoring mechanism Bharti formulated, implemented
centralized function and that is called central shared service. This model includes a no. of
verticals having the central controls and operating mechanism to address the above
challenges with these verticals GPA team is a vertical which ensures complete analysis of the
ToCo partner contracts from implementing the accounting guidelines as per the professional
statutory and regulatory requirements. GPA vertical looks after end to end Accounting,
Analysis, Reporting and Presentation of all the ToCo partners accounting.
Bharti Airtel & Tower Company
Bharti Airtel Ltd has entered as a Master Service Agreement (MSA) with Tower Company. As
per the MSA, the sharing operator is liable to pay charges (Rent, Energy, Costs) towards the
use of passive infrastructure at a site.
SIPOC-Rent provision
A fixed monthly Security Deposit per site is payable to Tower Company for use of passive
infrastructure at the site. The security deposit are agreed based on the location of site, type
of site (GBT, RTT etc) & number of tenancies on the site.

Introduction Tower Companies

Tower companies- Towers is an independently managed company offering passive

infrastructure services to all telecom operators and other wireless services providers such as
broadband service providers. Incorporated in November 2007, Tower companies Towers
Limited has been promoted under a joint venture between entities of Bharti Group including
Bharti Infratel Limited (rendering telecom and tower infrastructure services in India under the
brand name Airtel and Bharti Infratel Limited respectively), Vodafone India (rendering
telecom services under the brand name Vodafone) and Aditya Birla Telecom (rendering
telecom services under the brand name Idea), to render passive infrastructure services to
telecom service providers. Bharti Airtel is partner of many Tower companies all over India for
providing best telecom services in all parts of country. Some of the partner’s of Bharti Airtel
are-

 INDUS Towers
 Reliance Infratel Ltd
 Tower Vision Pvt.Ltd
 CNIL
 Idea Cellular Infrastructure services Ltd
CNIL- Chennai Network Infrastructure Limited (CNIL), a Global Group enterprise, is in the
business of Shared Passive Telecom Infrastructure in India. The company has a portfolio of
towers located across India that will help bringing in connectivity at affordable prices to the
poorest of poor creating a positive impact.

CNIL formed to acquire the tower portfolio business of Aircel. CNIL’s business model of
infrastructure sharing is based on building, owning, operating and maintaining the passive
telecom infrastructure sites capable of hosting multiple service providers. The model enables
the operator to convert their capital expenditure to a fixed and predictable operational
expenditure allowing them to divert precious capital towards core activities.
Infratel- Bharti Infratel Limited is a telecom tower infrastructure service provider that
deploys, owns and manages telecom towers and communication structures, for various
mobile operators. On a consolidated basis, Bharti Infratel is one of the largest tower
infrastructure providers in India, based on the number of towers that the company owns and
operates and the number of towers owned or operated by Indus Towers Limited - a Joint
Venture between Bharti Infratel, Vodafone India and Aditya Birla Telecom, represented by
Bharti Infratel's 42% equity interest in Indus.The business of Bharti Infratel is to acquire, build,
own and operate telecom tower and related infrastructure.

Tower Vision India- Tower Vision India Private Limited (TVI) is the second largest independent
tower management company in India with more than 4,500 sites across the country, which
forms an efficient and high quality portfolio of shareable sites.Tower Vision is an independent
tower management company, providing passive infrastructure services to the wireless
communications industry in India. TVI builds up tower sites for telecom operators on a Build-
Own-Operate basis, which are subsequently offered to other wireless operators for sharing.
TVI’s model is based on long term contracts based on rent, provisioning and O&M fees. The
company has over 39,009 standalone towers across 18 states, and 11 telecom circles in India.

Reliance Infratel Ltd- Reliance Infratel Limited builds, owns, and operates telecommunication
towers, optic fiber cable (OFC) network, and related assets; and provides these passive
infrastructure assets on a shared basis to wireless and other communications service
providers, as well as to non-communications customers under long-term contracts. The
company customers use the space on its telecommunication towers to install active
communication-related equipment and operate their wireless communications networks.
The company was formerly known as Reliance Telecom Infrastructure Limited and changed
its name to Reliance Infratel Limited in January 2008. The company was incorporated in 2001
and is based in Navi Mumbai, India. Reliance Infratel Limited operates as a subsidiary of
Reliance Communications Ltd.
Idea Cellular Infrastructure Ltd- Idea Cellular Infrastructure Services Ltd provides
telecommunication tower infrastructure services in Bihar and Orissa. The company was
incorporated in 2007 and is headquartered in Gandhinagar, India. Idea Cellular Infrastructure
Services Ltd operates as a subsidiary of Idea Cellular Ltd.

FUNCTIONS OF TOCO VENDOR ACCOUNTIG

Study and Analysis of the contracts with the ToCo partners.

Framing the accounting guidelines and implementation thereof.

End to End closure of audit issues.

Reporting related to ToCo partner accounting

Briefly following areas fall within the ambit of GPA profile.

1. Study and Analysis of the contracts with the ToCo partners.

 GPA team plays the role of subject matter expert (SME) within central shared services
(CSS) – Bharti Airtel Limited. In this capacity GPA team members needs to analyse,
study and understanding the contracts related to the ToCo partners and the
amendments related thereto. Further during this process end to end evaluation of the
contract is performed with respect to the porting of financial statements.

2. Framing the accounting guidelines and implementation thereof.

Based on the end to end study of the contract accounting guidelines are framed in
Adherence to IGAP, IFRS, and the other professional requirements. Accounting
Guidelines in only illustrative and different from contract to contract.

3. End to End closure of audit issues.

Bharti Airtel Limited is publishing quarterly audit financial statement as per the SEBI
Requirement. Quarterly audit is comprehensively done by the auditor and hence not
Subject to limited review, this is normally done in case of further organization. The
Reason for the comprehensive review is the complexities of the telecom industry and
large volume of transactions. Due to this reason GPA team is required to continuously
Work closely with the auditors to appreciate and get the audit issues closed timely.

4. Processing of payments:-
I. Forecasting :-There are two types of forecasting which are performed by
GPA team
(a.) Monthly: In this, GPA team forecast that from where they get all the funds
required to pay their ToCo partners at the end of month. I.e. borrowings, loans
from banks, etc.
(b). Annually: At the end of the year in totality they see their dues to the ToCo
Partners and manage funds to pay off.
II. Processing of payments: GPA team makes the payment to their ToCo partners by
following their equipment supply and equipment services process.
 5. Reporting related to ToCo partner accounting.
GPA team makes report after all the transactions made with their vendors. They make
a Proper format for the purchase orders, number of sites, payment mechanism, etc. of all
their ToCo partners. At the end GPA team analyse the better cash flow for the Bharti Airtel,
network efficiency, profitability, etc. They make comparison of contractual terms With all
their ToCo partners and analyse which vendor is more profitable for the Bharti Airtel.

SECURITY DEPOSITS

A monetary deposit given to a lender, seller or landlord as proof of intent. Security deposits
can be either refundable or non-refundable, depending on the terms of the transaction. As
the name implies, the deposit is intended as a measure of security for the recipient. A security
deposit is a sum of money held in trust either as an initial part-payment in a purchasing
process (often used to prevent the seller selling an item to someone else during an agreed
period of time while the buyer verifies the suitability of the item, or arranges finance) - also
known as an earnest payment, or else, in the course of a rental agreement to ensure the
property owner against default by the tenant and for the cost of repair in relation to any
damage explicitly specified in the lease and that did in fact occur.

SECURITY DEPOSIT is the refundable security amount paid to Tower Company/site holder as
per respective agreement.

My project is reconciliation of security deposits. I work with a team of GLOBAL PARTNER

ACCOUNTING TEAM of INDIA in payment processing. My work is to map the payments that
includes energy, rent, diesel, security deposits into site wise as per agreement between
partners.

TERMINOLOGY
Telecom site - It is the location/place from where services are provided to the cellular
operator.
Site owner - It means any third party building owner, structure owner, land owner or owner
of any property having valid existing title for such building/structure/land
Telecommunication equipment - RF antennae system, microwave or transmission antennae
systems, BTS, switching equipment and any other active equipment used for wireless
communication services that may be installed by the Airtel at that site.
Ground Base Tower (GBT) - site composed of a tower erected on land.
Ready for installation (RFI) sites - are the sites where passive infrastructure at site is ready
and is made available to Airtel for installation of its active infrastructure and other equipment.
Ready for Service (RFS) sites - are the sites on which active infrastructure has been installed
and is ready to generate network.

2G RENT- rent to be paid for 2G site falls under this head. 2G site are made “3G/4G” ready
by installing additional active infrastructure equipment. Following parameters are used for
calculating the rent of 2G site:
Standard rent- It is the basic rent which is to be paid for the site and is as per the agreement
terms. The amount payable depends upon whether the site is “GBT” or “RTT” and on the
number of tenants.
Location premium- This is the premium that is payable based on the location of the site. The
agreement mentions “specific percentage” of standard rent to be paid as location premium.
Rental premium- it is divided among all OPCOs sharing the site. Incase site rent paid to
landlord exceeds defined threshold limits, the excess amount is called rental premium.
BASE RENT = STANDARD RENT + LOCATION PREMIUM + RENTAL PREMIUM
TENURE PREMIUM - Tenure premium is based on the tenure of the site. If the tenure of the
site is decreases, then the tenure premium is paid by the Airtel which is a fixed percentage of
the base rent as per the agreement terms. No premium is payable if the tenure of the site is
more than 10 years.
APPLICABLE RENT = BASE RENT + TENURE PREMIUM
SITE RENT LANDLORD – It is the rent paid by the Tower companies to the owner of the site
where tower is erected.
SERVICE LEVEL AGREEMENT (SLA) - The agreement between Airtel and Tower companies
have defined SLA for site performance. Depending on the site performance, rewards and
penalties are calculated as per agreed terms. Rewards and penalties are calculated at the
circle level. After calculations, it shares with the finance.
The purpose is to define the process for accounting of expenditure incurred towards energy
and infrastructure provisioning services provided by tower companies (ToCo’s)
 TOWER COMPANIES

INDUS TOWERS LIMITED BHARTI INFRATEL LIMITED OTHER ToCo’s

ATC
GTL
VODAFONE
BSNL
IDEA

INDUS TOWERS LIMITED- Airtel has entered in an agreement with Indus for energy based
billing on a Fixed Cost Model (FCM) which is renewed every year. Tariff rates are fixed for
electricity and diesel at rates applicable as on 31st march. Thereafter, impact of electricity and
diesel rates fluctuations are adjusted to the fixed rates as per the terms of the contract.
BHARTI INFRATEL LIMITED - Bharti Infratel Limited is a telecom tower infrastructure service
provider that deploys, owns and manages telecom towers and communication structures, for
various mobile operators. It is a wholly owned subsidiary of Bharti Airtel.
OTHER TOWER COMPANIES - AIRTEL is availing tower services from other Tower companies
in all 23 circles. There are around 32 partners which are covered under Other Tower
Companies.

INVOICE BOOKING
PROCESS FLOW

SUPPLIER - Tower companies

INPUT - Invoice
FORM - PM module
OUTPUT – invoice details
CUSTOMER – circle SCM

 Central Tower companies submit invoice as and when to P2P and circle SCM
department.
 P2P and circle SCM will upload site wise details of invoice on property manager along
with scanned copy of invoice.
 Invoice will be approved as per delegation of authority (DOA).

SUPPLIER - SCM
INPUT – Approved Invoice
FORM - Excel
OUTPUT – Approved Invoice
CUSTOMER – IP team
 Auto CMT case to be generated on invoice approval.
SUPPLIER - Oracle
INPUT – Report parameters
FORM - Oracle
OUTPUT – status report
CUSTOMER – circle SCM

 IP team to run auto report and taken the list of invoices that have been approved in
system.

SECURITY DEPOSIT RECONCILIATION

Follow up with vendor for getting monthly statement of accounts (SOA)

Extracting vendor SOA from Airtel books every month

Preparing reconciliation with vendor in specified format

Follow up with vendor for any clarification of any entry in SOA if any

Review of SD reconciliation

Vendor sign off on SD reconciliation prepared

Internship as a Learning Process

The internship period exposed me to practical life. It helped me in applying various concepts
which I have learnt in the class.

My expectation

As I was new to telecom sector, so initially I began with knowing their duties and
responsibilities towards their work. After studying their duties and responsibilities I have seen
how they deal with their partner’s contracts and agreements. So for gaining more knowledge
of the organization I visited more online materials and interacted with my mentor.

Exposure

One of the most significant aspects of internship was being surrounded by a network of
people and divisions whose main mission was to do the Network Accounting.

Responsibilities

The responsibilities assigned as an intern:

 To acquire knowledge of the terminologies and methods that is needed for evaluating
with the ToCo partners contracts.
 On job training of operational activities being done by the GPA team members.
 Learning from the experience and expertise of GPA leadership.
 Learning Accounting Guidelines, operations which are significant in the proper
functioning of an organization in the corporate world.
Terminology of Derivatives

The following terms I have learnt during the internship which is necessary to understand for
dealing with the accounts:-

 ToCo Partners: ToCo partner is a person or group involved in a long term commitment
between two parties for the purpose of achieving specific goals on national level.

 Capex: Capital expenditures are expenditures creating future benefits. A capital

expenditure is incurred when a business spends money either to buy fixed assets or
to add to the value of an existing asset with a useful life that extends beyond
the tax year.

 Opex: OPEX (Operational Expenditure) refers to expenses incurred in the course of

ordinary business, such as sales, general and administrative expenses (and excluding
cost of goods sold - or COGS, taxes, depreciation and interest).

Challenges

The challenges faced during the internship period:

 As I was new to the organization and to the telecom sector and before this I don’t have
any kind of such experience so it was little difficult to adjust in the environment.
 Heavy workload with manager sometimes made it difficult for me to observe them
and analyse the situation.
Successes

There were many achievements like:-

 It was pleasure for me to have a chance to know about Bharti Airtel Limited and work
with their employees.
 It’s great achievement to get practical knowledge.

RECOMMENDATIONS

1. Simplification of payment clearance process: Centralization of payment approval in

here with collection process of vendor to avoid the mismatch at the time of payment
due.
 2. Availability of contract synopsis on E-portal for convenient across and data safety.

3. Switch over to Opex based model from traditional Capex based model to reduce the
capex and debt burden on the balance sheet.

4. Outsourcing of entire passive infra to ToCo partners to increase focus on the key
business growth drive. I.e. subscriber base- growth and value added services.

Bibliography
 Airtel Website : www.airtel.in

 Vodafone Website: www.vodafone.in

 Idea Website : www.ideacellular.com

 https://en.wikipedia.org/wiki/Jio

Reliance Jio

 http://www.newindianexpress.com/business/2017/may/09/bharti-airtels-net-profit-

drops-72-percent-in-q4-2016-17-1603000.html

Recent trends and market share of telecom companies

 http://www.investopedia.com/terms/s/security-deposit.asp#ixzz4mHyRWllN

Security deposit

 www.telecomlead.com

 http://www.airtel.in/airtel-annual-report-2015-16/pdf/annual-report-2015-16.pdf