How To Perfect Your Telecom Audit Process

by Nermine Shaker

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Published on this site: August 3rd, 2009 - See more articles from this month

Telecom audit is an important process for any organization. Human error, failure to pay close attention to details, constraint of time in checking long telecom bills, and insufficient knowledge of new technology and regulations - these mistakes can take a toll on the revenue of a company. Avoiding all these potential problems is an integral part of the expense management of an organization. Many small losses can add up to a huge amount. In order to curb this waste, organizations can either use an automated telecom audit tool, a Telecom Management professional, or a combination of the two.

Telecom audit is a process that helps to detect and reveal even the smallest errors that waste money. Thus, it provides an opportunity not only to recover lost revenue, but also ensures that errors are not repeated.

Telecom audit ideally has three stages:

1. Acquiring Documents to Create an Inventory Database:
   
   The first stage involves the collection of telecom invoices. These invoices show the costs over time and the customer records. Telecom audit companies at times use software in this stage that both acts as a database and helps in analyzing trends.
   
   Depending on the size of your company, just collecting these invoices could be a very time-consuming job. Start with the local phone bills and work outward. The long distance bills may be on the same invoice or billed separately. Wireless services can be billed as a group or individual accounts. Check to see if each bill matches with a known phone. For Internet service bills, they may be on a separate bill or, if the local provider offers broadband with local service, they may be with the local phone invoice.
   
   The next thing to collect is voice and data service contracts. These include local and long distance service, wireless phones, telecom equipment and any maintenance service agreements.
   
   Make the time to request your Customer Service Records (CSRs) from your provider. Your providers may take a few weeks to get to your requests, but it's worth the wait. These records contain your unique data that will ultimately be the foundation of your telecom audit. They are written in Universal Service Order Codes (USOC) and they are an itemized listing of all your lines, services, and features.
   
   You should also gather any agreements for Directory Advertising or Yellow Pages. If your company is large, sometimes a publicity or advertising department handles these agreements. The documents are important because they will specify the rates that apply to all advertising, when it was ordered and by whom.
   
   Other documents to get access to are tariffs. Tariffs are the provider's official documents that break down all the rules, service offers, rates, etc. that they offer. You can find these rules on your provider's website. Also gather any tax information that applies to your company. Charities, schools, churches, and some nonprofit organizations may be exempt from state and/or federal taxes.
   
   
2. Analyzing All the Data:
   
   The second stage of audit involves the comparison of inventory costs against pricing plans. And the first thing required is an inventory audit. In this section, you look at your organization's inventory of telecom assets. Instead of looking for spot errors, this kind of telecom audit looks for trend information. This data aids the company in deciding whether it needs to expand its telecom resources or to re-deploy its existing resources.
   
   Now a comparison of cost against pricing plans can be made. Here's where a telecom audit firm can be very helpful. They keep a record of current pricing and tariff changes. With the help of these records and databases, the audit firms can provide a cost effective plan for their clients.
   
   
3. Reporting and Recommendations:
   
   The third and crucial stage involves reports and recommendations. If you are doing this audit yourself, after looking at all the data, this is where you decide where you might be able to save money. A telecom audit firm will also give you their reports and recommendations at this time. Along with the presentation of their reports and analysis, they also give their suggestions for improvements and savings that have been identified in the process.
   
   They may find errors in you bills and suggest disputing some charges. They may find credits you never received and apply for refunds for you. Today's telecom bills contain many errors that you won't find unless you do an audit.
   
   Since billing errors play havoc on draining the organization's capital, partnering with companies that provide solutions to check such errors is becoming increasingly popular. When using a telecom-auditing firm, there are two ways to approach it. One of them is the 'contingency' method, where the telecom audit firms receive a percentage of the money they saved clients. The second can be a 'fixed fee' approach. Generally, small and medium firms go for the contingency process, whereas large firms go for the second approach, as it is easier to manage.
   

No matter which approach a firm takes, one thing that needs to be kept in mind is that telecom audits should be conducted by both big and small businesses to keep a check on their expenses. The telecom audit process is complex and time-consuming, but fortunately, there are companies that provide such services, and instituting a regular telecom audit can ensure cost optimization for any firm, and almost surely improve its bottom line.

Nermine Shaker has generated millions of dollars worth of savings for her clients. She is a Partner at THE SYGNAL GROUP, a Telecom Management Company that offers unbiased reporting, analysis and implementation of telecom strategies to businesses of all sizes.