1. Efficient and sustainable delivery of Government Services in India Leveraging eCommerce
23rd December 2015
EY refers to the global organization, and/or one or more of the independent member firms of Ernst & Young Global Limited

2. India… emerging “e” scenario
1995 … beep….crrrrr…..beep dialup internet services in 6 cities
Today, 25cr+ Internet Users
Growth rate: 38%
Mobile Internet: more than 50%
(Source: DoT, RBI, News Reports)
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Theme presentation

3. eGovernance…NeGP…eDelivery of Services
681b
More than 681b National e-Transactions since 1st Jan 2015 (Source: e-Taal) 31
More than 31 e-Governance MMPs being implemented under NeGP
(Source: DeitY)
POSITION
So what are we hearing in the marketplace about financial reporting?
While the past year’s financial reporting cycle presented challenges for many companies, the process to meet those challenges resulted in more in-depth analyses regarding the application of accounting standards, increase in dialogue between management, the audit committee, internal auditors and external auditors and greater scrutiny from investors and regulators.
In April 2009, CFO Europe Research Services, a unit of CFO Publishing and part of The Economist Group, launched a research project with Ernst & Young to assess how senior finance executives are responding to the downturn and preparing for the future. Based on meetings conducted with management and audit committees around the globe, and supported by a recent survey of CFOs and audit committee members in the European community, the following observations were made:
<Review key survey results>
The transition to more detailed reporting and therefore greater transparency was a positive outcome of the financial crisis, if sometimes challenging to achieve. For example, when CFOs were asked about their perspective on how the content of their annual reports has changed during the last year, a significant proportion told us they had increased the content of their report in several areas, with an increase in coverage of business risk and cash and debt reporting being the two most common areas.
Partly as a result of regulatory requirements and guidance, but also in response to investor requests, published reports and other communications contained more forward-looking information, with additional detail on the judgments taken to assess value, indicating perhaps the future of financial reporting. For example, when CFOs were asked in which areas investors were showing more interest, which ultimately impacted the company’s focus on disclosures, they told us that the three largest areas of increased interest, when compared to the previous year, were business prospects, risk management and cash management.
Company executives and their boards are more focused on their roles and responsibilities and their governance frameworks. When asked about their financial reporting experience, many CFOs indicated they spent more time in discussions with the audit committee this year than in previous years.
Client Discussion Questions
Any questions or comments? How do these responses compare with your perspectives?
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4. e-Commerce Revolution1
500
More than 500 start-ups1(Source: Economic Times) 1.
2. “Rebirth of e-Commerce in India” - 3.
70K cr
More than Rs. 70,000 cr in venture money1(Source: Economic Times)
2015
45K cr
About 125 million shoppers spent Rs. 45,000 cr in 20141(Source: Economic
Times)
650K cr
Estimated value of the Indian e-Commerce Market by FY’2020
(Source: Goldman Sachs report)
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5. India… exponentially growing “e-commerce” scenario
25cr+ Internet Users
Growth rate 38%
Mobile Internet more than 50%
Online Transactions
2013 : 180 lakh
2014 : 250 lakh
2015 : 380 lakh (expected)
Mobile Payments
Rs. 8000cr +
225m transactions
(Source: DoT, RBI, News Reports)
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6. Synergy between Government & e-Commerce players
Partnership
Informational
Synergy between Government & e-Commerce players
Payment Gateways
Transactional
Supply Chain
& Logistics
G2C/G2B
Services
Postal
Services
Authentication
Online Marketplace
Education
POSITION
So what are we hearing in the marketplace about financial reporting?
While the past year’s financial reporting cycle presented challenges for many companies, the process to meet those challenges resulted in more in-depth analyses regarding the application of accounting standards, increase in dialogue between management, the audit committee, internal auditors and external auditors and greater scrutiny from investors and regulators.
In April 2009, CFO Europe Research Services, a unit of CFO Publishing and part of The Economist Group, launched a research project with Ernst & Young to assess how senior finance executives are responding to the downturn and preparing for the future. Based on meetings conducted with management and audit committees around the globe, and supported by a recent survey of CFOs and audit committee members in the European community, the following observations were made:
<Review key survey results>
The transition to more detailed reporting and therefore greater transparency was a positive outcome of the financial crisis, if sometimes challenging to achieve. For example, when CFOs were asked about their perspective on how the content of their annual reports has changed during the last year, a significant proportion told us they had increased the content of their report in several areas, with an increase in coverage of business risk and cash and debt reporting being the two most common areas.
Partly as a result of regulatory requirements and guidance, but also in response to investor requests, published reports and other communications contained more forward-looking information, with additional detail on the judgments taken to assess value, indicating perhaps the future of financial reporting. For example, when CFOs were asked in which areas investors were showing more interest, which ultimately impacted the company’s focus on disclosures, they told us that the three largest areas of increased interest, when compared to the previous year, were business prospects, risk management and cash management.
Company executives and their boards are more focused on their roles and responsibilities and their governance frameworks. When asked about their financial reporting experience, many CFOs indicated they spent more time in discussions with the audit committee this year than in previous years.
Client Discussion Questions
Any questions or comments? How do these responses compare with your perspectives?
Travel
sector
Aggregator
Authentication
Services
e-Commerce
Business models
Health
Social Network selling
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7. Win-win, and, again “win”
Potential of increasing revenues through increased type and volume of transactions
Leveraging the partnership as a means to execute CSR (Corporate Social Responsibility)
Increased Citizen Satisfaction
Can act as a catalyst for increased innovation & system re-engineering to cater to a new world of opportunities
Higher Visibility
Grouping of services around user requirements & behavior patterns
Ease of Use
Tracking
Increased reach of Govt. services / products
POINT OF VIEW
Given the financial challenges facing organizations, we wanted to share with you how we are responding to today’s financial challenges through Ernst & Young’s audit service quality framework. This diagram features three elements:
First, the inner box which starts with the effective implementation of our Global Audit Methodology – which is the core our audit relationship… This includes four major stages – planning and execution; strategy and risk assessment; execution; and conclusion and reporting
Second, the outer yellow ring which focuses on service quality – bringing technical knowledge and industry experience to provide an efficient and effective audit
Third, the inside gray ring which looks at what we see to be the eight elements of an effective audit relationship. You’ll note that these eight elements are based on and consistent with the market feedback we just discussed.
The eight elements include (starting at 12 noon on the diagram)
Right team: Ensure the highest level of technical skills and industry knowledge in our audit teams and include the right specialists from across EY. Build relationship at every level and ensure global capabilities are integrated as a seamless part of the team. Provide consistent resourcing and coordination, within and across teams, and involve senior staff.
Technical expertise: Provide briefings on regulatory changes and engage technical specialists when appropriate.
Industry expertise: Demonstrate knowledge of our client’s industry challenges, and engage industry specialists where appropriate. Communicate industry benchmarks and best practices.
Understand the business: Take a collaborative approach while focusing on our clients’ most immediate needs and financial challenges. Ensure longer term issues are also being addressed. Be collaborative and act as a business partner.
Relevant insight: By applying knowledge of our clients’ business and financial challenges, bring relevant and timely suggestions to both management and the audit committee. Share experiences from our other clients.
Continuous communication: Continuously discuss our clients’ challenges and issues, while being both proactive and reactive. Bring ideas to the table with good, clear solutions. Provide regular communication, extending beyond the completion of assignments.
Deliver permitted services: an integrated approach that brings multi-disciplinary teams together to address your business issues.
Fair fees: Ensure the audit scope and pricing is understood and continually discuss fee-related matters
Client Discussion Questions
Any questions or comments on the framework? Does this effectively portray how we work together?
Higher Effectiveness and Efficiency quotient
Increased transparency and accountability
Theme presentation
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8. Pre-requisites Concerns related to Information Security & Privacy
Identification areas of compliances required as per Govt. norms
Strengthening of back-end processes for smooth provision of services to the e-Commerce platforms
Assessment appropriate pricing of product / services keeping in consideration the wide scale socio-economic impact
Internal capacity building & readiness for the new collaborative model
Re-design/upgrade of existing systems to seamlessly fit and deliver the requisite
Innovative Thinking, Disruptive Ideas, Open Approach
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The onus is on both sides to collaborate, communicate and create new areas for development to provide better , efficient and sustainable services to the citizens

9. Thank You Vikas Aggarwal Executive Director, EY LLP