Success with Microsoft Dynamics GP
The management of international mining companies encounter a number of business complexities: operational regulations and tax laws that vary between jurisdictions as well as country-specific languages challenge management’s ability to achieve a profitable and sustainable business.
Polar Star Mining Corporation (TSX: PSR) (“Polar Star”) is a publicly traded exploration and development company with property and mining operations in South America, and a corporate office in Toronto, Canada. Polar Star’s main properties are located in Chile, including the Chepica mine, where gold mining operations provide cash flow to fund exploration at their flagship Montezuma property, as well as other, new exploration throughout Chile. Since its inception in 2003, Polar Star planned to expand from mining exploration and development into production. This goal was reached in 2011.
Accounting & Management Challenges
In 2009, Polar Star identified a need to centralize the collection and reporting of their financial information to a platform that could properly support their distributed locations and resources. Prior to converting to Microsoft Dynamics GP, the operating expenses that were incurred offshore in Chile were entered into a basic, proprietary software system by the local bookkeeping staff. The management team in Toronto had difficulty accessing this data in order to prepare internal and regulatory financial reports on a timely basis.
Prior to implementing GP, the local Chilean finance staff would extract, reformat, and transmit the data to the Canadian staff electronically, on a monthly basis. This usually took several attempts because of miscommunication between English and Spanish-speaking employees in Toronto and Chile, respectively. This caused delays in financial reporting especially with Polar Star already under time constraints to comply with new IFRS (International Financial Reporting Standards) guidelines.
Polar Star needed an accounting system that supported multiple languages and both Canadian and Chilean tax and financial reporting regulations. Management in Toronto needed ongoing timely financial data, and they needed to make these system changes quickly.
The Solution Search
Polar Star’s finance team spoke with numerous mining industry and accounting experts. After reviewing several accounting systems and attending hours of vendor demonstrations, they created a short list of financial systems that met their requirements. Polar Star particularly liked the multilingual and multi-currency capabilities of Microsoft Dynamics GP. GP also offered a flexible chart of account setup to support the expansion of the company’s mining operations. GP had an attractive price point and seamlessly integrated with the Microsoft Office products already used by Polar Star employees.
An online search for Microsoft Dynamics GP providers and consultants in the Toronto area identified Rimrock Corporation as an established Microsoft Gold ERP Partner with considerable experience implementing Microsoft Dynamics GP for the mining industry. Polar Star decided the Rimrock consulting team was a great fit and were certain Rimrock would provide experienced guidance for Polar Star’s complex requirements. Because Dynamics GP is a Microsoft owned and supported tool, the Polar Star team were confident their project goals and requirements would be achieved successfully.
The Dynamics GP Implementation
The Microsoft Dynamics GP implementation at Polar Star’s Canadian head office took only 30 days. It was straightforward, requiring limited configuration to align with existing and anticipated business processes. The business process analysis phase helped Polar Star identify how they could realize productivity gains and where their accounting staff could benefit from additional training. Polar Star analyzed and documented the skill set needed going forward from their accounting staff in order to support the company’s transition to mining production. With this information they were able to attract high quality accountants who had previous experience with Microsoft Dynamics GP.
Rimrock’s implementation team assisted with configuration of the new general ledger accounts and categories, based on knowledge gained from implementing GP at other mining companies. GP facilitated the company’s transition from a chart of accounts supporting solely exploration operations, to a more robust general ledger account structure appropriate for mining production and multiple legal entities. Each individual GP user was set up with language and system access appropriate for their role at Polar Star. Three years of historical accounting details were imported into the GP database, enabling business performance comparisons and improved executive decision making.
During the implementation, Polar Star discovered that they required customized tax reporting to meet Chilean regulatory requirements. Rimrock accommodated this unexpected project task, and according to the Polar Star CFO Adam Rochacewich, “[Rimrock] went the extra mile to make certain the reports were developed and customized correctly”. In order to meet this goal, Rimrock tapped into the global pool of certified GP resources and located Spanish speaking consultants with experience in Chilean tax laws.
Project Results and Goals Achieved
The Rimrock project team successfully implemented Microsoft Dynamics GP within budget, on time and met Polar Star’s accounting process and reporting expectations. Polar Star benefited significantly from Rimrock’s experience with Dynamics GP, SQL database, configuration for an international company structure, and multi-lingual user interfaces.
Microsoft Dynamics GP was up and running prior to Polar Star commencing production at their XYZ mine. GP solved numerous problems Polar Star had been experiencing with their accounting system and decentralized finance team.
- The accounting database is now stored on site at the Canadian head office, but is accessible by users at all global locations.
- The finance team uses a multi-lingual interface and they are able to input data in their first language, making them feel much more confident and comfortable with the solution they use every day.
- Everyone at Polar Star has real-time access to all data and reports, regardless of their location or language, and only according to the security roles they have been assigned.
The new reporting capabilities support Polar Star’s business intelligence and decision-making requirements. Their monthly management reporting is now completed in less than one week. Polar Star’s finance staff uses Management Reporter to review results, prepare forecasts and create financial metrics. Compliance with IFRS is also accomplished with Microsoft Dynamics GP.
The implementation of Microsoft Dynamics GP significantly reduced management’s frustration with the slow transmission of financial data, report creation and decision making. The project results support the company’s evolution to a mining production operation. Polar Star continues to enhance their solution by implementing additional Microsoft Dynamics GP modules that support production operations, including purchase order processing and inventory tracking.