Moscow. 16 January. In January 2003, RAO "UES of Russia" has inaugurated an accounting system based on Oracle E-Business Suite ERP applications.

In 2001-2002, the Holding Company elaborated the "Concept of RAO "UES of Russia" Accounting". This document envisages the development of a new accounting system for business operations, provisionally called "Operational Accounting".

The Operational Accounting system in RAO "UES of Russia" will help create a unified database ensuring interaction between all accounting subsystems.

The operational accounting data is structured so as to meet the requirements of different accounting subsystems, such as book-keeping, taxation, statistical data, and management information, regarding the contents and methods of data presentation. The Operational Accounting database will be used by the accounting (financial), management, taxation, and statistical subsystems to achieve the goals set before each of the subsystems. This is especially important in the context of lack of consistency in the laws and legal acts currently regulating accounting practices of businesses in the Russian Federation. The Operational Accounting system being introduced at the companies of RAO "UES of Russia" is based on a comprehensive approach to the processing of input information, which removes the problem of lack of co-ordination between different kinds of accounting. The new system also helps minimize the professional risks (i.e. risk of human error) involved in different kinds of book-keeping and generation of financial reports. An important benefit from using the Operational Accounting system is the possibility of switching to principally new methods of accounting (financial management) in accordance with IAS. In 2003, RAO "UES of Russia" expects to use this system to prepare its financials under IAS.

The Operational Accounting system of RAO "UES of Russia" uses the ERP applications that are part of Oracle E-Business Suite. Oracle has made a valuable contribution to the success of the project by localizing its product. RAO "UES OF RUSSIA" and Oracle have reached a long-term strategic partnership agreement. An important role in the implementation of the new system has been played by specialists from IBM Business Consulting and PricewaterhouseCoopers.

According to preliminary estimates, the Operational Accounting system using Oracle's ERP applications at energy enterprises will generate savings of several billion Rubles. In addition, the new accounting system will help obtain timely and accurate information, ensure transparency of reports, and ultimately enhance control and management of the Company's business processes.

In the next few years, RAO "UES of Russia" intends to expand the use of the ERP-system at its enterprises. Specifically, in 2003 the Company plans to upgrade the accounting system by adding new modules. Besides, this year the system will be introduced at the Headquarters of OAO "Federal Grid Company" and OAO "UES System Operator – Central Dispatch Authority", and in a number of the Holding Company's energy enterprises.