Telecom Management (TEM) 3 Steps to Auditing Your Bills

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One of the first steps in any telecom expense management program is to audit your bills. The common way this occurs is for a firm to hire a telecommunications bill auditing consultancy have them look at the bills and contracts, compare the rates and see if you are being billed correctly. The telecom auditor usually takes a percentage of the findings as their fee. The audit is a pretty straight forward value proposition it costs you nothing unless the telecommunications auditor finds something.

But what if the auditor does find something, something big? Will you be in a position to go to your CFO for a big commission payment to the auditor for finding a billing error on your watch? That might be an uncomfortable situation. To ensure that nothing too big will be found during an audit, you may want to conduct an internal telecom audit of your own.

Follow these three steps to do a basic telecom audit and you will be well along the way to reducing your telecom costs and engaging an auditor for a more detailed review with confidence.

1. When was your contract negotiated last? This is important because the older your contract, them more chances for error and opportunity for rate reductions. If your contract is more than 3 years old, renegotiating or looking for alternative providers may yield considerable savings. Auditors will sometimes include these savings in their findings, so you will be better off determining whether your rates are competitive now. Call a telecom consultant (one who does not work on contingency) for a quick benchmark for rates. This will give you a good idea where the market is and whether a savings opportunity exists.

2. Determine where most of your spending is on your bill. If you have considerable long-distance usage charges, focus on your rate per minute. If you have higher monthly recurring charge, you will focus on the cost per service per location. You can do a quick effective toll charge rate per minute analysis using the summary reports on your bill. If your effective rate per minute is considerably higher than the benchmark, or some effective rates just do not make sense, you have just identified an area of further review. Pull out the contract and make sure the state contract rate is close to your effective rate. Sometimes a contract will just state a discount rate. Make sure you are getting your appropriate discount and call your account manager to confirm the base rate (frequently referred to as the tariff rate even though most rates have been de-tariffed).

On the monthly recurring side, do an analysis on a per circuit basis does the average make sense? Be sure to include only like services, T1s should not be mixed with DSL or T3s. Again, getting a benchmark from an industry consultant is easy and can help you quickly determine if you are in the ball park.

3. Look at your toll and local traffic mix. Do you have lots of switched traffic that might be consolidated onto a dedicated facility? (BTW, this is much easier with competitive carriers!) Do you have toll free services that can also be moved? Dedicated rates are typically less than half the comparable switched rate. So, consolidating your toll traffic onto dedicated services are extremely profitable activities.

Once you have reviewed the largest areas of spend on your telecom bill at a high level, you can move forward with confidence on a more detailed review by a qualified auditor. The audit may still find issues with the services you reviewed, but the findings should be smaller and will be in areas that require specific expertise.

Using a telecom expense management (TEM) system can keep your telecommunications spending in check over the long-term, reducing the need for audits and providing a comfort level that your telecommunications bills are accurate.

Article Source: http://depositarticles.com/

For more information and a free telecom management application, go to www.my-tem.com. my-tem.com provides simple free telecommunications management solutions.

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