Assessments:

1. State the nature and background of the specialized industry.

The practice of contracting a specific work process or processes to an external service

provider is known as business process outsourcing (BPO). Payroll, bookkeeping, telemarketing,
data recording, social media marketing, customer service, and more services are available. BPO
services are typically used to fulfill additional — rather than core — corporate activities, and can
be either technical or nontechnical.
Back office and front office services are the two basic categories of BPO services.
Internal company procedures such as billing and purchasing are included in back-office services.
Marketing and technical support are examples of front-office services that pertain to the
contracting company's customers. BPOs have the ability to combine these services so that they
work in concert rather than separately.
2. What are the relevant statistics, and updates of the specialized industry in the Philippine
setting?
The BPO industry is worth more than $300 billion globally. More than 3 million
individuals work for BPO vendors in India, while more than 1 million people work for BPO
vendors in the Philippines. BPO firms in Europe and the United States employ millions more
people. BPO providers can be found all across the world, particularly in underdeveloped
countries with low income taxes. In recent years, South Africa has dominated the BPO business,
particularly in call centers.
One of the main causes for the expansion of BPO in the Philippines has been the
government-led Philippines Development Plan, which has incentivized local and foreign
investments as well as other tax benefits over the years. There have also been other
contributing variables that have had a significant impact on how the BPO industry has shaped
the economy of the island nation.
3. Identify the different audit and accounting considerations and trends for the industry.

Security: Companies confront communication and privacy issues when outsourcing, especially
when information systems (IS) are involved.
Underestimating the costs of services: Companies who use BPO suppliers frequently
underestimate the ongoing costs, particularly when it comes to upgrades and contract
renegotiation.
Overdependence on service providers: When a corporation selects a provider to handle specific
processes, the vendor is now a member of the process.
Communication issues: When your organization hires independent service providers from
throughout the world, language hurdles can impede activity. This can cause delays in new
processes and a reduction in productivity.

4. Look for at least 2-3 audited financial statements of companies under the specialized industry in
the Philippines and list down your observations from audit report to the financial statements.
INFOSYS BPO S.R.O
The financial statements are prepared in accordance with Generally Accepted Accounting
Principles (GAAP) under the historical cost convention on the accrual basis except for certain
financial instruments which are measured at fair values. GAAP comprises mandatory accounting
standards as prescribed by the Companies (Accounting Standards) Rules, 2006, the provisions of
the Companies Act, 1956 and guidelines issued by the Securities and Exchange Board of India
(SEBI). Accounting policies have been consistently applied except where a newly issued
accounting standard is initially adopted or a revision to an existing accounting standard requires
a change in the accounting policy in use.

HCL TECHNOLOGIES PHILIPPINES INC.

The financial statements have been prepared in compliance with Philippine Financial Reporting
Standards (PFRSs). PFRSs are based on International Financial Reporting Standards issued by the
International Accounting Standards Board (IASB). PFRSs which are issued by the Philippine
Financial Reporting Standards Council, consist of PFRSs, Philippine Accounting Standards (PASs),
and Philippine Interpretations. Details of the Company’s accounting policies are included in Note
3. This is the first set of the Company’s annual financial statements in which PFRS 16, Leases has
been applied.