BMI LLC, a copper manufacturer in Azerbaijan, has successfully adapted its financial statements to comply with international standards, all thanks to funding from the European Union (EU) under the EU4Business Initiative, combined with support from the European Bank for Reconstruction and Development (EBRD).
BMI LLC has been operating in Azerbaijan since 2005 and specialises in the production of copper and copper cables. It is also now fully compliant with stringent International Financial Reporting Standards (IFRS).
In 2014, following the completion of a capex programme aimed at moving the copper plant to an industrial area, as well as a major capacity upgrade programme, the company applied to the EBRD for a loan totalling EUR 10 million.
Through the Advice for Small Businesses programme, the EBRD connected the company with RSM Azerbaijan LLC, a local consultancy providing financial audit services.
- conducted a financial due diligence exercise for the company’s management accounts;
- provided recommendations on potential improvements to the company’s accounting system and financial management;
- provided an analysis of all material items, including fixed assets, inventory, receivables, payables, other assets and liabilities, equity, sales, expenses, and off balance sheet liabilities;
- advised the company on the processes to follow for transition to IFRS and on the implications of differences in accounting principles and reporting requirements between local standards and IFRS.
As a result, the company received the first tranche (EUR 6 million) of the total loan from the EBRD, the remaining EUR 4 million being disbursed in 2016.
With this financing, BMI LLC was able to start negotiations with European suppliers and eventually purchased a new oven at the end of 2015.
The new equipment has helped the company boost productivity by 50%, copper manufacturing increasing to 500 tons per month (up from 250 tons). In 2015, BMI LLC also reported a 30% jump in turnover.
According to company CFO Mr Azer Gambarov, “the project was very successful” and should help the company continue boosting its productivity in the years ahead.