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what-your-treasury-system-must-do-to-cope-with-the-next-crisis what-your-treasury-system-must-do-to-cope-with-the-next-crisis Presentation Transcript

  • Treasury Hot TopicWhat your treasury system must do to cope with the next crisis
    www.pwc.com
    Thomas Jerolitsch, SunGard
    Hans Candries, PwC
    Gunter Geysens, PwC
  • Agenda
    2
    februari 2011
    Background
    Sungard’s perspective on what your Treasury System must do to cope with the next crisis.
  • The crisis and its effects has led Treasury to consider lessons learned and set its agenda accordingly.
    3
    februari 2011
    Background
    What challenges did the crisis pose for Treasury?
    Liquidity crunch, commodity & FX volatility, counterparty risk, accounting “fair valuation”
    What challenges did the crisis pose for Treasury?
    Liquidity crunch, commodity & FX volatility, counterparty risk, accounting “fair valuation”
    Were we prepared?
    Some were, some weren’t.
    Few had all risk areas adequately covered.
    Were we prepared?
    Some were, some weren’t.
    Few had all risk areas adequately covered.
    What are the long-term Lessons learned?
    “Best Practice” still holds true.
    What do we need to do to implement it in a sustainable way and “make the change stick?”
    What are the long-term Lessons learned?
    “Best Practice” still holds true.
    What do we need to do to implement it in a sustainable way and “make the change stick?”
    What did we change during the crisis?
    Many quick fixes “just to survive”
    Opportunity for treasury to shine
    What did we change during the crisis?
    Many quick fixes “just to survive”
    Opportunity for treasury to shine
  • Liquidity and risk are now at the top of the Treasurer’s agenda – systems are seen as a key enabler.
    4
    februari 2011
    Background
    Key Issues for Treasuries - Source PwC Global Treasury Survey 2010
  • Against the backdrop of increased demands on Treasury, the current technology environment at many companies is lacking.
    • Over-reliance on Excel or manual work-around – Many Treasury organizations utilize a patchwork of systems with limited automated interfaces requiring manual intervention and work-arounds mitigating the benefits of the technology.
    • Sub-optimal use of existing technology – Many companies have historically made poor decisions in technology selection and/or implemented the technology in such a way as to not take advantage of the functional capabilities of the systems.
    • Systems often require information not available – A functioning Treasury usually will need information from outside sources, or information that is not readily available. Even with better integration tools, turning data into useable information is always a challenge in most environments.
    • Performance management Treasury dashboards – Performance reporting is not usually a core function of Treasury systems and management dashboards are still in their infancy.
    • Commodities – Functionality is limited in most systems for commodities and information for valuation is sometimes not readily available.
    5
    februari 2011
    Background
  • Therefore, many companies are looking to improved technology as a key enabler to meeting their treasury objectives.
    6
    februari 2011
    Background
  • Agenda
    7
    februari 2011
    Background
    Sungard’s perspective on what your Treasury System must do to cope with the next crisis.
  • What your Treasury System must do to cope with the next Crisis.
    Thomas Jerolitsch
    24/02/2011
  • Agenda
    Introduction
    Working across the EcoSystem
    Cash and Liquidity Management
    Receivables
    Payments
    Risk Management
    Additional Services
    Summary
  • Introduction
    When talking about crisis, what do we think we need to do…
    Identification of Cash and Risk
    Cashflow Forecasting
    Operational Efficiency and Control
    Investment Performance and Risk
    Treasury Resourcing
    Bank Relationships
    Value of Centralization
  • Working across the EcoSystem
  • Working across the EcoSystem
    Optimize Receivables, Treasury and Payments
    Foster Collaboration between Trading Partners
    Provide Market-neutral and Vendor-neutral Trading Platform
    Communicate from Receivables, Treasury & Payment Solutions as well as ERP and in-house banking systems.
  • Cash and Liquidity Management
    • Identification of Cash
    • Interfaces to banks
    • Global
    • End of Day / Intra Day
    • Real time cash information
    • Investments / Funding
    • Cashflow Forecasting
    • Collection of Forecasting Data
    • Integration of Subsidiaries
    • Consolidation process
    • Global Cash / Liquidity position
    • Access to Money Market and FX Portals
  • Cash and Liquidity Management
    A practitioner’s view…
    “SunGard helps us determine our daily cash position early in the day, allowing us to take advantage
    of prime market rates for investing and borrowing.’’
    Joann Protopapa
    Manager - Treasury,
    H. J. Heinz Finance Company
    Treasury Management
    …the role of the Treasurer is changing, there are increased regulations and more demand for control…
    SunGard helped…
    • Gain Visibility for Decision Making
    • Provide Scenario Analysis
    • Improve Bank Connectivity
    • Reconcile Cash and Transactions
  • Cash and Liquidity Management
    Market viewpoint
    “While treasurers have always been closely involved with ensuring the day-to-day liquidity of the company, their ability to influence the different elements in the financial supply chain is gradually increasing. “
  • Receivables
    • Optimize Cashflow
    • Mitigate Bad Debt Expense
    • Consistent and structured processes & workflows
    • Foster Connectivity across the EcoSystem
  • Receivables
    A practitioner’s view…
    “With SunGard, our DSO went from 60 to 55 days, while we watched our industry climb to 70.”
    Jerry Drake
    VP Financial Services
    Viracon
    Receivables Management
    …treatment of trade receivables is as an important measure of a company's financial health…
    SunGard helped…
    • Mitigate Corporate Credit Risk
    • Lower DSO
    • Reduce Past Due A/R
    • Decrease Manual Processing
  • Payments: Challenges
    • Business Challenges
    • Multiple banks & multiple cash management services
    • End of day & intraday
    • Risk compliance
    • Technology Challenges
    • Separate connections to each bank
    • Complex to manage
    • Costly to maintain
    • Unreliability
    • Lack of portability
  • Payments: Corporate to banks communication
    Receivables
    1
    Treasury
    SSB
    2
    DATA MANAGEMENT
    INTEGRATION
    SSB
    FINANCIAL MESSAGING
    Payments
    NORMALIZE
    TRANSFORM
    MONITOR
    SSB
    3
    ERPIn-house Systems
  • Payments
    A practitioner's view…
    Payments Processing
    …many corporations rely on a fragmented approach to payments – lacking infrastructure, connectivity and control…
    SunGard helped…
    • Harmonize Payment Flows
    • Establish Business Rules / Workflow
    • Utilize Least Cost Routing
    • Execute in Any Format
    EXECUTE PAYMENTS FROM ANY SYSTEM AND IN ANY FORMAT AND IN ANY CURRENCY
  • Risk Management
    • Measuring Market Risk
    • Adjusting valuations for counterparty Risk
    • Exchange traded vs. OTC instruments
    • Measuring Counterparty Risk
    • Creation of visibility
    • Definition of limit policies
    • Real or Near time monitoring
    • Mitigation of Credit Risk through Receivables Management
    • Balance Sheet Exposure management
  • Additional Services
    Executed Trades
    Summary Level Hedge Data
    Better Data Better Decisions
    Treasury
    Workstation
    Trading
    Platform
    FX Trades to be Executed
    Aggregate Analyze Decide
    “With FiREappswe are confident of our ability to manage FX risk, regardless of the complexity of our business, or the prevailing market conditions.”
    Kristen L. Magnuson, Executive Vice President and CFO
    JDA Software
  • Additional Services
    Corporate-Bank
    Services
    • Electronic Bank Account Management (eBAM) Q4 2010 Interface from your Payments & Treasury solutions (with SWIFT inside) to manage bank accounts (opening, closing, signatories …)
    • Bank Account Statement Portal Q2 2011Manages bank accounts for account statement receipt, performs validity checks, creates dashboard and reporting
    • Bank Fee AnalysisQ2 2011Track and manage bank fees from your Payments & Treasury solutions (with SWIFT inside).
    Ongoing development & delivery of additional services for Corporate-Bank, Corporate-Corporate and Corporate-Trading Partner Communications
  • Summary
    • Treasury can influence different elements of the financial supply chain
    • Looking at the financial EcoSystem
    • Cash Management
    • Receivables
    • Payments
    • Risk Management
    • Additional Services
    • Software as a Service (SaaS)
  • Questions?