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Webinar slides treasury policies tms 9-20-16_ss
- 2. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 2
Martha Grant
Senior Consultant
Actualize Consulting
Jamie Christel
Treasury Advisor
Kyriba
Today’s Presenters
- 3. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 3
What are treasury policies?
Key policies for corporates
Policy maintenance and implementation
Leveraging technology to support your treasury policies
– Improves protection from fraud and mistakes
– Consistency of process, implementation of workflows and procedures
– Increases efficiency of your treasury operation
– Delivers compliance – internal and external
– Drives treasury to become more of a strategic partner
Agenda
- 5. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 5
Policies Procedures
What are treasury policies?
- 6. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 6
Policies lay out:
Risk tolerance and strategy
Accountability and ownership
Partnerships
What are treasury policies?
- 7. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 7
Policies should be:
Formally documented
Approved by the Board
and/or senior treasury managers
What are treasury policies?
- 8. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 8
Control risk
Ensure best practice
Standardize globally
Why should I care….?
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Bank account administration
Debt management
Payments
Short-term investments
Counterparty risk management
Foreign exchange
Business continuity
Disaster recovery
Treasury technology
Key treasury policies
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Intercompany loans/activity
In-house banking
Investment policy for employee benefit assets
(retirement plans)
Other policies to consider…
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Review annually or when major changes are made to operating
procedures
– Ex: Introduction of floating NAV
Require Board or senior Treasury approval
Communicate, communicate, communicate
Maintenance and implementation
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Technology can improve:
Application security (password controls & authentication)
Data security (improve protection)
Daily bank activity monitoring
Bank account control
– Dual authorization
– Centralized view of all changes
Payments
– Payment approvals
– Digital signatures
Trading
– Standard settlement instructions
– Proper due diligence
Fraud prevention opportunities
- 16. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 16
Standardize workflows and procedures for efficiency
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Internal compliance:
Establish
Comply with
Measure against
Examples:
Separation of duties – payments, reconciliations
Trading/approval limits
Password controls/login prevention
KPIs – cash forecasting, hedge performance, etc.
Robust audit functionality
How technology enables governance
Internal Policies
& Procedures
- 18. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 18
Regulation Impact to Corporates
FAS157 / IFRS 7
FAS133 / IFRS 9
FAS 157/133 / IFRS 13
Generate valuations for derivative financial instruments
Develop new framework to account for derivative transactions
Incorporate credit risk in all valuations
Sarbanes-Oxley 302/404 (US)
CFO needs to attest to audit and controls existence
- Treasury must prove they exist internally
- CFO must formally agree they exist externally
EMIR (Europe)
Dodd-Frank (US)
Tracking of net new information, including unique transaction
identifiers (including by business unit)
Reporting of all derivative transactions to central trade
repositories
Central clearing of derivatives (proposed)
SEPA (Europe)
Bank Accounts – switch to IBANs
Outgoing Payments – switch to new SEPA SCT formats
Direct Debits – switch to new SEPA SDD formats
Direct Debits – refresh mandates w/ customer and bank
External / regulatory compliance
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Regulation Impact to Corporates
FBAR (US)
For American companies and residents
Must track all foreign accounts + signatories + max balance of
account in prior 12 months
Reporting by corporates and on personal tax reporting
Specific forms (fun!) for both corporates and personal
BASEL III
Direct impact to corporates = nothing
Indirect impact is significant
-Increased borrowing costs (banks less likely to lend)
-Increased hedging costs (higher premiums offered)
-Emphasis on non-balance sheet lending (e.g. SCF)
-Push towards internal financing (netting & IHB)
FTT (Europe)
Must calculate and pay significant taxes on borrowing and
derivative transactions
Increased costs to borrow & hedge
Regulatory compliance
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Productivity
Financial controls
Global visibility
Effective financial decisions
Value creation hierarchy
Single point of data entry
• Eliminate re-keying errors
• Improve accuracy and
confidence in analysis
Automate repetitive tasks
• Shift time from processing to
analyzing
• Achieve results more quickly
Streamline reporting
• Automate and schedule
preparation and distribution
Treasury as a strategic partner
- 21. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 21
Productivity
Financial controls
Global visibility
Effective financial decisions
Treasury as a strategic partner
Build business value
through collaborative
business partnerships
Intelligence
Insight
Analysis
Examples
• Cash enablement
• Capital structure
• Shared service model
• Risk Management
• Supplier/Customer Finance
• Market expansion
• Business Intelligence
Value creation hierarchy
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Further reading
• AFP Guide: Business Continuity Planning: Why
Treasury Needs a Plan B
Download at: http://info.kyriba.com/AFP-TIP-Guide-KDC
Related Blog Posts:
• Going global: top six questions answered
• Money Market Fund Reform – a lot of fuss but worth the attention?
• Boosting visibility and control with centralized payment factories
• Making payments less risky
• What keeps the corporate treasurer up at night?
- 24. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 24
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