This document describes managed or outsourced treasury services. It can provide treasury services on a temporary or long-term basis, and handle tasks such as cash management, funding, hedging, and risk management. Services are customized and involve front, middle, and back office functions. Key benefits include access to established operations and controls, lower costs through scale, and expert resources. Treasury is never fully outsourced however, as the client retains control and decision-making.

1. Outsourced
or
‘Managed’ Treasury
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2. FTI Business Areas
Managed
Treasury
Treasury
Systems
Solutions
Technology-
Treasury
Based Treasury
Consulting
Training
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3. Managed Treasury can be..
• Temporary
o To facilitate a fast treasury start-up
o To facilitate a business disposal
• Long Term
o To buy into an established treasury facility/operation
• Very specific
o A Special Purpose Vehicle for eg a specific financing
• Core Treasury
o Covering FO/MO/BO
o Seamless with In-House
• Business Based or Tax Based
• Can be legal entity/treasury centre or integrated with HO
In Summary:
• Always Customised
• Treasury is never 100% Outsourced
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4. Managed Treasury -Scope
• Cash & Liquidity Management
• Surplus Cash Investment
• Inter-Company Financing/ In House bank accounts
• External Financing
• Risk Management
• Foreign currency
• Interest rate risk
• Counterparty and credit risk
• Netting
o Strategy development and advisory support
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5. FO/BO/MO Components
Mid Office Front Office Back Office
• Counterparties • Liaise with • Confirmations
Limits ‘HO’ Treasury • Settlements
• Permitted • Position • Reconciliations
Contracts Management
• Rates/Yield • Dealing &
Curves Transactions
• SSIs
• Accounting
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6. Control Process
Segregation Segregation
Mid Office Confirm &
Deal
Control Settle
Auditors/Regulators/Compliance require strong controls
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7. The Key Role for ‘Mid Office’
• Systems Static Data
o It’s not just about data!
• User Profiles/Access/Passwords
• Limit monitoring
• Mark to market valuations – why?
• Hedge accounting & effectiveness testing
• Analyses/Reporting
• Accounting Rules
• Bank Mandates
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8. Front Office Activity
• Position/Exposure Management
• Policy & strategy implementation
• Dealing/Transaction execution
• Transaction recording
• Cash & liquidity management
• FO Reporting
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9. Back Office Services
• Independent Checking
• Confirmations [before settlement]
• Settlement
o Cut off times
o Standard settlement instructions
o Authorisation
• Reconciliation
o Daily
o Query resolution
o Bank interest & charges
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10. Corporate Services
 Board Director
 Company secretary
 Secretarial and administration services
 Regulatory and statutory compliance
 Treasury governance, policy, procedures & control
framework
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11. System Integration/Embedded Controls
Reuters
Bloomberg
Banking
/EB TMS Accounting
Payments
e.g. Swift
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12. Straight Through Processing (STP)
means ….
A complete business process
Based on once-only input of data
Deal Confirm Report Settle Manage Accounting
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13. Managed Treasury Control Framework
Client Control
Client policy
Approves processes
Approves budgets FTI Authority
Regulation
Retains all decisions Limited authority
FTI regulated by Irish
Central Bank Bank mandates
FTI subject to MiFID No funds in FTI’s name
FTI Treasury ‘Best No credit exposure to
Practice’ FTI
Review
Controls
Statutory Audit
Embedded Controls
Regulatory
Infrastructure –
Client internal and systems & processes
external audit
Personnel – team
Internal review and allocation
assessment
FTI Personnel
Processes
Director level
Proven processes
Corporate treasury
Independent checks &
focus
controls
Expertise and
Subject to due Systems knowledge
diligence & audit
Independent Experience & proven
administration track record
Security protocols
Business continuity
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14. Managed Treasury - Benefits
• Access an established treasury – controls, systems, methodology,
procedures & controls, reporting etc
• Lower costs – economies of scale
• Access to a deeper pool of experience and expertise
• An immediate solution - a fully operational treasury quickly on
stream
• Treasury is high cost and a Treasury Centre may not justify a
standalone cost
• In-house treasury can focus more on the strategic, less on
operational
• A ‘Managed Treasury’ – probably stronger controls than ‘in-house’
• Flexbility to downsize
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