Treasury as a Strategic Partner: Creating New Value in the Organization Bob Stark – Vice...

Treasury as a Strategic Partner: Creating New Value in the Organization

Bob Stark – Vice President, Strategy

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Treasury has a lot to manage every day!

Dodd-Frank

Sarbanes-Oxley

Bank signatoriesFraud

Spreadsheets

ERP

SEPA Mandates Global banking regulations

Compliance

Payments approvals

Interest rate fluctuation

FX volatilityAmortization

Pooling

In-house banking

Counterparty risk

Operational risk

Tax regulations

InvestmentHedge accounting

Netting program

Earnings Credit

Credit qualityEMIR

Trade confirmations

Letters of Credit

SWIFT

Positive Pay Exceptions

AccountingAvailability

Reporting, Reporting, Reporting

IFRS FAS Debt


Productivity

Financial controls

Global visibility

Effective financial decisions

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

Value Creation Hierarchy


Improve data integrity• Eliminate reliance on ‘super’

spreadsheets• Standardize processes and

procedures

Controlled workflow• Separation of duties• Reduce SOX audit costs

Centralized audit trails• Improve visibility and

transparency• Better control of workflowProductivity

Financial controls

Global visibility





Productivity

Financial controls

Global visibility


Cash • Bank reporting• Cash positioning• Forecasting• Liquidity

Financial positions• Investment• Debt• Intercompany • Foreign exchange

Exposures• Foreign exchange• Interest rate• Counterparty• Supply chain




Productivity

Financial controls

Global visibility


Excess cash and liquidity• Strategic investing• Debt repayment• Supplier discounts

Treasury movement/analysis• Bank fee analysis• Search for liquidity• Bi/Multi-lateral netting• Optimal funding/drawdown

(domestic or international)

Risk Management• Better hedging protection• Trading diversification• Standardized procedures




Productivity

Financial controls

Global visibility


Treasury as a strategic partnerBuild value through collaborative business partnerships Intelligence Insight Analysis

Benefit to the organizationFinancial Per-

formanceRisk Man-agement

Operational Improvement

Business Con-tinuity

Regulatory Compliance



Global Visibility• Consolidation of positions,

forecasts and exposures• Better cash and liquidity projections

Reduced liquidity risk, better FX visibility• Enables cash mobility and optimized

deployment Where can cash & liquidity be put to better

use than sitting in our bank accounts?

Financial Perfor-mance

Risk Man-

agementOperational Improvement

Opportunities to increase business value


Banking Costs• Bank Fee Analysis measures pricing

‘activity’ accuracy• In combination with other

treasury data, can deliver: o Bank account usage vs. cost – for bank account

optimizationo Total cost of bank relationships, including trading

costs (a.k.a. total revenue banks receive from you)o Spreading around banking business more evenly

Fi-nan-cial Per-for-

mance

Operational Im-provement



Cybercrime and Fraud• Treasury is on the frontlines

o Data securityo Protect financial assets

• Best practices:o “Spear-Phishing” prevention policieso Payment Controlso Outsource data security (the cloud)o SOC1 and SOC2 Audit Reportingo Active monitoring and reconciliations

Opportunities to increase business valueFinancial Per-






Fraud Prevention and Detection

Detection PreventionBank Account Reconciliation

Sunset proceduresApplication Security

One-Time Password, IP Filtering

Daily ReconciliationReviewing daily bank transactions

Bank Fee Analysis

Data SecurityEncryption, Penetration Testing, Audit

Certification

GL ReconciliationMonthly true-up of bank to ledger

Bank Account ManagementOpening/Closing, Signatories

Task Control CenterFile & Task Monitoring, Approval of

workflow changes

PaymentsApprovals, Limits, Automation,

Authentication

Audit Trails Per transaction and system reporting

Financial TransactionsControls, Limits, Settlements


Cybercrime and Fraud• Treasury is on the frontlines

o Data securityo Protect financial assets

• Best practices:o “Spear-Phishing” prevention policieso Payment Controlso Outsource data security (the cloud)o SOC1 and SOC2 Audit Reportingo Active monitoring and reconciliations







Regulation & Compliance• Assessing the impact to the

entire business of:o Basel III / LCRo Money Market Fund Reformo SEPA, FATCA, FTT

• Effect is more than just regulatory compliance• What are the opportunities this presents for us?• How can we be proactive instead of reactive?

Opportunities to increase business valueFinancial Perfor-mance

Risk Man-

agement




Working Capital• Free Cash Flow often a KPI• Treasury determines liquidity

and working capital needs• Creates opportunity to collaborate with other

teams to affect payables, receivableso Payables Financing o Receivables financing or saleo Metrics to support inventory management


Risk Man-

agementOperational Im-

provement



Mergers & Acquisitions• Treasury is key to M&A!• Treasurers can help:

o Determine redundancies and cost savings in treasury/banking operations

o Measure impact on credit ratings, borrowing capacity, financial exposures, regulatory compliance

o Assess impact of currency/interest rates on price for & value of acquisition targets

o Advise on ideal capital structure & availability of financing options to finance deal


Risk Man-

agement





Business Expansion• Treasury can advise on ways

to grow the businesso Treasury team structure – align financial team

structure with global needs to support businesso Market Expansion – identifying friendly markets

for tax treatment and cash movemento Cash and liquidity deployment – collaborating with

tax to optimize cash deployment/distributiono Payment strategies – Local payments, non-banking

payment channels, mobile payments







Productivity

Financial controls

Global visibility


Treasury as a strategic partnerBuild value through collaborative business partnerships Intelligence Insight Analysis

Benefit to the organizationFinancial Per-


Operational Improvement





Tips and tricks to becoming more strategic

• Get Involvedo Build relationships that get you

“in the room”

• Ideaso Don’t be shy, put your idea out there

regardless of how small or big it might be

• You can never automate too mucho You will still have a job, just a better one

• Pay attention to your technologyo Not all software is built the sameo Focus on what can enable you to achieve strategic benefit

Treasury as a Strategic Partner: Creating New Value in the Organization

Bob Stark – Vice President, Strategy

Date post:	23-Dec-2015
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Treasury as a Strategic Partner: Creating New Value in the Organization Bob Stark – Vice...

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