The future of trading: The rise of data analytics in trading

11-01-2021 | treasuryXL | Refinitiv |


Redefining data: What is your strategy?

With more information available than ever, traders must find the right data, make sense of it, and ultimately take action.



With more information available than ever, traders must find the right data, make sense of it, and ultimately take action. Unstructured information, the explosion of alternative data, and the need for trusted sources makes an already daunting task even more complex.


In our second report with Greenwich Associates on the trading desk of the future we explore the data that will keep markets moving over the next 3-5 years. With an overwhelming 85% of those surveyed planning to increase spending on data management, the value of financial data is clearly increasing.

Alternative data tops the list of most important data types, but is only useful if traders trust the source. When it comes to issues of scale and trust, 41% of those surveyed will rely on large financial markets data aggregators. Finally, analytics to interpret existing, new and unstructured data are becoming as critical as finding the data itself.


The bottom line? Everyone needs a data strategy.


Download & Acces full report



Challenging next step for a Cash Manager in Dubai

08-01-2021 | Treasurer Search | treasuryXL

Treasurer Search is looking for a Cash Manager who already lives in Dubai.

Moving and building a cash management organisation from Europe to Dubai. $50K net. TMS experience a plus. 2nd or 3rd career step.

Tasks Cash Manager

The cash manager will help bring the current cash management organisation from Europe to Dubai. She will then manage the organisation that services almost 50 entities on various continents. The emphasis will be on payment processes, the 3 month rolling forecast and intercompany funding. Upgrading the banking and TMS infrastructure is an essential and substantial part of the position. The cash manager will continuously communicate with in- and external stakeholders.

Ideal Cash Manager

The ideal candidate for this position will have about 5 year experience in cash management positions in corporate treasury. As the TMS will have to be upgraded and moved, the ideal candidate has to have proven experience with TMS implementations. As a person the cash manager is hard working, detail oriented and flexible.

Our Client

Our client is a multi-billion industry conglomerate with almost 100,000 employees.

Remuneration and Process

Indication of the net salary for this position is $50K. Our client is not prepared to assist candidates for this position, with moving to Dubai. For interested candidates that qualify, a detailed job description is available.

Contact person

Pieter de Kiewit
T: (0850) 866 798
M: (06) 1111 9783



How FX Providers Can Help Prepare You for Market Motion

07-01-2021 | treasuryXL | XE |

Currency market moves caught you off-guard? You’re not alone. By working with a knowledgeable FX provider, you can minimize the effects on your business.

Woman looking at financial graphs

No matter when you check, the currency markets are constantly moving. Currency values are subject to drastic change seemingly at the drop of a hat.

Volatility in the financial markets isn’t random; changes in currency values are a direct result of real-world factors. Examples of the real-world events that can lead to increases and decreases in currency values include:

  • Natural disasters

  • Recessions

  • Inflation

  • Interest rates

  • Political happenings

It’s not uncommon for the markets to have slower periods of muted volatility, low interest rates, and steady returns in equity markets. But on the other hand, drastic changes can strike seemingly out of nowhere.

Volatility in the markets can have powerful, tangible impacts on businesses around the world. Corporate finance departments, treasury groups, CFOs, and business owners will be the ones left to face the consequences.

What could this mean for your business? Volatility in the markets can potentially:

  • Raise import costs

  • Reduce export sales margins

  • Make your product less competitive

  • Possibly disrupt your business plans for 2020 and beyond.

Manage FX risk with Xe

Your corporation doesn’t need to wait until the markets have already started moving to take action. FX volatility is a risk you can manage, and comprehensive FX risk management measures can help your organization to reduce the impacts of market volatility and account for future shifts in the market.

Many organizations lack FX risk management programs. Some feel that FX risk isn’t a major risk to their organization, while others lack the expertise or resources to implement the effective measures that their organization needs. Partnering with a knowledgeable FX provider can help your organization to manage its currency risk.

At Xe, we have been operating in the currency business for over 25 years as a knowledgeable authority. We have extensive knowledge of the markets and comprehensive product offerings including FX risk management tools to to help you and your corporation manage your currency risk with expert, tailored solutions.


Get in touch with


XE can help safeguard your profit margins and improve cashflow through quantifying the FX risk you face and implementing unique strategies to mitigate it. XE Business Solutions provides a comprehensive range of currency services and products to help businesses access competitive rates with greater control.

Deciding when to make an international payment and at what rate can be critical. XE Business Solutions work with businesses to protect bottom-line from exchange rate fluctuations, while the currency experts and risk management specialists act as eyes and ears in the market to protect your profits from the world’s volatile currency markets.

Your company money is safe with XE, their NASDAQ listed parent company, Euronet Worldwide Inc., has a multi billion-dollar market capitalization, and an investment grade credit rating. With offices in the UK, Canada, Europe, APAC and North America they have a truly global coverage.

Are you curious to know more about XE?
Maurits Houthoff, senior business development manager at, is always in for a cup of coffee, mail or call to provide you detailed information.




Visit XE partner page




Executive Briefing: The Next Gen Architecture for a Digital Treasury

07-01-2021 | TIS |


Read TIS’ new executive briefing The Next Gen Architecture for a Digital Treasury
and find out how to digitalize treasury with a best-of-breed ecosystem!


Leverage the expertise of multiple specialists with seamless API integration and cloud technology. Find out more about:

  1. Advantages of specialist vendors compared to All-in-One solutions for treasury
  2. How seamless data flow through API integration can deliver better user experience and faciliate strategic business decisions
  3. How to set up a best-of-breed solution that is tailored to your company’s treasury needs and future growth

About TIS

TIS (Treasury Intelligence Solutions GmbH), founded in Walldorf, Germany in 2010, is a global leader in managing corporate payments. The Financial Times named TIS as one of “Europe’s Fastest Growing Companies” for 2019 and 2020. Offered as Software-as-a-Service (SaaS), the TIS solution is a comprehensive, highly-scalable, cloud platform for company-wide payments and cash management. The TIS solution has been successfully used for many years in both large and medium-sized companies, including Adecco Group, Hugo Boss, Fresenius, Fugro, Lanxess, OSRAM and QIAGEN. More than 25% of DAX companies are already TIS customers.

The difference between the price of petrol at the gas station and the price of oil in the market (Dutch Item)

06-01-2021 | Erna Erkens | treasuryXL |


Weet u waarom er een verschil zit in de benzineprijs aan de pomp en de olieprijs in de markt? Hoe staan die met elkaar in verhouding?


  1. Hierboven de opbouw van de benzine-, diesel- en LPG prijzen en hun samenstelling.
    Dit zijn adviesprijzen. Die betaal je eigenlijk alleen langs de grote weg.Hieruit blijkt dat de inkoop van de diverse onderdelen maar een beperkt deel uitmaakt van de prijs door de accijns en de BTW. Blijft bij mij toch nog de vraag hangen waardoor prijsstijgingen altijd sneller te zien zijn aan de pomp dan prijsdalingen? Een totaal antwoord heb ik bij mijn zoektocht niet gevonden. Wel wat er nog meer van invloed is behalve de accijns en BTW toevoeging.
  2. Tussen de winning van de ruwe olie en de verkoop van de benzine aan de pomp zitten verschillende stadia van productie. Ruwe olie bestaat uit verschillende onderdelen met elk zijn eigen productie- en handelsstadia. Alle verschillende onderdelen zullen op hun eigen manier deze prijsverandering moeten verwerken en daar kan dus een verschil in tempo en prijs ontstaan.
  3. Benzine wordt in meer producten gebruikt dan alleen maar als brandstof in auto’s. Als de vraag groter wordt van bijv. de chemische industrie kan dit ook een opdrijvend effect hebben op de benzine aan de pomp. Groeiende vraag bij gelijk aanbod is hogere prijs! Dalende vraag bij gelijk aanbod is een dalende prijs. In die situatie zitten we op dit moment.
  4. De ingekochte olie wordt vaak gekocht op de termijnmarkt. Dit betekent nu een vaste prijs maar levering over een paar weken of paar maanden. Dus de benzine in de pomp vandaag is olie die al maanden geleden is aangekocht. Dus zit er ook tijd tussen de prijsaanpassing aan de pomp en de prijsstijging of daling van de actuele olieprijs. Op deze termijnmarkten wisselen partijen (scheepsladingen olie) soms wel 8 keer van eigenaar voordat er sprake is van daadwerkelijke aflevering van de olie. Dagelijks wordt gemiddeld 20 x de opgepompte hoeveelheid olie verhandeld.
  5. Er wordt voor de olieprijzen vaak gekeken naar WTI olie (voor de VS in mijn overzicht) en de Brent (voor Europa). Dit zijn eigenlijk vrij kleine olievelden en deze prijzen dienen als een benchmark (gemiddelde) voor de olie.De prijzen van de olie van andere velden kan best afwijken van deze benchmark. Soms zit er wel 10% verschil tussen. Dit hangt weer af van land / voor wie de olie is en of de olie makkelijk te delven is.
  6. De koers van de EUR/USD. Of een vat olie USD 30 kost met een koers van 1.15 = EUR 26.09 of USD 30 met een koers van 1.05 = EUR 28.57Dat maakt 9.5%  uit. Verder zijn er ook nog andere risico’s (transport, economisch, politiek) die afgedekt moeten of kunnen worden. Dit kan ook een onderdeel van de prijs zijn.
  7. Prijzen van benzinestations in de omgeving. Als je iets lager zit qua prijs en je verkoopt meer dan heb je toch een betere dag!
  8. Transportkosten. Het hangt ervan af waar de olie vandaan komt en waar hij naar toe moet!

Zo zie je maar dat de olieprijs wel belangrijk is voor onze benzineprijs, maar dat er nog heel veel dingen van invloed zijn op onze benzineprijs. En een stijging van de olieprijs wordt gek genoeg altijd sneller ingeprijsd, dan de daling. Maar die extra centen zijn dan voor de pomphouder en die verdienen er maar mondjesmaat aan. Er is toch iets geks aan de hand. In de vorige crisis was de olieprijs hoger dan nu maar de benzineprijs lager dan nu. Dat werd niet gecompenseerd door het koersverschil. Zo blijven er altijd bijzondere verschillen.

Erna Erkens
Owner at EEVA

Digital Treasury: Can it Tackle the Cash Forecasting Challenge?

05-01-2021 | Cashforce | treasuryXL |

Several decades ago, Excel was invented to process/model inputs and generate outputs. Today, it is still by far the most used technology to generate a cash flow forecast. However, as we strive to achieve better forecasting accuracy rates, our desire for automation and the seamless processing of FX hedges, liquidity borrowings and deposits have underlined the need for more effective modelling and increasingly powerful data processing.

The good news is that we’re at the forefront of that digital treasury revolution, or so-called ‘Treasury 4.0’. This means:

  • Leaving the manual-driven Excel jungle behind us and adopting an automated, data-driven forecasting process
  • Automating decision-making based on logic (rules that are within corporate policies), which will drive our liquidity and FX hedge usage


Last year, multiple treasury surveys from sources including the Association for Financial Professionalsthe UK Association of Corporate TreasurersPwC and Citi, concluded that cash flow forecasting remains the primary challenge for treasurers today.

What are the headaches behind the process? Why is it so difficult for a corporate treasurer to generate an accurate cash flow forecast? And do we currently have the opportunity to solve this challenge?

The cash flow forecasting challenge consists of multiple underlying process complexities. The aim is to create an accurate cash flow forecast that helps us to make optimal FX and liquidity decisions.

What is accurate? You could write a book about cash forecast accuracy, since accuracy levels are totally different when comparing forecasts between different industries, time horizons, cash flow categories etc. When we forecast with a time horizon of five years, the accuracy levels are, of course, nowhere near as precise as when we forecast something just a few days in advance – and more reliable data is available. Depending on the goal, the treasurer will need a specific form of accuracy.

In addition, cash flow forecast data, together with the forecast assumptions/used models, need to come together in a well-coordinated process. Other challenges lie behind this process, including a disconnect between different data sources/systems such as enterprise resource planning (ERP) and treasury management systems.

Furthermore, there are myriad data-related issues to contend with including: concerns regarding data quality inside these multiple systems; the sheer volume of data to be processed; the need for granular and/or high-level data; and whether reliable external data can be found to be used to further improve the model.

Finally, aligning and coordinating forecasting assumptions between the different company departments is a time-consuming exercise. Imagine pulling all these assumptions from both HQ and local levels into an Excel model. No easy task.



Fig 1: The cash flow forecasting challenge


Solving the cash flow forecasting challenge is easier said than done. Nevertheless, today treasurers can leverage several available technologies that, if used together intelligently, can tackle the described challenges head-on.

First, when we think about the goals and the accuracy levels that treasurers want to achieve, we can use different models to calculate those, such as accuracy heatmaps. Second, when we consider the data (ERP and non-ERP) required to run these cash flow forecasts, we can rely on big data engines, advanced extract, transform and load (ETL) processes, and application programming interface- (API) and non-API-based connectors that create an easy data flow into forecasting models. We have ways to analyse data quality as never before and we can set up a reliable work flow process to obtain assumptions from the decentralised business units all the way up to HQ level. This generates a cash flow forecast while keeping the granular detail.

Third – and we are only scratching the surface here – several machine learning models and algorithms are now at our disposal. These can be used to build and optimise cash flow forecasting models, so we can indeed solve the forecasting challenge in a reliable way.

Finally, armed with the right tools, the salient question is: what can we actually do with the cash forecast? We call it Cash Flow Forecasting 3.0: automating the decisions that are based upon the cash forecast (investing excess liquidity, performing a particular hedge, etc.) or the so-called post-forecasting decision-making engine.

By combining technologies we can not only automate manual and repetitive tasks, but effectively integrate the systemic data with human expertise and algorithmic trends from historic data. Add to this the use of recommendation engines and intelligent insights, and the interplay of data inputs can generate enriched decision support. Apparent visualisations and scenario analyses can offer a clear view of actionable results that treasury and management can use in their decision process. Reliable technology that enables people to make high-caliber decisions; this, we believe, is the true power of digital.



About Cashforce        

Cashforce is a Cash Forecasting & Working Capital Analytics platform for corporates, focused on analytics, automation and integration. Cashforce connects the Treasury department with other finance / business departments by offering full transparency into its cash flow drivers, accurate & automated cash flow forecasting and treasury reporting. The platform is unique in its category because of the seamless integration with numerous ERPs & banking systems, the ability to drill down to transaction level details, and the intelligent AI-based simulation engine that enables multiple cash flow scenarios, forecasts & impact analysis.


Webinar: Trends for Treasury and Cash Management 2021

| 04-01-2021 | treasuryXL | Nomentia |

Treasury & Cash Management Trends 2021

A new year is just ahead of us. And what better way to start the year than to look at trends that will shape our business in the coming months.

Some of the trends derive from the global pandemic that is still showing its effect on the global economy and businesses around the world but other trends have been long brewing or just got further amplified.

Date, Time and Registration

Thursday, January 14, 2021

Start: 13:00 CET / 14:00 EET

Duration: 45 minutes

Register: click here

Some of the topics Nomentia will cover


  • Centralization, in 2021 for real? A joint survey we did with GTNews showed that centralization is often stifled by internal roadblocks such as prioritizing the topic internally across functions.
  • This relates to the second trend for 2021, which is the role Treasury functions will take in bridging internal silos.
  • On top of this also payment fraud is a topic that has only further increased during the pandemic. Our survey shows that almost 50% of respondents consider fraud as a big challenge.
  • Lastly we will take a look at the death of monolithic platforms. In 2021 we will see the trend toward best-of-breed platforms continue.

Who should attend:


Cash Managers, Treasurers, and Finance leaders working in international companies who are interested in understanding the landscape they are operating in and want to stay up-to-date with developments.

Meet the speakers


Jukka Sallinen

Deputy CEO, Nomentia

Jukka is a cash management domain expert with a strong hands-on background from international and complex payment factory and SWIFT projects. Previously, Jukka has been working in various R&D roles, focusing on bank and ERP integrations and security topics.




David Kelin

David Kelin

Owner, DNA Treasury Ltd

David Kelin possesses invaluable commercial experience gained from over 35 years working in leading organizations in the areas of liquidity, treasury, and cash management. He has a keen interest in treasury technology and has written many articles on the topic. David owns and manages DNA Treasury Ltd where he provides advice to corporates and banks on treasury and liquidity. He has worked with 100’s of companies. He also runs a treasury training company which has developed courses and trained over 1,000 treasury professionals over the years.


About Nomentia

Nomentia is a Nordic powerhouse for global cash management. We believe in a world in which businesses can make the right decisions no matter how unpredictable the times are. Our SaaS-based platform offers solutions for cash forecasting and visibility, global payments with bank connectivity, reconciliation, in-house banking, guarantees, and FX dealing. We serve 2,300+ clients in over 100 countries processing more than 200 billion euros annually. Cash is king!

What is Cash Management?

| 04-01-2021 | by Kendra Keydeniers |

Cash Management

Cash management is often described as monetary logistics management. This analogy works quite well. It is the discipline of Treasury that is devoted to the management of planned expenditures, so it is highly focused on operational efficiency and process optimisation. It is about optimising the flow of money coming in from customers, some money going into savings, and other money going out to pay the bills. Since this is such a vital process to any organization, it is not hard to understand how cash management can make or break a company.

Note: At treasuryXL, we treat the practice of cash management from a corporate perspective. Within banking, the term “cash management” is often used differently. When bankers speak of Cash Management, they are usually referring to a particular line of business for the bank, which sells products and services to corporations to assist them in their cash management activities. They often call this line of business “transaction services”, working with slightly different definitions than the ones that we will use.

What does a Cash Manager do?

Cash Management is one of the three primary disciplines of Corporate Treasury. (Risk Management and Corporate Finance are the other two.) The first task that a cash manager has to accomplish is the proper execution and control of payments. This must be done according to the guidelines set by the company: salaries, suppliers, and tax authorities all must be paid with strict attention to company policies and procedures. An accountant might do the booking, whereas the cash manager instructs the bank after approval from the appropriate manager. In parallel, the cash manager keeps an eye on the money flowing in from customers.

In order to manage the payments, the Cash Manager has to know in advance when money will flow in and out, and how much. He or she collaborates with colleagues to complete a cash flow forecast: when will salaries have to be paid? when do we have to pay for this new machine? when will this client pay? In a large corporation that may see thousands of transactions on any given day, asking in advance about each potential payment and its timing is practically impossible. To cope with this, cash managers often rely on forecasting models, which predict cash flows based on historical data. Nowadays, software applications are used to develop and run cash forecasts for large corporations.

As cash forecasting grows in complexity, operational decisions regarding what banking services to use also become the duty of the cash manager. As long as a company has sufficient excess cash, inaccurate forecasting is not a problem, but when a bank has to provide credit, this will cost the company money in extra fees and interest expenses. This sort of error in cash management can be especially painful if the company had invested excess cash in the expectation that it had sufficient funds to pay the bills. For it is also the job of the cash manager to identify excess cash and invest it for short-term gains. (It might be placed within a money market account at a bank to earn more interest than a traditional savings account, for example.) In times of very low or even negative interest rates, however, finding low-risk ways to earn interest becomes an increasingly difficult task. On top of all this, the cash manager must also deal with foreign exchange. When payments have to be made in a currency other than the standard currency of the company, the cash manager must buy foreign currencies, often in consultation with colleagues from the risk management department.

Together with colleagues from other departments throughout the company, the cash manager is responsible for building and maintaining a payment infrastructure as well. This means having bank accounts with the relevant banks, connecting them to the bookkeeping and enterprise resource planning (ERP) systems of the company and (if applicable) to the company’s treasury management system (TMS). Technology has a huge impact on cash management, and new developments come up constantly. Systems have to be robust, but also user friendly. In consultation with the risk management department, operational controls within these systems must be implemented. Finally, the cash manager has to keep an eye on the cost of this whole machine. Banks and other suppliers do not work for free!

Examples of Cash Management activities

Different types of companies have very different needs for cash management activities. Here are several examples:

  • Telecom operators, utility companies, and tax authorities deal with large numbers of relatively small payments in local markets. The full integration of the systems that send out bills, generate bank statements, and connect the two (through an accounting process known as “reconciliation”) has to be automated. The cash manager plays an essential role in the integration of these systems and in their operation. For example, banks often charge fees on a per-transaction basis. As a cash manager at a company that processes many bulk payments, negotiating low transaction fees is very important.
  • International e-commerce companies with a focus on consumers will want to offer the most convenient payment infrastructure possible. They do not want to lose customers in the payment process. Each country has its own standards, such as credit card networks like Visa or Mastercard, or bank transfer schemes like iDEAL in the Netherlands or SOFORT in Germany. Cash management should be involved in choosing and implementing these standards.
  • Companies with many different subsidiaries often have complex and fragmented bank account structures. As a result, available cash is often spread out over many accounts. Corporate banking services, such as cash pooling, concentrate this dispersed cash into a small number of accounts. From these centralized accounts, sometimes called “concentration accounts”, it is much easier to organise internal funding for expenditures. Thus, cash pooling sometimes allows companies to avoid tapping external sources of funding, which are typically more costly.
  • Companies that aim to expand evermore internationally wish to be able to make payments anywhere in the world, and yet there are no banks that are present in each and every country on the globe. For this reason, many companies hold accounts with multiple banks, and it is the cash manager’s job to manage these complex international payments. Simultaneously operating the electronic banking solutions offered by each bank can be an elaborate process, not to mention the security procedures that must be followed. Recent Payment Services Directive (PSD2) regulatory adjustments have made it possible to manage (or at least screen) accounts from different banks through a single bank. Alternatively, there exists specialised software that brings all accounts together into a single application that can be used for screening and transaction purposes. Cash managers are keenly following these developments.

Frequently asked Cash Management questions

  • Q: Why should a company have more than one bank account?
    Historically, large companies have used multiple bank accounts to gain insight into the activities of their local subsidiaries. In an extreme example, a retail chain might have held a different bank account for each local shop, so that a large retailer could easily hold over 500 accounts! Today, such unnecessary complexity is considered unprofessional. Insight into local activities can be achieved through proper bookkeeping, and extra bank accounts cost extra money. Modern bank accounts also tend to feature more extensive payment capabilities than in the past. A single European bank account, for example, will allow you to send payments within most European countries. Nevertheless, the operations of global businesses still often require multiple bank accounts. In addition, many companies like to hold accounts with banks that are widely recognized by customers in the local market.
  • Q: Why is cash management separate from bookkeeping?
    In small companies, cash management need not be separate from bookkeeping. The two activities may be done within the same department. In larger companies, though, these activities are specialised. This is because the skill set required for bookkeeping is different from that of cash management. Furthermore, in larger companies it is important to segregate duties for purposes of operational control: the one sending the invoice should not be the one who processes the related payment. Lastly, it is important to mention that in larger companies a distinction is made between cash flows, on the one hand, and income and expenses, on the other. In the financial accounts of a large corporation, revenue is booked when a sale is made. However, it might take some time before this revenue actually reaches the company in the form of cash. Until it does, booked revenue is generally irrelevant to the cash manager. The same is true for expenses. An expense may be booked, but from a Treasury perspective, until an expenditure is disbursed, it is still considered cash on hand.
  • Q: Do cash managers also do foreign exchange (FX) management?
    In smaller companies, cash managers also manage foreign exchange, but FX management is a separate field of expertise. It might be the role of a cash manager to set up bank accounts in various currencies. By doing this, the cash manager lowers operational costs by preventing repetitive transactions between the same currency pairs, which can generate unnecessary fees; but, this is not FX Management. (The FX Manager researches market developments that have an impact on Treasury operations, and often plays a more analytical or strategic role.)
  • Q: For cash managers, what was the impact of the introduction of the international bank account number (IBAN)?
    When the IBAN was introduced a few years ago, this new standard for bank account numbers made international electronic payments easier. In theory, it allows companies to work with fewer bank accounts, making cash management easier and cheaper. However, some companies argue that doing local business requires having a local bank, so they maintain multiple international bank accounts, despite the convenience of the IBAN.

Cash Management summary

The cash manager is responsible for monetary logistics. He or she manages the cash flows going in and out of the company, knows how much is available, and where. The cash manager decides through what channels and storage units (bank accounts) the money flows, and optimises cost, visibility, control, and availability. He or she interfaces regularly with colleagues in treasury, finance, and accounting, as well as other departments, such as procurement, sales, and manufacturing. The cash manager holds a small but essential role in his company: without him or her, the company would be at a standstill within no time.

Check out these treasury topics as well:

What is Treasury?

What is Corporate Finance?

What is Risk Management?

What is Working Capital Management?

In the following days and weeks we will highlight the above treasury topics. Stay tuned!

Kendra Keydeniers
Community & Partner Manager at treasuryXL

What is Corporate Finance?

| 01-01-2021 | by Kendra Keydeniers |

Corporate Finance

Corporate Finance is not hard to describe. It is the financing of a corporation’s activities through borrowing and investment.

Nevertheless, Corporate Finance has come to mean many things, depending on who you talk to. This is because there can be many parties involved in the process of financing: treasurers, accountants, CFOs, CEOs, bankers, investors, lenders, and lawyers.

From a Treasury perspective, Corporate Finance is the work involved in answering one simple question: what sources should we use to fund our activities in the long-term and in the short-term, and why? Most corporate treasurers break Corporate Finance into two fundamental activities: Capital Budgeting (for long-term, strategic planning) and Working Capital Management (for short-term, tactical needs). Within treasuryXL, we work with corporate treasurers, and we will adopt their perspective.

Note: Perhaps the most common alternative perspective on Corporate Finance comes from bankers. When bankers talk about Corporate Finance, they are often referring to a particular line of business for the bank, which involves raising money for corporations or acting as advisers on their behalf. They see Corporate Finance not from the perspective of an individual corporation, but from the perspective of a broker, who facilitates the movement of capital between corporations and investors. As a whole, the connections between these buyers and sellers of financing are known as the “capital markets”. Other bankers, auditors, and advisers often equate the term “corporate finance” with the term “M&A”, or mergers and acquisitions. These bankers facilitate the buying and selling of companies, and they think of such transactions as a form of corporate finance because an M&A deal will often involve the infusion of cash into the company being acquired. For example, a corporate finance adviser might be a broker between an entrepreneur with a company for sale and the potential new owner of the entrepreneur’s company. This corporate finance adviser acts on behalf of one of the two parties, but this sort of Corporate Finance is very different from the world of Treasury.

What does a Corporate Finance Director do

Within most large companies with a group treasurer, there is a corporate finance director who reports to the treasurer. The most important task of the corporate finance director is to ensure that the company is able to finance both its current and future activities. To do this, the corporate finance director must be deeply familiar with the financial structure and overall profitability of the company, the strategy of the Board of Directors, any plans for long-term borrowing and investment, and competitive risks and threats, such as potential corporate takeovers. The corporate finance director will have to translate all of this knowledge into an extensive capital budgeting plan. This plan will identify where funding for the company’s strategy can be found, and when it should be tapped. Timing is extremely important, so a distinction is often made between long- and short-term financing operations.

For long-term financing, funding can be found from both internal and external sources. Internal sources might be tapped from company savings or from current or new owners who want to put more money into the business. External sources often include regular bank funding (usually structured as loans) but may also include non-bank lenders or investors. In any case, the corporate finance director is either in the lead or is heavily involved in such strategic, long-term financing transactions.

In short-term financing, by contrast, the corporate finance director usually has a strictly analytical role. He or she prepares the best solutions for sudden or short-term financing needs, but is not usually involved in the operational aspects, which are often handled by cash managers. For example, from time to time the cash flow forecasting of a company may be inaccurate, and a situation may arise in which salaries and suppliers cannot be paid in time. (In this situation, the company is short on cash. It might have assets that it could sell in exchange for cash, but such assets might not be very “liquid”, in the sense that they cannot be sold right away. Such a situation is known as a liquidity crisis.) A good corporate finance director will have created a financial toolkit to use in such a situation. That toolkit will outline the procedures for the following potential solutions to the liquidity crisis:

  • short term credit facilities with one or more banks,
  • a factoring program, where a third party pays bills before the company’s actual clients do,
  • negotiated credit terms with suppliers, which allow the company to pay at a later date, or
  • leasing programs that avoid the expenditure of funds to buy assets outright.

Other tasks that the corporate finance director might work on can be quite diverse. He or she might be involved in the dividend strategy: how much of our profits shall we pay to our shareholders? If the company has a lot of excess cash because it is doing well or perhaps because it just sold some shares, the director may be responsible for the investment strategy: shall we leave this money in the bank, or are there better investment alternatives?

Examples of Corporate Finance activities

While the following list of items is not exhaustive, these are the most common corporate finance activities:

  • Executing an initial public offering (IPO). An IPO is undertaken when a privately funded company decides to be listed on a stock exchange so that it can access funding from capital markets.
  • Getting a credit rating. A good credit rating will often lead to better borrowing conditions. To achieve this, the corporate finance director will ask an independent rating agency to write a report about creditworthiness.
  • Doing a bond issue. A bond is a form of long-term loan, which is funded by the purchaser of the bond, the initial “bondholder”. Such bonds can be bought and sold in the public markets, and whoever holds the bond will receive interest and be repaid according to the terms of the bond agreement.
  • Securing a loan from a bank. The terms of such loans are often either based on the company’s credit rating, or are asset backed. If they are asset backed, the bank can claim the company’s property in case of default.
  • Redefining and renegotiating payment terms with suppliers or customers.
  • Developing and executing a dividend program for shareholders.

Frequently asked Corporate Finance questions

  • Q: Who reports to whom? The corporate treasurer to the corporate finance director, or the other way around?
    There is no single reporting structure, but in most companies the corporate finance director reports to the group treasurer.
  • Q: Who holds formal responsibility in corporate finance transactions?
    The corporate finance director cannot claim final responsibility in all transactions. Typically, it is the CFO or the CEO who does. Due to the strategic impact of certain financing deals, often the CFO and CEO will want to be prominent. This is especially true in equity deals, such as initial public offerings (IPOs).
  • Q: Why is there so much confusion about roles and activities in Corporate Finance?
    As opposed to accountants, controllers, and auditors, the place of the corporate finance director within the hierarchy of many companies is not well defined. The activities of the corporate finance director often have strategic impact, and many want to take credit for the resulting financing deals for the company. Furthermore, although they have strategic impact, corporate finance activities can be managed by one or two independent individuals. This makes a large corporate finance team unnecessary, and it lends fluidity to the place of Corporate Finance within the hierarchy of most organizations.

Corporate Finance summary

Corporate Finance is of strategic importance to a company, and its activities are often very visible to the owners and Board of Directors. Proper Corporate Finance can only be executed well if done close to where important decisions are being made. It involves the long- and short-term funding of a company and the investment of its assets, but it is ultimately concerned with corporate strategy, which is developed at the highest levels of the organization.

Check out these treasury topics as well:

What is Treasury?

What is Cash Management?

What is Risk Management?

What is Working Capital Management?

In the following days and weeks we will highlight the above treasury topics. Stay tuned!

Kendra Keydeniers
Community & Partner Manager at treasuryXL

Top 5 most read articles at and LinkedIn of 2020

| 31-12-2020 | treasuryXL | Kendra Keydeniers

The last day of 2020 is here. The whole world experienced a ‘year not to forget’. I can imagine that when you popped the champagne last year you had other thoughts and plans in mind for 2020.

To make sure you don’t miss out on the pieces that made the most impact this year, we sifted through the data to uncover the articles our readers loved most in 2020 on our website and LinkedIn. (Treasury Topic ‘What is’ articles excluded).

Top 5 treasuryXL website articles of 2020

  1. Corporate Governance and Treasury | Embrace the Corporate Treasury Policy

    by Francois De Witte

  2. Top 5 most common pain points in Treasury

    by Michael Ringeling

  3. Corporates: Caveat IBOR!

    by Daniel Pluta, Enigma Consulting

  4. Exclusive interview with FX specialist Arnoud Doornbos about FX Risk Management

    by treasuryXL, Arnoud Doornbos

  5. How to simplify Procurement and Finance in the Supply Chain

    by Wim Kok

Top 5 treasuryXL LinkedIn posts of 2020

  1. Nomentia (former OpusCapita) makes Liquidity Management free for all customers!

    by Nomentia

  2. What is the difference between Treasury and Accounting?

    by TreasuryXL

  3. The missing part of a Treasury Job Description

    by Aastha Tomar

  4. An introduction to Forwards, Futures and Options Part 1

    by Aastha Tomar

  5. Partner Interview Series | The deeper dive with TIS (Treasury Intelligence Solutions)

    by treasuryXL, TIS

Within two weeks we will post a full recap of 2020 with an overview of the partners and treasury experts that have joined us, together with some interesting treasuryXL facts!

Thank you for being part of the treasuryXL community. Now it’s time to pop the champagne! Let 2021 begin…


Kendra Keydeniers

Director, Community & Partners treasuryXL