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The hidden secret behind the different types of foreign exchange exposure

23-11-2021 | treasuryXL | Kantox | LinkedIn

Fresh from leaving the famous Genesis rock band that he helped found, songwriter and musician Peter Gabriel came out with an innovative album called Exposure, where his fascination with electronics and new recording techniques was openly on display. In the eponymous song, he kept on droning the E-word over and over:

Exposure
Exposure
Exposure
Exposure
Exposure

At Kantox we share this almost obsessive-like concern. But we care about FX exposure, a very specific kind of exposure. And so do most corporate treasurers: according to the last Kantox & TMI FX Survey, exposure-related concerns are seen by as many as 66% of participants as the most important FX challenge faced by companies.

In this blog we seek to determine the three types of foreign exchange exposure:

Forecasts of revenues and expenditures
Firm commitments for sales/purchase orders
Accounts receivable/payable

Understanding the different types of foreign exchange exposure

FX exposure, in a nutshell, is the degree to which a company is affected by changes in exchange rates. To arrive at a precise definition of the three types of foreign exchange exposure, we need to understand the goals set by management in terms of its FX risk management policy.

If the goal is to remove accounting FX gains and losses, then accounts receivable and payable are the key pieces of exposure. If, however, management seeks to protect company cash flows from currency fluctuations, then the relevant type of exposure results from a set of company-specific business parameters.

These parameters include the firm’s sensitivity to FX (as measured by its profit margins and the weight of foreign currencies in the business), its degree of forecasting accuracy, the forward premium/discount of the currencies in which it operates, and several others. But the decisive element to consider is the firm’s pricing parameters.

Steady or dynamic prices? Forecasts and firm commitments

When determining the types of FX exposure, pricing dynamics play a key role. Does the company adjust selling prices after a campaign or budget period is over? Does it attempt to keep prices steady for a set of periods ahead? Or does it price dynamically with an FX rate? (*). Most firms implement one, or a combination, of the following pricing strategies:

Steady prices for individual campaigns/budgets. Some businesses keep steady prices for an entire campaign or budget and adjust them as the following campaign or budget period unfolds, thus incorporating FX fluctuations into the new prices.

⇒ TYPE OF FX EXPOSURE: forecasted sales and expenditures for each individual campaign or budget.

Steady prices for a set of campaigns/budgets. Competitive pressures may lead firms to keep steady prices across a set of campaigns or budgets without adjusting them, even in the face of sharp adverse currency fluctuations.

⇒TYPE OF FX EXPOSURE: rolling forecasts for sales and expenditures across a set of campaigns or budgets.

Dynamic prices. For firms that operate in a dynamic pricing environment, pricing is itself a natural hedging mechanism. FX risk arises from the time lapse between the moment a transaction is contracted and the moment it is finally settled in cash.

⇒TYPE OF FX EXPOSURE: firm commitments for sale and purchase orders

FX management and the types of foreign exchange exposure

This brief overview of the three types of foreign exchange exposure provides the starting point for a well-structured FX management process. Exposure items must be properly collected and processed before hedging programs can be implemented. Risk managers must know with precision how to retrieve, from disparate company systems, the information relating to each type of exposure.

Whereas most Treasury Management Systems provide the necessary information in terms of accounts payable/receivable, data about the two other forms of FX exposure —forecasts and firm commitments— are usually scattered between a host of company systems (ERP, CRM, specific software tools) and spreadsheets. This leads to a number of practical problems whose importance is usually underestimated:

Can the relevant pieces of exposure be retrieved in a timely manner?
Is the information complete and granular enough?
Who validates it, and through which processes?

Quite logically, the level of complexity increases in situations where different pricing parameters coexist within the enterprise, many currency pairs are in use, and both accounting and cash-flow related exposures are treated.

Technology to the rescue

The good news for treasurers is that Currency Management Automation allows them to efficiently collect and process the firm’s FX exposure with procedures that eliminate human error and other operational risks. The solution uses APIs to run the end-to-end FX workflow, allowing exposure data to seamlessly flow between different systems —ERP, TMS and others— without any need for spreadsheets.

Treasurers set up their own business rules according to the different types of foreign exchange exposure they need to collect and process, and let technology remove the risks and costs associated with manually executed tasks. With an added bonus: they can remove concerns about the accuracy of their budgeted FX exposure, giving them more time to improve forecasts.

(*) Note that more than one type of price dynamics can exist within the same company — think of heavy machines, spare parts, and services in the industrial engineering space, each with its different pricing criteria. In this case, the type of FX exposure will be different for each business line.

WEBINAR ALERT | Everything you need to know about payments for future-proof cash and treasury management

treasuryXL | Nomentia |

Date & time: December 2, 2021 at 2.00 pm CET | Duration 45 minutes

Finding the optimal payments process can be challenging. Therefore, TreasuryXL and Nomentia experts join forces to discuss payments in more detail.

Join the webinar to learn more about:

Introduction TreasuryXL and Nomentia
Payment set-ups for a future-proof multinationals
Areas of new developments and challenges
Dealing with different bank connections and ERP interfaces
The involvement of IT in technical payment set-ups
User management
Fraud management
Putting it all together

At the end of the webinar, we’ll have time for a short Q&A session to answer your questions.

Click on the banner for registration.

Meet the speakers

Kees-Jan Kindt

Seasoned Treasury Expert
TreasuryXL / Gazprom

Huub Wevers

Senior Sales Manager
Nomentia

Tapani Oksala

Solutions Manager
Nomentia

Expert-led Conversation | The Digitalisation of Treasury: Your FX Risk Management toolbox for 2022 | 30 November 2021

treasuryXL | Kantox

Date & time: November 30, 2021 at 9.30 am CET | Duration 45 minutes

2022 is just around the corner, and we want to make sure you’re armed with the best technology tools to help push your treasury department to the next level.

Join Kantox and TreasuryXL in this expert-led conversation on the future of FX risk management and the treasury trends to tap into in 2022.

Moderated by Pieter de Kiewit, owner of Treasurer Search, this deep-dive into the evolution of technology in treasury departments and the increasingly strategic role of the treasurer, will bring together insights from industry leaders, including Florin Hica, Head of Global Middle Office and Risk Strategies at ZF Group, Antonio Rami, Chief Growth Officer and co-founder at Kantox and François Masquelier, incoming President of the EACT.

The panel will be covering the following topics:

Treasury trends towards digitalisation
Why your Excel spreadsheet is not enough to manage currencies
The changing role of the treasurerThe session will close with a Q&A session.

Simplify your global business payments

18-11-2021| treasuryXL | XE | LinkedIn

Whether your business needs to process 3 or 150 international payments a month, learn how you can make payments to 220+ countries within your own business applications, and benefit from:

• Faster automated payment processes
• Savings using bank-beating exchange rates
• More accurate reporting by eliminating manual errors
• Secure transactions by validating payment data before it’s sent
• Transparency by receive tracking and reporting of each payment to its destination
• Flexibility to send to multiple currencies in a single file upload

Xe enables you to achieve everything a third-party payment provider has to offer, directly from your own business applications.

REQUEST DEMO

5 reasons why integrating Xe Global Business Payments into your own business applications will help power your business:

1. Improve your Financial Reporting
Xe Global Payments within your own business platform allows you to automatically reconcile foreign currency exchange rates directly at time of transaction. This means no more duplication or transferal of data from one application to another. Greater accuracy means greater transparency and visibility on your financial reporting, enabling you to make more confident business decisions.

2. Protect supply chain relationships and staff in overseas offices
If you are paying suppliers overseas, you want to ensure that your supply chain is protected, that you have full visibility on expenses so that your customer base is not impacted by any delays or rise in cost. And if you need to pay staff overseas you want to ensure they receive the right amount, on time, every time. By using Xe Global Business Payments within your own platform, any errors with bank account details are immediately highlighted, giving you time to rectify any costly mistakes.

3. Stop paying more than you should
Xe’s preferential exchange rates typically save you typically more money than if you used your bank for your business global payments. When you streamline your payment processes using Xe Global Business Payments in your own application, you are saving time on every overseas payment. That means you can save both time and money.

4. Improve speed and accuracy of high-volume, time-sensitive payments
It’s so important to have strict data verification and validation processes. We verify payments before they’re sent, so we can quickly flag any unsuccessful payments. For example, our system has a table of rules for each of the different payout currencies we offer. If you uploaded a payment to Brazil without a bank CLABE number, it would tell you it’s missing. Sending certain currencies can be extremely problematic, so we take out the guess work and make sure payments get where they need to go.

5. Get the right specialist support
A solution can only be as good as the support it offers. At Xe, we understand the daily challenges global Finance functions face. Our support team establishes a good rapport with clients and get to grips with the practical and technical elements of resolving problems quickly and efficiently. Our experts are available around the clock, to resolve issues no matter where clients are located or what time zone they’re in.

By using Xe Global Payments within your Microsoft Dynamics 365 or Sage Intacct applications, you can streamline your international payments process, and benefit from quality customer service and support from Xe’s front and back-end operations.

REQUEST DEMO

Online checkout starts before the payment solution (Dutch Article)

Het sleutelmoment in de e-commerce-funnel is de betaling. Online betalen blijft een hobbel, zeker in vergelijking met het gemak van contactloos en zonder pincode betalen in de winkel. Snelle en gemakkelijke betaling online verdient daarom speciale aandacht.

Het is goed om je te realiseren dat een klant online meerdere processen doorloopt voordat een conversie kan plaatsvinden. Tijdens dit proces bied je de klant zoveel mogelijk aandacht, beleving en gerichte informatie over dat waar hij of zij naar op zoek is. Dit alles binnen de ‘wetten’ van de optimale online klantbeleving.

Snel betalen

Maar zodra de klant de keuze definitief heeft gemaakt volgt het betaalproces. Voor jou als verkoper is dat een belangrijk proces op weg naar conversie, maar voor je klant is het een noodzakelijk kwaad waarin hij inhoudelijk veel minder geïnteresseerd is. De keuze is gemaakt en je klant wil gewoon zo snel mogelijk weg. In dit proces is snelheid dus van het grootste belang. Hoe sneller je klant kan betalen en vertrekken, hoe kleiner de kans dat hij alsnog afhaakt.

De online sales funnel is geen lineair proces. Knip het daarom in tweeën:

Online shoppen = Aandacht en beleving
Online afrekenen = Snelheid

Schematisch zou je er zo naar kunnen kijken:

De snelheid van het afrekenproces bepaalt mede of je klant het inderdaad gaat halen tot en met de betaling. Hoe meer tijd je klant kwijt is aan dit proces, hoe groter de kans op afhakers (drop-offs).

Het grootste deel van het afrekenproces bevindt zich overigens buiten het domein van de betaalprovider. Er zijn uitzonderingen, bijvoorbeeld wanneer je klant met PayPal betaalt, maar dan gaat het dus om een situatie zonder vrije keuze van de betaalmethode. Ook is de afweging vanuit het ‘kosten-versus-conversie’-oogpunt in dit geval vaak uitdagend.

Het online afrekenproces eindigt bij de betaaloplossing

Mooi zo: je klant heeft het gehaald tot aan de betaalpagina. In dit laatste gedeelte van de checkout is de betaaloplossing van je betaalprovider wél van grote invloed op de conversie. Zowel net vóór de betaling als net ná de betaling door je klant.

Enkele aspecten van net vóór de betaling waarbij de betaaloplossing van invloed is op de conversie lees je hieronder. Het gaat hier over zaken die van toepassing zijn op de betaalpagina. Het gaat hier over aspecten die van toepassing zijn op de betaalpagina. Dus vanaf de keuze van betaalmethode, ofwel het moment dat je klant daadwerkelijk wil gaan betalen. Ook noem ik aspecten van net ná de betaling waarbij de betaaloplossing van invloed is op de conversie. Het gaat hier om aspecten waarbij je klant het hele checkout-proces met succes heeft doorlopen, op de laatste betaalknop heeft gedrukt, en er toch een kink in de conversiekabel komt.

De juiste mix van relevante betaalmethoden. Je PSP kan je hier onderbouwd inzicht in geven. Welke betaalmethoden zijn in je marktsegment noodzakelijk om een optimale conversie te behalen. Kijk hiervoor ook naar verschillende landen en voorkeuren. Maar maak per betaalmethode ook de ‘kosten-versus-conversie’-afweging.
Zorg dat alleen klanten voor wie de betaalmethoden relevant zijn deze te zien krijgen op de betaalpagina. Het heeft bijvoorbeeld geen zin om een Engelse klant te confronteren met iDEAL als mogelijke betaalmethode.
Zorg ervoor dat je klant de betaling doorloopt in de look & feel van je bedrijf. Ook als je nog gebruik maakt van een redirect-pagina naar je betaalprovider.
Geef klanten de mogelijkheid om betaalgegevens op te slaan. Dat stimuleert niet alleen herhalingsaankopen, maar het invoeren van een 16-cijferig creditcardnummer geeft een grote kans op fouten.
Een responsive mobiele klantbeleving met een finger-friendly numeriek toetsenbord en een numerieke veldherkenning is wel zo prettig voor je klant.
De ‘achtergelaten winkelwagen’-recovery. Een verlaten winkelwagentje opvolgen in een branded e-mail kan je klant motiveren om toch af te rekenen.
Retries: wordt de betaling toch niet geaccepteerd? Zorg er dan voor dat je klant een alternatieve betaalmethode krijgt aangeboden, maar zonder dat de winkelmand per ongeluk wordt geleegd.
Fraude: een klant kan met een gestolen credit card afrekenen, of het geleverde ter discussie stellen. In beide gevallen staat de conversie op losse schroeven. Verkoop je een fraudegevoelig product of een fraudegevoelige dienst, zorg dan voor een goede fraudemanagementoplossing waarmee je de balans tussen je conversie en je frauderatio goed kunt managen.
Het optimaliseren van autorisatie-success rates op creditcardtransacties: dit is vooral interessant als je veel naar relatief ‘exotische’ landen verkoopt waar de autorisatie success rate op creditcards laag kan zijn. Steeds meer PSP’s bieden netwerkoplossingen waarmee ze de autorisatie-success rate kunnen verbeteren.

Conclusie

In de winkel betalen kan tegenwoordig makkelijk en snel. Je houd je telefoon dicht bij de terminal en klaar. Online betalen is helaas vaak nog tijdrovend. Want zodra je klant in het online winkelmandje op “bestellen” klikt wordt een checkout-proces doorlopen. De optimalisatie van dit proces vindt plaats binnen en buiten het domein van je betaalprovider. Een snel checkout-proces met een geoptimaliseerde klantbeleving helpt je klant om deze laatste fase van je funnel met succes te doorlopen.

Ramon Helwegen

About EcomStream

EcomStream is an independent consultancy and is specialized in optimization of online, omnichannel and marketplace payment solutions, and optimization of checkout flows.

The goal is to achieve much lower costs for you while creating a much better customer experience for your customers.

Thanks to its lean organisational model, EcomStream will help you to reduce the cost of ownership of your payment solution and to improve your ROI, fast.

The Launch of Treasurer Test 2.0 Is Just Around The Corner. Why and How did We Create a New Version?

16-11-2021 | treasuryXL | In 2017 we created the Treasurer Test, an online, peer-based assessment that measures the technical knowledge in treasury and the personality profile of the candidate. The idea for this originated from two important observations. First, in most labour markets there is no recognized qualification in treasury like CPA or CFA in […]

Changing priorities of corporate treasurers post-pandemic

| 15-11-2021 | Eurofinance | treasuryXL | LinkedIn

More than 18 months have passed since treasury professionals around the world had to leave their offices at short notice due to the escalating covid-19 crisis. In April 2021, EuroFinance carried out a survey to find out more about the different ways the pandemic has affected treasury professionals. Alongside the adoption of remote working, the subsequent report highlights treasurers’ accelerated adoption of digital technologies, and the contribution that treasurers make to board-level decision-making during a crisis.

What are the key takeaways from this report?

The importance of cash flow forecasting has been underlined by the crisis. Almost three quarters of treasury professionals have increased their focus on cash forecasting during the crisis, while 54% plan to prioritise cash forecasting in the future.
Cash management and liquidity management remains a top priority for treasury professionals. Seven out of ten said cash management/liquidity management was a top priority going forward.
Covid-19 has accelerated digital transformation. Alongside the rise in remote working, treasury teams have increased their adoption of robotic process automation (RPA), APIs/cloud, machine learning/AI and virtual accounts/in-house banks.
Treasurers have been more involved in board-level decision making during the pandemic, with 39% of treasurers saying they are more involved since the crisis began.

Want to see the full report?

Download here

How To Expand Your Business Overseas

11-11-2021| treasuryXL | XE | LinkedIn

As a growing business, expanding overseas can present a lot of exciting opportunities. However, it also requires some careful thought as it can seriously disrupt your existing business activities – even if only temporarily. Therefore, it’s vital that business owners looking to expand have fully understood the impact this will have on the day-to-day running of the company, as well as determining whether the rewards are going to outweigh the risks. If going overseas is the next important step for your business, that’s great news, but knowing where to start can be tricky. You need to gain a deep understanding of the competition, local market, whether you’ll need new office space and how you’ll build your international team.

That’s why we’ve put together this guide. Below, we’re going to take a look at eight steps you must take when expanding your business overseas if you hope to succeed.

Read on to find out more.

1. Perform due diligence

Following on from what we said above, before you expand overseas, it’s crucial that you understand the marketplace, competition and the risks. The best way to do this is to perform a deep dive due diligence. This should involve:

A market segmentation analysis to determine if your product will be well received in the local market
A product gap analysis when compared with other local goods or services
Competitor analysis
Your market opportunity/sizing
How you’ll need to grow/adapt your team to cater for your international expansion

By doing so, you can determine whether this is going to be the right move for your business and your workforce whilst weighing up the risks and rewards.

2. Put together a detailed strategy and business plan

As with any new business decision – especially one of this size – a detailed strategy and business plan need to be created. This needs to take into account the specific economic, cultural, governmental and market conditions in the local area.

Your strategy should include your short, medium and long-term goals, and it should set out your metrics for measuring success. It’s also important to create a budget, tactical plan, key dates and marketing strategy.

By putting together a localised strategy in this way, you can stay on the path to success whilst ensuring that your move overseas stays in line with the overall business goals and objectives.

3. Create a frontline team

When moving your business overseas, it can be tempting to quickly try and build a local team from scratch. This can be extremely time-consuming, risky and means your expansion is not going to get off to the best start.

Instead, you should consider relocating some of your key senior staff, even if the move is just temporary. By relocating proven and talented members of your team to your overseas location, you can hit the ground running.

After all, they already know the business, so they can get things set up. They can then help with the recruiting process to ensure that you employ local people who fit with the company culture and can continue to drive the business forward. This will obviously take a bit of work and lots of incentives to have staff members be willing to relocate but taking most of the stress out of it with luggage shipping and providing temporary housing is a good start.

4. Make sure your goods or services are prepared

Your gap analysis should have highlighted any areas of weakness, so you need to take the necessary steps to get your goods or services ready for the new local marketplace. This means:

Making changes to ensure your goods or services stand out from existing offerings
Determining whether you need to localise your goods or services. For example, does the name translate OK into the local language or does it need changing?
Getting a patent and trademark review to ensure your ideas cannot be duplicated by another local provider
Conducting tests and quality assurance to ensure your goods or services are up to local standards
Starting to build a local logistics and distribution network

5. Determine your organisational readiness

A one size fits all approach will not work when it comes to moving your business overseas. This is because the different languages, regulations, laws, customs and cultures will impact how you implement business policies and procedures.

Therefore, you need to make sure that your business can be flexible and accommodate these differences. You also need to evaluate your current structure and whether this will work in another country.

Not only this, but you need to decide on the average salaries, compensation packages and types of benefit programs you’ll be able to offer to your workforce. Remember, if you want to attract talented local professionals, you need to offer competitive packages.

6. Create a marketing strategy

When entering a new market, you need to make sure you have a go-to marketing strategy in place to help you effectively sell your goods or services overseas. This requires a strong sales model and methodology, as well as a pricing model that reflects the local market.

You also need to make sure that your branding will be well received by your new international customer base and create a marketing strategy that shouts about this.

7. Consider your legal readiness

Just as with your organisational readiness, you also need to make sure that you have all the necessary legal documentation and regulations in place, especially because some countries can be very litigious. If you’re unsure what you need to do, it might be time to get a professional opinion before spending time and money expanding overseas.

By ensuring that you get all the right local commercial agreements in place, review any local industry regulations and just generally stay proactive, you can mitigate the risks of legal action or problems further down the line.

This also includes getting the proper tax and finance infrastructures set up so that your foreign branch of the business is adhering to all local corporate policies and procedures.

8. Start establishing relationships with local businesses

The final step in this guide is to start establishing relationships with local businesses to give your own business a strong competitive advantage.

In doing so, you can create a supporting ecosystem of complementary products and services by working closely with local providers. For example, this could be manufacturers, shipping and courier services or local banks.

Now you’re finally ready to make the leap; you should be all set up financially, legally and with a team of talented professionals ready to help expand your business.

Cash Flow Forecasting – Why having the right tools can prove a significant advantage

| 10-11-2021 | treasuryXL | Nomentia | LinkedIn

Introduction David Kelin

David Kelin is the Managing Director of DNA Treasury Limited. He is a cash management specialist with over 30 years of experience working with corporates and financial institutions. Expertise in helping companies analyse their cash management requirements. He has experience in providing advice on treasury management systems selection. Recently he attended a roundtable discussion on cash flow forecasting for Nomentia, and tells us why cash flow forecasting is a crucial activity for every treasury department.

Round table on cashflow forecasting

I recently chaired a roundtable discussion on cashflow forecasting for Nomentia, a market-leading cash management & treasury solutions provider headquartered in Finland. The group included a cross section of treasury professionals representing a wide range of industry sectors and companies of varying sizes but each shared one common objective: how to best improve their cashflow forecasting processes and methods.

Of the many interesting themes to emerge, one challenge remained agnostic to each treasurer: securing ongoing collaboration from their business units and subsidiaries in the provision of reliable, consistent and accurate cashflow data. Given the importance of accurate cashflow forecasting for organisations of all sizes in today’s economic climate, this is one area of the cash forecasting process we’ll return to at a later stage in this article.

According to the Office of National Statistics (ONS) in the UK, 90% of businesses fail due to cash flow issues. Sir Richard Branson summed it up very well when he said, “Never take your eyes of the cash flow because it’s the life blood of the business.”

Focus on cash flow

Cash flow management is crucial for business survival and well-informed decision making around cash flow maximisation can ensure companies are adequately equipped to navigate times of uncertainty and plan for the long-term. Focussing on cash flow, rather than profit, is what successful businesses do. Let’s think of this in simple terms: a profit-making business that does not manage its cash flows effectively can struggle to pay suppliers and suffer from subsequent delays in meeting customer demand. The end result is unhappy suppliers, lost customers and a negative impact on profits.

The burning question therefore remains, if we unanimously agree that cash flow management is vital to business success, then why does it continue to prove an ongoing headache for many organisations. A sentiment I regularly encounter when meeting with treasurers across my network and hotly resonated during the course of the roundtable in question.

Data is key

When we explored this matter in more detail there was a broad consensus that cash flow forecasting is only as good as the data it comprises. The old adage of Garbage In, Garbage Out (GIGO) is true for cash flow forecasting. Inaccurate data leads to inaccurate forecasting, rendering the process inadequate and almost unfit for purpose.

The key outcome? Data is absolutely key. But data can come from many different sources for example the P&L, ERP systems, payroll etc. These data sources tend to be reliable in so much as they reflect known activities, however as a panel member correctly pointed out, relying on data that is derived from the P&L alone, to produce the forecast, does not lead to accuracy. You must also get the business units to provide and update cash flow forecast data in order to complete the picture.

Securing business unit ‘buy-in’ to the benefits of the forecasting process and, just as importantly, being able to depend on their full collaboration around accurate data provision can sometimes prove a hard challenge – here’s some guidelines to increase your likelihood of success:

Get senior management buy-in: the panel agreed it’s not enough for Treasury to simply tell the businesses to provide accurate, timely and reliable data. The process should be endorsed and championed by senior management through regular communication to the business units

Communication, Communication, Communication!: business units must also buy-in to the process. Companies that are the most successful at cashflow forecasting agree that when business units understand the importance of good forecasting, they tend to do a better job of providing quality data. A good example of this was offered by one of our panel members –

“We meet with our business units on a regular basis to explain why we ask them for cash flow forecast information. We always say that poor cash forecasting affects our bottom line. If you get your forecasting wrong, then your exposures are wrong, your hedging is wrong and this can ultimately lead to a potential FX loss which in turn, affects the P&L.”

Another treasurer further explained:

“The best business units are those who have bought into the forecasting process and understand its importance to the whole organisation. They take pride in providing accurate data in a timely manner. This behaviour doesn’t happen overnight but as a result of a change in the company culture which they have bought into. Cash flow forecasting is now part of our Key Performance Indicators (KPI’s).”

The right tools for the job: getting buy-in from business units takes more than just great communication. Panel members were clear that you need to make the data provision process as easy as possible, given most business units are busy running day-to-day operations and have limited bandwidth.

Providing the right tools for the job demonstrates treasury’s commitment to supporting business units with their part of the process. Spreadsheets can be a quick, no-cost tool of choice but are prone to human error and require consolidation at treasury level. Spreadsheets are also time-consuming, not user-friendly and limit data manipulation capabilities around forecast comparisons, variance analysis, what-if scenarios etc. Modern and affordable specialist cloud cash forecasting systems are fast replacing spreadsheets as the forecasting tool of choice, allowing business units input or update data from anywhere, quickly, efficiently and accurately.

In summary, cash flow forecasting is a crucial activity for treasury departments everywhere but to do it well you need to ensure that the entities supplying the information have bought into the process and are provided with the best tools for doing it.

CONTACT US

Announcement | FIS is partnering with Cashforce to bring best-of-breed cash forecasting abilities to its TMS system

08-11-2021 | treasuryXL | Cashforce

Our partner Cashforce is excited to announce that FIS has launched a new cash forecasting and working capital data analytics solution: FIS Cash Forecasting with Cashforce. FIS Cash Forecasting with Cashforce complements and integrates with FIS Treasury & Risk Mgr (Quantum & Integrity edition) and gives organizations the ability to forecast their cash position & FX exposure more accurately for the short & long term.

FIS is enabling mid-market and enterprise companies to manage their cash more effectively, overcoming the existence of
fragmented data, disparate workflows, limited transparency into root-cause analysis and the inefficiency of manual
reporting. With the launch of FIS Cash Forecasting with Cashforce, organizations will gain the ability to forecast their cash
position more accurately for the near term and into the future.

“The solution leverages deep insights into working capital drivers and all the power of artificial intelligence to turn
educated guesswork into specific, reliable predictions,” said Nicolas Christiaen, CEO of Cashforce. “With out-of-the-box
ERP connectivity and the ability to feed forecast data into FIS Treasury and Risk Manager – Quantum Edition and FIS
Treasury and Risk Manager – Integrity Edition, management teams are empowered to generate more timely reporting and
organize their workflow to streamline the cash forecasting process and sharpen decision-making.”

According to PwC’s 2021 Global Treasury Survey, cash and liquidity management – together with funding and capital
structure – are the top two priority topics for treasurers and CFOs. In fact, nearly one third (32%) of respondents to the
2021 FIS Readiness Report indicate that they are investing in digital technology to improve cash visibility.

FIS Cash Forecasting with Cashforce is responding to that need, helping corporations overcome the problem of
fragmented data by consolidating information from ERPs, AR/AP, procurement, sales, treasury management and other
systems while leveraging pre-built connectors that ensure a seamless flow of high-volume, granular data. Smart
forecasting logic creates highly accurate forecasts to evaluate different scenarios, analyze impact and calculate
forecast/actuals variance. Collaboration across the organization is simple with easy-to-define workflows that result in an
enterprise-wide forecast that can be consumed by treasury.

“We wanted to find a partner that could complement our treasury management solutions with an AI-driven cash
forecasting solution to help solve our clients’ forecasting challenges. I am happy to say Cashforce is that partner,” said
Steve Evans, senior vice president, Product Management, Corporate Liquidity and Insurance at FIS. “And because the
solution is SaaS-based, it is easy to implement and maintain – enabling treasury departments to focus on running their
treasury operation.”

Request a demo

About Cashforce

Cashforce is a ‘next-generation’ Cash forecasting & Working Capital Analytics solution, focused on automation
and integration. Our cloud-based software enables corporates to unlock their data and create smarter decisions,
saving time and money. By integrating internal & external company data (ERPs, TMS, data lakes etc) and
processing them through machine learning techniques, our software provides insight into cash flows & working
capital, automates manual and cumbersome treasury tasks and enables AI-powered-scenarios. Cashforce is
used by midsize to large corporates and has users in over 120 countries. To learn more, visit www.cashforce.com. Follow Cashforce on LinkedIn and Twitter.

About FIS

FIS is a leading provider of technology solutions for merchants, banks and capital markets firms globally. Our employees are dedicated to advancing the way the world pays, banks and invests by applying our scale, deep expertise and data-driven insights. We help our clients use technology in innovative ways to solve business-critical challenges and deliver superior experiences for their customers. Headquartered in Jacksonville, Florida, FIS ranks #241 on the 2021 Fortune 500 and is a member of Standard & Poor’s 500® Index. To learn more, visit www.fisglobal.com. Follow FIS on Facebook, LinkedIn and Twitter (@FISGlobal).