Tag Archive for: treasury

Online Treasury training programs: a new trend and options increase

| 21-11-2016 | Annette Gillhart |

online-trainingIf you are working as a treasurer and think about following a training you might as well look on the internet: an increasing number of programs are given online. We thought that it might be useful to check what’s on there and present a few.

A small selection of what we found

 

  • Hecht Consult Bank Training and Treasury Consultancy
    Michiel van den Broek is a financial expert and has hands on experience managing foreign exchange and interest risk. The last 10 years, Michiel has focused on training and has set up the Financial Training Hub. He has created custom programs and delivered training to hundreds of participants working for banks, financial supervisors and other financial institutions on subjects such as financial markets, asset & liability management and risk management. Michiel has published an e-book ‘Understand Banks & Financial Markets’ to introduce training participants in the world of finance. He offers training programs such as Financial Markets (Advanced), Banking Basics, Risk Management Basics, Compliance and Financial Markets, Introduction Asset & Liability Management, Bank Management and more. Read more
  • Coursera
    Free training programs! Coursera is an education platform that partners with top universities and organizations worldwide, to offer courses online for anyone to take. Their mission is to provide universal access to the world’s best education. Statement from their website: ‘Online learning plays a significant role in a lifelong education. In fact, a recent report by the U.S. Department of Education found that “classes with online learning (whether taught completely online or blended) on average produce stronger student learning outcomes than do classes with solely face-to-face instruction.’ Go and check the search term  ‘Treasury’. At the moment they offer two trainings: ‘Global Financial Markets and Instruments’ and ‘The Global Financial Crisis’. Read more
  • Treasury Services
    Next to other services they offer Treasury training and education in their Treasury Acadamy. The e-learning Treasury Academy enables participants of programs to decide when, where and how they want to follow training courses. Training courses are instantly available through their secured platform. They offer training programs on Foreign Exchange Risk Management, Foreign Exchange Options, Interest Rates and Interest Rates Risk, Modern Bootstrapping, Cash Management and more. Read more

Many more options

It is obvious that this is just a small selection of what can be found. There is more and options increase. If you do not want to follow courses alone you can consider peer assesments or blended learning, too.

Have you followed an online training program lately?  Please feel free to share your experience!

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annette-gillhartAnnette Gillhart – Community Manager  of treasuryXL

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How Bank Independency improves your Treasury Performance

| 18-11-2016 | PowertoPay |

bankgebouwenAs RBS in april 2016, ABN AMRO announced recently that they will lay off another 1500 employees worldwide and reduce services due to ongoing digitalisation. We came across an article of PowertoPay and in the light of recent developments you might find it interesting to read.

As we emerge from the global credit crisis and banks are starting to (geographically) withdraw from some parts of the market, managing cash flow more effectively is a top priority for treasurers. Monitoring, analysing and reporting on underlying business cash flow and risk has become extremely important. Despite the changing role of the treasurer which resulted in new requirements, treasury must still determine the optimal organizational structure that meets both strategic goals and supports overall efficiency. These efficiency goals have created the need for centralized bank-agnostic solutions that aggregate all financial information onto one platform.

The evolved need for bank-independency

As competition increases in the payments market, banks need to create competitive differentiation, either in-house or in a shared model. Banks need to reshape their focus and keep a consistent client focus. A recent example of a bank that needed to reshape was the withdrawal of RBS from a large number of countries. RBS has made the choice of being a consumer bank for the UK and decided to end servicing the earlier acquired Global Transaction Banking customers.

The withdrawal of RBS from large parts of the market created the need for large corporates to investigate bank-independency and bank-agnostic solutions more thoroughly. A logical consequence, because how can you be certain that your bank will remain active in a specific country for over five years? Frank Nolden, CEO of PowertoPay states:  “If the financial crisis has taught us anything, it’s that no matter how big, banks can go bankrupt. Therefore, corporates want to decrease their risk on financial counterparts, because these counterparts might no longer exist in a few years”.

Reducing risk

In order to: 1) reduce the risk on financial counterparts 2) overcome the bottlenecks  3) reduce potential credit inefficiencies found within the use of single banks, corporate treasurers increasingly focus on bank-agnostic solutions. Connecting to multiple banks via a centralized bank-agnostic solution means lowering the risks of having to change and select new banks in the future, which allows corporates to have greater financial performances.

Succeeding with simple connectivity

Large corporates more often choose for developing channels and services that support a multi-banking, bank-agnostic approach. According to the CEO of PowertoPay, Frank Nolden, “the maintenance of all the different multiple technology systems have driven corporates to opt for simple hub connectivity through centralized solutions”. Many corporates have to connect to a myriad of bank portals with numerous security tokens to handle their treasury operations, which considerably increases risk. Bank-agnostic solutions automate, centralize and standardize globally these payment and cash management processes, allowing treasurers to make better, more informed and faster decisions based on real-time holistic insights, improving their performance.

Conclusion

Corporates are always seeking to increase the levels of operational efficiency. Maintaining all types of different multiple technology systems with low efficiency levels have driven treasurers to opt for bank-agnostic, centralized solutions. These solutions reduce the risk on financial counterparts, creating more streamlined and effective treasury operations.

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Consider a treasury intern!

| 31-10-2016 | Pieter de Kiewit |

As you might know, I play an active role in the development of the Minor Treasury Management at the Hogeschool Utrecht. This is the second year this program is organized for Bachelor students, not only from Utrecht but also schools from other parts of The Netherlands.

I contribute in three aspects: informing students about why they should choose this minor, describe the relevant labour market to the students who chose the program and connect them with the market. Both guest lecturers as well as internship counselors found their way into the program through my mediation.

As far as I can oversee the Hogeschool Utrecht is currently the only higher education institute in The Netherlands with a structural focus on treasury. All other active in this field offer post graduate / evening study programs. In our recruitment we hardly see young graduates with thorough knowledge of corporate treasury.

In this blog I want to invite you to hire an intern. Perhaps they can offer the solution for the project where you do not know if you want to hire a consultant, ask a colleague or do it yourself. Interns ask surprising questions and present solutions you did not think about. Their recent classes taught them about theories you never heard of before. They can help you tackle projects and you can help them prepare for the treasury labour market. Win-win.

Did you ever hire a treasury intern? Tell us about your experiences in the comments below!

Editorial note

  • The internship for students of the Minor Treasury Management at the Hogeschool Utrecht will start February 2017 and will last for 20 weeks;
  • It is a full-time internship: the students will work for 4 days at your office and can work one day a week on their thesis, other structures can be discussed;
  • They prefer that students take the internship on their own, but in pairs may be negotiable.

 

Pieter de Kiewit

 

 

Pieter de Kiewit
Owner Treasurer Search

 

 

 

Reports: Journeys to Treasury, Treasury Systems Guide and The Future of Treasury Management Systems

| 26-10-2016 | treasuryXL |

A photo by Matt Duncan. unsplash.com/photos/IUY_3DvM__wA few interesting reports came out in the last couple of weeks: ‘Journeys to Treasury’, ‘Treasury Systems Guide 2016’ and ‘The Future of Treasury Management Systems’. We did some reading and decided we wanted to share these reports with the treasuryXL community. Let us know what you think! Did you see a report, article or something else that could be interesting for the treasuryXL community? Don’t forget to share!

 

Journeys to Treasury – BNP Paribas, EACT, PwC and SAP

In this day and age being a treasurer can be a challenge. BNP Paribas, the European Association of Corporate Treasurers (EACT), PwC and SAP have joined forces to form a thought initiative whose aim is to help finance professionals resolve some of the intricate puzzles that constitute the treasury of today and tomorrow. This resulted in the report: “Journeys to Treasury “.

Journeys to Treasury is a report that bases itself upon the understanding and knowledge of the challenges treasuries face today as well as the ability to anticipate the impact of transforming trends. In Journeys To Treasury, each of the four contributors offers their own expertise gained from their own journeys in this bumpy – yet encouraging – landscape, structured in 3 sections: Continued Innovation, Anytime, Anywhere Treasury and Cybercrime and Fraud.

Interested in reading the full report? You can download ‘Journeys to Treasury’ here.

Treasury Systems Guide 2016 – Bobsguide & GTnews

This bumper edition is full of features and commentary from industry experts, as well as our traditional functionality matrix that delves deep into what different treasury management systems are capable of.

With the recent decision to Brexit and the upcoming US election, it could mean that treasurers might have to sleep with one eye open in order to tackle potential fraud, manage cash visibility and meet regulatory requirements in these uncertain times.

We also look into what’s happening with regulation in Europe, innovation in Asia and tax in the United Kingdom which tie into some of the topics discussed by the bank and the TMS provider we interviewed.

Interested in reading the full report? You can download it here.

The Future of Treasury Management Systems – FX MM

FX-MM brings together leading industry experts to discuss the future of Treasury Management Systems (TMS) and examine how technology is enabling Treasurers to ditch the data gathering and take on a more strategic role within their organisations.

Our panel examines how technology is also helping to democratise the use of TMS, with Software-as-a- Service offerings enabling corporates large and small to enjoy the benefits of the cloud and more user-friendly systems.

Interested in reading the full report? You can download it here.

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Accountability foreign currency risks

| 19-10-2016 | Maarten Verheul |

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Sometimes in financial statements, I read that the income statement was negatively impacted by exchange losses. This seems unnecessary to me.

At the conclusion of each and every purchase order sales in foreign currency is a currency forward contract entered to avoid foreign exchange risks. Apparently, often to run the risk in the hope of some extra foreign currency earnings. Well, I can be brief about that. Your business is to sell your product or your service. Or, as they also say, “Every man to you.”

So, whose responsibility is it, that foreign currency is covered with a foreign currency forward contract? I say this is the responsibility of the Treasury department. Treasury should report this, at least to the management. If management decides that it is not covered, it will be their responsibility.

I even think that the Treasury department should report every single time. It may be that management decides not to do the act, because the risk is limited, but the next time the risk may be much greater.

The best scenario is when the management wants to exclude all risks with foreign currency and treasury delegates to hedge all transactions, buying and selling foreign currency forward exchange contracts. Then, there never is a doubt about what needs to be done and you won’t lose time consulting with management or directors.

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maartenverheultxlMaarten Verheul – Treasury Consultant

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Treasurer en controller; een paar apart ?

| 22-09-2016 | Jan de Kroon |

collaboration-1106196_640De treasurer en de controller zouden twee handen op dezelfde buik moeten zijn, maar de vraag is of dat in alle, of zelfs de meeste, gevallen wel zo is. Enkele uitzonderingen daargelaten, zijn de verschillen groter dan de overeenkomsten.

Kort door de bocht zou je kunnen stellen dat de treasurer zich met het financieren van de operatie bezig houdt aan de passiefzijde van de balans. De controller houdt zich dan bezig met vooral de operatie waarvoor die middelen aan de actiefzijde zijn aangewend en zorgt ervoor dat die cash ook weer beschikbaar komt voor de verschaffer van die middelen. Beiden spelen een belangrijke rol in de cash conversion cycle en als het goed is, stemmen ze hun belangen onderling goed af. De praktijk leert echter dat het in veel gevallen niet zo rooskleurig verloopt in de afstemming.

De treasury functie onderhoudt een brug tussen de financiële belangen van de eigen organisatie en ontwikkelingen op de financiële markten er buiten. Hij zorgt voor blijvende toegang tot bronnen van geld, beschermt vermogen en resultaat tegen financiële risico’s en beheert een superieure en kosten-efficiënte financiële infrastructuur. Daar is weinig op tegen te hebben; voorwaar een nuttige rol die op begrip van iedereen kan rekenen. Althans, dat zou je denken.

Toch gaat het in de relatie vaak verre van soepel. Meestal omdat ze niet alleen een andere taal spreken, maar ook elkaars wereld niet echt lijken te kennen; laat staan echt begrijpen. De treasurer heeft een groot belang bij juiste, tijdige en volledige positie informatie en verwacht die van de controller te ontvangen. Zich niet realiserend dat de controller het belang vast wel onderschrijft maar in zijn eigen business unit met een vergelijkbaar vraagstuk worstelt; hoe krijg ik in des hemelsnaam tijdig betrouwbare informatie uit de lijn en het primaire proces. Voor eigen gebruik in het veld, maar ook om een collega op het hoofdkantoor een plezier mee te doen.

Anders dan de gemiddelde treasurer is echter de controller een vogeltje dat minder goed gebekt is en mede daardoor niet altijd lijneenheden kan overtuigen van nut en noodzaak van tijdige prognoses op basis waarvan de treasurer zijn randvoorwaarden beter kan inregelen. Om dat op te lossen en betere positie-informatie te verkrijgen uit de operatie, is een aantal elementen van belang:

1. Zorg er voor dat treasurer en controller elkaar beter leren begrijpen. Dat kan door meer in te spelen op business partnership dan ‘leverancier-afnemer’;

2. Zorg voor een beter financieel economisch bewustzijn bij de lijn. Dat kan door bijvoorbeeld het hanteren van feedback en feed forward technieken maar ook door het benoemen van lokale treasury referenten in het primaire proces;

3. Zorg dat de verantwoordelijkheden scherp zijn gedefinieerd. Daarmee zorg je dat tenminste iemand zich verantwoordelijk voelt voor de juiste positie op het juiste moment;

4. Een periodieke treasury nieuwsbrief kan helpen bij het vermijden van ‘ver-van-het-bed-shows’ en het verkleinen van de communicatie-kloof.

Zo komen de handen weer op één buik.

Jan de Kroon

 

Jan de Kroon

Owner & Managing partner of Improfin Groep

Remarkable influx non-Dutch in the treasury labour market

| 19-09-2016 | Pieter de Kiewit |

This week it will be the second time I will give a guest lecture at the Hogeschool Utrecht. They offer a minor treasury management to students with a finance and economy focus. It is my role to describe the labour market they might enter. In preparation I made a quick scan of the treasury labour market and noticed that treasury in The Netherlands, especially in the junior role, is staffed by relatively many internationals. I dug in and have some hypothesises about the why and consequences.
 
The first and obvious is that treasury organisations are by nature international organisations. Possibly treasury hiring managers are not bothered as strong by the bias managers do in other job types. Treasury does not have a prominent place in the Dutch financially focused educational system. This is not different from other countries, the job type is a too strong niche. Graduates are educated in a system where controlling, accounting and audit dominate. Dutch graduates shape their career to what they want and know about, so these three job types (and “onbekend maakt onbemind”). Non-Dutch graduates in the Dutch labour market are bothered by the earlier mentioned bias and shape their career based upon what they can get: a treasury job. Hence both demand and supply strengthen the influx.

Separately from this I want to mention the difference in mentality between Dutch graduates and many non-Dutch ones. I notice that work-life balance, having a rewarding job and an employer with social responsibility are important aspects for Dutch graduates. Many senior and/or non-Dutch managers have a hard time dealing with this mentality. Graduates who came from China or India are often best-of-class, energetic and very dedicated. Work is for them their first priority. This often outweighs their different communication style, especially in more junior positions.

I don’t think there are any dramatic effects of this development. The likelihood of non-Dutch moving abroad is relatively high so a brain drain might occur. Furthermore Dutch post-graduate education like the Register Treasurer program will suffer in popularity in favour of the ACT, CTP or CFA programs. Personally I enjoy the international treasury business environment and contribute in getting the right man or woman in the job. Let’s see what will happen

Pieter de Kiewit

 

 

Pieter de Kiewit
Owner Treasurer Search

 

Why companies still use Excel

| 25-08-2016 | Lionel Pavey |

spreadsheet2
Do you still rely on spreadsheets in your daily treasury operations? We have read multiple articles on this subject lately and we decided to ask our community: Why do treasurers still rely on spreadsheets? Yesterday Jan Meulendijks gave us his opinion on the topic. Today expert Lionel Pavey talks about the benefits of using Excel in your company.

Why do companies use Excel?

Cost – it is part of the Microsoft Office Package; low maintenance costs

Use – everyone has some level of proficiency with Excel

Versatile – data can be customized to your own requirements

Simplicity – comes preloaded with over 400 different formulae, though far less than 100 are truly needed for Treasury purposes

Training – most people learn on the job, no need for expensive courses to help people use the software

Flexible – give the same data to different people and see how they uniquely extract the data they need to answer their queries

Compatibility – all relevant data that is present on standalone accounting software etc. can be exported into Excel and adjusted for individual purposes to achieve the desired results

Problems with Excel?

Ignorance – getting staff to comprehend the route from input to output

Errors – not incorporating checks and balances that can highlight discrepancies

Individualism – is the output only for your consumption or is it passed on down through the chain, enhanced and then passed on again?

Disarray – everyone applies different fonts, layouts, conditional formatting. Should be a company policy in place to determine how data is collated and presented

Uncertainty – why do people insist on hiding columns and rows?

Duplication – the same spreadsheet data is present on many PC’s at the same time with subtle but significant differences. Someone has to own the original document

Solutions?

Dedicated BI software – expensive, no value outside of the present company normally, requires regular maintenance, multiple departments have to sign off before it can even be implemented, constant reviews of whether the correct modules are present, system updates

Design Structure – implement a company policy clearly dictating how “shared” spreadsheets are to be designed.

Input Structure – agree who delivers what, to whom, when and in the agreed format

Share results – allow other people to see how their data has been incorporated into the final reports so they can appreciate the significance of their contribution

Ownership – define who owns what part of the process (their level of responsibility) and who owns the spreadsheet

Reports – ensure that the end users clearly define what they require at the start. 10 versions of a spreadsheet before they get what they wanted means they did not know what they wanted or did not communicate clearly

Conclusion

Excel is well known, robust, versatile and understood. For cash flow forecasting 4 or 5 secure “master” spreadsheets can allow for most situations – daily cash flow recording, future cash flow forecasting, agreed budget, capital expenditure plans, funding commitments. These have to be well protected and isolated on the hard drive. Everything is a trade off – nothing will give you 100 per cent accuracy. However, if you can relatively simply design the required spreadsheets then data is always up to date and available when needed. This covers the 80 per cent of the time maxim– the other 20 per cent you will have to work harder to achieve. Excel is not going away – every new versions even more functionality that allows us to achieve the required level of input more easily whilst ensuring that the output can be better analysed and interpreted.

 

Lionel Pavey

 

Lionel Pavey

Cash Management and Treasury Specialist

 

Do you still rely on spreadsheets in your daily treasury operations?

| 24-08-2016 | Jan Meulendijks |

spreadsheet2Spreadsheets, every treasurer knows how to work them. Spreadsheets are deeply embedded in treasury operations and they seem hard to eliminate. We have read multiple articles on this subject lately and we decided to ask our community: Why do treasurers still rely on spreadsheets? (source: gtnews.com)

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Jan MeulendijksJan Meulendijks
In many cases the treasurers of companies have started their area of expertise with smaller (SME) companies, where the available ERP-system did not offer treasury features and/or no separate treasury system was in use. So… you build it yourself in a spreadsheet. The big advantage of this is that such a spreadsheet only features what you really need, and can be kept quite simple but effective.

When the treasurer moves up to a larger company, the basic spreadsheet can be expanded with any new features required. Again, simple but effective. The big disadvantage of course, is lack of system documentation and dependance on the original designer to transfer knowledge to others.
I would like to classify this phenomenon under the “80/20”-rule: with a few basic spreadsheet functionalities you can achieve 80% of your treasury requirements, to achieve the remaining 20% you have to undertake large operations and investments. Is that all worth it???

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Do you still rely on spreadsheets in your daily treasury operations?

Treasury ABC Part IV

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For many people Treasury is, as they think, something that is not concerning. Because there are many items that could be mentioned and listed here, I chose to mention the items that have effect on our daily lives, even if we are not aware of the existence of the described item. Last week I published the third part of the treasury ABC which I’ll call the Treasury ABC for normal citizens. 

 

R is for Regulations

Regulations, regulations. Most people don’t like rules and legislations in their life. The perception is that rules and laws make us “less free”. And in a way, it is. Another way of looking to rules and legislations is that they give a certain assurance that things are going in an way that is generally accepted. Related to treasury activities it is important that the funds invested e.g. for your pension are in safe hands and that risks are limited to guarantee that, when you are entitled to receiving a monthly pension payment, you actually see the amount on your bankaccount. So remember, rules give more certainty and reduce risk for your own sake.

S is for Stock Exchange

Being Dutch it might make you proud to say that a Stock is a dutch invention. One of the oldest known stock is a share in the VOC (Vereenigde Oostindische Compagnie) dated September 9th 1606. Having stocks, and wanting them, brings the next step: a stock exchange where people can buy or sell financial instruments (stocks, options, etc.). Nowadays the index of the Stock Exchange is a main indicator of the state of the economy in a country. The higher the index the better the economy (or the perception of the economic state).

T is for Treasury

When writing the ABC for Treasury it might be helpful to give a definition of Treasury itself.Treasury is about steering and control of financial assets within an organization. Part of treasury management is Risk management. An organization wants to be sure that its financial assets will not disappear “in air” because of wrong investments. Finally, Treasury is also about reporting and justification of the actions which were made with regard to Treasury.

U is for United Kingdom

The United Kingdom is (still) one of the biggest countries in the EU. What makes this country special is that it did not give up it’s own currency but kept the Great Britain Pound (GPB) with care and proud. If that was the right decision is hard to say. Anyway, since we know that the outcome of the 23rd of June the UK will most probably will exit the EU, having their own currency makes such a step less complicated then it already is. Let’s compare some figures between the Euro, the GPB and the US Dollar (figures as at august 8th, 2016):

Currency rate USD 1.00 0.77 0.90

Currency rate GBP 1.30 1.00 1.16

Currency rate Euro 1.12 0.86 1.00

On June 23rd you could buy GBP 762 for Euro 1000. A day later, after the Brexit seemed unavoidable, you could buy GBP 813 and today (august 11th) GPB 859 for Euro 1000. Now we can see that the (financial) world doesn’t think it is very wise for the United Kingdom to leave the EU. The currency rate of the GPB to Euro has dropped around 12%.

V is for Volatility

Volatility of a stock or a currency rate is an indicator for the stability of it. The more volatile the stock, the more unrest around the company concerned. Some stocks are very stable and give the investor lower risk. The more volatility, the more uncertainty in the market. You can figure out that the more volatile the market is the more your investment is at risk.

Jan Doosje

 

Jan Doosje

Owner of Fimterim Advies & Consultancy