The ACT treasury network (South West England) met in Cirencester in May and I was invited to attend and share what the Policy and Technical team have been working on.
It was my first meeting with the group and I found it a highly informative session. There were members from a range of organisations – including US inbound businesses, manufacturing and retailers, with teams as large as 8 and as low as 1!
A number of topics were discussed at the meeting and it was great to see members sharing their experiences to help others and offer support with materials and contacts.
A couple of people shared the challenges of working for organisations that had grown by acquisition. One explained that although each acquisition used SAP as their accounting system, it had been configured in different ways! For the other, the result was a plethora of bank accounts and banking arrangements – many of which were outside of the core banking group. There was a discussion about the benefits of moving to fewer banks and bank accounts and the consensus seemed to be that the biggest benefits were intangible. Having fewer banking arrangements would allow processes to be simplified and standardised with greater control and the risk of payment fraud falling.
Selecting an appropriate banking partner for Europe was also of interest to the members. It was interesting to note that only US and EU27 banks were mentioned with the over-riding preference for banks that operated across a single platform and had a physical presence across major European jurisdictions.
Time was spent on cash forecasting and the systems and approaches that members used. One discussed running a weekly cashflow forecast and the effort it entailed providing it to senior management. Although it was agreed that nothing was done with the information provided, the CFO still wanted to know that someone was keeping an eye on where the money was going each week. The forecast and actuals were supported by MT 940 reports from across the globe. However, one of the problems identified was that some accounts (such as overnight sweeping deposit accounts) could not be reported on. This made the whole costly exercise less relevant! Very few people ran bespoke systems for forecasting and most were still using Excel (or a combination of Excel and a TMS). Where a TMS was being used, it was more as a data store that allowed a range of comparisons of previous forecasts to be made and for previous forecasts to be easily extracted.
Intercompany netting comes up from time to time and one of the members is working with a 3rd party netting company to help the European business settle their intercompany invoices. The key benefit they’re looking for is the consolidation of currency risks which the head office can then manage efficiently.
Most treasurers have to deal with team issues at least once in their career and the members shared some of their own challenges. Finding the right people and upskilling them at the same time as getting the day job done was a consistent theme. It was good to hear that some of the attendees are doing their ACT exams and the association has worked hard to provide a range of entry points – from eLearning short courses through to the recently revamped Advanced Diploma.
I shared an update on what the Policy and Technical team are busy with – LIBOR reform, the money market and FX codes, Brexit, payments (look for an upcoming article in The Treasurer on Secure Customer Authentication and the importance of 14 September 2019) and the Environmental, Social and Governance agenda, but it was good to hear what’s really keeping treasurers awake at night!
My thanks to Dave Patterson (Dyson Treasurer) and Gill Rowe (Head of Division – Treasury, St. James's Place Wealth Management) for inviting me.
