How the Treasury Quick Scan add value to your business

27/08/2019

| 27-8-2019 | François de Witte | treasuryXL |

Are you considering to invest time and money in treasury within your organization? Do you want to know if you can save a substantial amount of money and/or protect your company against major financial risks?

The Treasury Quick Scan can help organizations with just one scan to assess if an additional effort in treasury can be an added value.

 

The Treasury Quick Scan as a solution
SMEs struggle with increasing exposure to cash & liquidity problems, financing needs and risks (currencies, commodities, interest and liquidity).

Moreover, they do not always have a full-fledged Treasury/finance Department in the organization. That does not mean that these organizations cannot save costs or that there are no opportunities for funding, for example. It is not always necessary to set up a separate treasury department in a company to control and manage the treasury.

The Treasury Quick Scan aims to bring a solution to these companies. An experienced hands-on Treasurer can do a first scan within the organization.

The objectives to provide to the company are:

  • A diagnosis on his treasury
  • A benchmarking towards his peers
  • The identification of the pain points
  • Some quick wins and an initial business case to determine whether it is worthwhile investing in the treasury (resources, tooling).

A questionnaire for 5 treasury topics
By means of a structured questionnaire, the Treasury Quick Scan aims to make a quick scan / diagnosis of the treasury. Down below, we provide you some questions by topic:

  1. Working Capital Management:
  • Do you actively manage your working capital indicators (Days Sales Outstanding, Days Inventory Outstanding, Days Purchases Outstanding)
  • Do you have a credit policy in place?
  • How is your credit control organized?
  • Do you actively manage the payment terms of your suppliers?
  1. Cash and Liquidity Management:
  • Do you all have a visibility on all your cash positions?
  • Who manages the various cash positions daily?
  • Are you sometimes confronted with payments that are not paid due to lack of funds?
  • Do you do daily interbank transfers to settle the debit balances and to invest the excess liquidity optimally?
  • Do you already have an automatic cash pooling?
  • Do you centralize your in- and outgoing payments or consider doing this?
  • Do you have a cash forecasting process in place?
  1. Financing and Bank Relationship Management:
  • Do you experience difficulties in obtaining bank financing?
  • How many banks do you use? Do you need all the banks?
  • Do you ensure that the side business is distributed fairly to banks that grant large credits?
  • Are you monitoring regularly the costs which banks charge to you?
  1. Risk Management:
  • Do you have an overview on your foreign exchange, interest rate and liquidity risks?
  • Can you measure the impact of foreign exchange rate fluctuations on your Profit and Loss account?
  • Do hedge your main risks?
  • Do you have a written policy regarding the risk management?
  1. Organization and Compliance:
  • Which are the current tools in place to manage the fraud and operational risks?
  • Do you apply the 4 eyes principle throughout the company?
  • Do you have an overview of who can sign where on your bank accounts?

A short recap
The Treasury Quick Scan does not solve all your treasury issues but will provide you get a mapping of the current situation, the issues, a first set of recommendations and a business case for further investments in treasury.

For organizations without a dedicated treasury department, this Quick Scan can help them to determine how to manage the treasury. This can be done with own resources and/or you can also consider outsourcing some tasks. This can be very helpful for the development of your company.

How to start a Treasury Quick Scan?
Simply send me a mail or give me a call and we discuss the best option for you.

François de Witte – Founder & Senior Consultant at FDW Consult; Managing Director and CFO at SafeTrade Holding S.A.

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