Building Capacity across the Treasury Grid
by Andreas Lützelschwab, Head of Corporate Finance, Treasury & Tax, Swissgrid AG
National grid company Swissgrid was faced with the challenge familiar to many treasury departments: multiple bank connections and standards, and lack of process automation. To overcome these issues, Swissgrid appointed Treasury Intelligence Solutions GmbH (TIS) to support its automation, integration and security objectives, as the company’s Head of Corporate Finance, Treasury & Tax outlines in this article.
Treasury organisation and priorities
We have a small treasury function at Swissgrid comprising three people in front and middle office, and two people with back office responsibility. We work with five house banks, and maintain around 70 bank accounts. We use SAP as our ERP across the business, which includes the TR (Transaction Manager) and CFM (Corporate Finance Management) modules.
As a small treasury team with diverse responsibilities, it is very important that we are able to automate cash and treasury management processes wherever possible. One of the problems we had in the past was the need to maintain separate electronic banking systems for all of our banks, each of which supports different formats and security protocols. In addition, we used FIDES for our Swiss-based accounts for both account statements and payments.
This meant that we had to dedicate a lot of resource to managing each of the various systems, none of which were integrated with SAP. Payment files had to be manually uploaded into the relevant banking system, and electronic bank statements into SAP. Daily cash positioning and reconciliation was also a manual process. The lack of STP (straight-through processing) was a concern in terms of security, risk of error, and the amount of resource required to undertake relatively simple tasks.
- Fragmented infrastructure
- Lack of STP
- High maintenance costs and resource requirements
- Security concerns
- Rationalise and standardise bank connectivity
- Achieve high level of STP
- Automate and standardise payment and account reporting processes
- Comply with internal and external regulations
- Meet stringent security requirements
- Harness vendor expertise and avoid the need to dedicate resources to system maintenance
- Acquired a credible and reliable partner through TIS
- Visibility over payment processes, cash flow status and cash position
- Compliance with internal and external audit requirements
- Ability to scale up the treasury operations and adapt to changing regulatory and market conditions