The ‘Virtual Reality’ of Treasury
Global Treasury Benchmark Survey 2017
PwC’s latest global treasury benchmarking report reveals that the success of the treasury profession is dependent on how well it operates in an increasingly virtual environment. It records the views of over 320 treasurers and chief financial officers (CFOs) from around the world.
The forces changing treasury
Financial technology, such as online tools, enterprise resource planning (ERP) and treasury management systems (TMSs), is finally delivering on promises made over the last ten years. Integration, unbroken audit trails, enhanced security and workflow enable workers to collaborate on processes independent of their physical location, and the declining cost of treasury technology makes this more and more available.
Virtualisation is prevalent in treasury and probably has more impact here than on other business functions. It requires a more collaborative and less hierarchical organisation of processes. CFOs are also urging treasurers to take on wider responsibilities.
The treasury agenda
The treasury agenda continues to be dominated by traditional tasks such as liquidity management, risk management and funding, but CFOs are tending to put more emphasis on compliance and IT security. Cash flow forecasting is at the top of the treasury agenda, and cybersecurity, simplification of bank connectivity and establishing centres of excellence are being promoted to exempt the risks of cyber attacks. Other issues on the agenda are bank documentation/Know Your Customer (KYC),
Changing role of treasury
While 83% of respondents have a dedicated central treasury department, on average only 35% of the full-time equivalent (FTE) involved in treasury processes are employed in treasury departments. Treasury is widely seen as value-adding shared services, with 92% run as a cost-saving centre. Sixty-four per cent of the respondents say their treasury operates as the central counterparty or the group’s in-house bank.
The increasing virtual reality of treasury implies that it is no longer only about technical skills and centralised processing: success in treasury is now about integration and collaboration.