Cash & Liquidity Management
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Centralising Treasury and Cash Management Processes in the Volkswagen Group

by Michael Zucknick, Managing Consultant, IBM Global Business Services

The expansion of Volkswagen’s global presence over the last few decades has led to increased financial and liquidity related risks. Consequently, Volkswagen was seeking a comprehensive solution to manage financial transactions, global cash flows and financial risks more accurately. In 2005, Volkswagen AG decided to replace its legacy in-house cash, payment and treasury management solutions with an integrated platform based on SAP, referred to as the ‘Global Treasury Platform’. In summary, the Global Treasury Platform provided the following capabilities and objectives:

SAP In-House Cash and Cash Management

  • Build in-house banking and payment facilities;
  • Reduce the cost of intercompany payments, transfers and allocations;
  • Improve cash and liquidity management.

SAP Transaction Management including Market and Credit Risk Analyser

  • Manage financial transactions and execute hedging transactions;
  • Reduce financial risk levels and make risk exposure more transparent;
  • Analyse market and credit risk;
  • Improve corporate governance of the treasury function.

Until the end of 2008, the Volkwagen business unit Audi maintained a separate treasury function from Group Treasury. However, Audi has now finalised the replacement of its financial management systems, and transferred its treasury, cash and risk management operations to the Global Treasury Platform. This was an important milestone in the overall migration project, enhancing operational efficiency and visibility of information without affecting the in-house services and expertise which Audi’s treasury function provides.