by Cynthia Stimpel, Manager, Financial Risk Management, South African Airways
Enforcing segregation of duties
Looking first at operational risk, we have implemented a structured front, middle and back office treasury organisation to enable effective segregation of duties. Our front office dealers take responsibility for execution strategy, dealing and hedging. Our middle office monitors risk, limits and compliance. Back office users manage cash and liquidity, including bank account reconciliation and cash flow forecasting, and manage post-trade activities such as settlement and confirmation.
It is not enough, however, simply to divide responsibilities across different individuals or teams within the treasury department: segregation of duties must also be enforced at a process and systems level. An efficient and secure treasury management system (TMS) is therefore essential to a well-controlled treasury department. We first implemented SunGard’s AvantGard Quantum solution (‘Quantum’) in 2006 based on its ability to support our requirements for straight-through processing (STP) and integrated processing, revaluation, and real-time reporting.