Trends 2016: The necessary tool of Treasury Management

By CM Grover

Corporate treasury has evolved into a truly strategic function for most organizations. From being a manager of liquidity and financial risk, corporate treasurer has evolved into a strategic business partner.

Standing at the brink of welcoming year 2016, it is right time to brainstorm some of the key trends in this niche domain of treasury management.

Treasury Management – CFO’s Necessity!

“Improving visibility of balances and cash forecasting” remains the top priority for the CFO, at 21% as per “The Asia Pacific Treasury Management Barometer” report published in 2015. This is followed by these priorities at 12%:

• Enhancing cash and treasury management processes and automation
• Optimizing working capital
• Minimizing and mitigating risk

With volatile forex markets playing a crucial role, effective treasury management has become an inevitable task for every organization’s finance department.

Considering effective treasury management is crucial for CFO’s success in the organization, treasury transformation is gaining momentum. This need has spread beyond multinational corporations to mid-level organizations. The year 2016 should sees more corporates stepping onto the TMS (Treasury Management Solution) wagon, leaving behind their stand-alone ERPs or spreadsheets.

2. Combating Cybercrime

KPMG’s recent survey on Cybercrime has highlighted BFSI as the most vulnerable (at 74%) amongst all the other sectors. With increased number of cases in cybercrime within BFSI segment (at 72%), it has become a critically high priority for the IT departments to ensure high security across multiple access points, and Treasury Management Solution is no different.

A TMS has all the critical data regarding an organization’s past, current, and planned financial transactions. If this data (most of the times in the form of excel sheets which can be easily shared over email) gets into wrong hands, it could be detrimental to the organization!

Increased awareness at the C-level has resulted in identification of cyber risk as one of the top five risks. The coming year should see evolution of TMS with internal monitoring and surveillance strategies covering the assets treasury protects.

3. Cloud and Mobile is the way forward!

Cloud was once viewed with a cynical approach but now it has found way into the corporate’s core operations, Treasury being one of them. With plethora of benefits from “Treasury on Cloud”, the corporates can facilitate integrated cash and risk management, with reduced IT management and software installation costs.

With mobile phones, tablets, phablets becoming an integral part of the corporate executives, “Treasury on Mobile” is not far-fetched, wherein the senior management and stakeholders have quick, real-time access to critical decision making information on their finger-tips; facilitating enhanced business analytics (BI) and critical decision making even on the move!

(The author, CM Grover, is executive director, IBSFINtech)