international treasury: how kyriba helps you go global

International Treasury10/20/2015 | Greg Person

© 2015 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL.

Global TreasuryWhat’s different?

Let’s get started..


Financial Controls

What’s different about ‘global’ treasury?

• Cash mobility• Borrowing and investing

• Fraud prevention• Policies and procedures

• Netting / Cash pooling• Bank optimization

• FX volatility• Counterparty risk

• New people• More languages, time zones

Cash and Liquidity

Treasury Structures

Risk Management

New business culture


Going global – where to start?

Global Visibility & Payments

Policies, Procedures,

and Control

Cash & Liquidity

Structures

Treasury Structures


Structure of the treasury team may change – organically or by design– Representation in local markets– Time zone and language support– Shared services

Especially if team is regionalized or decentralized:– Ensure centralized visibility and control over treasury ops– Standardized policies/procedures– Central technology platforms (TMS, file sharing)

Treasury Structure





and Control

Cash & Liquidity

Structures

Treasury Structures


How to obtain global visibility1) Connect to all of my banks via:

– Banking partner– SWIFT (MT concentrator or service bureau)– Direct connections to banks– Country protocols (e.g. EBICS, Zengin)– Treasury Management System

Tip: usually a combination is best

Global Visibility


How to obtain global visibility2) Develop global cash forecast:

– Identify the right people (e.g. regional controllers)– Determine the right sources (e.g. ERP)– Implement the right technology to consolidate & provide

feedback (e.g. TMS, spreadsheet)

Global Visibility


How to obtain global visibility3) Analyze effectiveness

– Do I have too few or too many banks?– Do I have too few or too many bank accounts?– Am I able to mobilize cash efficiently?– Am I educated on the tax implications and local regulations in

each region (e.g. is notional pooling permitted?)

Global Visibility


Complete current treasury visibility & actionable information– 1200+ existing bank connections– 500+ payment formats library

Global Visibility with Kyriba


Increasing complexity and scale– Local formats and central bank requirements – Demands flexible bank connectivity – SSC operates a payment factory, centralizing all outgoing

corporate payments– Payments-on-behalf-of (POBO) is a common model in SSCs– Intercompany transactions to be made on the

back of each payment

International Payments


Standardize approval workflow across multiple banks and types of payments

Control the separation of duties in the payment process

Intuitive and interactive process maps to enhance payment controls

Dashboard and mobile app payment approval capabilities

Control the Payment Lifecycle


Track Payment Status of Bank Acknowledgements Global payment format

libraries (XML, EDI, SWIFT) and existing bank connectivity channels

Monitor 4 payment acknowledgement levels from SWIFT and Bank

Complete visibility from initiation, to approval, acknowledgement, and GL account posting





and Control

Cash & Liquidity

Structures

Treasury Structures


Globally, need physical (rather than notional) cash pooling– Unlikely to use same bank across all pooling regions

Often separate pools by region – rolling up to one global pool– Common to have North America, Europe, Asia

Demand for cash mobility (and tax) will determine balances kept within each region vs. swept “home”

Global Cash Mobilization


Interactive liquidity position worksheets to determine HQ, regional and local funding needs

Powerful cash pooling tools , intergroup lending and in-house bank solutions

Multi-bank target balance calculations and automatic cash consolidation bank transfers

Optimize Global Intergroup Liquidity with Kyriba


Multi-lateral netting = to determine net currency positions for each subsidiary

Can be internal and/or external FX typically at netting center Benefits:

– Minimize payments– Reduce FX transactions– Eliminate transaction costs

Multi-lateral Netting

Netting Center

Subsidiary

Subsidiary

Subsidiary

Subsidiary


Manufacturing Entities

Intercompany Payments Without a Netting Process

Americas Entities

EMEA Entities

Distribution Entities

Asia Pacific Entities

LATAM Entities


Kyriba Multi-lateral Netting Solution

EMEA Entities

LATAM Entities

Manufacturing Entities

Americas Entities

Distribution Entities

AsiaPacific Entities

Global Netting & In-house Bank

Entity

Reduce time, cost and errors in timely settlement of interco invoices Consolidate and hedge FX Exposures Optimize global cash balances at regional treasury centers





and Control

Cash & Liquidity

Structures

Treasury Structures


Must update (or create!) treasury policies, operational controls and KPI reporting for the Global Organization– Lack of standardization = opportunity for mistakes or fraud

– Lack of visibility = unable to make effective decisions

– Difficult to grow with business – risk falling behind if not efficient or scalable

Policies, Procedures and Controls


Effective BAM practices ↑ in importance when global1) FBAR

• Required to track US signers/approvers from 2010 – present

2) Fraud prevention• Without visibility and control over accounts…

bad things can happen

3) Bank (and bank fee) optimization• Need visibility to know cost vs. use of accounts and relationships to make best

keep/close decisions

Bank Account Management


Standardize the global BAM request and approve process

Mitigate operational, payment, fraud and compliance risk

Improve global cash visibility to optimize financial decisions

Reduce fees by rationalizing accounts Efficiently integrate M&A activity Repurpose time preparing for audits

Optimize BAM Process with Kyriba


Set clear objectives

Active monitoring

Realign as company evolves

Policies, Procedures and Controls - Measurement

Global Subsidiary Bank Account and Signer Scorecard

Global IHB Balance Limits

25© 2015 Kyriba Corporation. All rights reserved. PROPRIETARY & CONFIDENTIAL.

Treasury structure– Centralized, regionalized, decentralized– Accommodation for timezones and languages

What are we trying to solve for?– Align with corporate objectives– Prioritize major enhancements

Do we understand the regional differences?– Business model, supply chain and liquidity needs – Banking regulations– Tax implications

Do I have the right technology?– Treasury management– ERP– Internal file sharing– Banking

Summary: Considerations for a global treasury

Questions?