Where's My Cash?

Much has been written about the changes in macro-economic conditions around the world and the health of the banking industry. Less has been written about the risk and impact of financial system instability on the daily operations of a multinational treasury. For a treasury like Microsoft that supports banking needs of global business operations in tens or hundreds of countries, the risk is considerable, particularly when the treasury is adopting just-in-time management of cash on a global basis. With all that in mind, insight into a treasury team’s bank balances from all their banks and accounts worldwide is critical. And, while it sounds simple, it is pretty complicated to produce. At Microsoft, we’ve developed a system to help our treasury team get the accurate insights needed from the data on-hand. It’s a two-step process that has helped the team work more efficiently.

1. Standardize the Data

Corporate treasury staffs deal with many systems and applications: multiple bank cash management solutions, internal ERP, and perhaps dedicated treasury management systems, as well. The plumbing required to deliver corporate bank statements around the world in a timely manner is even more complex as many variances occur in the types of data needed (even within standards), country capabilities, and timing of statement delivery. Add in intra-day updates and the picture becomes increasingly complicated.

Microsoft group treasury acts as an in-house bank to over 250 country subsidiaries. To streamline reporting we implemented SWIFT ISO-XML 20022 for bank statement reporting covering over 99 percent of global cash. This initiative to implement a standardized format using BizTalk Server improved efficiency and delivered auto-reconciliation and auto-posting capabilities because of the standardized data structure. We placed priority on achieving electronic cash visibility and mobility by effectively managing the company’s bank account infrastructure, with the end goal of reducing cash held in high-risk locations.

2. Make Data Actionable

“Spreadsheet” is an innocuous name for an extremely powerful finance tool. Despite the plethora of systems in treasuries, the reality today (and foreseeable future) is that Microsoft Excel remains the default go-to application for cash positioning and financial analysis. So at Microsoft Treasury we turned Excel into our interactive business intelligence (BI) dashboard for a complete view of cash and bank operations. And you can do it too, with tools already in Excel.

After implementing ISO-XML 20022 to gain electronic visibility into cash balances at any given moment, the next step at our treasury was to implement Microsoft business intelligence (BI) tools to analyze and interpret the data managed in a SQL Server database. Real-time visualizations that show cash positions and risk profiles dynamically over time make it much easier to see and assess risk, and determine appropriate mitigating actions. The Power View visualization capabilities of Excel in Office 365 allow for interactive graphs, charts and maps that allow the treasury team to summarize cash balances by counterparty, currency and geography.

Most likely you already have the ability to do this same thing. These BI dashboards are an integral component of standard Office 2013 and Office 365 productivity tools. SQL Server is used by most enterprise IT organizations. The deployment and user experiences are something treasury teams around the world will already be very familiar with – and are consumable across multiple devices; from desktop to laptop to tablet.

At Microsoft we have seen clear benefits to this integrated strategy.

  • Visualize data for better decision making. With these dashboards, immediate, graphical representation of complex data is available in a form that allows the treasury and CXO leadership team to make strategic decisions. Self-service BI using the visualization capabilities of Excel PowerView empowers decision makers and allows IT to focus on data management.

  • Improved working capital. Due to real-time cash forecasting and position analysis, treasuries should expect improved forecast accuracy and feel more confident implementing just in time funding for subsidiary operations and so minimize idle cash balance in bank accounts.

  • Increased invested cash and investment income. With the ability to review cash balances by various dimensions and the ability to have improved cash flow forecast, a treasury should be able to transfer cash in non-interest bearing accounts to an investment portfolio allowing better risk-adjusted return on the cash.

In order to remain competitive it is incumbent on banks to develop new and innovative services and solutions that add value to the treasury user. In other words, tools that help a treasury run more effectively. Why not leverage the Microsoft tools treasuries use today?