Treasurers’ Data Sought but Not Decision-Making Skills, say ACT and Kyriba

Treasury teams are taking a more active role in strategic decision-making, with 70% of the 300 treasurers recently surveyed by Kyriba and the Association of Corporate Treasurers (ACT) contributing data and analysis, and 60% involved in working capital management. But treasurers’ advice isn’t being sought in regard to mergers and acquisitions (M&A), with only 18% providing input there and just one in five advising on market expansion.

The ACT and Kyriba survey entitled ‘Strategy, Technology and Proactive Treasury Management 2014’ was carried out in Q1 this year, with the release of the results timed to coincide with this week’s ACT trade show in Glasgow, UK, which gtnews is blogging from all this week.

Other key finding from the survey include a tendency among treasurers to lose confidence as tasks move from the operational to the strategic, with 85% stating they execute payments “extremely well” or “well”, and 70% thinking likewise for ensuring compliance. However, this number falls to barely half for effectively working the organisation’s capital, and less than 45% for contributing toward the overall growth of the business. These results bear out the findings about a lack of board room consultation on M&A and growth activities, suggesting treasurers perhaps need to work on their presentation and confidence to gain the ear of senior managers more effectively.

Global trade and the recent economic challenges are top of the list of treasury teams’ concerns when it comes to the biggest risk factors. Half of all treasury teams see foreign exchange (FX) risk as one of their three biggest risk factors, closely followed by a lack of visibility into liquidity and cash forecasts.

Commenting on the survey results, Andrew Burns, director of Kyriba UK, said: “The treasury team is becoming more involved in bigger strategic decisions, but it seems that its influence and analysis still does not play a needed role in major initiatives outside the finance department. One reason for this could be that treasury is undervalued for the impact its deep financial insight can have on major programmes.

“In the 17 years I’ve been in treasury, I’ve seen significant strides in it becoming a more strategic function, but this research highlights there is still ground to cover,” he concluded, citing proactive treasury management as a future growth area with more automation freeing up time for future value-adding strategic work.

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