Top 3 reasons to start using a TMS now

Managing financial risk is critical to any business, especially in today’s volatile and uncertain economic environment.

But how can businesses effectively manage their financial risk? How can businesses optimise their treasury operations? The answer, of course, is a Treasury Management System (TMS)!

In this blog post, we will discuss the top three reasons why your business should consider using a TMS.

Reason #1: Spreadsheets are holding you back

If you are performing all your core cash activities on spreadsheets, for example,

• positioning
• cash accounting
• forecasting
• financial instrument activity tracking

… then it’s definitely time to consider the transition to a TMS.

Even for more simplistic treasuries, having data in spreadsheets doesn’t make sense. A centralised system where data can be stored for analysis is vital for proactive risk management strategies, and if you are actively managing more than two or three of the following activities:

• over 50 bank accounts worldwide
• debt or investments
• foreign exchange activity
• pooling
• daily concentration and funding
• cash accounting
• more than five treasury-initiated payments a day
• in-house banking
• multilateral netting
• cash flow or balance sheet hedging, or
• hedge accounting

. . . then it’s definitely time to move to a TMS.

Automating repetitive tasks and getting all data in one place from a single point of entry just makes sense. Your reporting will be holistic, easier, and more informative. Everything will automatically be updated to cash position and longer-term forecast. The valuations on your financial instruments can be done across your entire portfolio at the click of a button. Not only this but you can also answer the questions from your CFO or Treasurer in minutes instead of hours or days.

Reason #2: You have outgrown your old TMS, and/or it is no longer actively supported by your vendor

How do you know if you’ve outgrown your old TMS? Ask yourself:

• Do you have dozens of side spreadsheets you utilize because your current system does not support certain types of activities?
• Are you using your current system for cash in your home country, but it cannot handle your global activity?
• Do you have to create all your executive-level reporting in MS Excel because no dashboards or good reports are available with the necessary information?
• Do you still use stickies to remind yourself and your team of crucial upcoming treasury events like debt payments?
• Is upgrading to the latest version too much trouble or too expensive?
• Or, worse yet, is there not the latest version at all because your vendor doesn’t support your product?

If you answered yes to any of these questions, then now is the time for a new TMS. Treasury and Risk management technology is offered over the web as a SaaS (Software as a Service) offering with regular updates that require no effort on your part to upgrade (updates/enhancements/improvements just happen, like updates to Gmail or Yahoo or your bank software). A TMS also supports all areas of treasury and risk for large global organizations!

Reason #3 – Treasury can add real value to your organization when empowered with the right tools

Some treasury functions have to happen each day and can be largely automated so that you free up time to add real value to your organization. Have you been intending to build/improve a cash forecast and perhaps, even give feedback with forecast to actual data to the business units who contribute to the forecast?

Have you been thinking about different coverage for your hedging program? But haven’t had the time to model the different possible scenarios and articulate your recommendations meaningfully for senior management and the Board? Did you hear about payment factories and/or in-house banks at the annual AFP conference or EuroFinance? And thought it might be applicable to your company but haven’t really explored the possibilities yet.

With these reasons and the modern challenges in mind, we have built a highly scalable and comprehensive TMS, Reval. The SaaS-based platform of Reval empowers companies to better manage cash, liquidity, and financial risk, including complex financial instruments and hedging activities. Through the power of its partner community, it delivers a seamless user experience that helps organizations gain a competitive edge.