Treasury reporting: taking the DIY route
For multinationals with complex operations, improved cash visibility and reporting may best be achieved by developing a bespoke solution in-house when vendors’ products fall short of requirements – and can also prove less challenging than anticipated.
Technology vendors extol the virtues of treasury management systems but are they really any good? At minimum, corporate treasury departments need a single dashboard that brings together data essential for accurate decision-making. This challenge is even greater for a company with subsidiaries and operations distributed around the globe.
Take the case of software company Citrix, which has found that none of the treasury solutions currently offered by vendors fully meets their requirements. A Florida-based multinational specializing in digital workspaces, networking and analytics, its products are distributed to over 10,000 partners in 100 countries and generate annual revenues of nearly US$3 billion.
According to director of treasury Bruce Edlund, Citrix decided on the DIY approach for improving its treasury reporting due to one simple reason: no vendor’s solution ticked every box. “We’ve been attempting to set up a comprehensive treasury reporting system and a persistent problem has been the lack of any off-the-shelf treasury reporting dashboard solution,” he explains
“Providers and consultants alike talk airily about the need to move away from Excel and install a treasury workstation. The problem is that there appears to be no provider who can handle all the data that in a complex organisation increasingly comes from multiple sources.
Tax reform catalyst
For multinationals like Citrix, the Trump tax reforms that encouraged them to repatriate overseas cash to the US refocused attention on visibility and reporting that highlighted deficiencies in vendor systems.
Traditional TMS products may connect seamlessly to banks, providing visibility into cash balances, but increasingly corporates invest their cash in non-bank products. According to its latest SEC filing, Citrix invests $1.18 billion in corporate bonds, government bonds and money market funds.
“In our case, the majority of investment is in fixed income securities and data from that is very different from our account balance information,” says Edlund. “Yet none of the vendor solutions can bring together investment balances data with account balance data – even when we explain our specific needs and highlight each data source we need combined for accurate cash visibility and reporting.”
As he ruefully notes, technology able to accomplish the task certainly exists – what’s missing is a transformative figure such as the late Steve Jobs able to develop a fully comprehensive solution.
“Instead, the reality is that for the full picture you have to submit to the lengthy process of using a workstation, extracting the required data, putting it into Excel and developing your own dashboard – a highly intensive manual process.”
Although no existing product fully meets the task of combining all data in a single dashboard and providing good visuals – that can be used in PowerPoint presentations for example. Edlund singles out two products offering many of these capabilities: Tableau Software’s interactive data visualisation products and the data science and analytics software produced by Alteryx.
However, Citrix’s solution came from within after treasury had first brainstormed on data points to review their cash by entity, country and currency and evaluate how accessible and liquid the cash was. Next came an initiative to evaluate automation tools
“While considering these options we also started reviewing the capabilities of the Microsoft Power BI service, which we already carried as part of our Microsoft Office package,” says Edlund.
“While Citrix has licences for Tableau, we found PowerBI to be more robust for pulling in disparate data sources and transforming the data without coding. Also, its reporting tools seem almost as good.
“We quickly realised that PowerBI could bring together our various data sources and transform that data, as well as offering great reporting capabilities. We used it to develop our own dashboard and to create centralised reporting for each of our entities, which converts local currencies to USD.”
The new dashboard, developed in under two months, provides Citrix with 99% daily cash balance visibility and after six months was supplemented with reports developed for investment portfolio performance and a share repurchase program. Migrating data to databases has also drastically reduced report prep time.
“With data on both our bank balances and investment balances centralised. I can ‘slice and dice’ this information as required and use relevant excerpts for specific reports and presentations,” adds Edlund. “We’ve created a more automated reporting tool and a dashboard capable of creating graphs for PowerPoint presentations. However, perhaps the most tangible benefit is time saving.”
Edlund credits the rapid progress to Citrix’s treasury comprising “a very data-focused team, who are all keen to learn and figure out ways of addressing our various challenges” and whose members include an individual well advanced towards becoming an accredited chartered financial analyst (CFA).
“We developed a solution that met our needs in-house and that DIY approach should work just as well for other companies,” Edlund concludes. “However, success really depends on the individuals in your team and how much they wish to be hands-on. What marks out our people is their openness to new technologies and keenness to learn things.”
Having worked in treasury for 15 years, his one regret is that the solution devised by Citrix’s team wasn’t available at the start of his career. “I’ve also been amazed at just what databases can do but bringing them together in an uncomplicated manner has always proved a major challenge.
“I worked several years at Walmart, which had big treasury workstations. When I joined in 2010, they were using SunGard Quantum and we later implemented SAP Treasury. But we still faced a lengthy task in pulling various data sets out of the system. I would have loved it if we’d been able to complete this work much earlier to improve cash visibility and reporting– it has proved to be a very long evolution.”
More on just how Citrix went about internally developing a bespoke solution for improved treasury reporting from the company’s own resources will be revealed at EuroFinance’s strategic international treasury conference in Miami this May, where Edlund will be presenting together with treasury colleagues Dilara Yergin and Robert Zavertnik.