EuroFinance

Agenda

• Day 1
  • 9am

    Basics of cash forecasting

    • Importance of cash forecasting in operational and strategic treasury and financial management/accounting
    • Using cash forecasts to manage liquidity, day-to-day and FX risk and capital structure
    • Top-down vs bottom-up forecasting
    • Short and long-term debt structures – financial ratios and tax impacts
    • Time buckets and forecast horizons
    • Relevance of hedge accounting to cash forecast horizons
    • Frequency of forecast updates
  • 10am

    Key components of a cash forecast

    • Comparison and Importance of bank balances, inflows and outflows in different types of companies
    • Sources of information needed to build a cash forecast
    • Importance and objectives of:

    o Reviewing actual balances and cashflows vs forecast
    o Checking actuals vs the accounting cash flow statements
    o Having a formal cash forecasting policy in treasury

  • 10.45

    Refreshment break

  • 11am

    Services typically associated with cash forecasting

    • Pooling and sweeping
    • Netting
    • Cash forecasting systems
  • 11.30

    Using the cash forecast

    • Managing payments and FX, liquidity and FX risk once forecasts are in place
    • Typical hedging instruments used
    • Impact of treasury deals on cashflow forecasts
    • Drivers of minimum cash balance requirements
  • 12.30

    Group discussion

    • Build a cash forecasting policy for an Example Company
  • 1pm

    Lunch

  • 2pm

    Group exercise

    • Build a cash forecast template for an Example Company
  • 3.30pm

    Break

  • 3.45pm

    Typical issues associated with cash forecasting

    • Frequently missed inflows and outflows
    • Timing of cash flows
    • Trapped cash
    • Accounting vs actual cash
    • Systems (including forecasting modules in treasury management systems [TMS]) and spreadsheets
    • Transparency and accuracy of source information
    • Contractual issues: Cashflow timing; FX and commodity hedge adjustment clauses
    • Misconceptions associated with pooling and sweeping, and netting
    • Not keeping up effectively with business change
  • 4.45pm

    End-of-day discussion

    • Adjustments needed to cash forecasting policies and templates
  • 5pm

    End of Day 1

• Day 2
  • 8.30

    Recap Day 1 (optional)

  • 9am

    Sophistication in cash forecasting

    • Payment runs, including optimal frequency of runs
    • Corporate cards and wallets
    • Direct debits and e-invoicing
    • Forecasting for specific events
    • Review of contract terms
    • Self-billing systems
    • Customer relationship management, supply chain, inventory and HR management systems
    • Trend analysis and rules-based forecasting
    • ML/AI
    • Black swan events
    • Group cash forecasting policies
    • Stakeholder partnering
    • 3^rd party netting
    • Reinvoicing and centralised invoicing
  • 11am

    Refreshment break

  • 11.15

    Internal & external partnerships

    • Processes required for effective partnering
    • Skills needed for effective in-house partnering
    • Skills required for effective 3^rd party partnering, including with customers and suppliers
    • Treasury organisation structures for effective partnering
  • 12.30

    Group discussion

    • Adjustments needed to cash forecasting policies and templates
  • 1pm

    Lunch

  • 2pm

    Group discussion

    • Applying the adjustments to the Example Company’s Day 1 policy and template
  • 2.30pm

    Practical requirements

    • Practical requirements for Example Company to become more sophisticated
    • Sensible timing of improvements
    • Project management approaches
    • Change management approaches
  • 3.30pm

    Break

  • 3.45pm

    Group discussion

    • • What improvements are possible in the attendee companies
      • What are the practical requirements
      • How could supplier attendees’ companies and others help
  • 4.45pm

    Attendees’ s summary of learnings

  • 5pm

    End of Day 2