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Cash & Working Capital

Cash & Working CapitalTreasury Management
January 15, 2025

Treasury’s Better Idea Enables Product Team To Please Customer

Asked by the business to open a customer bank account, treasury proposes a better approach, a win for everyone.Bringing a better idea to a product team responding to a customer’s request served as a powerful demonstration of one treasury team’s strategic value and ability to enable business partners to succeed. This example of treasury using its expert insights on financial transactions and processes emerged during a conversation at the NeuGroup for Tech Treasurers 2024 Tech Summit. And while the company’s industry—financial services—may…
Justin Jones
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BankingCash & Working Capital
December 18, 2024

Cash Flow Collaboration: Bridging Treasury and Procurement

Aligning treasury and procurement can be key to improving working capital management, but that requires skillful change management and relationship building. As treasury teams face increasing pressure to improve working capital management amid higher interest rates, cash conversion cycles are emerging as a key metric for success. At NeuGroup’s inaugural Working Capital Symposium this fall, attendees highlighted the growing priority of developing strong relationships with procurement to shrink conversion cycles and optimize cash flow—which, as one assistant treasurer aptly put in the…
Justin Jones
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Cash & Working Capital
December 11, 2024

More Tech Treasurers Weigh Dividends After Mega-Cap Initiations

A majority of tech firms in NeuGroup’s Capital Structure Survey pay dividends and more are considering the move. Fast-growing technology companies historically pumped profits back into the business to fuel more expansion. Most shunned paying dividends to shareholders, a use of capital seen as a sign of slowing growth. But the tide started turning in 2024 for Big Tech, with Google parent Alphabet, Facebook parent Meta and Salesforce all initiating dividend payouts. “We landed on a modest dividend and for us…
Justin Jones
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Cash & Working CapitalRisk Management
November 20, 2024

Rethinking Global Funding Strategies in Liquidity Structures as Geopolitical Risks Rise

Fewer capital injections and intercompany loans to subs, more frequent dividends, and local borrowing helps ring-fence risk and reduce interdependency in markets where corporates face restricted currencies and geopolitical threats. Partnering with global banks with deep knowledge of each country’s regulations and risks can pay off. The Russia-Ukraine conflict that erupted in 2022 shocked treasury and finance leaders into a heightened awareness of geopolitical risk, a shock compounded by the aftereffects of a pandemic that had exposed overreliance by corporations…
Justin Jones
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Cash & Working CapitalTechnology
November 20, 2024

A Treasury Dashboard Drives Better Working Capital Management

A member leads a cross-functional, strategic digital transformation project to improve working capital management. Treasury at one multinational corporation is leading a digital transformation project to improve working capital management. At the center of the initiative is a new dashboard, still in its early stages, described in detail at a recent meeting of NeuGroup for EMEA Regional Treasury. Here is a brief overview of the dashboard prepared by the presenter for NeuGroup Insights.Starting point: aged AR. Treasury began the project by targeting…
Justin Jones
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Cash & Working CapitalTechnology
October 23, 2024

Digital Payment Conversion: Breaking the Paper Check Chain

Viewpost is another tool for companies to transition “long-tail” suppliers paid by check to digital payments. Many finance teams whose religion is efficiency are eager to convert suppliers that still want to be paid with paper checks into believers in digital payments. But conversation at NeuGroup’s first-ever Working Capital Symposium made it clear there are plenty of challenges standing in the way, even as cutting-edge corporates bring forward-thinking innovation to the payments arena. “We’ve tried a number of initiatives to transition suppliers,”…
Justin Jones
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Capital MarketsCash & Working Capital
October 16, 2024

Investing Cash with Liquidity Layers, Tiered Duration Structure

An enhanced cash layer helps one cash investment manager fund M&A deals while earning better returns than MMFs. A so-called enhanced cash category whose size can expand or contract like an accordion depending on anticipated outflows—including spending to finance M&A deals—is one of three layers of liquidity with differing durations described recently by a member of NeuGroup for Cash Investments at the group’s fall meeting in New York. The other two layers are operating cash and strategic cash. “We need to have…
Justin Jones
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Cash & Working CapitalTechnology
October 9, 2024

Virtual Cards: B2B Payment Method Draws Interest Amid Obstacles

The cards offer corporate buyers another tool to boost working capital, but some vendors balk at interchange fees.Virtual credit cards are generating buzz among treasury teams looking to improve working capital management by extending payment terms while allowing smaller vendors that don’t participate in supply chain finance programs to be paid sooner. That lets buyers hold their corporate cash longer and invest it at today’s attractive interest rates. “As rates have increased, and even while they now fall, the value…
Justin Jones
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Cash & Working CapitalInvestment Management
September 25, 2024

Cash Investment Managers Mull Duration Changes After Rate Cut

A sampling of sentiments about short-term cash investments as yields respond to Fed rate cut. The Federal Reserve’s 50-basis-point rate cut last week is generating plenty of buzz among treasury teams responsible for investing excess cash who have made the most of short-term rates topping 5% following years of yields near zero. The beginning of rate cuts raises the question for some cash investment managers of when to start extending duration. More context: After the Fed started raising rates in…
Justin Jones
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Cash & Working CapitalTechnologyThe NeuGroup Insights Interview
September 25, 2024

Exceeding a Skeptic’s Expectations: ML for Cash Forecasting

Bechtel’s machine learning models outperformed traditional cash forecasts, happily surprising AT Dan Degagne. Earlier this year, Bechtel assistant treasurer Dan Degagne spearheaded an in-house project to develop a machine learning (ML) model designed to relieve some of the pain of generating accurate cash flow forecasts—a challenge shared by just about every company in the NeuGroup Network. Mr. Degagne had doubts about the ultimate outcome. But in a new NeuGroup Insights video you can watch by clicking the play button below, he says he was…
Justin Jones
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