Category

Cash & Working Capital

Cash & Working CapitalTechnology
January 12, 2023

For Treasurers, 2023 Means Going Back to Basics

With companies facing strong economic headwinds, treasurers are doubling down on liquidity management. Treasury’s core mandate is to support the company’s performance by ensuring adequate funding through smart cash management and external borrowing. According to NeuGroup’s 2023 Finance & Treasury Agenda Survey, treasurers plan to make that their number one priority this year (see chart). The survey also showed that treasurers are targeting improvements in analytics and modeling capabilities, which came in at number three this year, up from seven…
Justin Jones
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Accounting & DisclosureCash & Working Capital
November 17, 2022

FASB Has Issued New Disclosure Rules for Supply Chain Finance. What Do They Mean for Corporates?

The FASB’s disclosure rules will bring transparency to SCF programs but don’t require reclassification of trade payables. The world of supply chain finance (SCF) is facing a major change. Starting in 2023, corporations that extend payment terms with their suppliers and set up SCF programs so those vendors can be paid early by a bank or other third-party finance provider will have to disclose the terms and size of the SCF programs in financial statement footnotes. “It’s one of the…
Justin Jones
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Cash & Working CapitalFP&AThe NeuGroup Insights Interview
November 10, 2022

Fresh Takes: Cash Flow, Spending Discipline, Profits and People

Timely insights on liquidity and how finance can add value to the business from Chris Ortega of Fresh FP&A. “Profits are a dream but cash is a reality.” That’s among the timely, on-target insights aimed at CFOs, treasurers and other finance executives in this episode of NeuGroup’s Strategic Finance Lab podcast, which you can hear by hitting the play button below or heading to Apple or Spotify. It’s delivered by Chris Ortega, the CEO of Fresh FP&A, a consultancy focused on finance…
Justin Jones
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BankingCash & Working CapitalTalking Shop
November 10, 2022

Talking Shop: How Much Liquidity Does Your Holding Company Maintain?

Editor’s note: NeuGroup’s online communities provide members a forum to pose questions and give answers. Talking Shop shares valuable insights from these exchanges, anonymously. Send us your responses: [email protected]. Member question: “We are a multibillion-dollar bank and have traditionally held cash and liquid securities to cover four quarters of holding company expenses, including opex, debt, preferred and common dividends. We set the upstream dividend from the bank to the holdco to maintain that level every quarter. “After many years of this practice,…
Justin Jones
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BankingCash & Working CapitalRegional
November 3, 2022

Sending More Cash Out of China Using Pools in Free Trade Zones

Unpacking a member’s cash pool in China in a free trade zone where window guidance put no limit on cash outflows. Many NeuGroup member companies face a challenge getting cash out of China—in part because of rules limiting outflows from cash pools set up under a so-called nationwide scheme to 50% of the net equity held by a company’s entities in the country. But not all multinationals have this problem. At a recent session of NeuGroup for Global Cash and Banking, one member…
Justin Jones
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Cash & Working Capital
October 27, 2022

Crunch Time: A Rising Emphasis on Cash Forecasting Accuracy

Management is putting greater focus on cash forecasting accuracy. Some in treasury wonder whether the extra work is worth it. After a decade of cheap money, liquidity is once again at a premium. Because it costs more to borrow, and pays more to invest, treasuries are under pressure to improve cash forecasting accuracy. In this environment, “treasury has three important mandates: don’t run out of cash, don’t run out of cash and don’t run out of cash,” one member said. “From…
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Cash & Working CapitalESG
September 29, 2022

A Finance Treat to Tame the Scope 3 Elephant in the Climate Room

HSBC and one member established a supply chain finance program that rewards ESG-friendly suppliers. Corporates striving to reduce their carbon footprints amid investor pressure and growing disclosure regulations face a daunting challenge when it comes to reducing emissions by suppliers and customers. These so-called scope 3 emissions do not originate from the business itself but are an indirect consequence of the corporate’s value chain. Enter ESG-linked supply chain financing programs like HSBC’s sustainable supply chain financing program, which incentivizes suppliers to have fewer emissions…
Justin Jones
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Cash & Working CapitalFP&AThe NeuGroup Insights Interview
September 22, 2022

Keys to Cash Flow Sustainability: Fresh FP&A’s Chris Ortega

An expert’s take on why managing cash burn and liquidity today is more critical than ever for finance organizations. In a video clip you can watch by clicking here or hitting the play button below, recognized FP&A authority and influencer Chris Ortega shares valuable insights on why treasurers, leaders of FP&A and CFOs managing risk in this time of economic and market volatility need to be “laser-focused” on building paths to cash flow sustainability and optimization. Mr. Ortega today is leveraging his extensive background…
Justin Jones
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Cash & Working Capital
September 8, 2022

Getting Religion: Treasury Spreads Reverence of Free Cash Flow

Rigorous control over free cash flow gives treasury a seat at the strategy table. By working to shorten the cash conversion cycle and making free cash flow a key metric of success, treasury at one NeuGroup member company gained credibility, responsibility and authority as a strategic partner within the enterprise. Its experience offers a road map for other corporates where treasury aims to augment its role in working capital management. Companies that succeed in this effort will better weather economic…
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Cash & Working CapitalTechnology
August 11, 2022

Better Accuracy, Smarter Insights: Digging Into NeuGroup’s Cash Forecasting Survey

Members benchmark and share approaches to making forecasts more accurate and more valuable. A recent debriefing session analyzing the results of NeuGroup’s May 2022 Cash Forecasting Survey made clear that beyond discussions of methodology, accuracy, technology and the effort required, lies this fact: Treasury needs to clearly define the purpose of a cash forecast and identify the audience who will use it to make decisions that help meet strategic goals. In other words, if the information in a forecast is…
Justin Jones
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