Quantcast
Go Search

Page Edit Mode

December-January 2008

Cover Story

Risk managers are stressed out these days dealing with the solvency issues surrounding some major insurers and the impact of the recession.

Snow, rain and gloom of night haven’t stopped the mail, but the recession is taking its toll. CFO Joe Corbett talks about how the service can get back on track.

Global warming and severe weather pose serious risks for businesses. Here are some to consider.

A commitment to making treasury a strategic partner helped Toyota Financial Services steer straight through the downturn. TFS wins this year’s AHA overall excellence award.

HealthTrans, Little Caesar and Western Container, like many middle-market companies, use a blend of ingenuity and enhanced traditional cash management techniques to preserve liquidity, cut costs, conserve working capital and prevent losses.

While its Big Three competitors struggled, Ford’s treasury filled up on cash when the markets were easy, which allowed the auto maker to reduce its debt without destroying shareholder value and steer clear of government loans.

Microsoft CFO Chris Liddell says companies should already be thinking about their strategy for success once the economy emerges from its difficulties.

While funding and managing capital needs rule the day now, the future of treasury will be more about the power of information, speed and flexibility, and better technology.

On full risk alert, treasuries are exploring constructive ways to spread available liquidity up and down the supply chain to avoid a bad break



Features

  • Can You Bank on Your Bankers?
    With credit availability limited and some financial institutions still on shaky ground, treasurers are sorting out which relationships can work...
  • Hungry for a World of Digital Data
    The craving for information is driven by companies’ aggressive liquidity management in the face of tight credit as well as credit concerns around counterparties and supply chains.
  • Developing a 360-Degree View of Credit Risk
    Companies are expanding the use of all tools at their disposal as they seek to gain greater visibility into all exposures, develop creative strategies and take mitigating action quickly.
  • Opportunity Knocks Twice
    Under more pressure to reduce costs, increase productivity and avoid accounting errors, CFOs look to outsourcers, who now see middle-market companies as an engine for growth.
  • Doing Business in a Volatile World
    Despite the growing global uncertainty and instability, companies have yet to take the same formal and measured approach to political risk as they do to managing other exposures, such as currency risk and business continuity.
  • Not-So-Easy-Rider
    Southern Company’s CFO Paul Bowers keeps a weather eye on what’s down the road.
  • Cashing in Next Wedding Season
    With reduced liquidity and the increased cost of borrowing, including a savvy treasurer on a merger team can help ensure a successful union.
  • When Quants Ruled
    Sophisticated risk modeling put banks ahead of the class in risk management until their practices sparked the financial crisis. Will their problems damage risk management’s credibility or help companies learn how to implement it more wisely?
  • SWIFT's New Sweet Spot
    As more companies seek to connect to multiple banks through a single platform, SWIFT is providing more ways and more reasons to link up.
  • Is Getting Back to Normal Possible?
    Economists Milton Ezrati of Lord Abbett, David Levy of the Jerome Levy Forecasting Center and John Lonski of Moody's Investors Service look at what comes next for the economy.
  • Follow the Money
    Are taxpayers on the hook for hundreds of billions of dollars for a credit crisis that may have been overblown? Who is the bailout really helping?
  • No Rest on Retirement
    Although a few companies had made savvy moves with their plans before the crisis hit, the ailing economy is prompting many to freeze their pension plans and eliminate matches for 401(k)s.
  • Revving Up Dashboards
    New systems are often in the fast lane, increasingly robust in functionality and regularly adding enhancements, while many users are taking their time adopting new features.
  • Whacking the System Over Breaking the Buck?
    Spurred by the Reserve Primary Fund’s drop below $1 a share in the wake of Lehman’s fall, proposed SEC rules on money market funds could end up curtailing many companies’ ability to raise short-term funds.
  • Carbon Trading Is on the Horizon, Ready or Not
    Momentum continues to grow for the expansion of carbon markets in North America and a cap-and-trade system in the United States, presenting a myriad a challenges for businesses. Here’s a look ahead from Pat Concessi.
  • Compensation Cyclone
    The economic storm, plunging share prices, underwater stock options and public fury over bonuses point to a dramatic drop in executive pay in 2009.

Lists

Surveys

  • 2009 Risk Management Survey
    The financial crisis has infiltrated decision-making about insurance. Almost a third of the finance executives who responded to the survey say their brokers have recommended changing carriers in their directors and officers liability program.
  • Risks Revisited
    Market turmoil and the recession have brought enterprise risk management (ERM) into sharper focus, say senior financial executives responding to Treasury & Risk's 2009 ERM survey.
  • The 2009 Cash Management Survey
    The intense focus on cash management hasn’t let up as access to credit remains tight for many companies, according to the almost 200 senior financial executives who responded to Treasury & Risk’s annual cash management survey.
  • 2009 Middle Market Survey
    Finance executives at companies with revenues of $2 billion or less last year ranked an economic slowdown as their worst fear.
  • The 2009 Financial Leadership Survey
    Ensuring accurate cash flow forecasting and effective working capital management are percolating to the top of financial leaders' agendas, according to the 320 senior financial executives surveyed by Treasury & Risk.
  • Biannual Economic Survey
    Pessimism may finally be abating. More than 70% of the senior financial executives surveyed say the worst of the financial crisis has passed.
  • Risks Mount in Retirement Plans
    The volatility in financial markets has resulted in another bad year for companies' retirement plans, and the more than 330 finance executives who responded to Treasury & Risk's 2009 Retirement Survey seem to be taking a fairly downbeat view.

For Your Information (FYI)

Washington Update

News Briefs

Q&A

  • Supply Side Scrutiny
    Companies need to become more aware of the potential financial risks their suppliers face and what steps to take to help support them.
  • Moving Toward Stability?
    Preventing another meltdown requires understanding global interdependence, how value relationships evolved and network theory.
  • Why SEPA Matters
    Direct debit, the second SEPA instrument, launches Nov. 2 as the Payment Services Directive becomes law in most of the E.U.
  • FX Risk Revisited
    Wells Fargo’s Larry Kirschner examines why in the face of double-digit currency moves, treasurers need to understand which risk exposures matter most and how to execute a plan of action.

Departments

Governance & Accounting

  • Dividends Pay Off
    More than 30 companies listed on the New York Stock Exchange have begun paying dividends in the last year and a half.
  • Around the Hedges
    Sometimes vanilla products are too constraining, But creating more flexible products that qualify for hedge accounting can be challenging.
  • XBRL: It’s the Law
    The SEC under Mary Schapiro moves full-speed ahead with the financial reporting standard but pauses on the road to GAAP-to-IFRS conversion.
  • Double Vision on Oversight
    Accounting regulators want two audit firm partners to review each public company’s audits and interim reports.
  • Modulating Say on Pay
    Advisory votes in the U.K. have helped make CEOs’ compensation more sensitive to poor company performance, study says.
  • Inventories Look Past LIFO
    If convergence with global accounting standards doesn’t obliterate LIFO, the Obama administration’s craving for revenue could.
  • The ABCs of GRC
    As regulatory risks loom, companies evaluate how to get more out of governance, risk and compliance software.
  • Fair Value Twist
    FASB's new guidance on where on financial statements 'impaired securities' should be reported prompts a heated response.
  • Hunting Foreign Bribes
    U.S. agencies boost efforts and reach out to international regulators to ensure managers aren’t paying off local officials.

Retirement & Benefits

  • Healthy Motivation
    As Congress considers universal health care, companies try to contain costs by making employees better consumers of health benefits.
  • Count ETFs in 401(k)s
    SunGard and iShares team up to provide a way for plans to offer exchange-traded funds alongside mutual funds.
  • Pension Funding Relief?
    Companies ask Congress for some leeway in making the huge pension contributions resulting from last year’s losses.
  • 401(k)s Come Up Short
    Democrats and Republicans agree that retirement savings plans demand reform. Whatever happens, corporations will likely lead the way.
  • Docs Back In-House
    More large companies turn to offering health care services as a prescription for cutting costs and boosting worker productivity, survey shows.
  • Pensions Hunker Down
    Last year’s market sell-off is encouraging corporate plan sponsors to lighten up on equities as they shy away from risk in general.
  • 401(k) Fees Showdown
    Although courts have sided with 401(k) plan sponsors in lawsuits over plan costs and revenue sharing, the government is preparing to pounce.
  • Target-Date Troubles
    As stocks dive, fund companies are revisiting 401(k) target-date strategies and plan sponsors are fretting about possible lawsuits.
  • Risky Health Assessments
    Companies could run afoul of federal laws when asking employees to fill out questionnaires about their habits or medical conditions.

Risk Management

  • Monitoring the Monitors
    The audit group at Talecris worked with business-line leaders to put in place automated monitoring of controls.
  • D&O Checklist
    As the market tightens, risk managers must make a strong case for renewal and brace for the possibility that some insurers will run into trouble.
  • Commission Slip
    A ruling by Illinois regulators could bring back the practice of major brokers’ collecting contingent commissions from insurers.
  • S&P Boosts ERM
    The rating agency is currently developing criteria and a methodology for its new enterprise risk management corporate ratings category.
  • Age Bias Claims Rise
    Maintaining staff demographics throughout layoffs and cutbacks can help companies stay out of court.
  • Tracking Covenants
    Using a wiki format, the new Web-based Debt & Covenant Manager can help companies comply with loan restrictions.
  • Green Moves Up
    Despite the financial crisis, escalating environmental and sustainability issues worldwide pose new risk on several fronts, survey says.
  • Bonus Risk for CROs
    Companies need to evaluate the compensation structure and length of tenure for the position of chief risk officer to ensure more autonomy.
  • Regs May Trim Hedges
    Companies say the plan to corral derivatives activity on exchanges will increase costs and make hedge accounting difficult.

Tools & Technology

  • Working Together on Risk
    Kyriba’s alliance with FXpress reflects the increasing demand for treasury technology with robust risk capabilities.
  • Cloud Computing Rolls In
    New services deliver a range of technology without up-front capital investment. The downside could be giving up control.
  • Banker in a Box
    Oracle’s Hyperion Strategic Finance provides the kind of financial modeling and simulations outside consultants charge big fees for.
  • Virtual Meeting Rush
    More companies are using virtual worlds for training and gatherings while new technology aims to make them a mainstream reality.
  • Better Than Spreadsheets
    With capital spending decisions critical in a down economy, CFOs want easier, faster ways to evaluate alternatives. IBM Cognos offers a new Blueprint.
  • Hasta la Vista?
    Sticking with the Windows XP system is becoming more complicated as the launch of Microsoft’s newest operating system draws near.
  • A Better View of Banks
    As finance departments in search of liquidity develop relationships with more banks, Fundtech can help keep track of all the accounts.
  • Really Selective Upgrades
    Business Suite 7 allows enhancements to be made to specific processes, like the new treasury component, reducing costs and timeline.
  • Risk Oversight Times 2
    After acquiring FXpress, Reval aims to combine the best of both products into an even better derivatives risk management solution.

Treasury Management

  • Idle Balances Reap Rewards
    The extension of FDIC insurance and other responses to the financial crisis have changed the value proposition for leaving money just sitting in the bank.
  • Cash: Irrational Insecurity?
    Corporate investors are rethinking previous paradigms and still settling for low rates of return, although some see that beginning to change.
  • Digitizing Remittances
    Companies can add payments and documents that require special handling to their lockbox flows with Virtual Remit.
  • Skillful Revamping
    Diebold’s treasury boosted productivity by reorganizing its 150 staffers according to the tasks they perform best.
  • All Eyes on FX Risk
    As turbulence rocks the currency markets, companies look to new tools to find hidden exposures and new tactics for hedging.
  • Payments Flow Faster
    A California water district and Union Bank develop a hybrid lockbox that streamlines check processing and ensures same day credit.
  • Paperless Pitch
    CB Richard Ellis arranged an automated invoice and payment processing system using products from four different vendors.
  • Putting Checks to the Test
    A manually intensive process turned out to be the best way for educational non-profit ETS to ensure payment before exam day.
  • Beware of Fee Hikes
    Pressured banks need revenue and profits, and transaction banking and treasury management are seen as likely sources.

Careers

Profile

  • At the Capital
    The auditing industry faces many challenges as Mary Moore Hamrick moves to CAQ from PCAOB at a time of great change.
  • Trading on Challenges
    Incoming CFO Adena Friedman began her career at Nasdaq in 1993, long before it went public, officially became an exchange and expanded to several continents.

People on the Move

  • Careers
    Caroline Dorsa, Robert Olson, Brian Valentine, Frank Wilson, Sean Trauschke, John Pietrowicz
  • Careers
    Kathy Waller; Jacques Croisetiere; Joseph Trpik Jr.; Sandra Callahan; Mike Reynolds; Kevin Nowlan
  • Careers
    Nicholas Fanandakis; David Sparby; Catherine Smith; W. Patrick Shannon; Timothy Griffith; William Morrison
  • Careers
    John Gerspach; Annmarie Hagan; Lynn Good; Tim Morse; Blake Jorgensen; Joseph Ianniello
  • Careers
    Ross Kari; Andrew Cederoth; Brian Tierney; Marcel Smits; Colm Freyne; Sheila Taylor

Opinion

Editor's Desk

  • Fall Focus
    As the fallout from the financial crisis begins to settle, what should treasurers be focusing on?
  • Cloudy Daze
    Expect the uptick in fraud cases seen during the recession to continue through the recovery.
  • Vital Signs
    Vital signs of a new economic environment.
  • Hats Off to Best Practices
    The strong field of contenders for this year's Alexander Hamilton Awards underscores the role of the financial crisis in galvanizing treasury's rise in the corporate firmament.

Final Word

  • Warding Off Proxy Battles
    A proactive communications policy and a response team in place can help a company better handle contact with activist shareholders.

Logo of Summit Business Media
(c) 2010 Treasury & Risk. A Summit Business Media publication. All rights reserved.  www.summitbusinessmedia.com
Contact Treasury & Risk  | About Us | Advertise | Site Map | Privacy Policy