Ford's treasury de-compartmentalized its risks by developing a cash-flow-at-risk (CFaR) tool to show how exposures as different as commodity price fluctuation and foreign exchange volatility could be interrelated and that hedging them separately could undo natural hedges.  

"We knew that there is a diversification benefit among our commodity and currency exposures," says Dennis Tosh, director of global trading and automotive risk management. "But we didn't have a robust process or system that could measure it and give us a more realistic view of our net exposures. Now we do."

To get to that vision, "we needed a comprehensive and integrated system," Tosh says. After evaluating several solutions, Ford concluded the best source was Reval, software already used by Ford for hedge accounting compliance and hedge valuation.

Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.

Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Thought leadership on regulatory changes, economic trends, corporate success stories, and tactical solutions for treasurers, CFOs, risk managers, controllers, and other finance professionals
  • Informative weekly newsletter featuring news, analysis, real-world case studies, and other critical content
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the employee benefits and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Treasury and Risk

Just another ALM site