TOMATO CATCH-UP - Newsletter Issue 169 – February 2014

Your monthly resource on working capital, process optimization and issues relating to the world of corporate treasurers, IT professionals and bankers!

Introduction:

Last month, one of our readers pointed to news that you need to know about. Your company may also have news that would interest our readers. If that’s the case, send such news to us so we can include them in the newsletter. Take note of Pt. 1 about Pietro Lunati, our expert for reporting issues. EMIR, EBICs, SWIFT, RMB, and Basel III are also among the topics covered in this newsletter.

Enjoy the variety!

Regula Spottl and the Tomato Team

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Pietro Lunati: Our Expert for Your Reporting Issues

Pietro Lunati has been with Tomato since April last year. During this time, he demonstrated his extensive knowledge in optimizing financial reporting from ERP and TMS. He is our expert on Data Souring from SAP, special solutions with excel and other IT topics.

Pietro has 20-years of experience in IT and management. 25 years ago, Martin and Pietro worked together in a multinational company in Basel. He was responsible for Treasury IT and was later country IT manager. After, Pietro was Head of IT in a telecommunication company and worked in various cities such as Basel, London, Milan, Turin and Rome.

His formal background is in economics. He specializes in the organization of treasury systems, project management and system integration.

If your department needs better and more concise reporting, Pietro might be YOUR expert! As usual you can work and book Pietro per hour or per day depending on your needs.
Pietro's profile in our Team page...

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The Tomato Mug has Become Legendary

More and more often, when Martin visits clients or fellow finance and IT professionals, he sees one of our mugs on their desk. The logo posted near the top „Keep Your Liquidity High“ is the result of extensive brainstorming years ago. It’s a winner for sure! And it’s become popular!

We could have chosen a fancy shape but didn’t. After all, the mug (we call it „cup“) has to be steady so that there is no risk of it tipping over and splattering its contents over the keyboard.

We look at it this way: It’s risk management and the content of the mug is liquidity. It really reflects basic cash and risk management principles!

All that in a mug with the inscription: Keep Your Liquidity high!

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Ongoing Issues Treasurers Face: Part 2

Installment 2 in our monthly series “Treasurers’ 5 Items Plan” offers 5 reasons for Incurring Debts in Euros rather than in US Dollars. Again, these suggestions are as valid as they were in 2005 when we composed them.

If you are a company based in a Euro country, your current shareholders and creditors should be allowed to subscribe for your share extensions in their own currency.
If you are based in the USA, you can achieve name recognition as a company and debtor in Europe by emitting your debt in Euros.
The IPO of your bonds in Europe is by far simpler than the processes expected of you by the SEC.
A potential redemption of the bonds as a whole or in part is cheaper at your local exchange, as you are positioned to your advantage in negotiations with your local banks..
A potential increase in volume is easier to handle.

Treasurer’s 5 Items Plan…

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Schweizer Zahlungsverkehr: Jetzt für Umstellungen ab 2015 planen

In den Euro-Ländern ist die Einführung von SEPA mit der Einlieferung von Zahlungsdaten in ISO-20022 und der Verwendung der IBAN und BIC bald abgeschlossen. Mit den Terminen für 2016 wird dies bald auch die restlichen (nicht-Euro) Länder wie den Schweizer Zahlungsverkehr betreffen.

Haben Sie selbst Expertise aus SEPA Projekten? Nutzen Sie Ihre Erfahrung nun für die Umstellungen im Schweizer Zahlungsverkehr bevor das Wissen verlorengeht oder wieder aufgearbeitet werden muss. Viel Erfolg!

Die bevorstehenden Umstellungen im Schweizer Zahlungsverkehr:

Bei den Überweisungen beginnt die Umstellung 2015
Bei den Lastschriften beginnt die Umstellung 2016
Bei den Einzahlungsscheinen beginnt die Umstellung 2018

Informationen dazu liefern Websites wie:

migration-zv.ch: Offizielle Website des Payments Committee Switzerland (PaCoS)
iso20022.ch: Website von Recon IT Services und der Agentur am Wasser

Gerne unterstützten wir Sie, sei dies in kurzem Tages-Coaching auf Abruf bis hin zur Projektleitung.

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EBICS kommt in die Schweiz

EBICS ist ein internetbasierter Kommunikationsstandard fűr den Zahlungsverkehr von Firmenkunden und Banken, der die “flexible, effiziente, nachvollziehbare und sichere Abwicklung von Bankgeschäften ermöglicht”. Er kann einfach an betriebliche IT-Architekturen und hohe Transaktionsvolumen angepasst werden. Ausserdem steht das Verfahren allen Interessenten (lizenzkosten-)frei zur Verfügung.

In der Dezember 2013 Publikation hat Six-interbank.clearing.com, angekűndet, “EBICS goes Europe. Auch in die Schweiz.” In der Publikation finden Sie Details űber die Entwicklung des Stardards in der Schweiz und Anforderungen. EBICS goes Europe. Auch in die Schweiz… (pdf, 1 Seite)

Gerne unterstützten wir Sie von Tomato, sei dies in kurzem Tages-Coaching auf Abruf bis hin zur Projektleitung.

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SWIFT announces Know Your Customer (KYC) Registry

The KYC Registry is a centralized location to collect and share information required by banks as part of their due diligence processes. The new utility will help banks to manage compliance challenges and reduce the high costs associated with implementing KYC-related regulations.

The registry is under development and will go live later this year. „Swift will host and manage the registry, verifying the completeness, validity and accuracy of the information provided. Member banks will retain ownership and responsibility for their own information." Press Release...

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Two-way Automated RMB Cross-border Pooling within the SFTZ

Two global banks recently announced two-way automated RMB cross-border pooling solutions within the SFTZ. Citi has executed the first automated RMB cross-border pooling transaction on behalf of Roche China. With this new service, companies can automate the transfer of renminbi out of China and back to subsidiaries within the China (Shanghai) Free Trade Zone (SFTZ). HSBC has completed a “two-way cross-border sweeping service for the industrial manufacturer Dover to help it deploy funds more efficiently between its onshore and offshore entities.”

Many multinational corporates want to achieve two-way pooling to “release their trapped cash overseas and to be able “to use external group liquidity pools as a funding source for onshore subsidiaries,” says Yigen Pei, China Country Head of Treasury and Trade Solutions at Citi. “This type of pooling structure can address both of those concerns.”

For now, these solutions are limited to companies registered in the SFTZ. They allow a subsidiary in the SFTZ to receive funds from an offshore entity but under the current regulations, companies cannot distribute the received funds to other entities in China outside of the zone.

Full story in the Treasurytoday.com article “Farewell to trapped cash in China?”

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Basel III: Leverage Ratio

On Jan. 12, 2014, the Basel Committee on Banking Supervision introduced an updated Basel III leverage ratio framework. “The leverage ratio measures capital held by a bank against its total assets, so the changes will lead to higher reported capital ratios,” explains Geoffrey T. Smith in the Wall St Journal article “Banks Get a Break on Leverage-Ratio Rules.” The new framework will allow banks to report lower overall risk.

In KMPG’s blog “The Leverage Ratio – a simple backstop measure”, Helen Campbell lists the key changes. Full story…

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CFOs Strategies to Maintain/Improve Competitiveness

CFOs play an important role in ensuring the company’s competitiveness. For many, the chief objective is efficiency. The CFO Insight essay “Achieving Competitiveness” highlights strategies CFOs use. They include:

Labor costs are a popular way that CFOs use to boost efficiency. However, they know that they need to consider various factors especially in multinationals and they usually aren’t the sole decision-makers.
Working capital management is a popular way to increase efficiency. The article lists various strategies CFOs use and cites survey results on how successful these strategies have been.
Finance Function: Staff turnover is very expensive. Instead of cutting jobs, many CFOs invest in finance skills, so staff can perform value-added tasks. In a recent CFO survey, “44% of respondents listed it as their number one investment priority.”
IT: CFOs are involved in most IT decisions. They know the importance of IT and are willing to spend money on improvements. For example, improving their planning and forecasting abilities is high on the agenda.
New technologies: Analytical capabilities that lead to a better understanding of the business as a whole are in high demand among CFOs.
Business process outsourcing (BPO): Many CFOs are starting to realize that “outsourcing firms perform many tasks much better than their own finance functions, plus they have access to new technologies.”

Full story with many examples and survey results…

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Three Key Support People Leaders Need

The higher on the corporate echelon a leader reaches, the more he/she tends to become isolated. To overcome this dilemma, leaders need to develop a “high-power inner circle.”

The article “The Three Power-People You Need on Your Team” in a leadershipfreak blog describes these people as:

Visionary who is never satisfied.
Tender-heart who nurtures people.
Doer who is fanatical about execution.

They should be from very different age groups.

You choose them for their strengths which include:

Hard working doers (they trump thinkers)
Strong opinions and emotions.
Persistent alignment with organizational values.
Comfort saying no.
Strength to confront brutal facts.
Openness to change.

If you are a leader, can you identify these people in your inner circle? What’s lacking? What do you need to do? If you are a strong player in the organization and know you are the type a leader needs, make it known to a leader who seems to lack your personality and skill in his inner circle! If you are young and relatively new to the organization, take note of the people with whom your top boss is surrounded and who really has the power in the organization. Full story…

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From the Desk of Regula Spottl, Greensboro, NC

SAS: A Model Company in North Carolina

One of my friends has been working for SAS in Cary (about 45 minutes East from Greensboro near Raleigh). SAS has 14,000 employees worldwide. The company analyzes other companies’ data. My friend has been telling me about some of the perks the company is giving its employees. They include for example:

4 coffee shops/restaurants, day care centers. The boss encourages employees to eat with the kids.
Everyone has an office (no cubicles).
No set hours.
Free health clinic with free prescriptions etc., a hair salon, car wash and more

The Today Show recently visited the company and produced this video.

No wonder SAS ranks No. 2 on 2014 Fortune list of Best Companies to Work For in the US.

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