Latest Centralisation Articles
Many multinational corporations are continually seeking to further centralise and optimise their treasury activities. Cash and liquidity management has often been the driver of this trend and with Europe’s implementation of the single euro payments (SEPA) there is a further impetus to centralise payments.
Mergers and acquisitions are opportunities to streamline treasury processes, get budget for new technology and demonstrate leadership. However, it is probably the risk of business failure that motivates treasurers most to implement best practices for global cash, liquidity and risk management in the combined company.
Centralisation of payments and collections, and simplification of bank account structures, have been amongst treasurers’ and finance managers’ objectives for many years. The challenges have often proved insurmountable - but that is changing.
Companies with a high degree of payment and liquidity management centralisation enjoy reduced costs, improved liquidity and FX management, and closer working relationships with their treasuries. Yet for many receivables still lie outside this structure and remain the preserve of local business units, so cost savings have yet to be realised.