Download - Hardest Job In Finance V1
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Corporate Foreign Exchange ManagementThe Hardest Job in Finance!
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Topics to be Discussed Today
• Panel Introduction & Opening Comments
• Corporate Foreign Exchange Management(What makes it so hard?)
• Risk Factors (What should you be concerned about?)
• Best Practices(Is there a better way?)
• Questions from the Audience
• How to Get Started
Copyright 2007 Rim Tec Inc. Slide 2
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Panel Speaker Introductions
• John Connors– Partner at Ignition Partners– John spent sixteen years at Microsoft Corporation in several strategic roles.
• 2000 to 2005 SVP of Finance and Administration and CFO• Previous positions included VP of Enterprise Group and Corporate Controller
– Serves on the Board of Directors for Nike, BioPassword, Second Space, Jobster, Xensource and FiREapps
• Wolfgang Koester– CEO of FiREapps– Former CEO of GFTA Trendanalysen, a quantitative currency management firm. He
has managed risk for a broad range of companies as well as governments, including G-10s, since 1986
• Corey Edens– Chief Product Officer FiREapps– Formerly the President of Valcon Distributing, Controller for Microsoft Networks, and
an Auditor for Deloitte Haskins and Sells
Copyright 2007 Rim Tec Inc. Slide 3
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A Fragmented Cross-Functional Process
Corporate Controller• A/P • A/R• Intercompany
Treasurer• Cash Management• I/C Settlement
Tax• Repatriation• I/C Loans• Transfer Pricing
Regional Controller• A/P • A/R• Intercompany
Foreign Exchange Manager Banks
Resource & Time Intensive
Inaccurate Exposures
Unnecessary Cost & Risk
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The Old Way of Managing Foreign Exchange
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Survey: What Makes Foreign Exchange Exposure Mgmt So Hard?
DataIntegrity
ERPLandscape
ComplexSpreadsheets
CurrencyVolatility
ComplexDerivatives
TaxImplications
CashManagement
IntercompanyPayments
PolicyCompliance
GlobalCoordination
InaccurateExposures
UnnecessaryTransactions
PoorResourceUtilization
EarningsVolatility
IncreasedAudits
MarketRisk
NonCompliance
UnnecessaryCosts
BusinessImpact
Challenges
ForeignExchangeManager
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Foreign Exchange Exposure ManagementOperational Challenges Create Economic and Compliance Risk
Compliance
Economic
Risk Factors
Economic
Compliance Operational
• FAS 52 • FAS 133 • SOX
• Earnings Volatility • Unnecessary Costs
• Turnover
• Lack of Skilled Resources • Manually Intensive Process
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Cornerstones of Foreign Exchange Best Practices
• A holistic/enterprise-wide approach
• Top down management support
• Understand the currency exposures well– data integrity – system set up– measurement– transparency
• Sound foreign exchange processes and responsibility
• Communication
• Leverage the power of automated, on-demand solutions
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Foreign Exchange Exposure Management Value Chain
Pre -Trade Trade Post-Trade
AggregateExposures
AnalyzeExposures
DecideActions
SelectInstrument
PriceExecuteTrade
ConfirmTrade
SettleTrade
FiREapps Banks / Inv. Banks Treasury & Accounting Systems
Accountfor Trade
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Keys to Success: Process, People, and Systems
Foreign Exchange ExposureManagement Platform
Exposure Analytics Decision Management
DataIntegrity
ExposureMeasurement
PolicyBased
Decisions
InternalBanking
LogicOptimization
Centralized, Disciplined and Timely Process
Transparency, Auditability, and Compliance
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Holistic Exposure Management Process
Corporate Controller• A/P • A/R• Inter-Company
Treasurer• Cash Management• I/C Settlement
Tax• Repatriation• I/C Loans • Transfer Pricing
Regional Controller• A/P• A/R• Inter-Company
Centralized FX Mgmt PlatformTimely Disciplined ProcessGlobal Coordination
ForeignExchangeManager
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Transform Risk Factors into Value Drivers
• Accurate FX Exposures
• Auditable Processes
• Risk Mgmt Policy Compliance
• Decrease Earnings Volatility
• Reduce Transaction Size and Volume
• Exposure Analysts • Focus on Value Add
• Global Coordination
ValueDrivers
OperationalCompliance
Economic
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Start Your Journey to Foreign Exchange Best Practices
• Best Practices Whitepaper: – Mailed to webinar attendees – Link will be sent early next week
• Contact FiREapps to schedule a 15 minute FX Health Check:– Call +1.866.928.FIRE (3473)– www.fireapps.com
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Thank You for Your Time