Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 16

Why not manage BAM in the same way as cash
management? Bank account management starts
with a full inventory of the information available
and the media on which it is held.

Why not manage BAM in the same way as cash management?
Bank account management starts with a full inventory of the
information available and the media on which it is held. It is
of the utmost importance to use a more robust tool, allowing
you to manage all aspects of the accounts and their accessories. "Know Your Banker" (i.e. KYB) is just as important as KYC
is for your banker. Why allow your banker to be in control and
pull the wool over your eyes, particularly when it comes to
charges and miscellaneous expenses, for example.

-

N°99

- NOV /

DEC / JAN 2018

Bank accounts, the source of risk and fraud

LE MAGAZINE DU TRESORIER / TREASURER MAGAZINE

ROI and Business Case
How do you demonstrate the value added of a project which,
on the face of it, has none or very little? This is the nub of the
challenge to be overcome. How do you prove to a CFO that an
eBAM project is a key component in treasury management,
and that it can bring in money or cut down the risk of losing
it? The difficulty often lies in the art of combining what exists

In general, when it comes to BAM, few treasurers can boast
that they can instantaneously produce a list of all accounts
with their respective attendant signatory powers. SimiB.A.M  Points  of  a.en0on  for  Treasurers  
larly, when somebody leaves the business, it is well nigh
BAM  processes  aren't  standardized,  explains  and  understood  documented  
impossible to produce a complete list of all the accounts on
! and  consistent  although  highly  complex  
which he has signing powers. It is easy to delete people from
account lists in an IT payment tool, but their signatory powers
Over  reliance  on  e--‐mails,  faxes,  post/couriers  for  date  exchanges  and  all--‐in  
! heavy  manual  processes  
will not be cancelled until the bank has duly been notified in
writing. Another example is that the annual review of bank
! Decentralised  process,  access  and  control  over  bank  documents  
accounts and balance confirmations are very much manual
processes. Transmitting information when there is a change
! Absence  of  group  Power  of  Signatures  (PoS)  policy  and  guidelines  
in staff, and changes in signatory powers, are also still
manual and not very secure processes, done by mail or email.
Few applications provide audit trails recording who amended
! Limited  0me  to  report  (especially  at  year--‐end  closing  for  audit  purpose)  
what and when and most of all why (with documentation
! Mul0ple  sources  of  data  (some  0me  conﬂic0ng/inconsistent)  from  
explaining and giving reasons for the change). Because they
are non-standard and not consolidated, these databases are
	
   previous  I.T.  tools  including  XL  spread--‐sheets  
unreliable
and unsatisfactory.
	
  
Archaic  data  archiving  processes  including  lots  of  hard  copies  of  (the  same)  
There are, however, tools that can help with this manage! documents  
ment
work,
and
that
can
even
be
grafted
onto
the
existing
arwill	
  not	
  be	
  cancelled	
  until	
  the	
  bank	
  has	
  duly	
  been	
  notified	
  in	
  writing.	
  Another	
  example	
  is	
  that	
  the	
  annual	
  
No  clear  deﬁni0on  of  who  is  responsible  of  what  and  all--‐in  lack  of  
chitecture.
a time
when
everyone
is talking
about
riskpmareview	
  of	
  bank	
  At
accounts	
  
and	
  
balance	
  
confirmations	
  
are	
  very	
  m
uch	
  manual	
  
rocesses.	
  Transmitting	
  
! mo0va0on  for  doing  it  and  also  resources  
information	
  when	
  
there	
  itis	
  is
a	
  csurprising
hange	
  in	
  staff,	
  that
and	
  changes	
  
in	
  signatory	
  pshould
owers,	
  are	
  
nagement,
surely
bank accounts
inalso	
  still	
  manual	
  and	
  
not	
  very	
  secure	
  
done	
  by	
  mail	
  or
or	
  eat
mail.	
  
Few	
  
applications	
  
provide	
  
audit	
  trails	
  recording	
  
who	
  
Absence  of  misuse  of  dual  Authori0es/Signature,  insuﬃcient  segrega0on  
general
be soprocesses,	
  
badly managed,
the
very
least so
manually
amended	
  what	
  and	
  when	
  and	
  most	
  of	
  all	
  why	
  (with	
  documentation	
  explaining	
  and	
  giving	
  !
reasons	
  
for	
  the	
  
of  du0es  and  not  enough  4--‐eye  principles  applied  
managed?
An
account
is
by
its
very
essence
a
huge
tinder
box
change).	
  Because	
  they	
  are	
  non--‐standard	
  and	
  not	
  consolidated,	
  these	
  databases	
  are	
  unreliable	
  and	
  
unsatisfactory.	
  	
  

16

no clear and specific policy on the principles to be applied to
signatory powers. Accounts are all too often managed locally
and therefore in a decentralised way even though we are
trying to centralise treasury management. We need to know
how each subsidiary is asked to handle the management of
its signatory powers, the basic principles by which it must
abide, the segregation of duties when these are to be put into
practice, etc. This is the starting point to be addressed. There
are a great many KYC (Know Your Customer) documents, and
it is a good idea to manage them centrally on the same tool.
Unfortunately, they are all too often managed chaotically and
messily. We offer this as a general observation.

Deficiencies  often  encountered  
1.  LACK  OF  CONTROL  AND  ORGANIZED  PROCESSES  

!

Internal	
  controls	
  aren't	
  suﬃcient,	
  lax	
  or	
  not	
  fully	
  tested	
  re.	
  PoS	
  and	
  
Commitment	
  Authori=es	
  

!

Not	
  enough	
  quality	
  repor=ng	
  available	
  upon	
  demand,	
  global	
  picture	
  on	
  bank	
  
with what
wanted
in terms of IT resources.
accounts,	
  signatories	
  
and	
  is
bank	
  
fees	
  charged	
  

No	
  central	
  overview	
  of	
  the	
  number,	
  type	
  or	
  status	
  of	
  bank	
  accounts,	
  or	
  associated	
  mandates
Decentralized	
  physical	
  archiving	
  of	
  paper	
  documents	
  
Inconsistent	
  process	
  across	
  the	
  company	
  to	
  maintain	
  financial	
  power	
  of	
  signatures	
  within	
  i nternal	
  application	
  
2.  TIME--‐CONSUMING,  MANUAL  AND  ERROR  PRONE  PROCESSES  

We must not start with a blank page. We need
to adapt the eBAM module or modules to our
ERP, to our TMS, to our payment factory and to
Highly	
  e xposes	
  and	
  i nefficient	
  paper--‐based	
  processes	
  for	
  maintaining	
  bank	
  accounts	
  (unsecured)
Information	
  i s	
  saved	
  i n	
  different	
  systems,	
  on	
  OFFICE,	
  on	
  paper	
  or	
  i n	
  e mployee's	
  heads	
  
the other resources in place. The scale of the
Tracking	
  of	
  changes	
  can	
  be	
  complicated	
  and	
  time	
  consuming	
  
task is vast and, for example, we need several
3.  FRAUD  RISKS
tools for signatory powers, ideally adhering to
Very	
  high--‐risk	
  e xposure	
  due	
  to	
  a	
  l ack	
  of	
  overview	
  of	
  bank	
  accounts	
  
	
  within	
  the	
  group	
  and	
  manual	
  unsecured	
  communication	
  means
the principle of segregation of duties. Those
4.  COMPLIANCE  RISKS
who have done this find that these tools are
Risk	
  of	
  non	
  having	
  documentation	
  i n	
  place	
  (e.g.	
  EMIR,	
  ISDA	
  protocol,...)
Missing	
  clear	
  major	
  principle	
  on	
  signatory	
  rules
sometimes not very user-friendly and are
	
   difficult to input in terms of signatory powers.
	
  
Why not have one single interfaced tool which
feed
There	
  
ools	
  that	
  
can	
  help	
  
with	
  this	
  
management	
  
ork,	
  increase,
and	
  that	
  can	
  even	
  bwould
e	
  grafted	
  
onto	
  into all other tools? This is possible, with Hanse
of
riskare,	
  
if hitowever,	
  
is nottkept
under
control.
Fraud
is on wthe
the	
  existing	
  architecture.	
  At	
  a	
  time	
  when	
  everyone	
  is	
  talking	
  about	
  risk	
  management,	
  surely	
  
it	
  is	
  
Orga
for example. In terms of BAM in the wider sense, only
and
compliance is becoming ever stricter and more irksome.
surprising	
  that	
  bank	
  accounts	
  should	
  in	
  general	
  be	
  so	
  badly	
  managed,	
  or	
  at	
  the	
  very	
  least	
  so	
  manually	
  
a few suppliers can boast of being able to offer everything.
Managing
your
accounts
badly
can
have
huge
adverse
consemanaged?	
  An	
  account	
  is	
  by	
  its	
  very	
  essence	
  a	
  huge	
  tinder	
  box	
  of	
  risk	
  if	
  it	
  is	
  not	
  kept	
  under	
  control.	
  Fraud	
  
Others
only offer some of the modules. But you can always
quences,
in terms
of cost, reputation,
business
is	
  on	
  the	
  increase,	
  
and	
  compliance	
  
is	
  becoming	
  ever	
  
stricter	
  and	
  interruption,
more	
  irksome.	
  Managing	
  
your	
  accounts	
  
tweakeyour
badly	
  Faced
can	
  have	
  
huge	
  such
adverse	
  
consequences,	
  
in	
  tto
erms	
  
of	
  cost,	
  
reputation,	
  
business	
  interruption,	
  
tc.	
   IT architecture to achieve your goal. To sell this
etc.
with
risks,
we need
make
bank
account
Faced	
  with	
  such	
  risks,	
  we	
  need	
  to	
  make	
  bank	
  account	
  management	
  more	
  professional,	
  just	
  
as	
  we	
  did	
  
for	
  have to combine its quantitative and qualitative
project,
you
management
more professional, just as we did for payments,
payments,	
  and	
  automate	
  it	
  further.	
  We	
  also	
  often	
  find	
  that	
  MNCs	
  have	
  no	
  clear	
  and	
  specific	
  policy	
  on	
  
benefits.
and automate it further. We also often find that MNCs have
the	
  principles	
  to	
  be	
  applied	
  to	
  signatory	
  powers.	
  	
  Accounts	
  are	
  all	
  too	
  often	
  managed	
  locally	
  and	
  
therefore	
  in	
  a	
  decentralised	
  way	
  even	
  though	
  we	
  are	
  trying	
  to	
  centralise	
  treasury	
  management.	
  We	
  
need	
  to	
  know	
  how	
  each	
  subsidiary	
  is	
  asked	
  to	
  handle	
  the	
  management	
  of	
  its	
  signatory	
  powers,	
  the	
  basic	
  
principles	
  by	
  which	
  it	
  must	
  abide,	
  the	
  segregation	
  of	
  duties	
  when	
  these	
  are	
  to	
  be	
  put	
  into	
  practice,	
  etc.	
  
This	
  is	
  the	
  starting	
  point	
  to	
  be	
  addressed.	
  There	
  are	
  a	
  great	
  many	
  KYC	
  (Know	
  Your	
  Customer)	
  
documents,	
  and	
  it	
  is	
  a	
  good	
  idea	
  to	
  manage	
  them	
  centrally	
  on	
  the	
  same	
  tool.	
  Unfortunately,	
  they	
  are	
  all	
  
too	
  often	
  managed	
  chaotically	
  and	
  messily.	
  We	
  offer	
  this	
  as	
  a	
  general	
  observation.

Table des matières de la publication Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018

COUVERTURE
SOMMAIRE
EDITORIAL
FINANCIAL HIGHLIGHTS Luxembourg Tax News
INTERVIEW with Dick Oskam, Head of Sales for Transaction at ING
FOCUS
Value generation - How to create (more) value for the company with a better capital allocation
Managing bank accounts, the Cinderella of treasury management
Treasury on the Digital Front Line
FORUM
Implementation of EU Tax Rules
Innovative payments solution
Construction de portefeuille : combiner gestion active et passive
Decision Time: Investing in Money Funds after EU Reforms
Payments as a Strategy
Are asia’s corporates ready to repo?
The evolving role of treasurers
THE FINANCIAL RISK OBSERVATORY
NEWS
LIFE BEYOND NUMBERS
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - COUVERTURE
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 2
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - SOMMAIRE
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 4
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - EDITORIAL
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - FINANCIAL HIGHLIGHTS Luxembourg Tax News
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 7
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - INTERVIEW with Dick Oskam, Head of Sales for Transaction at ING
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 9
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Value generation - How to create (more) value for the company with a better capital allocation
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 11
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 12
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 13
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Managing bank accounts, the Cinderella of treasury management
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 15
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 16
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 17
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 18
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Treasury on the Digital Front Line
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 20
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 21
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Implementation of EU Tax Rules
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 23
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Innovative payments solution
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 25
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Construction de portefeuille : combiner gestion active et passive
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 27
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Decision Time: Investing in Money Funds after EU Reforms
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 29
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Payments as a Strategy
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 31
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - Are asia’s corporates ready to repo?
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 33
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - The evolving role of treasurers
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 35
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 36
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - THE FINANCIAL RISK OBSERVATORY
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 38
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 39
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 40
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - NEWS
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 42
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 43
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 44
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 45
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 46
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 47
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 48
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 49
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 50
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 51
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 52
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - LIFE BEYOND NUMBERS
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 54
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 55
Trésorier/Treasurer magazine - N°99 - Nov/Dec/Jan 2018 - 56
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