2020 Treasury challenges

As a treasury outsourcing provider, 2020 gave ETOS an unparalleled opportunity to prove our metal. Every business struggled to some degree during lockdown and the sudden switch to working from home. It was a brutal test of business continuity. Looking back on the year, we’ve reviewed some of 2020’s treasury challenges.

A large company was unable to allow all staff access to its network. Staff were allocated times to access their files and treasury functions and the TMS sat within the environment. Productivity declined steeply.
ETOS was able to step in, access the treasury system and all past and future treasury transactions and reports, using our own processes, enabling BAU. We worked with the client and their banks to facilitate the settlement process and the hedging plans.

A treasury manager designed and owned a spreadsheet that recorded the entire business portfolio. No one else was familiar with the spreadsheet structure or set up, creating key person risk. The manager left the business during lockdown which put intense pressure on the company while it gained an understanding of its positions and settlements status. With ETOS supporting the middle and back office functions, the company gained access to all relevant information. The treasury team was quick to reconcile expected positions with the banks to determine the actual portfolio and then record them in a system, building integrity for current and future requirements. Turn around was very quick, with the immediate issues resolved within a few days. Future proofing has been an integral part of every process.

While working from home, many businesses experienced a lack of cohesion between team members managing different parts of day-to-day middle and back office processes. For example, authorisers didn’t always understand what they needed to sign. Without someone sitting next to them with an explanation, they were often caught short.
ETOS was able to quickly step in and get settlement structures and education in place within one working day, restoring pre-COVID efficiencies to important processes.

A treasurer at one company recorded his orders long-hand in a book. He took the book home and fell ill shortly afterwards. No one else knew what exposures the company had. This could also  have caused concerns for the banks given the market fluctuations at the time.
ETOS quickly reconciled the position, identified the outstanding orders in the market and recorded them in a system. Proper protocols were put in place to ensure that management had visibility across hedging. Proper controls and processes were implemented to provide future proofing.

A medium sized business had managed for some time with a single treasurer who handled everything. While in the office, the management team was comfortable with this structure. Once in a ‘work from home’ environment, the lack of transparency became a concern.
The company had a treasury system that ETOS could access outside the company environment.  ETOS implemented middle and back office controls quickly and took on the role of Austraclear proxy, handling all settlements.

A treasury manager left suddenly to look after his family. Treasury transactions were recorded in a physical spreadsheet and he had single-handedly managed all settlements. Company management did not find it easy to understand treasury transactions and hedging, so the business was left very exposed, with the potential to breach covenants and policy parameters.
ETOS jumped in and reconciled all open transactions and orders in the market to ensure that there were no settlement failures. The ETOS team then set up the correct controls for settlements to banks and third parties and checked to ensure there were no breaches of policy rules and benchmarks.


If you’d like to future-proof your middle / back office operations, message or call Lesley Mitchell on +64 9 917 3476.