Citi Perspectives 2024 Corporates Edition

34 | Services Citi Perspectives Key treasury considerations for a real-time world At this point, looking at the treasury fundamentals is important. Companies will need a global bottom- up cash flow forecast by currency where they operate in real-time. Without this, you will have idle cash sitting in bank accounts that may or may not be used. In today’s higher interest rate environment and the greater cost of capital, this makes a company even more inefficient. Getting the most of out of a company’s cash is vital, and in a real-time world, that means 24x7x365. However, no one wants to work every day. So, cash and FX desks need to think about moving from people dependence to automated process dependence, to intelligent automation. It must be said that to really harness this aspiration of automation, companies will have to be grounded with strong cornerstones of bank account administration and rationalization, cash flow forecasting, and automation of cash flows on a cross-entity basis with automated accounting. The linchpin to achieving this goal will be data consumption and how firms harness data. Companies today need to think about their data strategy and business processes. What data do I get from my financial service providers? How old is the data? How do the balances and payments I see frommy service provider reconcile to my forecast and estimated cash positions? Who within an organization is processing disbursements? Examples include traditional accounts payable, payroll, non-accounts payable disbursement related to marketplace or other activity, tax disbursements, dividends, etc. In a real-time world, how do actual cash flows match up against forecasted cash flows? This will need to be done at or near real-time. Can users of What challenges do you see associated with real-time treasury with regards to your organization? 69% Treasury systems that operate in real-time Staffing 24x7x365 Other conflicting priorities at this time Lack of understanding regarding benefits Foreign exchange and investment markets do not operate 24x7x365 Other 49% 44% 35% 35% 9% Do you see yourself as an early adopter, fast follower, or an unlikely adopter of real-time treasury? 62% Fast Follower Early Adopter Unlikely to Adopt 25% 13% Real-Time Information Real-Time Liquidity Real-Time/ Instant Payments None of the Above 78% 62% 53% 11% Where will your treasury focus on within the next 3 years? Citi surveyed clients globally in 2023 and the responses show that companies are beginning to think about this.