1. Making Sure You Select the Right TMS Solution for Your Organization Christopher Duffy Director - KPMG LLP Dory Malouf Treasury Advisor - Kyriba

2. 1 Introductions Christopher Duffy, Director - KPMG LLP Chris is a Director for KPMGs Treasury and Market Risk Management Practice with over 25 years experience in Financial Services, Capital Markets, and Corporate Treasury. Chris provides clients with a broad perspective on addressing risk management issues, having held senior positions in corporate treasury, banking, government, and advisory roles over the course of his career. He has provided clients with project management support on treasury integration and acquisition integration activities. Dory Malouf, Treasury Advisor - Kyriba Dory is a Treasury and Cash Management thought leader with a professionally recognized career. Dory recently joined Kyriba as a Treasury Advisor at the start of 2014, after being a treasury practitioner for the past 14 years at leading corporates in the Detroit area such as Pulte Homes. Dory has implemented and utilized four different treasury management systems in his career and is passionate about the world of treasury operations and how technology unlocks process improvement and business value. 3. 2 Current Hot Topics in Treasury Bank account and relationship rationalization Cash flow forecasting and liquidity management Controls and governance Counterparty credit management Covenant compliance Foreign exchange risk management Treasury centralization & transformation Treasury management systems Investment portfolio management Liquidity has become a much bigger issue. Keeping a credit facility in place has become harder and more expensive. If you wait until you need the credit it will be harder to obtain and much more expensive than prior to the crunch. The decision is how much headroom to maintain. Group Treasurer The role of treasury has broadened significantly within our organization into M&A, Working Capital and Enterprise Risk Management & Reporting. Its helped raise the profile of treasury and given our treasury people a broader field of play. Head of Corporate Finance & Treasury 4. 3 Leading Practices in Treasury Cash Position, Forecasting, Management Centralized visibility/control over enterprise cash position Formalized short, medium, and long term rolling cash forecasts Automation of daily tasks, such as reconciliations and journal entries Use of the Society for Worldwide Interbank Financial Telecommunication (SWIFT) Network Bank Account Management Limit the number of bank relationships based on credit and liquidity requirements Analyze bank accounts monthly; utilize applicable bank fee analysis tools Monitor banks performance using annual bank reviews and a bank report card Utilize Electronic Bank Account Management (eBAM) technologies, along with SWIFT Hedging Automated measurement and reporting of global exposures Centralized decisions and management of interest rate, FX and currency hedging Link derivatives with the underlying assets/liabilities for reporting requirements Financial Accounting Standard (FAS) 133 and 157 reporting Netting Centralized automated netting process using cash and non-cash settlements Visibility and transparency to all inter-company loans on a global basis Investments & Debt Automated counterparty exposure monitoring and reporting Automated interest calculations Visibility to global investments Reporting to show how debt and investments are aligned with policy and corporate risk tolerance Liquidity planning linked with debt planning 5. 4 The Increasing Importance of the Treasurer Moving up the organization pyramid Strategic Executional Transaction Execution Cash Position FX , IR, Commodities Debt & Investments Analytical Liquidity Management Cash Flow Forecasting Financial Risk Management Bank Relationship Management Performance Measurement Business Unit Partner Founder-level Accountability Value-added Functions 6. 5 Why a Treasury Management System? Focus on optimizing key treasury processes. A Treasury Management System (TMS) can provide greater functionality to help companies centralize control: Cash Position Cash Forecasting Bank Account Mgmt Hedging Investment & Debt Treasury Accounting Cash Reconciliations Risk Management Banking Services Intercompany Loans / Netting Each theme is aligned to specific drivers that help guide successful implementations and change. Drivers: Unprecedented visibility into key close activities across multiple management levels Proactive monitoring capability to assist with identification of bottlenecks and control gaps Drivers: Standardized, consistent processes across entities Productivity efficiencies gained through automation Drivers: Inherent systematic controls Quality improvement due to reduced manual processes Risk mitigation Treasury Management Systems Transparency Process Unification Governance & ControlResource Optimization Drivers: Cost reductions leading to impressive Return on Investment (ROI) Enhanced staff efficiencies allow for shifting focus from transactional to analytical 7. 6 TMS Vendor Selection & Implementation Methodology 8. 7 Analysis of Business & Technical Requirements TMS Vendor Selection & Implementation Methodology Review of the companys existing treasury business processes versus leading industry practices (gap analysis) High level TMS business requirements Utilize standard tools and checklists developed on multiple other projects across industries Quick-hit vs longer term opportunities for improvement across the treasury organization Development of a short- term and medium-term treasury roadmap Roadmap will align existing treasury business processes with a treasury vision Incorporate leading industry practices to improve efficiency and the control environment Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 9. 8 TMS Vendor Selection & Implementation Methodology Preparation of a request for proposal which briefly summarizes the project scope, timeline and preparation of catalog of requirements to evaluate functional gaps of the systems. Define vendor selection criteria, demonstrations, and scoring parameters relevant to your organizations treasury requirements. Analysis of Business & Technical Requirements Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 10. 9 TMS Vendor Selection & Implementation Methodology More successful when defined scripts, transaction types, and agenda definitions represent your agenda rather than the vendors. Based on defined TMS selection criteria, project team will summarize demonstration results to facilitate vendor evaluation. Intensive review / challenge of information provided by the system vendors based on our in- depth system knowledge. Providers and market developments responses are evaluated using a scoring model whose weighting features can be defined according to the Clients needs. Analysis of Business & Technical Requirements Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 11. 10 TMS Vendor Selection & Implementation Methodology Vendors presentation on systems functionalities based on test cases which reflect clients day-to- day work. Preparation of management summary taking into consideration the scoring model results, the workshops, the total cost of ownership and details on strengths and weaknesses. Live demonstrations are an opportunity to observe the look and feel of each system. Coordinate an agenda for live demonstrations by the TMS vendors to ensure each vendor follows the approved agenda and demonstrates how your companys transactions flow through the system. Ensure that all functionality that is desired is actually viewed. Vendor demonstrations are typically 3 to 5 hours in duration, depending on the system complexity. Analysis of Business & Technical Requirements Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 12. 11 TMS Vendor Selection & Implementation Methodology Define detailed business concepts which reflect clients requirements with regard to the system Help ensure accordance of IT concepts Help ensure a short and efficient implementation phase and challenge to meet the timetable requirements Thorough business blueprints that reflect your requirements, processes and functions and serve as a basis for testing. Analysis of Business & Technical Requirements Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 13. 12 TMS Vendor Selection & Implementation Methodology The system-specific IT specifications are prepared by the implementation team. Reviewing the IT concepts on an ongoing basis will ensure that future system setup represents your treasury strategies formulated within the business concepts. Implementation of a system environment which not only represents leading practice but will also significantly improve your treasury performance. Analysis of Business & Technical Requirements Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 14. 13 TMS Vendor Selection & Implementation Methodology The objective of the test phase is to analyze whether the system is operating soundly and securely. Review is based on substantial test procedures on the one hand and walkthroughs on the other hand. Thorough testing processing and documentation and secure data migration that helps ensure a successful go-life and fulfills audit requirements Analysis of Business & Technical Requirements Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 15. 14 TMS Vendor Selection & Implementation Methodology After the successful go-live of your central treasury the implementation team will develop a roll-out plan together with you and your implementation partner. In addition, local as well as web-based trainings are organized by KPMG in coordination with the system provider. Analysis of Business & Technical Requirements Preparation of Request for Proposal Evaluation of System Vendors Workshops & Management Decision Design of Processes & Functions Implementation Testing Go Live 16. 15 The Value Creation Hierarchy Productivity Financial controls Global visibility Effective financial decisions Treasury as a strategic partner Source:The Treasury Mandate: A Strategic Partner for Unlocking Business Value - kyri.ba/treasurymandate 17. 16 Case Study & Best Practices Discussion Pay attention to your technology Pulte has used three different treasury workstations; all are not built the same Get involved Build relationships that get you In the room Ideas Dont be shy, put your idea out there regardless of how small or big it might be You can never automate too much You will still have a job, just a better one 18. 17 Case Study & Best Practices Discussion Examples of Strategic Partnership with a TMS: Competitor analysis Economic Analysis Fraud prevention Treasury efficiency Benchmarking Treasury Performance Unclaimed funds recovery 19. 18 Additional Kyriba Resource White Paper The Treasury Mandate: A Strategic Partner for Unlocking Business Value Download at: kyri.ba/treasurymandate 20. 19 Thank You For Participating! CONTACT US: KPMG: Christopher G. Duffy Director KPMG LLP cgduffy@kpmg.com treasury@kyriba.com twitter.com/kyribacorp kyriba.com linkedin.com/company/kyriba-corporation kyriba.com/blog Kyriba: