The Treasury Forecast is Bright and Breezy

Bank of America’s intelligent innovations give treasurers a clear view ahead

Any initiative that makes a treasurer’s working day easier is welcomed by the community. So, it comes as no surprise to see Bank of America scoop two of TMI’s coveted Technology & Innovation Awards in 2021 for its mobile app and forecasting developments, while assisting four clients to achieve Corporate Recognition Awards.

The pandemic has changed the way we work – arguably forever. As the line between work and home life continues to blur, treasurers (and the C-suite) expect to have the ability to access their cash management information at any time of the day, from any geographical location. To this end, mobile solutions are becoming de rigueur. But not all cash management apps are created equal.

One that stands out from the crowd is Bank of America’s (BofA’s) CashPro® mobile app – winner of the 2021 TMI Technology & Innovation Award for Best Mobile Technology Solution. Following substantial focused investments, the app now delivers the power of the CashPro® platform into treasurers’ hands, enabling them to view their cash positions, and track, execute and approve payments – all in a sustainable, paperless, and biometrically secure manner.

During the past 12 to 24 months, BofA has added additional features to the app, including remote cheque deposit capabilities (up to 100 at a time) and the use of a mobile token – on top of fraud prevention measures, FX capabilities, and electronic document signing. Commenting on the app enhancements, Tom Durkin, Global Product Head of CashPro®, Global Transaction Services, BofA, said: “We made it our permanent goal to offer the simplest experience for our clients. We collect user feedback from everywhere: the in-app feature, user analytics, call centres and our CashPro® advisory boards. With this information, we tailor every design decision to meet users’ needs, making the app the best possible ‘high-tech’ experience for clients to do business.”

Recent CashPro®App metrics attest to the success of this approach: eight of the 10 highest sign-in days in the app’s history were logged in December 2021. Moreover, there was a 54% year-on-year increase in usage from what was a record-breaking 2020 in terms of sign-ins. This seal of approval has culminated in CashPro®App being named TMI’s Best Mobile Technology Solution 2021.

Forecasting success

Another BofA innovation rolled out in 2021 also caught the eye of the TMI judging panel, with CashPro® Forecasting being Highly Commended in the Solution Innovation category of the TMI Technology & Innovation Awards.

Rapidly changing conditions and unexpected market disruptions mean an ever-greater need for companies to quickly generate reliable cash flow forecasts so they can anticipate liquidity needs and make effective working capital decisions. As a result, corporate treasurers are reviewing their cash flow forecasting capabilities and looking to the market for best-of-breed solutions to help meet their evolving needs.

BofA’s CashPro® Forecasting solution was made available to all clients in October 2021. Leveraging ML technology, the solution helps corporates achieve accurate and efficient multi-bank cash forecasting, reducing the manual time typically required to maintain a forecasting process, while also offering robust analytics to produce more reliable daily, weekly or monthly forecasts, up to a year ahead. A variety of scenario analysis tools are also built in to help clients to create forecasts using their own assumptions – and all reports can be easily exported to Excel.

Designed in partnership with a fintech vendor, CashPro® Forecasting uses an open source container application platform, meaning that the vendor’s ML models can be hosted on premise without compromising intellectual property. The TMI judges were particularly impressed by the enhancements made to the vendor’s existing forecasting solution, which came from input from BofA and its clients – leading to a solution that is heavily derived from corporate treasury practitioners’ input.

Reflecting on both TMI accolades, Faiz Ahmad, Head of Global Transaction Services, BofA, said: “The past two years have set the stage for an acceleration in payments innovation. Our clients are ready and we are ready for the next chapter in the convergence of real-time data, digitisation and payments. We have more capabilities planned for our industry-leading CashPro® App, and more solutions like CashPro® Forecasting that will give clients the functional and informational edge to better compete in their markets.”

Testament to innovation

Ahmad’s words certainly ring true in light of four BofA clients being Highly Commended in TMI’s Corporate Recognition Awards 2021:

ACCO Brands embraces AI

American manufacturer of office products ACCO Brands was faced with the challenge of integrating acquired company Esselte, which has operations in 22 European countries, into ACCO’s existing treasury structure – which included an SSC in Poland. Global Treasurer Jagannath ‘JB’ Bobji and his team turned to BofA, their primary banking partner for many years, for support. 

“One pressing need rapidly became clear; our multiple consumer brands, now boosted by Esselte’s, generated a high volume of relatively low-value sales, making reconciling accounts receivable [AR] a constant challenge,” said Bobji. Approximately 31,000 invoice payments each month, with remittance advice arriving by email or through the company’s portal, would have to be matched to the ledger. This cumbersome task was being managed online using spreadsheets and a lot of manual input.

To solve this problem, BofA worked with ACCO’s EMEA Treasury Director to implement an automated system, Intelligent Receivables, which brings together AI, ML and optical character recognition (OCR) to automate the process of reconciling incoming payments. These include extracting remittance data from emails, email attachments, electronic data interchange (EDI), and payer web portals, and matching the payments to open receivables and creating a receivables posting file that ACCO uploads to its ERP system. In the few instances where an invoice cannot be automatically matched, an exception portal allows the receivables staff to upload supporting data or make other adjustments to enable matching.

Together with the BofA team, ACCO’s treasury team travelled to Poland to share and approve the proposal with Senior Finance Director of the SSC, Maciej Lasek. Under Lasek’s leadership, both Agata Przezdziecka, Mira Pencerzynska and ACCO’s AR team in Warsaw, piloted the project to automate reconciliation across Europe.

After some teething challenges in Spain, a market known for its love of paper-based instruments, the solution pilot soon became a success, and has now been rolled out across Europe and is also live in Australia with considered expansion to ACCO’s North American entities.

Commenting on the benefits of this AI-based solution, of which ACCO is an early adopter, Lasek said: “The results speak for themselves; where previously approximately 70% of payments needed manual intervention to be correctly matched, today that figure is down to 10% and may fall even further. AR staff at our Warsaw SSC have been freed from repetitive manual tasks and can focus on supporting the business in more productive ways”. These results, together with the forward-thinking of the ACCO and BofA teams, makes the project deserving of a Highly Commended accolade in TMI’s Corporate Recognition Awards, within the Best AI Solution category.

Qualcomm pools its resources

The wireless technology and innovation giant Qualcomm was experiencing accelerated growth in Asia and wanted a centralised, automated, and flexible cross-border liquidity management structure that would support its present needs and future business expansion.

BofA was chosen from among its three relationship banks to put in place a multi-currency notional pool at the regional level so that wherever the regulations allow, the company can concentrate liquidity in a centralised location in its base currency with the benefit of minimising FX costs yet maximising yield. Separate domestic cash-sweeping arrangements were also rolled out for local currency and USD to optimise yield while reducing related FX costs. In addition, automatic zero-balance sweeping structures were created.

Due to Asia’s disparate regulatory landscape, the solution had to be meticulously structured to comply with country-level regulations and documentary requirements. To ease the regulatory complexity and establish a sensible timeline for deployment, Qualcomm decided to adopt a phased approach to rolling out the structure, starting with Singapore and China.

This bespoke cross-border liquidity management solution has now provided Qualcomm with full visibility and control of the group’s liquidity, as well as cost savings due to reduced reliance on external financing, FX management, tax expenditure, and daily administration. Qualcomm is now well on its way to achieving efficient and advanced liquidity management practices across countries in Asia – and the TMI judges were delighted to reward the company with the Highly Commended accolade for Best Cash Pooling Solution.

Kohler sweats its working capital

As many corporate treasurers will understand, cash application has always been a challenge in Asia with multiple payment instruments, channels, and local market practices. American manufacturer Kohler was experiencing these challenges – and had partially resolved them with the implementation of a common ERP and receivables system across the region, and centralisation of its receivable management with the team in Shanghai.

Yet that still left the Kohler team with the challenge of a receivables matching process that is manual, labour-intensive, and prone to error. Working with BofA, Kohler implemented Intelligent Receivables (IREC), which leverages AI and ML, to automate cash application across its 10 markets in APAC.

Kohler was particularly drawn to the fact that IREC could be customised to its unique requirements, such as the ability to process payment and remittance data in local languages, as well as local payment instruments. In a pilot in China, Kohler achieved STP application rate of 85% and has since rolled out IREC in the remaining nine markets.

What’s more, the customer intelligence from an analytics module in IREC is helping Kohler to identify patterns and payer behaviour to further improve DSO. A parallel effort with customers to encourage them to submit remittance advice and modification of their remittance advice practices to optimise STP is also underway. The benefits to Kohler are enormous – and the TMI judges were impressed by the fact that the company is leveraging IREC to the full, ultimately using it to change the way it does business with buyers for the better, while improving customer experience. This makes the project deserving of the Highly Commended Accolade in the Best Working Capital Solution category of TMI’s 2021 Corporate Recognition Awards.

Brink’s delivers top treasury teamwork

In 2020, private security and protection company Brink’s, announced the acquisition of the majority of G4S’s cash operations for $860m. In Asia, Brink’s would need to take control of multiple new entities across nine countries and consolidate them into the company’s existing cash management structure.

The acquisition was a huge project for the Brink’s treasury team, which comprises just four people. The process started in March 2020 with the valuables transport businesses in Singapore, China, Thailand, Hong Kong and Australia, and ended with cash transport in remaining countries including Malaysia, Indonesia, the Philippines and Macau by February 2021.

The list of achievements by Brink’s treasury team is extensive. In less than a year, and during a global pandemic, the team:

Achieving all of this during the height of the Covid-19 pandemic, without increasing treasury headcount, is an impressive feat – and directly reflects the great teamwork within the treasury department at Brink’s, as well as with their banking partner, BofA. Brink’s is a model for any treasury on how to integrate a new acquisition, even in the most difficult of times, and a worthy Highly Commended for Top Treasury Team of the Year 2021.