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www.pwc.com
Treasury Hot TopicBig-Bang Treasury Transformation
Pierre Parlongue, CelioSuzanne Hosmans, CelioDidier Vandenhaute, PwC
AgendaAgenda
1. Celio at a glance2 Issues and objectives2. Issues and objectives3. What did we accomplish
L l d4. Lessons learned
2PwC Conference Treasury Hot Topic
Celio at a GlanceCelio at a Glance
A fast growing retail company
PwC 3February 2011
Celio Celio isis a a fastfast--growinggrowing international international clothingclothing retailerretailer
866
Quick facts
Annual turnover €1 bnDouble digit growth 572
672
775866
g g
# stores > 1.000Openings: 130/year
Staff Approx 3.500270
321365
405
572
Treasury staff 3 FTE
# bank relationships 42
# b k t 7506 34 70
150170226
270
# bank accounts >7506
■ Most of our owned stores are located in Western Europe and India whereas clothes are mainlypurchased in Asia
A i t l 200 ffili t l t i
4
■ Approximately 200 affiliates are also present in Middle East, Asia and Africa
PwC Conference Treasury Hot Topic
Acquisition of Jennyfer in 2005Acquisition of Jennyfer in 2005
A i iti 2005Acquisition 2005
Annual turnover € 280 Mio
# stores 380
# bank relationships 20
# bank accounts > 250
5PwC Conference Treasury Hot Topic
Issues and ObjectivesIssues and Objectives
The Treasurer and CFO points of view
PwC 6February 2011
Main objective: Main objective: centralizedcentralized cash collection in cash collection in BelgiumBelgium
• Retail activities• Family-owned group• No external rating
ConsiderationsNo external rating
• 42 bank relationships (of which 38 local)• 42 bank relationships (of which 38 local)• Disconnection Banks vs Celio presence/needs• High banking costs & limited visibility
Key issues
• LT financing of the groupg g p• Efficiencies• Mutually beneficial relationships
Priorities
7PwC Conference Treasury Hot Topic
Many stakeholders Many stakeholders -- shared objectivesshared objectives
Treasury
CFO
Cash collection companies
Group TreasurerFO/MO/BO
T
Treasury
PwC
p
Treasury accounting
Project coordinatorBanking & Cash
Systemsi i
IT PMOIT- InterfacesAccounting
Banks
OrganisationIT-HardwareDocumentation
AP/AR
Fi Di t S it
LegalIT
System vendor
Finance DirectorsAuthorisers
Documentation
SecurityStores
Regulatory
Retail Service Bureau
Local country reps
8PwC Conference Treasury Hot Topic
Main issues related to treasury activitiesMain issues related to treasury activities
New protocols not supported ■ Bottle neck risk■ Rejected payments after deadline
Decentralised BRM■ Few economies of scale■ Out of market bank fees■ No priority status and no reciprocity
Decentralised treasury activities■ Staff inefficiencies■ Lack of visibility and poor cash forecasting■ Multiple Treasury systems
I ffi i t t l t i fl
No automated cash concentration ■ Simultaneous borrowing and lending■ Loss of value days
No formal treasury policy / processes ■ Heterogeneous treasury risk management
Multiple payment processes / systems■ Inefficient control on outgoing flows■ Heavy approval procedures■ High dependency towards banks
Few treasury / risk management tools
■ Wide use of Excel; poor information■ Few support to treasury activity growth
No formal treasury policy / processes ■ Heterogeneous treasury risk management
9PwC Conference Treasury Hot Topic
Many blocking factorsMany blocking factors
A ti
ERP1
TMS
Accounting entries
Generator 1Com
1
Com
TMS1
TMS2
Reconciliation tool 1
Commercial systementity 1
Commercial Reconciliation
1000+ stores
A ti
40+ banks
ERP2 ERP3 3 …system entity 2
Reconciliation tool 2
AccountingEntries
Generator 2
P l i t
TreasuryAccountingStores networkSecurity
IT
10PwC Conference Treasury Hot Topic
People impact
What did we accomplishWhat did we accomplish
Sweat sweat sweat…
PwC 11February 2011
3 phases covering 3 streams3 phases covering 3 streams
Strategy & organisational design
Bank & CM restructuringg
Treasury and CM systems
Implement1. Construct organisation
Select
1. Organisational and functional requirements
2. Bank(s)3. System(s)
Analyse and Design
2. Banking selection3. System selection
1. Policies and Procedures2. Banking design3. System Design
12PwC Conference Treasury Hot Topic
TTreasuryreasury system architecturesystem architecture
Local ERPs
Payment FINPaymentFactory tool
SWIFTReconciliation
FINprocessing
Converter MT 94x
MT 94x
T 10
xMT 9
TMS
Tool
FileActprocessing
ConverterM
T4x
Treasury ERP
BanksSWIFTService TMSLocal entities
13PwC Conference Treasury Hot Topic
BanksSWIFTBureauTMSLocal entities
CostCost -- benefitbenefit reviewreview
14PwC Conference Treasury Hot Topic
More balanced bank relationshipMore balanced bank relationship
15PwC Conference Treasury Hot Topic
Key lessons learnedKey lessons learned
Every project is different, but…
PwC 16February 2011
Issues (1/3)
AnalysisDesign
Selection Implementation
Issues (1/3)
No innovative solutions
Analysis & design
issues
Finance support at
dangerNo budget
Garbage out -
garbage in
PwC 17February 2011
Issues (2/3)
AnalysisDesign
Selection Implementation
Issues (2/3)
Difficult to compare
Selection issues
Difficult landing
Hard price negotiationlanding negotiation
PwC 18February 2011
Issues (3/3)
AnalysisDesign
Selection Implementation
Issues (3/3)
C Cross complexity
No priority status
Expectation not met
Implementation
Issues
Availability of
resources
Don’t sweat the
small stuff
Migration of new bank
PwC 19February 2011
We would be delighted to hear and answer your We would be delighted to hear and answer your questions!
PwC 20February 2011
Th k !Thank you!
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