RiskStudy Finds Gaps in Financial Risk Management Methods Among Corporations

Study Finds Gaps in Financial Risk Management Methods Among Corporations

A recent SunGard study, ‘Financial Risk Management in Treasury’, has revealed that corporate treasurers around the world find it difficult to consistently and accurately measure and monitor financial risk exposure. The study of more than 200 treasury professionals from more than 25 countries examined practices around interest rate, credit, counterparty, commodity, liquidity, foreign exchange (FX) and market risk.

Accurately measuring and effectively managing exposure to financial risk is of utmost importance to a corporate treasurer. Failure to do so can lead to consequences from embarrassing headlines to large financial losses. In spite of this, many companies continue to use spreadsheets to perform essential analysis such as short-term cash forecasting (65%) and monitoring of counterparty trading limits (45%). Using spreadsheets to perform complex risk management tasks can expose a process to fraud, the potential for non-compliance with basic accounting principles, and in some cases, human errors that have cost companies millions of dollars.

Paul Bramwell, senior vice president (SVP) of treasury solutions at SunGard’s AvantGard business unit, said: “This study shows that although 87% of firms have a risk framework established within their organisations, many are reliant on manual processes which can leave a firm vulnerable to errors. The use of treasury technology can automate and enhance oversight while helping to improve efficiency and reduce potential for errors.”

Related Articles

Why working in silos is a killer when battling financial crimes

Cyber Security & Fraud Why working in silos is a killer when battling financial crimes

3w Andrew Simpson
How Brexit will shape the payments landscape

Brexit How Brexit will shape the payments landscape

3w David Beach
Digitization and the role of the digital treasurer – part 2

Automation Digitization and the role of the digital treasurer – part 2

1m Victor Penna
What financial services can learn from the Uber breach when preparing for GDPR

Big Data What financial services can learn from the Uber breach when preparing for GDPR

2m David Beach
Why Ferguson Plc opts for floating rate debt: Bellin 1TC conference day 2

Capital Markets Why Ferguson Plc opts for floating rate debt: Bellin 1TC conference day 2

2m Victoria Beckett
An overview of FX risk management tools and strategies

Foreign exchange An overview of FX risk management tools and strategies

2m Michael McCaw
Treasury 101: What are the major foreign exchange risks?

Foreign exchange Treasury 101: What are the major foreign exchange risks?

2m Michael McCaw
Algorithmic FX trading an "inevitable endpoint" for treasurers

Automation Algorithmic FX trading an "inevitable endpoint" for treasurers

3m Curtis Pfeiffer