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Centralized Cash Management

Ms. Carmen Hett

UNHCR Treasurer

4 December 2014

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Enabling a Centralized Cash Management Approach :

- Capturing Global Cash Flows – ERP Automated Cash Flow Forecasting

- Payment execution release of funds through dedicated banking platforms

- Centralized funding of bank accounts in local currency – where possible

- Automated Electronic Bank Statements and Bank Reconciliations

HQ Treasury

Dedicated Banking Platform (s) at HQ and in Country

Underlying enabler – ERP - PEOPLESOFT - Finance & Supply Chain - TMS

ERP – Banking standardized Electronic Banking Communication Gateway

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ERP - TMS - Integrated Systems Architecture

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“End- to End – Processes” - Budget Planning - ERP – TMS

BUDGET PLANNING - Forecasted Cash flows

versus Actuals :

Purchase Requisitions

Purchase Orders (PO)

Implementing Partners Agreement (IP Module)

AP / AR

Payroll

Cash Flows – Forecast - Actuals Cash Actuals - Reconciliations

Identify timing of cash

needs replenishments

and global funding of

bank accounts

Assessment of Actual

cash payments versus

Budget Planning

Bank Statement

Processing

Bank Account

analysis and

reconciliation

ERP – Integration to Obtain Automated Cash Flow Forecasts

Automated

Cash Flow Forecasts

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TMS - Cash Flow VIEW - ERP System generated

Cash Flow (Short Fall) / Surplus

AUTOMATED Cash Flow forecasting Tool based on transactional

data in the ERP systems, e.g. Procurement (Requisitions, Purchase

Orders) to Implementing Partner Agreements to Bank, AR /AP,

Payroll .

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UNHCR – Global Operations in 127 Countries

183 field offices have operational banking requirements:

337 bank accounts

84 countries with two or less bank accounts

43 countries with more than two bank accounts

125 banking partners

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What drives the underlying requirements ?

Why Bank Accounts ?

Internal Factors

(UNHCR specific)

External Factors

(Country specific)

• Delegation of Authority Plan (DOAP),

Control and Oversight

• Human Resources / Travel Policies

• Petty Cash

• Private Sector Fundraising

• Specific Operational Requirements

• Implementing Partner Agreements

• Unstable Political Situation

• Geographical Remoteness, Distance and

Specific Operational Requirements

• Generally Accepted Business Practice

• Limited Local Financial/Banking System

and Restrictions to International

Banking

• Currency Restrictions and Protection

• Sanctions and Related Effects

UNHCR cannot influence external factors

Optimization potential in the UNHCR specific, internal factors

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Payment Execution – Transactions and Value

• EFT payments are most common, accounting for 91% in value terms and

76% in transaction terms

• Payments are executed through centralized pay-cycles (using two major

relationship banks) and at local level where required

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Centralization Impacts : Country, Regional or Headquarters

Design of Functional Processes

Approval, Control, Oversight

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Challenges and Resources

Organization

New policy considerations for organizational

structure, redesign of administrative, financial

and supply chain processes to further centralize

financial control and oversight on a country,

regional - to headquarters level

Bank Accounts

Focus on rationalizing local bank relationships

and leveraging existing global and regional bank

relationships through a well-defined BRM

strategy and guiding principles

Payments Execution

Leverage existing solutions (e.g. H2H), apply

stricter payment policies in third-party

agreements and explore card/mobile solutions

as payment mechanisms to be integrated in ERP

systems as payment type.

Technology

Explore the implementation of bank-agnostic

connectivity XML AND (SWIFT) – Further

integrate ERP systems to TMS and Banking

Communication.

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Direct Cash Assistance to Refugees

Using Biometrics Application– New Payment Technology Using Iris Scan - without card – without pin UNHCR- Cairo Amman Bank and IrisGuard

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