Cash visibility is top concern of firms doing business in PHL - survey

Firms doing business in the Philippines are still grappling with planning future cash requirements amid limited resources and heavy reliance on manual processes in the country, a joint survey by SunGard and Bank of America Merrill Lynch found. In their Treasury Barometer 2013 survey, SunGard and Bank of America Merrill Lynch said improving visibility over projected cash inflows and outflows remain a top priority of firms here. “When we looked at the problem in the Philippines, cash visibility remains the top issue,” SunGard vice president Brad Maclean told reporters at a teleconference Tuesday, noting that less than 25 percent of firms see their cash visibility as being optimal. Cash visibility is generally defined as a firm's understanding of how much money they have and where they have it. Maclean said this could have stemmed from the use of spreadsheets or other manual systems for cash flow forecasting. “When we looked at the use of tools, 66 percent of respondents regionally are not using cash flow forecasting tools. But when we looked at the Philippines, in itself, the number was significantly higher,” he noted. Some 85 percent of surveyed firms that have operations here use spreadsheets, above the Asia Pacific benchmark of 69 percent, results of the Treasury Barometer 2013 show. “One of the reasons for this [excessive use of spreadsheets] could be the fact that they are working with disparate systems in different companies, connectivity issues between firms or even banks that makes them heavily reliant on spreadsheet or other more manual processes,” Maclean opined. Another top priority for treasurers of firms doing business here is rationalizing bank accounts, which entail either narrowing the number of banks they deal with or limiting the relationships they have in a particular bank. Firms, likewise, want to improve the efficiency of cash management by transferring funds from diverse accounts into a central account. Meanwhile, 51 percent of firms said the key challenge to cash forecasting is bringing the internal subsystems together into one. Centralizing reporting processes (38 percent) came in second, followed by tapping more resources (35 percent), improving on sales targets or projections (32 percent) and fine-tuning bank connectivity (18 percent). Mike Fullmer, senior vice president at SunGard, said the findings here generally mirror that of other markets. “Dependency on spreadsheets, non-satisfaction with cash forecasting and the idea that there is inaccurate data and lack of integration was shared by both markets,” he said. SunGard, a Fortune 500 company, provides software solutions for different firms spanning energy companies to banks. It has over 40 installations in the Philippines. The Treasury Barometer 2013 is touted as the largest Treasury survey dedicated to Asia and the Pacific, with over 913 respondents across 14 industries in 17 countries. Of the total respondents, 250 respondents have regional business operations in the Philippines. — BM, GMA News