Though self explanatory, being Currency Aware implies awareness about status of foreign currencies the organization is dealing in or intends to deal in the future. This awareness helps a CFO to assess the risk the organization is facing. A known risk is always better than an unknown one, thereby providing a CFO with an advantage to take necessary steps and set off the risk impact on organization’s net assets. The most common mistakes CFO’s do is to assess the risk, deploy methods to off-set the risk but they do not analyse whether the risk management techniques they employed are working as expected or not. So another important aspect of being “Currency Aware” is to analyze the post management impact. This becomes a hideous task if required to be done manually, but if you have a reliable software solution at work which manages the risks as required, and generates appropriate reports for post management analysis.
There are not many dedicated software solutions available in the market which provides you end to end currency risk management solution. IBSFINtech(hyperlink to website: http://ibsfintech.com/) is an organization offering niche solutions corporate in managing Treasury, Trade Finance, and Forex. IBSFINtech’s Innovative Treasury solution is targeted to help you off-set trade imbalances, changes in inflation rate, and ensure continuous monitoring of relevant foreign currencies. So what should be the characteristics of a perfect currency risk management solution which helps a CFO to be “Currency Aware” as well as allows responding with appropriate action plan for risk management?
1. Integration with different backend systems (the sources of financial data capture or generation) in an organization
2. Accessibility and capability to manage data from different sources and in different formats
3. Record of workflows and transaction history data
4. Continuous monitoring of foreign exchange exposure
5. Compliance management as per RBI guidelines The Innovative Treasury solution is available in on-site as well as hosted Software-as-a-Service (SaaS) solution.