Page 1

Why do we need this process?

To save the “spread” cost of purchasing Foreign Exchange from external banks

GL accounting for both the FX deals happens automatically.

Once agreed both sides should benefit

Accounting is consistent across the entities

Date: 14 May 02 Presenter: Anil Passi

Click to proceed…..

For the above reasons this workflow was designed and developed from scratch……

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Workflows Diagrams ( Main Process)

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

Page 3

Workflows Diagrams ( Setup Validation Process)

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

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Workflows Diagrams ( Main Deal Approval Process)

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

Page 5

Workflows Diagrams ( Deal Cancellation process)

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

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Internal F/X Transaction

Treasury Workshop14.05.2002

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Internal F/X Transaction

Treasury Workshop14.05.2002

Main FX Deal

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Internal F/X Transaction

Treasury Workshop14.05.2002

Contra FX Deal

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Why do we need this process?

Treasury Workshop14.05.2002

Significantly improve lead time in resolving internal FX deals across the Time Zones

Automate deal approval process from email client

Save the hassle of navigation through 6 different windows to approve both ends of the deals.

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Workflow

Deal Settlement

Process

Deal Entry Screen

Overview Of The Internal FX Process

Treasury Workshop14.05.2002

Buy CAD 25M Sell USD 16M

SWIFT To Sell USD

SWIFT To Sell CHF

Settle Deal

Buy USD 16M Sell CAD 25M

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What does the approver in the Deal Initiating Company See?

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

The approver in the deal initiating company will receive an email notification along with the deal details.

The approver should then approve or reject the deal.

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What does the approver in the Contra Company See?

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

The approver in the contra company will also receive an email notification along with the deal details.

Approver of the deal in contra company should enter the Bank Accounts from which the deal should be performed.The primary bank accounts will be defaulted.

Approver may decide to Approve/Reject the deal.

Scroll Down the Window

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Exception Handling

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

One or both the companies Cancel the deal

In the ideal world, approval process will be simple, when both ends of the deal are approved, the deals can then be settled

In the real world following can happen

Deals are not approved before the “Deal Value Date”

Approvers have not been setup correctly

Banks have not been setup correctly

Approver is unavailable

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Deal rejected

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

In the event of deal rejection both the deals will be cancelledautomatically.

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Deal expires

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

Both the deals will be cancelled.

When the deals are cancelled, every treasurer involved in the lifecycle of the deal will be sent a notification confirming the cancellation of deals.

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No approver

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

A Notification is sent to the Support Team.

The support team will co-ordinate with the users to complete the setup

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No bank account

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

A Notification is sent to the Support Team.

The support team will co-ordinate with the users to complete the setup

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Approver unavailable

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

We can setup upto 3 approvers in Treasury for each Company

Each approver will be assigned the precedence of 1,2 or 3

If Approver-1 does not respond in a days time, a reminder is sent. If there is no response to the reminder, then Approver-2 is notified.

Approver-2 will be notified only if the value date of the deal has not yet been surpassed.

If a deal can not be processed by any of the three approvers, then the deal will be cancelled automatically.

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Where do we setup the approval limits for FX Deals

Treasury Workshop14.05.2002

These reports are those distributed to shareholders/investors. The format of the reports and accounting standards / policies are prescribed by law (e.g. Companies Act 1985 in the UK , Federal Code of Obligations in Switzerland, etc.). The level of summarisation in these reports tend to be high, although a substantial amount of “one-off” data is required for additional notes and schedules. The main example of these reports is the annual financial statement.

In Oracle, we can assign limits to dealers for every possible Deal Type.

A request for Approval will be sent to the approver only if dealers Limit Amount is greater than the deal value.

If none of the approvers in Treasury have the rights to approve a specific FX deal a notification will be sent to Support team.