Snapshots of what’s on International Treasurer’s radar screen.
A few topics came out of this week’s editorial meeting, including a continuing discussion of tax and legal structures and treasury, a look at the capital measures Argentina’s taking to help stimulate its sagging economy and a look at how corporate treasurers are continuing to invest in technology to help them do their ever expanding jobs.
Argentina.
Argentina’s economy is currently facing stiff headwinds as the global downturn finally catches up to the country, which until recently saw rapid growth. Stringent capital controls, dollar-sniffing dogs, tariffs and nationalization of some private companies are just a few of the measures taken by the government of President Cristina Kirchner to pull the country out of a deepening rut.
There is widespread consensus around the difficulty of covering Argentina’s finances and predicting which way they will head. We’ll take a look at what’s happening as well as a quick look at Brazil’s walk-back of its recent capital controls.
TMS Focus.
As IT has written, treasurers are prepared for just about any outcome in Europe (and continue to think of other risks to be covered); so while they to see what happens in Europe, many companies are investing in upgrades for their treasury management systems. This is mainly because as companies continue to expand, treasury is being asked to do more and more. Technology can obviously help here.
Also, in the chaotic world of TMS vendors, who is coming out as the safe play when it comes to TMS implementation? Why is the strategic direction of a TMS vendor (its ambitions, acquisitions, etc) important to know for treasurers?
Tax and Legal. There has been a lot of discussion of tax structure overhaul across The NeuGroup universe, particularly the idea of making them more efficient. This has become doubly important as global tax authorities are coordinating at a faster rate to catch avoidance practices. Peer groups have discussed regulated markets and tax structure impediments and the concurrent challenges of access to liquidity for utilization of investment. But overhauling them isn’t always so smooth, and sometimes the more efficient the structure becomes, the more inefficient it becomes for treasury to move cash around. Tax planning initiatives can create substantial value to member firms on an after-tax earnings basis, but too often create cash management and balance-sheet problems in the process, complicating treasury’s ability to “cover” them.