The costs and inefficiencies of de-centralized FX buying/selling and hedging are horrendous. Tech Data Treasurer Chuck Dannewitz and Assistant Treasurer Scott Walker explain to TREASURY & RISK writers how they saved millions of dollars by moving to a central FX team using FireApps to collect the data and implement the hedges needed.

A particularly important point they stressed was that. “We recognized that we needed more visibility on a day-to-day basis, as well. We wanted to be able to net trades, and to reconcile our FX trades, so we could evaluate how much is the bid-offer spread, and determine how much is just cost and how much is an actual currency gain or loss. We needed visibility into the causes of FX gains and losses, and whether they are expected or unexpected, so when unexpected losses occur, we can determine what went wrong and come up with a different hedging strategy.“

There were considerable admin savings, savings from netting across countries and eliminating duplicate hedges, and also from the consistent application of FX policy and standards world-wide.   

Read more in the full article - recommended - here.