CTC Research Perspectives
A qualitative perspective providing detailed analysis, benchmarks and ideas revolving around one of AFP’s original research reports.
A summary of interviews including peer insights and comments on the survey results addressing managing short-term cash in a volatile regulatory environment. Find practitioners’ reactions to Money Market Funds proposals and expiration of TAG.
According to practitioners, the SEC proposal that funds will hold back a percentage of the investment to prevent a “run” on the fund is even more problematic than the floating NAV idea. “Our MMF investments are short term–a matter of days,” said one practitioner, “We don’t want to be locked out.”
A summary of interviews including peer insights and comments on the survey results addressing the following issues:
- Changes to short-term investment policy and strategy in response to fluctuating conditions over the past few years
- Definition of safety and the factors that influence safety in the short-term investment portfolio
- The effect proposed money market reforms and the possible end of unlimited FDIC insurance may have on bank deposits and short-term investments
- Counterparty risk management for international cash holdings vs. U.S. holdings
A new report from AFP’s Corporate Treasurer’s Council (CTC) reaffirms trends observed during the 2011 Strategic Role of Treasury Survey: treasury is growing in importance within the organization, and is transcending its traditional functions.
There are several trends driving this expansion of treasury’s role. According to the AFP survey, “Strategic Role of Treasury,” these include:
- The growing importance of core treasury activities such as liquidity management and cash management in the current economic environment (cited by 78 percent of survey respondents).
- Demand for greater visibility into liquidity by senior management and the Board.
- Greater focus on the measurement of financial metrics.
A summary of interviews and an analysis of the key takeaways from these interviews that address the following issues:.
- organizations’ short-term investment strategies and what impact the recent slowdown in the U.S. economy has had on these strategies
- the reasons companies are deciding to expand or shrink their short-term investment balances
- the role of earnings credit in affecting short-term investment strategy
- the differences in strategies associated with U.S.-based cash holdings and non-U.S.-based cash holdings and the impact taxation on repatriated foreign earnings may have on the decision to bring cash back to the U.S