More Related Content Similar to Simplifying Regulatory Compliance for Your Hedging Program (20) Simplifying Regulatory Compliance for Your Hedging Program2. © 2016 Kyriba Corp. All rights reserved. PROPRIETARY & CONFIDENTIAL. 2
Today’s Presenters
Jonathan Zeman
Senior Consultant
Thomas Gavaghan
Manager, North America Pre-Sales
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FX Program Management: Procedural elements to managing
your FX Program
Valuations: Foundational building block to proper accounting
treatment
Derivative Accounting Compliance
Automated Accounting
Agenda
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FX Risk Management Processing
Collection
Classification
Aggregation
Policy Setting
Trade Capture
Visibility & Positioning
Limits Monitoring
Scenario Analysis
Valuation & Effectiveness Testing
Confirmations
Settlements
Accounting
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Balance Sheet
– Translation & Remeasurments
Cash Flow
– Forecasted revenue and expense
Integration = Centralization
Exposure Management
Collection
Classification
Aggregation
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Accounting and economic
strategy and objectives
Aggregation of executed
transactions in the market
Calculate market value of
held positions
Centralized visibility of
existing positions and
exposures
Front Office Management
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Establish and maintain
limits
Perform scenario analysis
– What if?
– Stress testing
Report & Dashboard
creation
– Internal
– Regulatory
Middle Office Management
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Collection and integration of auditable Market Rates:
– Spot Rates
– Forward Rates
– Volatility Surfaces
Fair Value Measurements
– Transactional & Portfolio valuations
Effectiveness Testing:
– Critical Terms Matching, Shortcut, Long-Haul Regression
Valuation & Effectiveness Testing
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Electronic
confirmation and
matching process
Generate & Net
settlements
Automated integration
with GL
Back Office Management
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Best Practices Questions to Ask:
Topic Question
Front Office What tools are available to easily integrate with my ERP(s), and
other exposure tracking tools to track against policies?
Middle Office What is the source of my market rates for valuing my portfolio, and
how easy is it to document our results for audit?
Back Office How do I get the proper accounting entries posted into my GL?
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Accounting Guidelines
– ASC 815 / 820
• Fair Value, Cash Flow, Net Investment
– Translation vs Transaction Risk
• Disclosures (Quantitative and Qualitative)
– Entity level (e.g. Foreign Exchange Risk)
– Revenue Recognition
– Initial measurement and Re-measurement
– ASC 830
• Functional vs. Reporting Currency
– Parent and Subsidiary Relationship
FASB guidelines that systems can help simplify…
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Seamless End to End Accounting
– Journal entry to general ledger account creation and
automation
– Interfacing capability
Government Legislature
– Dodd Frank / EMIR / Volcker / Basel III
Margin Processing
– Cash position monitoring and reporting
Post Trade Environment Automation
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Thank You for Attending! - Further Reading
Blog posts:
(subscribe to receive our blog posts under http://www.kyriba.com/blog)
FX: Managing Uncertainty in 2016
FX: To Hedge or not to Hedge, that is the Question
EM FX hedging: treasury management systems outshine ERP
(Euromoney)
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Thank You For Attending
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