Whatever the cause the breach will trigger an

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stipulated in the treasury manual since this should trigger an automatic investigation. Whatever the cause, the breach will trigger an investigation into the root cause. The importance of the treasury manual to the OSP cannot be understated since it will form the basis of the contractual relationship with the client. It will also shape all of the tactical and operational aspects of its operations and the OSP will be judged by not having any execution breaches. Regardless of their size and nature, any breaches should be viewed extremely seriously by the management of the OSP and client since this would suggest a weakness in the control environment. In order to give the clients more comfort, the disclosure of these breaches has to be transparent, with agreed daily, weekly, and monthly KPIs reported by the OSP to the client. 3.0 What is the ideal target operating model to support treasury outsourcing? The aim of the target operating model (TOM) is to describe the future state of the tactical and operational processes an organization is going to employ using its human, IT and other resources to meet its strategic objective. For the TOM to be successful it must factor in all of the points detailed in table 4 (below). Key attributes of an outsourced treasury’s target operating model (Table 4) Strategic Vision A clear vision defining the role and mandate of the OSP. Technology Extensive use of technology to ensure straight through processing. Effective Resourcing Appropriate staffing and resources to achieve its targeted objectives.
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15 Segregation of Duties A strong control culture that has segregation of duties built into all aspects of its being. Plug and Play The migration process off the clients systems and onto the OSP has to be an efficient and a (relatively) painless process. Key performance Indicators Accurate and regular reporting on KPI's to the client. Audit and Compliance Regular independent audit of the OSP operation to validate adherence to its client’s treasury policy. 4.0 Conclusion For a variety of reasons treasury outsourcing may not be a viable solution for everyone. However, the strategic objective of outsourcing is to help organisations focus on one word, “Core”. With the advent of cloud computing the barriers towards accessing a treasury outsourcing solution is being lowered. This means that mid- cap and SME’s can access all of the benefits of a centralised treasury function at a fraction of the cost; it also gives the opportunity to more established treasury operations to participate in the treasury outsourcing option. Innovative use of technology, clearly defining the scope at the start of the treasury outsourcing relationship and a strong sprit of partnership between the OSP and the client is fundamental to making the relationship and the venture an ongoing success.
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16 5.0 Bibliography Anon, 2009b. Too Many Treasuries Still Use Manual Processes: AFP Will Be Valued. Treasury & Risk, (January), p.10.
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