As uncertainty related to liquidity forecasting has increased over the years, cash management is becoming more complex. On top of this, the alternative investment industry continues to face increasing regulation and external forces like competitive environment, political mandates and international relations – only further complicating the process for hedge funds. In response, fund managers must seek a structured solution to help organize activity at a central level while also providing flexibility to manage cash and liquidity more efficiently.
The primitive form of cash management generally uses manual spreadsheets or custom solutions that are marred with poor structure, leading to mismanagement, less transparency and inefficiency. To make matters worse, daily cash management has dependency across multiple business units and departments. The use of a linear solution here often impacts the operations of treasury as the information flow layer becomes simplistic and lacks optimal data management. It also compromises the forecasting speed and significance of the forecast.
With this, global hedge fund operations across multiple currencies require standardized solutions that can handle the complexities of upstream trading systems and downstream accounting systems. This calls for a structured and centralized approach, but the centralization requirement can lead to the system being very rigid. Therefore, flexibility is also needed to maintain adaptability in an environment of changing regulations and standards.
The IVP Cash Master Approach
IVP Cash Master offers a solution to the problems arising in the cash management arena with an optimal mix of structured centralization and built-in flexibility to adapt to any changes in the external and internal environment of the alternative investment industry.
It offers multiple methods of settlement, including host-to-host transfer with banks, SWIFT connectivity and ISO20022 support with real-time and automated reporting. The workflow-based integration of various business units and processes help maintain integrity of the system as well as transparency. Additionally, it supports integration with any standard expense management system or accounting system.