A Brave New World of Technology Is Making Treasurers More Efficient

What new technologies will impact treasurers and CFOs and change corporate finance in the not-so-distant future? A number of current and emerging technologies will allow treasurers to manage real-time information, eliminate boundaries for cross-border transactions, conduct business anywhere with wireless connectivity, better protect the corporate financial infrastructure and much more.

What’s Driving New Technology?

According to Susan Colles, Client Delivery Consultant for Bank of America, much of the new technology is “led by the demand for more message-driven and real-time activity to coexist with batch-oriented legacy systems. Enterprise Resource Planning and Treasury Management System vendors are developing technologies that will assist treasury staff requesting data on an ad hoc basis. This will encompass the deployment of web services, XML messages, and the unattended delivery of data.”

In addition, there are true science-fiction-style technologies, such as artificial intelligence, that could dramatically change the way treasurers conduct business. Here are some of the technologies foreseen as having the greatest influence on treasurers within the next five years.

A Single Standard

XBRL (Extensible Business Reporting Language) is a web-based programming language that creates a common language and a single standard for financial data. This means the way financial data is reported will be the same from company to company, simplifying the preparation of SEC filings, tax returns and other documents by treasurers. XBRL allows data to be used by any software program, across any platform, and in any country, offering the compatibility treasurers need, especially if their companies have offices throughout the world.

XBRL also tags financial data and gives it context, improving the accuracy and speed of corporate reporting. With XBRL’s precise tagging, financial information can move easily between domestic and foreign corporate divisions without needing to be manually re-keyed or passed through translation software. This is currently necessary because U.S. currency is kept separate from foreign currency and cash entries are automatically sorted according to each country’s accounting standards.

Once manufacturers begin to release XBRL-compliant software, this new language may very well become the standard for financial reporting.

Business Intelligence Software

At its most basic level, Business Intelligence (BI) software can help treasurers gain control over company data, centralize systems and use the web to gather information on both their business and competitors. BI software can go even further — it can offer search results that trigger customized database questions and answers. For instance, BI software can alert treasurers to production problems, assist them in finding solutions and provide all relevant data so treasurers can take action and make informed decisions.

At its most advanced level, BI software resembles something from Star Wars. New BI software will have an intelligent search agent, known as an avatar, that accesses internal databases, collects data, analyzes the information and presents it to the user. The avatar, which has a name and digitized face, can be questioned directly about daily product sales, returns, company rankings, etc. The avatar will use the internal databases to answer as many questions as possible.

Digital Cryptography

Cyber security has been an issue since the creation of the internet. Although perfect security is virtually impossible to achieve, mitigating risk is the key to internet security. One way to safeguard financial transactions is with public key cryptography (PKC).

Unlike conventional cryptography where messages are encrypted by a sender and decrypted by a receiver using the same password, PKC gives each person a pair of keys. One is a public key, which is usually printed in a confidential directory. The other is a private key, which is kept secret. Anyone can send a message with the public key, but it only can be decrypted with the private key.

Of particular interest to treasurers, PKC also can be used for authenticating digital signatures on either or both ends of domestic and global financial transactions.

What’s Ahead?

According to Colles, “Bank of America is very involved with numerous standards organizations, such as the Interactive Financial Exchange Forum, RosettaNet and TWIST, to stay abreast of the latest technology changes.” To learn more about the infrastructure and new tools that will help you prepare for the future, contact your Bank of America Global Treasury Services Officer.

About The Author John Manzella [Full Bio]

John Manzella, founder of the Manzella Report, is a world-recognized speaker, author of several books, and an international columnist on global business, trade policy, labor, and the latest economic trends. His valuable insight, analysis and strategic direction have been vital to many of the world's largest corporations, associations and universities preparing for the business, economic and political challenges ahead.




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