The financial management department It has been one of the most changes in companies since the outbreak of the pandemic. In Spain, CFOs expect a higher degree of digitization and better cash flow visibility.
This follows from the new European study on liquidity management commissioned by Agicap, an expert in the European Software as a Service market for treasury management and forecasting, and Arvato, an international financial services company.
The report -based on surveys of 2,735 professionals from seven countries including Spain- reveals the effect that crises and unforeseen situations can have on operations in Finance departments.
Liquidity problems
Know the cash flow accurately, transparent and updated is now more important for 86% of those consulted in Spain. This demand is also explained by the liquidity problems of Spanish companies: 87% say they face liquidity bottlenecks, being ‘common’ for 34% and more frequent in B2B activity (44%) than B2C (21 %).
Financiers mainly attribute the lack of cash to severe delays in customer payments (76% experience them ‘often’ or ‘very often’), followed by unforeseen events such as natural disasters or the pandemic (67% ). Invoices sent late (33%) and lack of control of payments received (32%) are also relevant.
In addition, almost nine out of ten respondents in Spain (88%) admit regularly face defaults. And 41% are considered ‘important’ to ‘existentially threatening’.
Management tools
In this context, it is not surprising that the majority of those consulted in Spain watch the treasury of the company at least once a week (87%), while 29% evaluate the cash flow daily and 33% several times a week.
However, many processes are still ‘manual’. Three out of ten respondents (30.4%) rely on Excel or Google spreadsheets, while less than a quarter of Spanish financiers (23.4%) use a dedicated tool in the cloud. 30% opt for locally installed software, and 15% rely on an external service provider.
The little automated management continues to generate errors. 53% of Spanish financiers state that they have made mistakes in their treasury calculations -for example, due to an incorrect entry in an Excel formula-, while 72% have ever had problems managing working capital needs in the company, mainly for ‘technical’ issues.
digital solutions
This is how two thirds of those consulted in Spain (66%) expect a growing digitization of financial management in their company, and half demand greater control. Of them, 89% defend the importance of having fast and truthful visibility of current and future cash flow.
More than half of those surveyed (58%) anticipate invest in cash management software in the next 12 months, while 24% are not sure and the rest (18%) do not consider it. Data security, automated forecasting, real-time view of incoming and outgoing payments, and ease of use/operation are the main advantages noted.
In addition, three quarters of those surveyed in Spain consider that cloud-based cash flow planning has advantages over planning carried out with locally installed software.
“Monitoring the evolution of the treasury with precision and in a continuous and automated manner is essential to boost the growth of companies”, highlights Kevin Sipin, general manager at Agicap Spain. “Automated systems help to anticipate unforeseen events and act more quickly in the face of possible variations in available cash”.
