Effective Management of Solvency
Liquidity Management
Comprehensive consulting for optimizing your liquidity planning, management, and monitoring to ensure the financial stability of your organization.
- ✓Optimized Capital Costs
- ✓Improved Cash Flow Forecasts
- ✓Regulatory Compliance
Your strategic success starts here
Our clients trust our expertise in digital transformation, compliance, and risk management
30 Minutes • Non-binding • Immediately available
For optimal preparation of your strategy session:
- Your strategic goals and objectives
- Desired business outcomes and ROI
- Steps already taken
Or contact us directly:
Certifications, Partners and more...
Comprehensive Liquidity Management
Our Strengths
- Comprehensive expertise in all areas of treasury management
- Experience with advanced forecasting and simulation models
- Proven implementation strategies
⚠
Expert Tip
By using predictive analytics and integrated treasury systems, companies can reduce their liquidity costs by an average of 19% while significantly improving their forecast accuracy.
ADVISORI in Numbers
11+
Years of Experience
120+
Employees
520+
Projects
We accompany you with a structured approach in developing and implementing your liquidity management.
Our Approach:
Analysis of existing liquidity situation and processes
Development of customized liquidity management concepts
Implementation, training, and continuous improvement
"Effective liquidity management is the key to financial stability and operational capability in an increasingly volatile market environment."
Andreas Krekel
Head of Risk Management, Regulatory Reporting
Expertise & Experience:
10+ years of experience, SQL, R-Studio, BAIS-MSG, ABACUS, SAPBA, HPQC, JIRA, MS Office, SAS, Business Process Manager, IBM Operational Decision Management
Our Services
We offer you tailored solutions for your digital transformation
Liquidity Planning and Forecasting
Development and implementation of advanced cash flow forecasting models
- AI-powered forecasting models
- Scenario analyses and stress tests
- Integration of business and financial planning
Cash Management and Pooling
Optimization of group-wide liquidity management
- Cash pooling structures
- Bank relationship management
- Treasury management systems
Liquidity Risk Management
Development and implementation of early warning systems and contingency plans
- Liquidity metrics and limits
- Contingency funding plans
- Regulatory compliance (LCR, NSFR)
Looking for a complete overview of all our services?
View Complete Service OverviewOur Areas of Expertise in Risk Management
Discover our specialized areas of risk management
Strategic Enterprise Risk Management
Develop a comprehensive risk management framework that supports and secures your business objectives.
▼
Operational Risk Management & Internal Control System (ICS)
Implement effective operational risk management processes and internal controls.
▼
Financial Risk
Comprehensive consulting for the identification, assessment, and management of market, credit, and liquidity risks in your company.
▼
Non-Financial Risk
Comprehensive consulting for the identification, assessment, and management of non-financial risks in your company.
▼
Data-Driven Risk Management & AI Solutions
Leverage modern technologies for data-driven risk management.
▼
Frequently Asked Questions about Liquidity Management
What are the core components of effective liquidity management?
Effective liquidity management comprises four core components that function as an integrated system:
🔍 Dispositive Liquidity Planning
•
Rolling cash flow forecasts (short-, medium-, and long-term)
•
Scenario analyses and sensitivity calculations
•
Integration of business planning and liquidity planning
•
Consideration of seasonal effects and special influences
💰 Operational Cash Management
•
Daily disposition and balance management
•
Cash pooling and group financing
•
Investment and financing management
•
Payment transaction optimization and bank relationship management
⚠ ️ Liquidity Risk Controlling
•
Definition and monitoring of liquidity metrics
•
Early warning systems and trigger events
•
Stress tests and scenario analyses
•
Contingency Funding Plan (emergency plan)
📊 Reporting and Governance
•
Management reporting and decision support
•
Regulatory reporting (e.g., LCR, NSFR)
•
Limit monitoring and escalation processes
•
Treasury policies and governance structures
Which liquidity metrics are particularly relevant?
For comprehensive liquidity management, various metrics are relevant that capture different aspects of liquidity:
📊 Regulatory Metrics
•
Liquidity Coverage Ratio (LCR): Ratio of high-quality liquid assets to net liquidity outflows in a 30-day stress scenario (minimum requirement: ≥ 100%)
•
Net Stable Funding Ratio (NSFR): Ratio of available stable funding to required stable funding (minimum requirement: ≥ 100%)
•
Liquidity Monitoring Tools: Additional metrics such as concentration risks, unencumbered assets, etc.
💼 Business Metrics
•
Cash Ratio: Ratio of cash and cash equivalents to current liabilities
•
Quick Ratio: Ratio of cash plus short-term receivables to current liabilities
•
Current Ratio: Ratio of current assets to current liabilities
•
Cash Conversion Cycle: Period between payment for inputs and receipt from customer receivables
⚙ ️ Operational Metrics
•
Days Sales Outstanding (DSO): Average receivables collection period
•
Days Payable Outstanding (DPO): Average payables payment period
•
Days Inventory Outstanding (DIO): Average inventory holding period
•
Free Cash Flow: Operating cash flow minus investments
🔄 Dynamic Metrics
•
Forecast Accuracy: Deviation between forecasted and actual cash flow
•
Liquidity Buffer Ratio: Ratio of liquidity buffer to potential stress outflows
•
Funding Concentration: Dependence on individual funding sources
•
Intraday Liquidity Usage: Maximum utilization of intraday liquidity
How does cash pooling work and what benefits does it offer?
Cash pooling is a central instrument of group-wide liquidity management and works in various ways:
🔍 Basic Principle and Types
•
Physical Cash Pooling (Zero Balancing): Daily physical transfer of all balances to a master account
•
Notional Pooling: Virtual consolidation of balances without physical transfer
•
Hybrid Pooling: Combination of physical and notional pooling
•
Multi-Currency Pooling: Consolidation of balances in different currencies
💰 How Physical Cash Pooling Works
•
Automatic transfers (sweeps) from subsidiary accounts to the master account
•
Target balancing or complete balance clearing (zero balancing)
•
Internal current account relationships between master and subsidiaries
•
Automated interest calculation for intercompany loans
📊 Benefits of Cash Pooling
•
Reduction of external financing costs through netting effects
•
Optimization of interest margins through volume bundling
•
Improvement of liquidity transparency and management
•
More efficient use of internal group liquidity
•
Reduction of bank fees and transaction costs
⚠ ️ Legal and Tax Aspects
•
Transfer pricing documentation according to §
90 para.
3 AO
•
Arm's length principle for interest rates
•
Corporate law capital maintenance provisions (§§ 30,
31 GmbHG)
•
Compliance with local foreign exchange regulations for cross-border pooling
•
Avoidance of liability risks through appropriate contract design
How can AI improve liquidity forecasting?
Artificial intelligence is transforming liquidity forecasting through several innovative approaches:
🤖 AI Technologies for Cash Flow Forecasting
•
Machine Learning Algorithms: Random Forest, XGBoost, Support Vector Machines
•
Neural Networks: LSTM (Long Short-Term Memory) for time series analysis
•
Natural Language Processing: Analysis of contract clauses and payment terms
•
Computer Vision: Automatic extraction of payment information from invoices
•
Ensemble Methods: Combination of different forecasting models for higher accuracy
📊 Data Integration and Analysis
•
Multi-source data integration: ERP, CRM, bank data, market data
•
Automatic anomaly detection in historical cash flows
•
Identification of hidden patterns and correlations
•
Real-time processing of transaction data
•
Consideration of external factors (economic indicators, seasonality)
🎯 Concrete Improvements
•
Increase in forecast accuracy from 78% to 92% for 90-day forecasts
•
Reduction of Mean Absolute Percentage Error (MAPE) by 40‑60%
•
Automatic adaptation to changed business conditions
•
Early detection of liquidity bottlenecks
•
Granular forecasts at customer and transaction level
⚙ ️ Implementation Approaches
•
Cloud-based solutions with API integration to financial systems
•
Hybrid models with human expertise and AI support
•
Continuous learning through feedback loops
•
Explainable AI for traceability of forecasts
•
Scalable architectures for growing data volumes
What is a Contingency Funding Plan and how do you develop one?
A Contingency Funding Plan (CFP) is an essential component of liquidity risk management:
🔍 Definition and Purpose
•
Emergency plan to ensure solvency in stress situations
•
Proactive identification of action options during liquidity shortfalls
•
Clear governance structures and decision processes in crisis situations
•
Fulfillment of regulatory requirements (e.g., MaRisk AT 7.2)
•
Minimization of reputational risks through proactive crisis management
⚠ ️ Key Components of a CFP
•
Early Warning Indicators: Quantitative and qualitative trigger events
•
Escalation Levels: Graduated measures depending on crisis severity
•
Action Options: Concrete measures for liquidity procurement
•
Communication Plan: Internal and external communication strategy
•
Responsibilities: Clear assignment of roles and authorities
📋 Development Process
•
Risk Analysis: Identification of potential liquidity risks and stress scenarios
•
Scenario Development: Definition of idiosyncratic and market-wide stress scenarios
•
Action Planning: Development of countermeasures for each scenario
•
Governance Design: Definition of decision processes and responsibilities
•
Implementation and Training: Training of involved employees
•
Regular Tests: Conducting simulations and planning exercises
🛠 ️ Best Practices
•
Diversification of Liquidity Sources: Avoiding dependencies
•
Predefined Credit Lines: Committed facilities with clear drawdown conditions
•
Liquidity Reserves: Highly liquid assets as buffer (min. 5% of balance sheet total)
•
Regular Review: At least annual update of the CFP
•
Integration into Overall Risk Management: Coordination with other risk areas
How do you integrate Treasury Management Systems into the existing IT landscape?
The integration of Treasury Management Systems (TMS) into the existing IT landscape requires a structured approach:
🔄 Integration Architecture
•
API-based Integration: REST/SOAP interfaces to ERP, accounting, CRM
•
Real-time Data Flow: Event-driven architecture for timely updates
•
Middleware Solutions: Enterprise Service Bus for complex system landscapes
•
Cloud Connectors: Secure connections between on-premise and cloud systems
•
Microservices: Modular integration of individual treasury functions
📊 Data Synchronization
•
Master Data Management: Central management of master data
•
Bidirectional Data Exchange: Synchronization in both directions
•
Data Validation: Automatic checking for consistency and completeness
•
Historization: Versioning of data changes
•
Conflict Management: Rule-based resolution of data inconsistencies
🔐 Security Aspects
•
Identity and Access Management: Role-based access rights
•
Encryption: End-to-end encryption of sensitive financial data
•
Audit Trail: Complete documentation of all transactions
•
Compliance Monitoring: Automatic checking for rule violations
•
Penetration Tests: Regular security reviews
⚙ ️ Implementation Approach
•
Phased Migration: Step-by-step integration of individual modules
•
Parallel Operation: Temporary dual operation of critical processes
•
Agile Methodology: Iterative development and continuous feedback
•
DevOps Principles: Automated tests and deployments
•
Change Management: Comprehensive training and support for users
🛠 ️ Technological Trends
•
Open Banking APIs: Standardized bank interfaces (PSD2)
•
Blockchain: Distributed ledger for transaction security
•
AI/ML: Intelligent data analysis and process automation
•
RPA: Robotic process automation for manual activities
•
Low-Code Platforms: Rapid customization and extension
How do you conduct effective liquidity stress tests?
Effective liquidity stress tests are a central element of liquidity risk management:
🎯 Basic Principles and Methodology
•
Proportionality Principle: Appropriateness of tests to company size and complexity
•
Reverse Stress Tests: Identification of scenarios that would lead to insolvency
•
Combined Scenarios: Consideration of multiple, correlated risk factors
•
Dynamic Simulation: Multi-period analysis with feedback effects
•
Sensitivity Analyses: Variation of individual parameters to identify critical factors
📊 Scenario Development
•
Idiosyncratic Scenarios: Company-specific stress events - Rating downgrade by 2‑3 notches - Default of a major customer (>10% of revenue) - Product recall or reputational damage
•
Market-wide Scenarios: Systemic stress events - Severe recession (GDP decline >3%) - Liquidity crisis in the banking sector - Extreme market volatility (VIX >40)
•
Combined Scenarios: Simultaneous occurrence of multiple stress factors
⚙ ️ Implementation Steps
•
Definition of stress scenarios and parameters
•
Modeling of cash flow impacts
•
Calculation of liquidity metrics under stress
•
Analysis of results and identification of weaknesses
•
Derivation of recommendations and measures
•
Documentation and reporting to management and supervisory bodies
📈 Advanced Techniques
•
Monte Carlo Simulation: Stochastic modeling with probability distributions
•
Machine Learning: Identification of complex risk relationships
•
Bayesian Networks: Modeling of dependencies between risk factors
•
Copula Models: Representation of non-linear correlations
•
Agent-Based Modeling: Simulation of market dynamics and contagion effects
What regulatory requirements exist for liquidity management?
The regulatory requirements for liquidity management are extensive and vary by industry:
🏦 Banks and Financial Institutions
•
Basel III/IV: International standards for liquidity risk management - LCR (Liquidity Coverage Ratio): Short-term liquidity resilience (
30 days)
•
NSFR (Net Stable Funding Ratio): Structural liquidity (
1 year)
•
ILAAP (Internal Liquidity Adequacy Assessment Process): Internal assessment process
•
MaRisk: Minimum requirements for risk management in Germany - BTR 3: Specific requirements for liquidity risk management - AT 7.2: Requirements for contingency plans (Contingency Funding Plan)
•
EBA Guidelines: European requirements for liquidity risk management - Stress tests, early warning indicators, intraday liquidity management
📈 Investment Funds
•
KAGB (Capital Investment Code): Regulation of investment funds in Germany - § 30: Liquidity management for open-ended investment funds - § 216: Redemption suspension and swing pricing
•
AIFMD/UCITS Directive: European regulation for investment funds - Liquidity stress tests and reporting - Liquidity Management Tools (LMTs)
•
BaFin Circulars: Specific requirements for liquidity management
🏭 Non-Financial Companies
•
IDW PS 340: Audit standard for risk early detection systems - Identification of existence-threatening risks, including liquidity risks
•
KonTraG: Law on Control and Transparency in Business - Obligation to establish a risk early detection system
•
IFRS 7: International Financial Reporting Standards - Disclosure requirements for liquidity risks - Maturity analysis of financial liabilities
📋 Cross-Industry Requirements
•
Corporate Governance Code: Recommendations for corporate management - Board responsibility for appropriate risk management
•
ESG Regulation: Increasing requirements for sustainability risks - Integration of climate risks into liquidity planning
What trends are shaping the future of liquidity management?
The future of liquidity management is shaped by several innovative trends:
🤖 Technological Innovation
•
Predictive Analytics: AI-powered forecasting models with 90%+ accuracy
•
Blockchain and DLT: Decentralized payment systems and smart contracts
•
APIs and Open Banking: Real-time data exchange with banks and financial partners
•
Robotic Process Automation: Automation of repetitive treasury processes
•
Cloud-based Treasury Platforms: Scalable and flexible solutions
💰 New Financial Instruments and Structures
•
Virtual Accounts: Simplification of cash pooling and payment transactions
•
Dynamic Discounting: Flexible payment terms for suppliers
•
Supply Chain Finance: Integration of suppliers into liquidity planning
•
Digital Currencies: CBDCs (Central Bank Digital Currencies) and stablecoins
•
Programmable Money: Automated payment flows through smart contracts
🌱 ESG Integration
•
Green Treasury: Sustainable investment of liquidity reserves
•
ESG Risk Assessment: Integration of sustainability risks into liquidity models
•
Sustainable Supply Chain Finance: Promotion of sustainable supply chains
•
Impact Investing: Liquidity investment with positive social and environmental impact
•
Transparency and Reporting: Extended disclosure on ESG aspects
🔄 Organizational Transformation
•
Treasury as a Service: Outsourcing of treasury functions
•
Agile Treasury: Flexible and adaptable organizational structures
•
Shared Service Centers: Centralization of treasury activities
•
Business Partnering: Strategic role of treasury in the organization
•
Skill Transformation: New competency requirements (data science, digitalization)
🌐 Globalization and Geopolitics
•
Fragmentation of Global Markets: Regional treasury structures
•
Sanctions Risks: More complex compliance requirements
•
Currency Volatility: Increasing hedging necessity
•
Cyber Risks: Increased security requirements
Success Stories
Discover how we support companies in their digital transformation
Generative KI in der Fertigung
Bosch
KI-Prozessoptimierung für bessere Produktionseffizienz
Fallstudie
Ergebnisse
Reduzierung der Implementierungszeit von AI-Anwendungen auf wenige Wochen
Verbesserung der Produktqualität durch frühzeitige Fehlererkennung
Steigerung der Effizienz in der Fertigung durch reduzierte Downtime
AI Automatisierung in der Produktion
Festo
Intelligente Vernetzung für zukunftsfähige Produktionssysteme
Fallstudie
Ergebnisse
Verbesserung der Produktionsgeschwindigkeit und Flexibilität
Reduzierung der Herstellungskosten durch effizientere Ressourcennutzung
Erhöhung der Kundenzufriedenheit durch personalisierte Produkte
KI-gestützte Fertigungsoptimierung
Siemens
Smarte Fertigungslösungen für maximale Wertschöpfung
Fallstudie
Ergebnisse
Erhebliche Steigerung der Produktionsleistung
Reduzierung von Downtime und Produktionskosten
Verbesserung der Nachhaltigkeit durch effizientere Ressourcennutzung
Digitalisierung im Stahlhandel
Klöckner & Co
Digitalisierung im Stahlhandel
Fallstudie
Ergebnisse
Über 2 Milliarden Euro Umsatz jährlich über digitale Kanäle
Ziel, bis 2022 60% des Umsatzes online zu erzielen
Verbesserung der Kundenzufriedenheit durch automatisierte Prozesse
Let's
Work Together!
Is your organization ready for the next step into the digital future? Contact us for a personal consultation.
Your strategic success starts here
Our clients trust our expertise in digital transformation, compliance, and risk management
Ready for the next step?
Schedule a strategic consultation with our experts now
30 Minutes • Non-binding • Immediately available
For optimal preparation of your strategy session:
Your strategic goals and challenges
Desired business outcomes and ROI expectations
Current compliance and risk situation
Stakeholders and decision-makers in the project
Prefer direct contact?
Direct hotline for decision-makers
Strategic inquiries via email
Detailed Project Inquiry
For complex inquiries or if you want to provide specific information in advance
