This report is the first ever edition of the Luxembourg Treasury Survey. Its analyses and conclusions are based on data gathered via online surveys that were sent to companies that have treasury activities in Luxembourg.

The KPMG Treasury Survey focuses on companies with treasury activities in Luxembourg. It aims to better understand the kind of treasury centres that have been set up, to identify what operations they conduct, and to learn how they measure the performance of their treasury services.

Executive summary

The KPMG Treasury Survey focuses on companies with treasury activities in Luxembourg. It aims to better understand the kind of treasury centres that have been set up, to identify what operations they conduct, and to learn how they measure the performance of their treasury services.

Our panel is predominantly composed of companies headquartered in Europe and Luxembourg (60%), and in North America (40%).

From our overall results we noted the following trends in the field of treasury:

Treasury centres and their main operations

  • Most treasury centres are evolving from service centres to more strategic, centralised value-adding or profit centres.
  • One of treasury centres' main priorities is to obtain 100% cash visibility within their group while ensuring efficient control over the majority of their cash. In this respect they have begun setting up cash pooling and netting solutions, while a few of them (12%) are also taking advantage of payment factories.
  • The majority of treasury centres protect cash by conservatively managing their risks.
  • Two-thirds of the respondents apply IFRS hedge accounting.
  • Regulations continue to have a substantial impact on treasury activities, especially Basel III, EMIR, the Dodd-Franck Act, the Sarbanes-Oxley Act, and legislation in the area of Base Erosion and Profit Shifting (BEPS).
  • More and more treasurers are reporting specific "treasury dashboards" to their CFO/CEOs that highlight their core treasury activities and their performance via a regular reporting of their main treasury key performance indicators (KPIs), in addition to the available cash within the company. The progression of these KPIs is taken into account by senior management to more effectively allocate their available budgets and to better decide on further investments or developments, including the hiring of additional treasurers to handle specific development projects within the company's treasury centre.
  • Bigger companies tend to have larger IT infrastructures, and are mostly using a treasury management system combined with enterprise resource planning (ERP), as well as IT reconciliation and market data tools.

Treasury personnel

  • The majority of the Luxembourg treasury offices are run by five to ten people. However, one out of four respondents reported having only one person managing treasury activities.
  • Treasury teams are considered to be balanced by 56% of the respondents, and approximately 30% have a high percentage of junior staff in their team.
  • Half of the companies are planning to hire new recruits over the next two years, as they look to extend or improve their treasury activities in Luxembourg.

Risk and controls

  • Generally, risks are considered to be under control. However, room for improvement exists in dealing with a multitude of new regulation constraints, and the increasing risks linked to cyber-attacks.

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