Global online auction and shopping company
Business need addressed:
Discovery and utilization of idle cash
Genpact improved reconciliations processes to uncover idle cash and determine the most productive use
Increased cash flow and liquidity
A global online auction and shopping company with a highly complex bank account structure was unable to identify and mobilize idle cash in the accounts of its subsidiaries. Genpact analyzed accounts-related activity to identify subsidiaries with significant amounts of idle cash, and advised the client on the best way to leverage these funds.
- Highly intricate financial structure, encompassing more than 100 subsidiaries operating over 300 bank accounts
- Inability to get an enterprise-wide view of available cash
Genpact improved the client’s reconciliations process so that it could proactively locate idle cash, and supplied options for utilizing these funds:
- Tracked account balance changes during the monthly reconciliations process to identify accounts that showed extended periods of inactivity
- Determined which subsidiaries had significant idle cash that was earning little or no interest
- Analyzed the client’s business needs and provided counsel on how to utilize funds
- Provided recommendations that enabled the client to add $7.05 million to its working capital account, to be further invested through its capital markets team
The company channeled $7.05 million to its working capital account and achieved Earnings Before Interest and Taxes (EBIT) of $86,000. The client has now simplified its accounts structure to ensure greater controllership in the future.
This was authored by Sumit Sapra Vice President at Genpact.