Vorwerk

Challenge

An FX risk perspective has increased in importance for this global group as it has continued to expand. Based on financial positions, cash flows and derivatives, the objective was to be able to calculate and analyse the impact of changes in exchange rates. Given that the company did not wish to implement a TMS, it was necessary to find another way to avoid complex calculations in Excel, which are also time-consuming and prone to error.

Solution

This implementation project entailed the setting up of the Risk management solution of Nomentia and an interface for market data. The existing data previously maintained in Excel were also imported into the Nomentia solution. New transactions can now be captured and automatically taken into account using a simple user interface. At the press of a button, the data from the financial status, forecast, derivatives, exchange rates, volatilities and correlation matrices are now analysed in a computation module and made available via a dashboard report. This makes it simple to simulate hedge transactions and to analyse the impact on the overall risk KPIs (cash flow at risk and value at risk) both reliably and easily.

“Nomentia enables us to rapidly and simply assess our FX risk – as easily as we always wanted it to be."

Oliver Schmitz, Corporate Treasury, Vorwerk & Co. KG

Output

• Calculation of risk arising out of exchange rate changes.
• Calculation of group risk exposure on the basis of financial positions, cash flows and derivatives.
• Risk perspectives for the entire group, divisions and individual subsidiaries.
• Analysis of risk contributions from divisions and subsidiaries with a flexible risk horizon.
• Simulation of the impact of notional hedge transactions.
• Integrated sourcing of market data.
• Intuitive dashboard with drill-down functions for analysis purposes.