“The primary problem facing treasury was to bring the City 30 years forward and create an electronic financial processing environment to maximise efficiencies, enhance governance through transparency, optimise best in class technology, and focus on leading practices along the way,” says Stefan Jaskulak, Director of Cash Management Services, City of Los Angeles Treasurer’s Office.

Treasury was stuck with a great deal of legacy processes: it was a department where the City’s cash book was on Excel, paper reports were stacked to the ceiling, and cashiers sat at computers manually entering data about the City’s cash into the mainframe general ledger system. “Treasury was thought of as a clerical function and not an integral player in the City’s financial operations, even though responsible for the City’s $7 billion portfolio and its $60 billion plus cash management programme,” explains Jaskulak. As such, treasury faced a highly politicised environment, the largest budget deficit in LA’s history, and an overwhelming resistance to change.

Treasury took on the monumental task of re-engineering the banking and financial processes, which meant the way the City had always done business would have to change.

As Crista Binder, Assistant Treasurer, City of Los Angeles Treasury Department points out, “When taking on a project of this size it is imperative that your project team includes members with a variety of skills from stakeholder departments. A dedicated project leader is also a must, but one that doesn’t have a department bias. All projects of this size need champions that are willing to stake their careers on the project’s success. Setting a project vision is also critical to keep the leaders focused on the end result.”

Creating a vision was critical to the project’s success to make sure that the solutions being recommended did not deviate from the vision. Throughout the implementation, treasury engaged their financial service providers, Wells Fargo Bank and treasury management experts to train treasury staff on how to conduct assessments and educate treasury on leading practices in banking and treasury technology. With the assistance of Craig Jeffery from Strategic Treasurer, LLC, treasury created a three-tiered approach to analysing the cash flow, technology and accounting processes of each department:

Tier 1 – Deep Dive.

Departments with complex revenue streams and financial processes.

Tier 2 – Regular.

Departments with moderately complex financial processes.

Tier 3 – Limited.

Departments with few banking services.

To plan and track the implementation, treasury developed a single page matrix that included all departments and all products. The scheduled date of a product implementation for a department could be found where these two criteria intersect with a simple traffic light colour (green-yellow-red) to indicate adherence to the timeline.

It is a great honour to be recognised for treasury excellence by such a prestigious international organisation. We look forward to participating in and contributing to future international events to enhance our knowledge of global financial best practices.

The outcome of the solutions implemented is a ‘virtual treasury’ and a cutting-edge financial management and information system. Treasury also took the initiative to ‘go green’ through the elimination of paper statements, paper cheque returns, and return of paper lockbox documents.

“Implementing new technology and new processes can be daunting and intimidating. It was refreshing to see the large number of departments and people embrace the new and improved way of banking,” comments Binder. “Today, the City has a virtual financial framework that supports all of the City’s departments in delivering services to over 4m residents.”