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Volvo Cars - Cash Forecasting Expert Interview - 2025-03-27

Metadata

  • Date: 2025-03-27
  • Company: Volvo Cars
  • External Participants: Lee McEneff (Group Treasury)
  • Palm Participants: Emma Sjöström
  • Type: Expert Interview
  • Domain Areas: Cash Forecasting

Summary

Context

Expert interview with Lee McEneff from Volvo Cars Group Treasury, met at a conference. Lee has deep experience in Treasury operations, having built Volvo's SAP cash management module in 2016. This is a discovery conversation about their cash forecasting process and pain points at a large automotive multinational.

Key Discussion Points

  • 40 entities report to Group Treasury with monthly Excel forecasts uploaded to Quantum (TMS)
  • Business controllers in each entity submit forecasts by 3rd of every month via email
  • SAP is the common ERP across almost all entities (standardization seen as critical)
  • Day sweeps for cash pooling - entities don't hold cash, central Treasury covers negative balances
  • UK market is 100% online direct sales (no traditional wholesale), making AR unpredictable
  • Intercompany netting managed centrally with dedicated AP team
  • 30-day standard payment terms means solid AP outlook at start of each month

Pain Points

  • Excel chaos across 40 entities - "When it's on the Excel, anything can go wrong"; different formats, decimal conventions, Lakh notation (India)
  • Business controllers not Treasury-focused - Spend ~1 hour/month on forecasting; focused on commercial, not cash
  • Last-minute funding requests - Entities reach out when "something crazy" happens
  • Overwriting forecasts loses variance visibility - Changing 100 to 80 looks the same as changing 100 to 800
  • Year-end AP rush - Invoices approved but not forecasted, then big push to pay suppliers
  • Chasing entities for on-time reporting - Constant follow-up needed

Feature Requests & Needs

  • Variance/discrepancy reporting - Report deviations rather than changing figures; "if you see a variance, you pay more attention"
  • Pattern detection - Proactive alerts for missing cyclical items (e.g., UK tax payment every March)
  • On-time reporting enforcement - Ensure timely submissions without manual chasing
  • Direct ERP connection - Pull AP/AR data by due date range automatically

Jobs & Desired Outcomes

Job: Aggregate cash forecasts from 40 decentralized entities into reliable group-wide view

Desired Outcomes: - Minimize the time spent chasing entities for forecast submissions - Reduce errors from manual Excel manipulation (format, decimal, typos) - Increase visibility into forecast changes vs original figures - Reduce year-end surprises from unforecasted AP

Job: Detect missing or anomalous items in entity forecasts proactively

Desired Outcomes: - Minimize the risk of missing cyclical payments (tax, annual fees) - Increase early warning of unusual AP/AR patterns - Reduce the need for manual review of every entity forecast

Domain Insights

  • Trust in AI for forecasting: "I wouldn't trust any less than a human... once it works, like it works, you kind of start to trust a little bit more than yourself"
  • Automotive AR challenges: Wholesale is predictable (know where vehicles are), but direct-to-consumer (UK) is unpredictable - customers pay from personal accounts with messy reference data
  • Central Treasury prefers control: "Giving too many hands access to something like that could be a bit dangerous" - want approval process
  • Common ERP is critical: "I've seen big companies try to do forecasting with six or seven different ERPs and I don't think it really works so well"

Three Wishes (from Lee)

  1. On-time reporting - Stop chasing markets for submissions
  2. Discrepancy reporting - Report changes/variances, not just new figures
  3. Pattern detection - AI detects when expected items are missing

Notable Quotes

"When it's on the Excel, anything can go wrong with it. You know, there's not kind of if we had something cleaner." - Lee McEneff

"I think if you see a variance, you pay more attention. If you have to report a deviation of something, you pay a little bit more attention." - Lee McEneff

"I wouldn't trust any less than a human... It's like a good Excel formula - once it works, like it works, you kind of start to trust a little bit more than yourself." - Lee McEneff

"The controllers aren't giving enough time on this because at the end of the day they're concerned with commercials... they probably spent an hour at this a month." - Lee McEneff

Full Transcript

Date: 27/03/2025, 15:06

00:00 Emma Sjöström: It's not perfect, like it's it's not perfect in my opinion because it's sometimes gets the word a little bit wrong and it's it's not Treasury expert. So, you know, as we reach with the transcripts, you're like,

00:06 Lee McEneff: All right.

00:09 Emma Sjöström: No.

00:09 Lee McEneff: What does it mean? Yeah.

00:11 Emma Sjöström: Hey not free today. You know like stuff like this but it's it's a very useful for me to go back and make sure I understood things correctly.

00:17 Lee McEneff: Actually, it's Yeah.

00:22 Emma Sjöström: Cool. How have you been since the conference?

00:24 Lee McEneff: Yeah, pretty good. Lots going on. Now as you can imagine with Mr. Trump and the tariffs on the cars so the industry is everyone woke up a bit.

00:34 Emma Sjöström: Right.

00:38 Lee McEneff: More nervous today. But yeah. And obviously the market is reacting as expected as well. So it's it's been very interesting.

00:50 Emma Sjöström: I bet what a time to be alive.

00:52 Lee McEneff: Yeah, crazy.

00:54 Emma Sjöström: Actually yeah.

00:55 Lee McEneff: But yes, I've been I've been good on. Yeah. And you

01:00 Emma Sjöström: Yeah, I'm good. Thank you. I'm just thinking of, have you seen this meme? Where there's this dog sitting with a cup of coffee or in like a surrounded by fire? And it's just this is fine, the situation. This reminds me about Yeah.

01:16 Lee McEneff: That's how we're feeling.

01:19 Emma Sjöström: I understand that. Okay, so going from that feeling into like cash forecasting. Okay, thank you so much for months.

01:26 Lee McEneff: Yeah, nobody but I I have looked in a little bit deeper functionalities and so that's why I mentioned it to the back office here. that I was like, damn, if I had Have had more time to think about it, it would be ideal to have them, but yes. This won't be the last one.

01:48 Lee McEneff: I imagine.

01:49 Emma Sjöström: No. Yeah, I'm happy. Like the more, the more perspectives, the better. I think. So that sounds great. Yeah.

01:55 Lee McEneff: Yeah.

01:57 Emma Sjöström: So just starting a bit like broad. I like a group level. How Would you mind describing a bit like your current cash forecasting process? How it what?

02:07 Lee McEneff: yes, it's really basically if I'm being very honest, we have about no

02:10 Emma Sjöström: Well.

02:15 Lee McEneff: I think it's around 40 entities. That we take care of in group Treasury. Well, there's more That. Yeah, there's a lot more but the main ones are about 40 that will report in their Volvo 100% wholly on the entities that they will prepare this excel with the APS and the projected a horse for a period at the monthly period.

02:41 Lee McEneff: And then on this Excel They send it, they upload it into what we're using this quantum. And then basically on that we have a monthly forecast or a weekly forecast to allow for our cash. Yeah, our kind of central Treasury use quantum as the kind of The competition system.

00:00 :

03:02 Emma Sjöström: Yeah. Quantum. Interesting. And so you update this weekly, did I get that, right?

03:09 Lee McEneff: yeah, so it's actually monthly

03:12 Emma Sjöström: Monthly update.

03:13 Lee McEneff: And then any major changes like if something especially on the AP so it pops up

03:18 Emma Sjöström: then we will go in a manually change for that for the entity. Yeah, yeah. Okay. Got you?

03:24 Lee McEneff: Okay, so we have outside where we have quite a large AP.

03:24 Emma Sjöström: so,

03:29 Lee McEneff: Team. With involved with that take care of our intercompany transactions as well. So what they will do is with, on our netting days, we have a couple of netting this month, they will take care of them. Update in our manual update. There's this Excel, that's that's a direct feed and into quantum, but that's only for two like let's say the the largest entity.

03:53 Lee McEneff: So,

03:55 Emma Sjöström: Yeah.

03:55 Lee McEneff: And then, the rest of them are manually held and controlled by the business controllers, in the entities. So they said You save over car, Ireland will be in responsible for his own they and they, three of every month. They will give in to Central Treasury for the upload and then if there's anything kind of crazy in the month, There's a fine, art is whatever a big one.

04:19 Lee McEneff: Obviously. Then we will they will reach out to central surgery at the back office and they would adjust accordingly or arrange funding where I need

04:28 Emma Sjöström: All right. So it's very it seems like it's it's the often situation where it's kind of like last minute requests for Funny.

04:36 Lee McEneff: Yeah, there can be. There can be here. No, we try to keep asbest as possible when it comes to the incomings. It's quite stable because we know where the vehicles are and when the vehicles are received. So, when we sell these cars onto from our local entities, onto these factoring agencies or the dealerships, so we can control, we have on the AR front, I would say We have At least for the wholesale markets because obviously we played around with selling or we play around with selling cars online as well.

00:00 :

05:10 Emma Sjöström: All right. Yeah.

05:11 Lee McEneff: We have got direct customers in the UK, it's 100% online. So all of the vehicles in the UK gets old online.

05:18 Emma Sjöström: Also, no wholesale at all.

05:21 Lee McEneff: Not traditional wholesale. We still have dealerships that. Take care of the fixing of the cars and the handing over the vehicles whatever. But yet the market you 100% order, your car and Volvo is Volvo. Yeah.

05:36 Emma Sjöström: And how?

05:36 Lee McEneff: Is.

05:37 Emma Sjöström: Yeah. No. That's super cool because that makes it. Yeah, I bet it's much harder to obviously.

05:42 Lee McEneff: Yeah. Yeah, or on that one is quite It's quite hard.

05:48 Emma Sjöström: How do you deal with that currently? Like what?

05:50 Lee McEneff: No. Well, right now, we have, for example, we have a couple of ways of doing it, obviously, when the customer does his our order, it's they have a down payment so so we have got in various Psps, we have, we hold

06:00 Emma Sjöström: Right.

06:07 Lee McEneff: And balances on are these collection. So we hold them until the vehicle is paid for and the vehicles paid for on cash. So we invoice when the vehicles ready and in the important country. So it's when it's in the UK let's say from Belgium or Sweden and the customer gets, there's an auto trigger than an SAP.

06:27 Lee McEneff: To the customer to say, Okay? It's payment time and then the customer just money will transfer from his horror bank account into us. So you never know when that's going to happen.

06:39 Emma Sjöström: That's are they are the customers like compared to other businesses today? Do

06:40 Lee McEneff: they pay more on time? Is that like I'm just

06:45 Emma Sjöström: Now it's, it's crazy like sometimes because you're living a lot. It's just at the end of the day. It's it's a normal customer like you and I so they like you get a an invoiced pay for a vehicle. That's 60,000 pounds. And you have to do it from your bank account.

06:46 Emma Sjöström: And obviously, they're put in their name, their address everything in the reference field, It's it's quite hard to identify. Who's paying this? but yeah, so the AR on those entities It's not so clean.

06:47 Lee McEneff: What no interest. Super Cool. Thank you. But and how do you collect this forecast day? Upload this into quantum of themselves. So they

07:18 Emma Sjöström: but that forecast is just

07:30 Lee McEneff: Email.

07:32 Emma Sjöström: Email.

07:33 Lee McEneff: yeah, so the business controller for the entity, what they will do is they know More or less, where the vehicle is. and they know the flow so they expect then they will what they will have and say Okay we expect that we will have 10 handovers next week or 100 next week so we expect that this money coming in So that's that's very manual and that too exchange compared to if we look at a market like a France where we don't have that model that's quite rigid and structured but in the UK it's it's a lot of editing.

08:06 Lee McEneff: Like you mentioned

08:06 Emma Sjöström: Sure. Okay.

08:08 Lee McEneff: On the AOR, the AP. We have all our other majority of entities, our payments on behalf, so, we have quite clear payment terms and obviously, with their with exception of a random tax payment or anything crazy are AP is quite Okay. And because We have the emails, casual module.

08:30 Lee McEneff: We hold the internal balance. So the majority of our entities are in the day sweeps. So they they entities are not castration. So they will always have or investment into Overcare Central. That's a And then when they go into negative balance, we have a sweep from our bank account centrally to cover.

00:00 :

08:55 Emma Sjöström: Gotcha.

08:56 Lee McEneff: So, it's quite developed.

09:00 Emma Sjöström: Yeah, no it's nice. Being able to have that structure.

09:03 Lee McEneff: Yeah, it was it took us a long time. I think well that was my one of my first projects in 2016 was the kind of Sap side.

09:11 Emma Sjöström: Okay.

09:11 Lee McEneff: Setting that up. So there in those casual module. When the guys here in Treasury in my current role, they were taking care of all the Yeah, the banking kind of side put a technical more so operational more side I was yeah my focused on that.

09:29 Emma Sjöström: Oh, so you're are you still on sap? And

09:33 Lee McEneff: I'm supposed to not be on sap word. It's well, when you were an sap head, it's hard to move away. I I sometimes don't trust what the bank says. I go to

09:42 Emma Sjöström: but,

09:46 Lee McEneff: Interesting. So we're okay. But you don't have any other like systems that you're supposed to

09:47 Emma Sjöström: they're not and just Quantum quantum as well.

09:54 Lee McEneff: use like there's some team. Cool. Google. I'm also I think, if I remember correctly, well we'll get deeper to the degrees if I just wanted to ask you because if I remember correctly, there was a little

10:01 Emma Sjöström: I, I guess it's if we look at the Earth, 40 entities,

10:31 Lee McEneff: bit talking about like, bridging the fp&a forecast, with the cash flow forecast,

10:34 Emma Sjöström: and the 40 business controllers, who Play around with that excel like like it's no man's land. So it is quite hard even though that it should be as easy as just having an AR figure and an AP fear but then there's a lot of things that go on. I feel like

10:35 Lee McEneff: and like that whole houses. I'm super interested in like what

10:50 Emma Sjöström: When it's on the Excel, anything can go wrong with it. You know, there's not kind of if we had something cleaner.

10:54 Lee McEneff: Yeah. What does that mean? When you say it's different like a little bit

11:02 Emma Sjöström: that follow instructions or business, controllers new, they get on they get a a TTP, Let's say instructions on how to fill in exactly what they want, or Used up, so we're not having these this issues. But I'm I imagine this is kind of a must be industry standard or A corporates, have this issues with forecasting I'd say from from the subsidies.

00:00 :

11:14 Lee McEneff: Yeah. Yeah, that's what we're hearing about at least. Well, it's an interesting problem for sure. What would such like, instruction? What would such an instruction look like? For example, do you think

11:30 Emma Sjöström: yeah, I mean It depending on what the ultimate goal is I guess if they were feeding into a unique database rather than rather than spreadsheet. I guess, I guess take include exactly the instructions. Exactly. What an AP is exactly what they are. Is exactly what time frame is. And perhaps if the to have kind of those like strong ones, that's your base is you put something in and then you you don't edit our figure, you know, you have another kind of figure.

11:41 Emma Sjöström: Or another field that would say, Okay well take what I've given you already and do this adjustment over it rather than I'm going to undo what I did. I've already told you

11:45 Lee McEneff: Okay. Yeah. I think you try to explain it a little bit more like M5.

12:35 Emma Sjöström: Yeah, so a Let's see what we get sometimes is. We were trying to position cash. And Ireland says, they will have not Ireland. That's too easy. We'll just say something like Another close market difficult market. Mexico pesos, right? They will say that they will receive just a hundred thousand.

12:36 Emma Sjöström: This week. So we should have access to the cash the 100,000 next week just say the seventh of April. They say they should have that cash so we can anticipate that. But what we see is closer to the date the sixth let's say they know they're not gonna get a hundred but they will actually change it and say, Okay, well we only get the 80 but then the mistake what happens is That they actually changed to 80 to 800, you know, so then it messes up the whole kind of

12:40 Lee McEneff: Oh wow.

13:35 Emma Sjöström: And personal position them for, for those days. when if you had worked and said, Okay, previous the in this month, I told you it was going to get a hundred rather than

13:36 Lee McEneff: I gotcha. So, a way to kind of report in inform about the the

14:03 Emma Sjöström: Have. or me being able to change that I should just make

14:07 Lee McEneff: got and maybe because maybe preserved that variance as well, like maybe that,

14:13 Emma Sjöström: There should be something else. I think that would allow you to do that

14:21 Lee McEneff: Yeah. Is it like they're almost like just updating the forecast itself? Hmm.

14:24 Emma Sjöström: different. So you will actually say Okay I will be off by 10 on the hundred.

14:34 Lee McEneff: I was right. Yeah. Yeah.

14:37 Emma Sjöström: Yeah, then yeah. so, to report the change rather than the new figure, if Because I think, if you see a variance, you pay more attention. And if you if

14:48 Lee McEneff: No, I agree. and I guess,

15:14 Emma Sjöström: you have a whole figure

15:19 Lee McEneff: But it makes sense like I so I'm still learning treasury. Okay so bear with I'm

15:19 Emma Sjöström: Yeah, they're there because it's just it's just they're updating that 100 so

15:23 Lee McEneff: guessing I'm assuming like I want to see that variance is looking back so I can reach out to the Mexican team and say Hey how can we collaborate on like driving that variance down, right?

15:24 Emma Sjöström: they and it's really easy. Then to just say, Okay, I mean they make a mistake. But I think if you have to report a deviation of something, You can pay a little bit more.

15:35 Lee McEneff: Got. No, makes sense. Thank you.

16:40 Emma Sjöström: To the deviation rather than changing all the, even though it has the same. has the same end, let's say, The same thing at the end of the day, they want to report. 80 on the on the 6th for the seventh. Well,

16:51 Lee McEneff: Do.

16:54 Emma Sjöström: Do.

16:55 Lee McEneff: I'm a little bit curious about like assumptions that are driving forecasts.

16:57 Emma Sjöström: to change the whole thing, I think. we are maybe I'm just talking but this is again, just All right. Yeah. Yeah. From a back office point of view. These are the business controllers, I would say at the ones, you know, so they know that what's happened in their locally.

00:00 :

16:58 Lee McEneff: The either on the cash, forecasting side or the fp&a side and like, you're and

17:03 Emma Sjöström: But if you do have a big deviation, now this We need to ask also have control especially in cash management. Say Okay, what I needed to make sure that I did X activity to ensure that I had X amount of pesos for you or I actually Played with my AP because I was expecting to have this from you.

00:00 :

17:14 Lee McEneff: Fluffy question maybe. But like,

17:14 Emma Sjöström: You know, if you if you're buying currency as well. I mean sometimes if your baby, for example, if you have a big outgoing on the 11th but you know that Mexico was going to give you 100k on the tent. Well then you wouldn't have bought any excess, you know, because obviously well from our point of view we want to keep as much in Euro and sick as possible as the majority of the European entities market are organizations who want to do.

17:15 Emma Sjöström: We try to not keep so much in dollars, but that's for other reason. but because I guess that's so Fluctuate. The fluctuates so much. You know and I think if you ask the question, you get seven different very variations on the answer. But I mean from our point of view, We just over from Cash management.

17:16 Emma Sjöström: Point of view we could we try to play it simple as much as we can. But if you talking to a trader and they will obviously be a bit more brave than what we would.

17:15 Lee McEneff: Why is that?

17:41 Emma Sjöström: I don't know, I think if you work in that, if you work in trading, I think you are a little bit. Gambling must come natural to the Washington thing. It's either. I don't know.

17:46 Lee McEneff: Cool. I'm just gonna look. so, If we touch them on this, a little bit already. But I like, what would you say is the most difficult part of like, kind of aggregating all that subsidy or like all those forecasts from all your 40 entities into this one group wide cap?

18:06 Emma Sjöström: I think that's it.

18:27 Lee McEneff: Yeah, hardest bits there. Like what makes it go? Ah, You know.

18:28 Emma Sjöström: It's education. I guess. It's it's like different formats. It could be as simple as Now, and this sounds really really basic but it's the testimony points under the comma. In Excel, for example, the way some we have entities in India, that use luck. So they actually have a different kind of Structure to look at figures.

00:00 :

18:32 Lee McEneff: All right.

18:57 Emma Sjöström: I mean, Excel should Be smart enough to say this. But I mean, oftentimes, when you're talking like India, for example, you might get What those for you? Is 10 million rupees is that a lot or not? So it did they actually mean this, you know, but the way they view it.

18:57 Emma Sjöström: It's so basically that they view it as in one and then a separation on two and then they'll have three and three. So it's the way they so, oftentimes, when you do get these excels in trying to compile them You don't know what we do to use the kind of standard European setup.

18:57 Emma Sjöström: And again, this is the most basic area. I'm not saying this is takes a lot of time to fix, but but it is something and that's because these Excels are produce by or they edited by so many different types of people I'd say.

18:58 Lee McEneff: I bet, yeah. I guess it would be hard to find a unified Excel template. Everyone would want

19:58 Emma Sjöström: Yeah.

20:06 Lee McEneff: Yeah.

20:08 Emma Sjöström: Now, here I think it'll be too hard to be honest, what could work for one business can stroller in an entity? If that person leaves then and might not necessarily work for, I think what you need to do is you need to have a system that's not so familiar.

20:08 Emma Sjöström: Everyone has excel the way that like Excel, I will say to you, that my Excel format is way better than yours. And I have no reasons because it's just the way I have become used to it. No,

20:09 Lee McEneff: Just a familiarity of it. Yeah.

20:38 Emma Sjöström: it's everyone's familiar the way things are, but if you have kind of Something. That's not so generic. And it's purely based. I mean, generic in the sense that It does this purpose and it's strict and it says, Okay, this is it rather than an excel is so dynamic.

20:40 Lee McEneff: Yeah.

20:57 Emma Sjöström: I think then because that sort of like it comes with its own problems, then. again, I could just be Making this up, but I feel happy and

20:58 Lee McEneff: Yeah, no. Fair enough. So, but

21:12 Emma Sjöström: So, that would be that the training falls to receipts. Because we can't have trainers from Central Charity. Going every time there's we, we do provide training and there's someone on board, but if it's I mean, you would have a full-time trainer then just for this.

21:15 Lee McEneff: Yeah, no, no. I got

21:34 Emma Sjöström: You couldn't do that, right? So

21:36 Lee McEneff: That sounds very hard. This. So, we are, I'm just interested in kind of reconciling things a little bit because that problem just for your information, we currently build all our forecasts from their account level and up. I do machine learning and also we have room for human input, right? I'm just

21:38 Emma Sjöström: All right.

21:54 Lee McEneff: All right.

22:00 Emma Sjöström: no, it's not a very deep it's so we have we use the Swedish Church of Accounts

22:35 Lee McEneff: To.

22:35 Emma Sjöström: and in the majority of I mean from accounting purposes we it's kind of standardized and where rfp, so what we will then Do is we would just look for AR and air AP elements and report on them.

22:39 Lee McEneff: Yeah. Yeah.

22:57 Emma Sjöström: And then obviously, then we take A or an AP elements. One is in the company as well because we have a netting. So I never sketch when we do our internal payment of invoices, it's all done to accounting. There's no Cash change. But or there's very few entities in a group that do a physical payment.

22:57 Emma Sjöström: I mean entities that Like, South Africa, or Turkey, which took over the local governments. Need the money to go out and not to hold and an intercom not to hold them. An intercompany balance and accounts. I mean. They will require this. but it's I mean for the majority of entities, it's just a standard AP with A trading partners or not? so,

22:59 Lee McEneff: So if you could like reimagine cash flow casting for you, how about what just like, if you could wave a magic wand? Like what would you? What would your first thing be? That would just work magically or

23:54 Emma Sjöström: Yeah, I would say something to go in. Check obviously, on the account levels. So the Going to account levels, read the AP, it check a specific document. Check a specific payment date. And then report it your AP on that range. So it's going in checking because obviously you have adjustments on your accounts now.

23:58 Emma Sjöström: So yeah and your accountant on AP but then what you would be clever enough to just jump into the AP ledger Download or check when it's falling due and then report back on the date and the range. So if you have, for example, if we're doing a monthly forecast, it's clever enough to go in, check your, AP from the range of the first of April, to the 28th of April, only considering these document types, which in our case, will be supplier document types or Deducting and a supplier document.

24:05 Emma Sjöström: Adjustment, whatever the balance and then sending that out for that entity then which is report into central that that's what they intend to pay in the month of April.

24:08 Lee McEneff: Right? So some way to get that data into the forecast. Basically,

25:18 Emma Sjöström: And then, obviously, on the Accounts receivable the inverse effect. But that's I mean that's what you should do if you were to do it well manually, that's the way you would do it.

25:23 Lee McEneff: Right. When do you know like this data or at the account level? Like the the booked actuals if you will like what

25:36 Emma Sjöström: I wish we and I guess this is something that the procurement team works quite well here, we accept 30 days as standard minimum payment terms, where suppliers, which is, I mean, yeah. So we have that's minimum. So obviously we have some

25:44 Lee McEneff: That's right. Yeah.

25:57 Emma Sjöström: suppliers that we buy so much from them that we get 60 days or, you know, so but I mean standard minority business with us, it's 30 days. Which means that we should have a solid AP outlook at the start of every month. It does answer your question. So what

26:02 Lee McEneff: and yes, I'm thinking a little bit, but so if I'm thinking, if there is a mapping or like in your system, some way you have, maybe voices, you have these kind of known booked actuals coming up that for, for AP

26:22 Emma Sjöström: Yeah, the majority of entities sap so that would be there.

26:37 Lee McEneff: Just basically, they like the data sources, where one could find this information. And so that's one thing like you start across all your entities or is that like living centrally somewhere. Okay.

26:40 Emma Sjöström: So yeah, so I mean having a common ERP is always say, I think that we only have one national sales company that that doesn't have sap is I think they use Fort Knox, but they will change. Now this year to use SUV. And I mean the entity only sells less than a thousand cars a year.

26:50 Emma Sjöström: But it's still, I think. we see that as that important to have this kind of unity, and this clear picture because I figured a big companies that tried to do these kind of forecasting with six or seven different ERPs and

26:58 Lee McEneff: Yeah.

27:34 Emma Sjöström: I don't think of really, really works so well. It's nice to kind of have a transaction ubi with the Grinter, something and then but, I mean, not very many companies, use SAP as their forecasting, At least I don't think they do. At least for Treasury. It's quite difficult to use sap.

27:34 Emma Sjöström: As well as you would like to put.

27:34 Lee McEneff: Yeah, I got you outside. I think it's interesting because we're working a lot would like And machine learning models, like, where we look good at your actuals for actually happened and then especially for for AP. It's, it's quite easy to to predict then. Okay, what will happen? And you will you will get like seasonality

28:03 Emma Sjöström: Yeah.

28:23 Lee McEneff: Yeah.

28:25 Emma Sjöström: probably like, I mean, that's, that's kind of what you want because And that's important to realize this. Well, if you have so many outgoings, I mean, I imagine the controllers are doing this activity themselves but From a Treasury point of view. Maybe we just at the fall. between the the chairs now because it, I mean, If it's a couple of, Hundred more AP items in a month that we would have noticed that.

28:30 Emma Sjöström: But then maybe that's Something. There's something happening in that market that we need to kind of focus on as well.

28:32 Lee McEneff: For sure.

29:11 Emma Sjöström: why have they got so many outgoings and they're not AP, even though they're selling guys or maybe the other big backlog, but that's Yeah.

29:12 Lee McEneff: Yeah. I just think it interests, it's interesting because it's also a little bit, a matter of trust. Like So you have your process where you're collecting all this forecasts from your entities and then you're creating this master dog, where you can clearly see, you know, like where the data is coming from and comparing that to his machine learning model that from, for each of your bank accounts, looking at your actual history.

29:16 Lee McEneff: Created these forecasts that those are not built on your booked actions, right? The look of the liquid looking and

29:19 Emma Sjöström: Yeah.

29:56 Lee McEneff: And I wonder what it would take. For you to trust such a forecast. Like would you need The ability to compare it to your current forecasts. And so what how do you think about like trusting these new types of technologies when it comes to forecasting, for example?

29:57 Emma Sjöström: I think I like the fact that I wouldn't trust any less than a human, you know. It to be honest I feel like It's like a good Excel formula once it works, like it works, you know, you kind of start to trust a little bit more than yourself. So I mean this could be good.

30:02 Emma Sjöström: You know at the end of today it is you just reporting a figure If it's miles and miles of, I could have a custom implication but you should have control over those. Well from central point of view you know you're not going to accept that an entity says. Okay, we're gonna have two billion dollars sales next month.

30:08 Emma Sjöström: Now even though some entities do report this Which it's just because it's laziness as well. You know, the controllers aren't giving enough time on this because at the end of the day they're concerned with commercials very concern is selling the girls again these out there So, they're not giving enough.

30:13 Emma Sjöström: And but that, this is just a small part of their Their month, you know? I mean so they're at the end of the day, they probably

30:17 Lee McEneff: Of course.

31:22 Emma Sjöström: spent an hour at this a month. And it's probably after a close heart close, and Their tutorial or whatever. So it's You probably would trust the AOA a bit more because it doesn't have those external pressures.

31:25 Lee McEneff: Interesting. How would you feel about? So imagine you have this Basel. I'm just like throwing some scenarios out Now. Imagine you had this baseline forecast for each entity for each of their accounts. if you'd want to influence it, for example, There is this big tax payment coming out? Currently the processes, your entities informs you, and then you throw it into your forecast.

31:32 Lee McEneff: If I understood that correctly, How comfortable are you with, If you had such a system, would that be something that you would open up for your entities to directly go into their entity update, the forecast for the account? Or would you want to still have like this approval like approval process if you will or that? It would like some house?

31:40 Emma Sjöström: Yeah, I can get given too many hands access to something like that is kind. That's that could be a bit dangerous. I still would I think. what you could do is, At least from ours because it's so cyclical all our businesses cyclical. So if it is a big tax, the AI could detect that.

32:08 Emma Sjöström: Okay. You haven't got your tax included. Okay. For example, this is no, this is no secret in the UK every match, there's quite a large in the automotive thing. This is of course a large tax payment.

32:28 Lee McEneff: Like hmm.

33:03 Emma Sjöström: Right. So then the AI. On top of the AP or the activity that they're used to doing from January to December, could detect again with training that I should have picked up a tax document.

33:04 Lee McEneff: We could be a bit proactive and say, Hey you should have gotten something from this and the UK entity regarding tax should you maybe child or

33:18 Emma Sjöström: Yeah. Yeah. Yeah.

33:22 Lee McEneff: In. So, when we have agents everywhere agents could reach out, right? Hey.

33:27 Emma Sjöström: Yeah.

33:28 Lee McEneff: Summer. Yeah.

33:32 Emma Sjöström: I mean, this is again just ideas that I think could.

33:35 Lee McEneff: They're really good ideas. It's really nice. I think it's super inspiring to just hear. Like, from your perspective, these sometimes, seemingly small things that could actually be quite helpful to just maybe keep track even of, hey, they should be some tax and payment in the forecast here but it's not.

33:37 Lee McEneff: And yeah.

33:39 Emma Sjöström: And towards the end of the year as well. I mean from our point of view from

33:59 Lee McEneff: so,

34:02 Emma Sjöström: Treasury that's a big thing. What what? And again, I'm not saying that AI is a magic one. Not for these things but the clinic have Again a AP, maybe a horse could when you have unknown aort the end of the year, you know it's it's good for cash. So I but it's like okay how likely is an entity because what we do is From I'm sorry.

34:02 Emma Sjöström: Oh, maybe it's really selfish. But from from the end of the year We kind of over the Christmas period. We do tend to work the last couple of days but If you were late to observe, if there has been Random APs put in the ensure that there's enough cash under the payments go out.

34:02 Emma Sjöström: At the end at the end of the year because we need to get our suppliers. Paid a lot supports the end of the day so it's kind of to say, Okay how likely is it that an entity? We'll have an AP based on trends, you know,

34:10 Lee McEneff: Swim. Yeah, okay. So you mean the AI could exactly. Like you're saying, look back at the history and see what has to behavior been for this entity in the past around this time of year and and somehow

35:13 Emma Sjöström: just so you're kept, you know, just to be like, Okay, maybe I do need to because I tell you, I was in and again, this is personal but I was Guatemala last year

35:24 Lee McEneff: Look.

35:33 Emma Sjöström: Look.

35:35 Lee McEneff: But working 10 hours, time different.

35:38 Emma Sjöström: so then, Yeah, I was in Guatemala so I was there you live tonight waking up. They just check and make sure that you know, but I probably didn't need to be worried at all because there was nothing but it's always better to kind of have yeah, thankfully robot again these are just something that was like okay that could make it could make this easier for for someone

35:42 Lee McEneff: yeah, so also bit of like built-in proactiveness of like

36:02 Emma Sjöström: Okay, exactly. That just to be like, okay, adds up.

36:05 Lee McEneff: yeah, these

36:08 Emma Sjöström: This entity has a very large AP but there's no payment once been a proposal being made. There's no but there's no payment orders on the payment invoices. So be prepared that they could be gonna or they haven't reported these ones. But they will definitely need to pay them.

36:09 Lee McEneff: Yes, that's a

36:28 Emma Sjöström: And I think that's what we do. Get, we do get That there's a big push that the invoices are registered and approved. And then they're not forecasted towards the end of the year, especially so, it's one there. The payment is really these approvals or the the goods receive receivables are done on them.

36:48 Emma Sjöström: then you get the big push to say, Okay, we need to get cash out to these supplies and you always know if there's an open AP Or if there's an AP blocked. It's going to have to go to, you know, with towards the end of the

36:30 Lee McEneff: Yeah very cool so maybe yeah so but I may understanding correctly maybe the system could or the AI could keep these. Wouldn't that create quite large variances essentially at the end of the year like for these entities and then Hey, you know.

37:09 Emma Sjöström: But I think they're already there. It's just if someone thinks about them, but I

37:27 Lee McEneff: Yeah.

37:28 Emma Sjöström: Yeah.

37:32 Lee McEneff: Cool. I want to be mindful of your time. I know. I only scheduled

37:44 Emma Sjöström: Oh, I didn't.

37:48 Lee McEneff: And, but

37:51 Emma Sjöström: And, but

37:57 Lee McEneff: Yeah, I just want to like if you could like do summarize like your top three like magical wishes around when it comes to cash forecasting, what would they be? like, in terms of how it would work for you and your business and in your own,

37:58 Emma Sjöström: Yeah, ensuring on-time reporting of figures.

38:17 Lee McEneff: On time, yeah.

38:20 Emma Sjöström: Because what you do, often turn up the chase the markets. Again. Hello, for discrepancy reporting. Or to give discrepancy reporting rather than a low for a full changes. Like I mentioned before,

38:22 Lee McEneff: Yes, yes.

38:41 Emma Sjöström: And then patterns, I think as well with patterns. so,

38:46 Lee McEneff: Sorry, what the

38:51 Emma Sjöström: Patterns. Like in the sense that if, if there is a detection that clearly there's something wrong with this one,

38:52 Lee McEneff: Pat. Oh yeah.

38:58 Emma Sjöström: I think on time correctness and then Changeableness.

39:02 Lee McEneff: Super. That's super cool. Do you want me to reach out? I'm happy to set up another meeting with your dad included and and your colleague as well from the

39:08 Emma Sjöström: yeah, and I think for that session and maybe a demo, if you have something to demo,

39:19 Lee McEneff: Sure, definitely. I'll tell. I'll tell good yet and he'll you. Is that? Is that okay?

39:27 Emma Sjöström: Yeah, sure. I will I I think now we're towards the end of the month so I think

39:33 Lee McEneff: Yeah. this was

39:34 Emma Sjöström: it probably be next month. Some oh yeah, early next.

39:41 Lee McEneff: it probably be next month, some

39:45 Emma Sjöström: A cook. There's no no pressure from our side like whenever works good for you. Of course.

39:50 Lee McEneff: No.

39:51 Emma Sjöström: Alright. Okay, so I'll reach out to video. He's very busy today, but I'll make

39:52 Lee McEneff: Sure.

39:56 Emma Sjöström: sure he gets back to you soon as possible. And to chat about that demo. Thank you so much, Lee. This was really valuable to me, see you soon.

40:03 Lee McEneff: No worries. Take care. All right, Jojo