If you are reading this, you are probably already an experienced professional who is respected in your field. Your expertise may be in business management, marketing and sales, law enforcement, health care, insurance, construction, public services, or any of a dozen other professions. But what you may not know is that in many ways, you are also an experienced “Chief Financial Officer” in your own right and you are likely employing many of the tools used by the best professional CFOs.
My personal field of expertise is in Public Administration, specializing in government finances. For 24 years, I served as the elected Treasurer of Schoharie County, a rural municipality in upstate New York with about 32,000 residents. As the county’s CFO, I oversaw an annual operating budget of about $80 million and my fiduciary responsibilities included cash management, budgeting, liquidity analysis, investing of funds, future financial projections, and fraud prevention.
You may not realize it, but you are probably performing every one of these functions on a daily basis as well. Do you log on to your bank account on a regular basis in order to check your balances and look at recent payments to protect yourself against fraud or identity theft? If so, you are using “liquidity analysis” as a tool in fraud prevention.
When you log on and check those bank balances as you are drinking your morning coffee, do you also calculate in your mind whether you have sufficient funds available for upcoming recurring expenses such as mortgage payments, car loans, or other regular disbursements? If so, you are doing “cash management” combined with “future financial projections.”
If you are considering refinancing your mortgage or consolidating other debt, then knowing your precise cash position and effectively managing that cash can be very beneficial in helping you earn the highest credit ratings and the lowest loan rates.
Having a clear picture of your cash position can also be an important tool in helping you (or your public entity or higher Ed institution) be prepared for an emergency or unexpected fiscal crunch.
And if your prudent fiscal management has resulted in a larger cash balance in your low-or-no interest checking account than you really need at the moment, you will probably consider shifting some portion of those funds into a money market account—or maybe a CD—in order to earn higher interest. You have now successfully combined “liquidity analysis” with “future financial projections” and “investing of funds.” Congratulations! You are using the data, information, and tools of a Chief Financial Officer.
At three+one®, we help county governments and other public entities use the best resources available to manage their cash effectively. Our patented cashvest® system accurately monitors a public entity’s liquidity and provides it with the tools and technology needed to most effectively manage the funds that flow both into and out of its numerous bank accounts on a day-to-day basis. We provide our clients with objective, analytical, and accurate financial data that helps them use their resources to the very best advantage, thus maximizing their returns.
In our daily lives, most of us already practice the key elements of being an effective chief financial officer, no matter what our actual job title is. As it turns out, you probably already employ tools like “liquidity analysis,” “cash management,” and “financial projections” with your family’s finances. And it all starts out with that quick, but very effective, glance at your personal bank balances.
Having access to key data about current liquidity is critical to every facet of financial management. It is the starting point for cash control, financial projections, fraud prevention, and effective investing of funds. When you do those things on a personal level, with only one or two bank accounts to deal with, the process is fairly straightforward. But when you are the CFO of a large public entity or higher Ed institution, it gets much more complicated.
That’s where three+one® comes in.
Dealing with dozens of bank accounts, separate highway and general funds, enterprise funds, reserve accounts, debt-service funds, and the millions (or even tens of millions) of dollars that flow through those accounts every day can be a real challenge. The first key component is knowing exactly how much cash you have on deposit, and where those funds are—that’s liquidity analysis—and here at three+one®, that is precisely what we do. We can help you get a clear, detailed picture of the public funds that you manage, just like the one you have for your personal finances. Regardless of whether interest rates are rising or falling, we can provide you with the tools and data you need to best manage those funds.
We serve large and medium-sized public entities throughout New York State as well as in many other states nationwide. If you are a manager of public funds, please give us a call. We are sure that you will be satisfied with the results.
The author served as a county legislator, a county treasurer, and as a disaster recovery coordinator in New York State and has always strived to maximize the impact of federal and state monies at the local level.