CFO interview - Gary Carroll, CEO for the Super Cheap Auto Group
Interview with Super Cheap Auto Chief Executive Officer, Gary Carroll.
Q.
How do you measure the performance of your treasury function?
A.
There are a number of ways we measure treasurys performance. The first measure is adherence to policies and the companys desired risk profile. Secondly, we measure the timeliness, quality and accuracy of treasury reporting. Thirdly, we evaluate financial performance against various benchmarks.
Q.
If a chief financial officer (CFO) wanted to keep a good grip on the performance of its treasury function, what one or two questions would they be asking?
A.
I would ask a question to draw out knowledge in relation to working capital management. For a company such as Super Cheap Auto, which is a retailer undergoing significant store growth, the question may be What is the impact on our working capital position if we opened ten stores instead of the planned five in the next six months, and how would you manage such a situation?
A treasurer should have a detailed knowledge of the drivers of their working capital position, and the back-up plans that are in place to manage through unplanned events.
Secondly, I would ask about the level of interaction with other departments - How often do you meet with the finance and operations teams, and are you involved in all major investment etc decisions? A treasury that operates in a silo is a major concern, as it compromises the quality of planning decisions.
Q.
What is the best way for a CFO to support the treasury function?
A.
Provide the team with:
Clear policies and risk profiles so they know the parameters of their role.
Access to information (reports etc.) and people to enable timely decisions to be made.
Relevant training and development opportunities so they continue to build their skills.
A large part of this training is getting to understand the broader business in detail. It is a hobby horse of mine, but treasury teams that understand the business are much more effective. They also are more respected and valued by the business, which leads to earlier involvement in key decisions.
Q.
What do you find most frustrating / biggest challenges about your supporting role to treasury?
A.
As with many other companies, we do not have a dedicated, stand-alone treasury function - rather, the function is managed by people as part of their overall responsibilities.
As such, it is a constant challenge in balancing the workloads so as not to unduly compromise any area. Finding suitably qualified and experienced people is also a major challenge.
Q.
What do you see as the emerging issues for your treasury in the future?
A.
We are currently increasing our exposure to overseas jurisdictions in a number of areas - operations, importing and exporting. In addition, we are altering the nature of how we source products from overseas, which has implications in relation to timing of payments. Accordingly, the complexity of our treasury function (e.g. FX, cash and working capital management and funding) is expected to increase significantly in the next 12 to 24 months.
