Cash Management System: Features, Integrations, Costs, Pros of Custom Software

Cash Management Software Overview - ScienceSoft

ScienceSoft applies 14 years in financial software development and practical knowledge of 30+ industries to help businesses implement effective cash management software.

Cash Management System: the Essence

A cash management system is used to forecast, track, and report corporate cash flows. The solution is especially helpful to manage cash flows (including in various currencies) across multiple, including international, company branches and across complex bank account structures.

Cash management software integrates with ERP, accounting software, and bank accounts. Implementing a custom cash management system of average complexity may take 6 – 12 months, while building a high-end solution may require a minimum of one year. Average costs for building the cash management system are $150,000 – 400,000, depending on the solution complexity.

Annual ROI for custom cash management software may reach up to 230%. An average payback period for a custom cash management solution is about 6 months.

Cash Management System: Key Features

Cash tracking

  • Monitoring real-time cash inflow and outflow on corporate operating, investing, financing activities.
  • Tracking cash balances across multiple bank and/or (in case of an in-house bank) intercompany accounts, currencies, regions, entities, and more.
  • Cash positioning (daily, monthly, etc.) based on the consolidated bank statement data.
  • Tracking the cash transfer status (sent, in transit, delivered).
  • Automated segmentation of cash transactions (e.g., A/R, A/P, taxes, payroll).

Reconciliation

  • Automatically matching data on cash transactions provided in daily/weekly/monthly bank statements with those recorded in the general ledger.
  • One-to-one, one-to-many and one-to-all cash transaction matching based on the pre-defined rules.
  • Automatically defining the outstanding cash transactions and marking them to be reconciled manually.

Liquidity management

  • Automatically calculating working capital.
  • Monitoring current ratio and quick liquidity ratio to plan operating, investing, financing cash activities.
  • Scheduled/on-demand cash transfer between bank and/or (in case of an in-house bank) intercompany accounts based on liquidity needs.

In-house banking

  • Multi-currency cash pooling.
  • Payment factory (POBO and ROBO/COBO services) enabling centralized management of payments and collections across multiple intercompany entities.
  • Assigning optimal bank accounts and payment methods (e.g., ACH, BACS) for external cash transactions based on user-defined rules.
  • Multilateral intercompany netting.

Electronic bank account management (eBAM)

  • Managing bank account opening, registering, changing, closing.
  • Tracking and analysing bank fees.
  • Creating, authorizing, and changing account signatories.
  • Assigning cash transaction limits and target balance thresholds across bank accounts.
  • Automated alerts on the cash balance exceeding/dropping below the pre-defined threshold.
  • FBAR reporting.

Analytics and reporting

  • Cash flow forecasts (by period, account, region, entity) based on the historical and current data on cash transactions, company and customer payment behavior trends.
  • Short- and long-term liquidity forecasting.
  • Ad-hoc and scheduled customizable reports, e.g., cash flow statement, cash position report, reconciliation report.
  • Real-time drill-down dashboards (by period, currency, branch, region, bank/intercompany account, etc.) on:
    • Cash transactions.
    • Cash balance.
    • Working capital balance.
    • Actual vs. forecasted cash flow.
    • Liquidity ratios.
    • FX-related cash gains/losses, investing and financing activities, and more.

Security and compliance

  • Multi-factor authentication.
  • Role-based access control.
  • Data encryption.
  • Electronic signature workflow.
  • Full audit trail for each cash transaction.
  • AI-based fraud protection.
  • Regular vulnerability scanning.
  • Compliance with IAS (IFRS), FASB (GAAP), EMIR (for the EU), SOX, ISO 20022, industry-specific regulations.

Gain 100% Cash Flow Visibility in Real-time!

ScienceSoft’s team is ready to plan, build and support a robust cash management system to improve the effectiveness of your cash & liquidity management processes.

Bank accounts

To import real-time data on cash transactions, cash balances across multiple domestic and international bank accounts to the cash management system, as well as automatically upload regular bank reports for overall cash visibility and faster reconciliation.

ERP/accounting software

  • To upload real-time data on cash transactions from the cash management system to ERP/accounting software for the automated creation of entries in the general ledger, accounts payable and accounts receivable ledgers.
  • To upload general ledger, AP and AR ledger records within a specified period from ERP/accounting software to the cash management system to enable reconciliation.
  • To import data on current cash balances from the cash management system to treasury software for timely investment/ borrowing activities.
  • To upload the data on investments and loans from treasury software to the cash management system for accurate reconciliation.

Success Factors for the Cash Management System

Powerful data visualization capabilities. To enhance overall cash transparency.

End-to-end cash management automation. To eliminate time-consuming manual tasks across all cash management processes, from cash positioning and reconciliation to cash forecasting and reporting.

ML-driven forecasts on cash flow. To provide accurate insights on future cash flow for improved liquidity planning.

Average costs for building the cash management system vary between $150,000 and $400,000, depending on the solution complexity.

Annual ROI for the custom cash management software may reach up to 230%. An average payback period for the solution is around 6 months.

Financial advantages of cash management software

  • 80%

    increase in the cash management team productivity due to the automation of the cash management processes and enhanced overall cash visibility

  • 90%+

    cash forecast accuracy due to in-built AI capabilities

  • 80%+

    reduction in time for bank reconciliation

  • 40%

    faster monthly financial close

  • Decreased

    fees on the FX transactions and cross-bank cash transfers

  • Off-the-Shelf Cash Management Software We Recommend

    Oracle Cash and Treasury Management

    Best for: mid-size and large enterprises

    Description

    Rating: Key player on the global market for cash management systems (as per Research&Markets report).

    Key strengths:

    • Trend forecasts for cash flow and liquidity needs.
    • OOTB integration with Oracle Treasury to manage cash investment and borrowing transactions.
    • Comprehensive security model with user-based access control and fraud monitoring algorithms.

    Cautions: Perpetual licensing only.

    Features

    • Daily cash positioning in multiple currencies across multiple bank accounts.
    • Automated bank reconciliation.
    • Physical and notional cash pooling.
    • Automated calculation of bank fees.
    • Payment templates with pre-set bank account transfer attributes.
    • Multi-entity cash forecasting templates.

    Pricing

    $28,795 for 4 users/year (for integrated Oracle Cash and Treasury Management).

    Trovata

    Best for: mid-size businesses

    Description

    Rating: A leading open banking platform for cash management.

    Key strengths:

    • Pre-built direct integrations with the major US banks, including Bank of America, Citi, HSBC, J.P. Morgan, PNC.
    • Easy setup.
    • Advanced real-time cash visualization with an OOTB BI tool.

    Cautions: No capability to assign user roles for role-based access control.

    Features

    • Interactive dashboards to track real-time updates on the cash position.
    • Creating custom cash flow groups by the functional type (e.g., vendor, customer, partner).
    • Tagging and searching data from multiple bank accounts by region, entity, division.
    • Automated bank reconciliation.
    • Multi-entity ML-based cash forecasting.
    • Scenario modeling for liquidity planning.
    • A native mobile app enabling online cash management on the go.

    Best for: mid-size businesses

    From $500/month (for a basic feature set) to $2,500/month (for an advanced toolkit).

    When to Opt for a Custom Cash Management System

    ScienceSoft recommends developing a custom cash management system in the following cases:

    You need cash management software providing specific features (e.g., custom liquidity calculations, cash flow forecasting based on user-defined parameters) to automate your unique cash and liquidity management processes.

    Off-the-shelf cash management solutions do not provide compliance with the local regulations in the regions your company operates.

    A ready-made cash management system requires costly and effort-consuming integration with your other essential back-office systems (e.g., finance, accounts receivable/payable, supply chain).

    You need easy system scalability to process and store increasing amounts of data on cash transactions as your business grows.

    Implementation of the Cash Management System with ScienceSoft

    In financial management software development since 2007, ScienceSoft helps companies build effective cash management solutions.

    Cash management system consulting

    • Analysis of cash management digitization needs.
    • Assessment of the existing cash management processes, tools and their integration points (if any).
    • Suggesting optimal features, architecture, and tech stack for cash management system.
    • Preparing an integration plan (with ERP, accounting software, bank accounts, etc.).
    • Implementation cost & time estimates, expected ROI calculation.

    Cash management system implementation

    • Cash management needs analysis.
    • Cash management system conceptualization.
    • Architecture design.
    • Cash management system development.
    • Integrating the solution with the relevant systems (ERP, accounting software, bank accounts, etc.).
    • Quality assurance.
    • User training.
    • Continuous support and evolution (if required).

    About ScienceSoft

    ScienceSoft is an international IT consulting and software development company headquartered in McKinney, Texas. We provide consultancy and development services to help businesses build robust cash management software tailored to their cash tracking, investing and forecasting needs. Being ISO 9001 and ISO 27001 certified, we apply a mature quality management system and guarantee cooperation with us does not pose any risks to our customers’ data security. If you are interested in developing an effective cash management system, feel free to check ScienceSoft’s offer in cash management system development.