• Treasury advice and financial market data is abundant in competitive financial markets and can be tainted in terms of underlying conflicts of interest when provided by client’s financial market providers such as banks. There is more often than not an information overload that cannot be easily sifted for applicability and relevance.

• APRM provide our clients clear, focused and independent advice reflecting our core competency as specialist treasury advisors
• APRM have a single goal; to recommend what is best for our clients
• APRM’s fixed fee structure provides a firm and impartial platform, guaranteeing no conflicts of interest through commission style fee activity or proprietary financial market trading activities. 100% of APRM’s income is derived directly from client mandates
• APRM have no cross shareholdings, partnership or commercial links with any banks

• APRM have a proven track record over 10 years in adding measurable value to our client’s treasury related performance.
• APRM’s approach to providing advice to clients on their various forms of foreign exchange risk, commodity price risk and interest rate risk is to ensure we have a complete understanding of our client’s business drivers and the impact of such financial risks to our client’s overall business performance.
• APRM design active risk management frameworks and policies that are durable; providing optimum performance under “all-weather” financial market environments. Our analysis incorporates the following research;

• Materiality of financial market risk impacts to earnings and corporate value
• Budget and forecasting process
• Client / bank relationship and provision of credit for risk management purposes
• Knowledge of client’s competitors position and behaviour
• Macro-economic influences on client business activities
• Forensic examination of potentially material embedded financial markets risk existing within client’s business operations; such as long term supply contracts and tendering documentation

• APRM’s three principal advisors have individually had over 25 years experience in the global financial markets advising companies on the use of derivatives and financial instruments.

• APRM provides clients with a comprehensive understanding of treasury products used for hedging foreign exchange, commodities and interest rate risk.
• Through the provision of workshops and one to one client meetings APRM explain structured transactions marketed to our clients by banks
• APRM teach clients to use, execute and report financial market instruments
• APRM take the Greek out of derivative jargon

• A treasury policy document needs to be an enduring and practical document concisely capturing a company’s treasury related risks, institutional knowledge and management framework of such risks. It should anchor the underlying treasury objectives against the usual fluidity of key management and Board appointments. A treasury policy will generally cover the following content;

• Policy Purpose, Scope and Implementation
• Financial and Treasury Management Objectives
• Board, and Management Responsibilities and Delegated Authorities
• Foreign Exchange Risk Recognition and Hedging Policy Control Limits
• Commodity Price Risk Recognition and Hedging Policy Control Limits
• Interest Rate Risk Recognition and Hedging Policy Control Limits
• Funding and Liquidity Risk Recognition and Control Limits and Financial Covenants
• Approved Financial Market Instruments and Their Use
• Cash Management
• Operational Risk and Dealing Procedures
• Reporting, Benchmarking and Performance Measurement

• APRM have been instrumental over the past decade in bringing practical option strategy advice to New Zealand companies in the course of hedging interest rate and foreign exchange risk. Options, when used properly, often allow for critical financial risk management solutions correctly tailoring to differing business drivers such as competitor behaviour, or uncertainty around forecast activities.
• The use of purchased options not only provides clear risk / return outcomes to companies seeking financial certainty but also (and mostly overlooked) commercial flexibility that can have tremendous competitive advantage. The use of options often comes close to achieving the holy grail of hedging outcomes – “to reduce volatility but not at the expense of earnings”.

• APRM strongly believes that a principal treasury advisor must be able to robustly and forensically determine the type and materiality of treasury related risks impacting on client company earnings and overall corporate value; such risks include;

• Foreign Exchange Risk

1.      Foreign Earnings

2.      Balance Sheet Translation

3.      Foreign Sourced Capital Expenditure

4.      Imported Cost of Goods

5.      Export Revenues

6.      Indirect Foreign Exchange Risk associated with Commodities, Imports and Exports 

7.      Economic Risk

• Debt

1.      Liquidity Risk

2.      Funding Risk

3.      Security Structure

4.      Credit Utilisation

5.      Cash Management

• Interest Rate Risk
• Commodity Price Risk
• Counterparty Credit Risk

• To quantify these risks and to measure the effectiveness of APRM’s policy risk control recommendations the following modeling analyses are built to quantify and measure materiality, sensitivity and volatility of financial risks on the company’s earnings, cash flow, shareholder value and in the case of financial institutions net margin income. The risk models enable simulation and scenario testing to compare results of alternative hedging policies (existing, competitors and recommended). The models produce tailored outputs including volatility comparatives.

• Earnings @ Risk
• Cashflow @ Risk
• Value @ Risk
• Gap Risk Analysis
• Net Margin Income (NIM @ Risk)