Why cash shortfalls are spotted late
Many treasuries watch liquidity on today's balance. There is a forecast, but it sits in a separate spreadsheet that gets updated weekly or monthly, and nobody checks it every day against an agreed minimum. By the time the shortfall shows up on the bank statement, there's no time left to fund it calmly, and the company ends up drawing on an overdraft or an emergency loan, the most expensive money there is.
FLIQO measures liquidity risk on projected cash, day by day across the whole horizon the company plans for, against levels the company sets and approves.
Three levels the company sets
The liquidity band has three levels:
- Minimum available reserve: the floor. Below it, the company can no longer cover, with its own funds, the share of operations it is expected to carry.
- Recommended minimum: the minimum reserve plus a buffer for the normal swings in collections and payments.
- Liquidity threshold: the ceiling. Above it, there's cash the business doesn't need and that should be invested.
FLIQO proposes all three levels from the company's own operating history and the parameters treasury declares. A band only takes effect once a second person approves it. It is recalibrated as often as the company chooses and can be adjusted for seasonal periods.
Alerts on the forecast, not on today's balance
Every day in the horizon is checked against the band. If the projected balance falls below the minimum reserve, the alert is critical; if it gets close, it's an early warning; if it goes above the threshold, it flags excess cash.
Consecutive days with the same alert are grouped into a range, with its length and the lowest balance it reaches, and the longest ranges come first. That's how a one-day dip is told apart from pressure that lasts for weeks.
What if cash flows turn out worse than expected
The forecast shows the expected case. To measure how far it can stray, FLIQO simulates thousands of possible cash paths and calculates, over several time frames, the balance in the worst cases, the probability of falling below the minimum reserve and the probability of running out of cash. In treasury this is known as liquidity-at-risk.
The risk dashboard puts it alongside days of liquidity, bank concentration, FX exposure and use of counterparty limits. Each indicator comes with a traffic light and a short note on what it means and what to do about it.
Before committing to a decision, you can build scenarios with different assumptions and see how they affect cash.
From warning to funding
Knowing cash will run short only helps if you know how much and in which month. The funding calendar sets projected cash, the minimum reserve and any approved budget not yet in the forecast side by side, month by month, and shows the funding each month requires. That gap is compared with the undrawn amount on existing credit lines, so you know whether they cover it or new debt is needed.
Months with cash above the reserve show up too: that's cash that can go into short-term investments.
Alerts for each person
On top of the band alerts, each user can set their own: projected cash below an amount, days of liquidity below a minimum, or a month whose funding need exceeds a set figure. FLIQO checks them every day and sends a notice when one is met.
In a group, when a subsidiary stays outside its band for several days, the parent company's treasury is notified as well.
Ask Aria
You can ask Aria which days in the coming weeks cash drops below the minimum reserve, how much funding is needed month by month, or where coverage stands against the band today. Aria answers with the same data shown on screen.
Aria informs. It doesn't approve bands or make funding decisions.
Frequently asked questions
Where does the forecast come from?
From the cash flows the company already has in FLIQO: estimates from each department, recurring items, debt payments, investment maturities and actual movements from bank statements. The starting balance is the latest observed balance of each account.
Who sets the band levels?
Treasury. FLIQO proposes them from operating history, but none takes effect without a second person's approval.
What if the company has little history?
Six to twelve months of actual movements are recommended for calibration. Until then, the company can work with a band set by hand and calibrate it once there's enough history.
Does it work for a group of companies?
Yes. Each company has its own band, and the group view shows how many subsidiaries are inside it, how many are outside, and how much credit each one will need during the year.
Does FLIQO replace the company's liquidity policy?
No. The company sets the policy. FLIQO measures against it every day and records who approved each band.