Is there a way to take precautions from changes in interest rates, exchange rates or commodity price fluctuations?

Dianos Dealer Wizard manages in a complete, automated and flexible way, all financial instruments, including the most complex ones, with instruments for Deal Management, Risk Analysis and Covers Management, offering useful tools for decision support.

Source: Gruppo SCAI – Corporate Financial Risk Management, 02/12/2014

Suite Dianos Dealer Wizard – Corporate Financial Risk Management

The need of management instruments for financial risk in businesses companies

Foreign exchange risk management, variation in interest rates and commodity prices, need derivatives hedging instruments, which can be complex to handle. Tools like Dianos Dealer Wizard for Corporate Financial Risk Management, allow easy monitoring and management of advanced instruments capable to minimize financial risks, and they have become indispensable work companions.

The logic behind the use of these tools is explained, at macro-economic level, in terms of allocation of not typical risks, to specialized actors able to diversify and, in single company level, in the reduction of the variability of future cash flow, according to the specific break-even evaluations.

The goal of financial risk management strategies in industrial and commercial companies, should be focused especially in the safeguarding of company’s operating profitability, for a period of time sufficient to take measures in order to deal with the changing in exchange rate, in commodity prices or in fluctuations of interest rates, especially for companies more exposed in trading activities with foreign countries or for highly indebted firms.

The recent adoption of IAS legislation, has imposed greater attention to this area, requiring closer formalization and more transparency in the behavior and information associated with the use of derivative financial instruments in the balance sheet, ennobling the so-called Corporate Financial Risk Management (CFRM). The management and the board are therefore invested with new responsibilities that require new competences together with appropriate tools.

The management of foreign exchange risk, variations in interest rates and commodity prices, together with the implementation of IAS 39, represent a complex subject involving a significant evolution in the finance and accounting systems.
The risk-management could be use with simple financial instruments, or seize the opportunities offered by more complex strategies with new methods of hedge accounting, by internal evolution. However it is urgent for companies the introduction of greater awareness and transparency for the management of financial risks.

Dianos Dealer Wizard, solution of Financial Risk Management

The objectives of Dianos Dealer Wizard, a solution for Financial Risk Management developed by SCAI Capital, company of Gruppo SCAI that it is specializes in solutions for banks and finance, are the identification, measurement and management of financial risk within business companies.
In particular, the risk of changes in interest rates, exchange rates or commodity prices, can be effectively neutralized through the use of financial instruments “derivatives”, simple (plain vanilla) or complexes (which have to be constantly monitored and managed).

Dianos Dealer Wizard – Corporate Financial Risk Management, meets the needs of companies in any sectors and corporate holding in the following areas:

  • Representation of exposures on foreign exchange risk,
  • Interest rate and commodity price within Corporate Financial Risk Management, with management criteria and controls consistent with the legal framework (IAS, IFRS, ITA-GAAP, L. 231/01),
  • Management of financial assets, for decision support in the negotiation and
  • Administrative management of accounting records.