Auckland Regional Council has received a dozen responses to a request for proposals for a new treasury management system.
Information chief Tony Darby expects another half-dozen to arrive by the RFP deadline of August 16.
Darby says outsourcing is one option for the replacement of its current nine-year-old Corporate Treasurer system. He calls the existing system, from the Sunguard Treasury Group, antiquated and says the council needs a new system to better manage its finances.
One of the issues driving the change is that the council is moving from a net investor to a net debtor position as it buys Auckland’s rail infrastructure. The way rates are collected between councils is also changing, further pushing the need for a new system.
“We have to be able to do more accurate cash models. The old system requires a lot of manual work between it and the core [SAP] financial systems. With 450,000 bits of rates coming in [from householders and businesses], we need to be able to forecast a [financial] model,” Darby says.
With hoped-for better financial management and “more grunt” resulting from a new system, the ARC believes the replacement will pay for itself within six months.
Corporate Treasurer offers a range of cashflow management tools that link with the council’s SAP system and is commonplace at large corporates or local bodies.
Darby says Sunguard offered the ARC an upgrade of the 1993-installed system, but the council felt it more prudent to see what the wider market offered, even considering outsourcing. But if the function is outsourced, the couple of council staff doing treasury management work will be kept on as there is “truckloads of work” for them.
Darby declines to estimate the cost of a new system, saying that would alert bidders.
“The estimated cost also depends on the solution; it depends on needing new hardware. It could be six figures. We have been getting huge variations [in tenders],” he says.
Darby adds the new system is expected to come into operation next year after parallel testing with the current system from March 2003.