Reducing the cash tied up in day-to-day operations, by managing receivables, payables and inventory.
The three levers are collecting from customers sooner, holding less stock, and using supplier payment terms fully without paying late.
Each franc released this way is a franc that need not be borrowed, which is why working capital is often a cheaper source of funding than credit.
A credit facility a bank makes available up to an agreed ceiling, which a company draws on as needed and repays, paying interest only on the amount used.
For a business it is a buffer against timing gaps: covering supplier payments and salaries while waiting on customer receipts, without borrowing a fixed sum in advance.
Common forms include an overdraft on a current account and a committed revolving facility.
Matching bank transactions to accounting entries automatically, rather than line by line.
Software compares incoming payments against open invoices using references, amounts, dates and counterparty names, clearing what matches and leaving only exceptions for a human.
Structured references are what make this reliable: a QR reference or an ISO 20022 end-to-end reference lets a payment be matched with certainty, where a free-text message requires guesswork. Automating reconciliation is typically the single largest time saving available in a fiduciary's bookkeeping work.
A sub-account defined within a real bank account, used to identify who a payment came from without opening a separate account for each.
Each customer or purpose is assigned its own virtual account number. Payments arrive in the single real account but carry the virtual reference, so they can be allocated automatically.
In Switzerland, the QR-IBAN with a structured reference achieves much the same reconciliation outcome by a different route.
A Treasury Management System: software that consolidates bank balances, forecasts cash, executes payments and tracks financial risk in one place.
A TMS sits between the company's accounting system and its banks, and is what makes concentration, forecasting and a payment factory workable at scale.
Historically a tool for large corporates, though lighter cloud-based alternatives now serve smaller companies.
A centralised function that executes all of a group's outgoing payments, instead of each entity paying from its own accounts.
Entities submit payment requests, and the payment factory validates, batches and transmits them to the banks, typically as pain.001 files or through a bank API.
The gains are consistency of controls, fewer bank connections to maintain and lower transaction costs.
An organisational model in which one central function manages cash, financing, foreign exchange and risk for an entire group, rather than each entity doing so itself.
The benefits are negotiating power with banks, netting across entities, and one consolidated view of exposure. The cost is a layer of coordination and intercompany arrangements.
This is a model for groups with multiple entities, not for a single company.
A measure of how closely a cash forecast matched what actually happened, usually expressed as the variance between forecast and actual over a period.
It matters because decisions rest on the forecast: how much to keep liquid, whether to draw on credit, when to invest a surplus. A forecast that is consistently wrong in the same direction points to a fixable assumption, often customer payment behaviour.
Cash available to a company during the business day, as distinct from the closing balance.
A company may end the day comfortably positive yet be short at eleven in the morning, when a large payment leaves before customer receipts arrive. Intraday liquidity is about having funds at the moment each payment must settle.
Real-time payments and intraday reporting through camt.052 have made this easier to monitor.
Bringing the balances of several accounts together into one, physically or notionally, to manage the total rather than each account separately.
It improves interest terms and gives a single view of available cash. Notional pooling is restricted or unavailable in some jurisdictions.
An automated bank arrangement that moves balances between accounts at the end of each day, so that funds end up where they are needed.
Typically, surpluses are swept up to a main account and deficits covered from it, leaving subsidiary accounts at a target balance, often zero.
The purpose is to avoid holding idle cash in one account while paying overdraft interest on another.
The management of a company's cash: knowing what is available, where it sits, and making sure obligations can be met without holding more idle cash than necessary.
It spans monitoring balances across accounts, forecasting inflows and outflows, covering shortfalls and placing surpluses.
For a small company this is a weekly look at the bank balance. For a group with subsidiaries it becomes a structured discipline with dedicated tools, which is where most of the terms in this section come from.
Payments that settle within seconds, at any hour, including weekends and public holidays, rather than in batches on working days.
Switzerland launched instant payments on 20 August 2024, on the SIC5 platform operated by SIX for the Swiss National Bank. Institutions that handled more than 500,000 incoming customer payments in 2020 had to be able to receive them from that date, covering over 95% of Swiss customer payments; the remaining institutions follow by the end of 2026.
An important nuance: receiving instant payments is compulsory, while sending them remains optional and is often charged. Elsewhere, the equivalent schemes are SEPA Instant in the euro area and Faster Payments in the UK.
The shift matters for reconciliation: when funds and the account statement arrive together, matching a payment to an invoice stops being an end-of-day exercise.
A broad term for the infrastructure and mechanisms that move funds between parties.
It covers:
These systems are overseen by central banks and regulators. In Switzerland, SIX Interbank Clearing operates the domestic system on behalf of the Swiss National Bank.
Replacing a sensitive value, such as a card number, with a substitute token that has no exploitable meaning outside the system that issued it.
When a card is added to a phone wallet, the device stores a token rather than the actual PAN. If the token is intercepted, it cannot be used elsewhere.
Tokenization reduces the scope of data a merchant must protect, since the real card number never reaches their systems.
An isolated test environment that replicates a bank's or provider's API, using fictitious data, so developers can build and test an integration without touching real accounts.
Under PSD2, banks must make a testing facility available to third parties before going live. A sandbox is also how a software company validates an integration after a bank changes its interface.
The term is also used for regulatory sandboxes, where a supervisor lets firms test innovative services under relaxed conditions. The two meanings are unrelated.
Financial technology: the use of software and digital infrastructure to deliver financial services, often by companies outside traditional banking.
It covers payments, lending, investment, insurance, accounting automation and the open banking infrastructure connecting them.
The term describes an approach rather than a sector: established banks run fintech products too, and the line between a fintech and a bank with good software has largely stopped being useful.
Financial services offered inside a non-financial product, at the moment they are needed, rather than through a separate bank or provider.
Examples include paying in instalments at an online checkout, insurance offered during a booking, or an accounting tool that lets a business pay a supplier invoice without leaving the software.
Embedded finance is what BaaS infrastructure is generally used to build.
Banking as a Service: licensed banks providing their regulated infrastructure to non-banks, so that another company can offer accounts, cards or payments under its own brand.
The bank holds the licence and carries the regulatory obligations, while the partner owns the customer relationship and the interface. A retailer offering a branded card is usually doing so on a BaaS arrangement rather than holding a banking licence itself.
The right of individuals to obtain their personal data in a structured, commonly used and machine-readable format, and to have it transferred to another provider.
In the EU it is established by the GDPR. Switzerland's revised Federal Act on Data Protection, in force since September 2023, introduced an equivalent right.
Applied to banking, data portability is the principle behind being able to take your transaction history with you when you change provider, rather than leaving it behind.
The processes by which a customer grants, reviews and withdraws permission for a third party to access their financial data or initiate payments.
Consent must be explicit, limited to a defined scope and duration, and revocable at any time. Under PSD2 an access consent is time-limited and must be renewed, which is why aggregation connections periodically stop and require the customer to re-authenticate.
Good consent management means the customer can see at a glance who has access to what, and end it in one step.
Collecting and consolidating financial data from several banks or sources, usually through APIs, into a single view.
For a company with accounts at three banks, aggregation is what produces one consolidated cash position instead of three separate logins. It is the service an AISP licence permits, and the foundation on which cash management and accounting tools are built.
A provider that connects to many banks and exposes them through a single interface, so that a software company integrates once instead of bank by bank.
The aggregator absorbs the differences between institutions: varying API standards, authentication flows, data formats and coverage. Without one, supporting twenty banks means twenty integrations to build and maintain.
The trade-off is a dependency and a cost per connection, against the engineering effort saved.
An interface published by a bank that lets authorised external software query account data or submit payments directly, rather than through file transfer or a web portal.
In Switzerland, most bank APIs are reached through bLink, the SIX platform that standardises the connection, so a software provider integrates once rather than separately with each bank.
For accounting work, a bank API is what makes transactions appear automatically, where EBICS or camt.053 downloads require a file to be fetched and imported.
An Application Programming Interface: a defined way for one piece of software to request data or actions from another, without a person in between.
An API sets out what can be asked, in what format, and what comes back. That contract is what allows systems built by different companies to work together reliably.
In finance, APIs are what replaced file downloads and manual re-entry: instead of exporting a statement and importing it elsewhere, one system queries another directly.
The extension of open banking principles beyond payment accounts, to savings, pensions, insurance, mortgages and investments, so that a customer can authorise access to their full financial picture.
In the EU this is the aim of the proposed Financial Data Access framework (FiDA), still in negotiation. Open banking covers the current account; open finance would cover everything else.
The practice of banks opening access to account data and payment initiation to licensed third parties, with the customer's explicit consent, through secure APIs.
In the EU it is mandated by PSD2: banks must give authorised providers access to payment accounts. Switzerland took a different route. There is no equivalent legal obligation, and access is market-led, developed through bLink, the SIX platform through which Swiss banks expose standardised interfaces to software providers.
For a fiduciary, the practical consequence is that bank data can flow automatically into accounting software instead of being downloaded and imported by hand.
Amounts customers owe the company for goods or services already delivered. They appear under current assets on the balance sheet.
A customer invoice creates a receivable when it is issued, and clears it when the payment arrives. Matching incoming payments to the right invoice is reconciliation, which is why structured references such as the QR reference exist.
Receivables that are unlikely to be collected must be written down, since Swiss accounting requires assets to be stated prudently.
Amounts a company owes its suppliers for goods or services bought on credit. They appear under current liabilities on the balance sheet.
In bookkeeping, a supplier invoice creates a payable when it is recorded, and clears it when paid. The gap between the two is what a cash flow forecast depends on, and the aged payables list is how a fiduciary sees what is falling due.
A statement summarising revenue, expenses and the resulting profit or loss over a period, typically the financial year. Also called the profit and loss account.
Where the balance sheet is a snapshot at one date, the income statement covers the span between two such dates, and explains how equity changed over it.
Swiss law allows two presentations: by nature, grouping expenses by type such as salaries and rent, or by function, grouping them by activity such as production and administration. Most Swiss SMEs use the presentation by nature.
A financial statement presenting what a company owns and owes at a specific date, usually the close of the financial year.
It has two sides that always balance:
Unlike the income statement, which covers a period, the balance sheet is a snapshot at one moment. It is one of the three parts of the Swiss annual accounts, alongside the income statement and the notes.
The amount actually paid to the employee, after the employee's share of social contributions and any source tax has been deducted from gross salary.
Typical deductions are AHV/IV/EO at 5.3%, ALV at 1.1%, the employee's BVG share, and accident and daily-sickness insurance premiums. Net salary generally lands between 83% and 88% of gross, varying with age and pension plan.
The total remuneration owed to an employee before any deductions: base salary, plus any thirteenth month, bonuses, commissions and allowances subject to social contributions.
Gross salary is the figure stated in the employment contract and the basis on which every social insurance contribution is calculated. It is what appears at the top of the payslip, before employee contributions are subtracted to give net salary.
The total income generated by a company's business activities before any costs are deducted. Also called turnover, and the top line of the income statement.
Revenue matters beyond performance measurement, because several Swiss obligations are keyed to it: VAT registration from CHF 100,000 of worldwide taxable turnover, full double-entry accounting above CHF 500,000 for sole proprietorships and partnerships, and eligibility for the net tax rate method up to CHF 5,024,000 including VAT.
Revenue is recorded net of VAT, since VAT collected is owed to the ESTV rather than earned.
A cost incurred in running the business, recorded in the income statement and reducing profit for the period.
Common categories include rent, salaries and social charges, utilities, insurance, professional fees and office supplies.
An expense is distinct from an asset purchase: buying a laptop creates an asset that is depreciated over several years, while the monthly software subscription to run it is an expense in the period it relates to.
The owners' residual interest in the business: what would remain if every asset were realised and every liability settled.
Assets − liabilities = equity.
For a Swiss company it typically comprises share capital, legal and voluntary reserves, and retained earnings carried forward. Minimum share capital is CHF 100,000 for an SA, of which at least 20% of each share's nominal value must be paid in, subject to an absolute floor of CHF 50,000. For a Sàrl the minimum is CHF 20,000, fully paid in.
When liabilities exceed assets, equity turns negative. This is overindebtedness, which triggers specific duties on the board under Swiss law.
What a company owes to third parties. Liabilities appear on the right side of the balance sheet, alongside equity.
In everyday use, "debt" tends to mean borrowed money specifically, while "liabilities" covers every obligation, including unpaid invoices.
The resources a company owns and expects to draw economic benefit from. They appear on the left side of the balance sheet.
Swiss accounting splits them in two:
Total assets always equal liabilities plus equity.
A report from a bank listing all transactions on an account over a given period, with the opening and closing balances.
For bookkeeping, the statement is the source document reconciled against the ledger: every entry on it should correspond to a booked transaction, and anything unmatched points to a missing or duplicated entry.
Statements are delivered on paper, as PDFs, or as structured camt.053 files, which accounting software can import and reconcile automatically.
The date on which the actual transfer of cash or securities is completed.
It follows the trade date, with the gap set by market convention: most stock markets settle two business days after the trade, written T+2. The United States moved to T+1 in May 2024.
The date on which a financial transaction, such as a stock or bond trade, is executed or agreed.
It marks the point at which contractual obligations begin between buyer and seller, even though the money and securities change hands later, on the settlement date.
The date on which funds are effectively credited to or debited from an account.
It determines when money actually becomes available, and when it starts or stops earning interest. A credit booked today with a value date two days out is visible on the statement but not yet usable.
The gap between booking date and value date is why a bank balance and an available balance can differ.
The date on which a transaction is officially recorded in the account ledger.
It can differ from the value date because of processing delays or bank cut-off times: a payment made late on Friday may be booked on Friday but only take value on Monday.
In a camt.053 statement, the booking date is what determines which statement period an entry appears in, which makes it the date accounting software generally posts against.
The channels a company uses to exchange payment files (such as pain.001) and account statements (such as camt.053) with its bank.
An international, XML-based messaging standard for exchanging financial data between banks and their clients. It covers payments, account reporting, securities, trade services, cards and foreign exchange.
ISO 20022 replaced a patchwork of national and proprietary formats with one structured standard, carrying far more detail per transaction than the older SWIFT MT messages. That richer structure is what makes automated reconciliation possible.
Switzerland migrated its domestic payment traffic to ISO 20022 between 2018 and 2022, retiring the old DTA and ESR formats. CAMT, PAIN and SEPA messages are all ISO 20022.
A family of ISO 20022 XML messages used by companies to send payment instructions to their bank. The counterpart of CAMT messages, which flow the other way.
The older family of SWIFT message types for international payment instructions and reporting, now being replaced by ISO 20022 messages.
SWIFT began migrating cross-border payments from MT to ISO 20022 in 2023. Many banks still offer MT940 alongside camt.053, but it carries less detail, which is why reconciliation is generally more reliable from camt.053.
A family of ISO 20022 XML messages used for cash management and account reporting, sent by banks to their corporate clients.
The Bank Identifier Code, also called SWIFT code: a globally unique code identifying banks and financial institutions for international transfers.
Format: 8 or 11 characters.
Example: DEUTDEFF (Deutsche Bank, Frankfurt).
Used alongside the IBAN to route cross-border payments to the right bank.
The Primary Account Number: the number printed on a credit or debit card, identifying the card account.
Format: 13 to 19 digits.
Example: 4111 1111 1111 1111 (Visa test card).
Used worldwide for card payments and transaction processing.
Note: the spaces mirror how the number is printed on a card and are not part of it: 4111111111111111.
The International Bank Account Number: a standardised format for identifying bank accounts, designed to make international transfers reliable.
Structure:
Length: fixed per country: 21 characters in Switzerland, 22 in the UK, 27 in France.
Example: CH93 0076 2011 6238 5295 7.
An IBAN contains no information about the account holder's name or balance.
How IBAN compares with other bank codes
Note: the spaces in an IBAN are for readability only. In payment files and online forms it is written without them: CH9300762011623852957. The same applies to the spaces and dashes shown in the table.
