Liquidity Risk Management

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Duration 5 days – 35 hrs

 

Overview.

 

This Liquidity Risk Management Training Course is tailored for banking professionals in the Philippines, focusing on the skills and knowledge necessary to manage liquidity risk effectively. Participants will learn how to assess liquidity risk, apply regulatory standards, and develop strategies to maintain adequate cash flow and ensure stability during periods of financial stress.

 

Objectives

 

  • Identify, measure, and manage liquidity risks.
  • Ensure compliance with regulatory liquidity standards, including the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR).
  • Implement liquidity stress testing to assess resilience under adverse conditions.
  • Develop effective liquidity risk management policies and contingency funding plans.

Audience

 

  • Risk Managers and Treasury Professionals involved in managing liquidity and capital.
  • Financial Analysts and Asset Managers responsible for assessing cash flow and funding needs.
  • Compliance Officers who oversee regulatory compliance in banking institutions.
  • Finance and Accounting Professionals in the banking sector.
  • Bank Executives seeking to improve their institution’s resilience against liquidity challenges.

Pre- requisites 

  • A basic understanding of banking and finance principles.
  • Familiarity with risk management concepts and regulatory frameworks.
  • Experience in financial analysis or treasury functions (recommended but not mandatory).

 

Course Content

 

Day 1: Introduction to Liquidity Risk Management

 

Understanding Liquidity Risk in Banking

  • Definition and types of liquidity risk
  • Importance of liquidity risk management in financial institutions
  • Regulatory requirements and global standards (Basel III)

 

Liquidity Risk Measurement Basics

  • Key liquidity indicators
  • Cash flow forecasting and monitoring
  • Tools for measuring liquidity

 

Day 2: Regulatory Standards – Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR)

 

Liquidity Coverage Ratio (LCR)

  • Overview of the LCR and its role in maintaining short-term liquidity
  • Calculating high-quality liquid assets (HQLA)
  • Practical examples of calculating LCR

 

Net Stable Funding Ratio (NSFR)

  • Understanding the purpose of NSFR for long-term funding stability
  • Key components of the NSFR calculation
  • Practical exercises on NSFR

 

Hands-On Workshop

  • Group exercise: Applying LCR and NSFR calculations to sample data

Day 3: Liquidity Risk Stress Testing

 

Introduction to Stress Testing

  • Importance of stress testing in liquidity risk management
  • Types of stress tests: scenario analysis and sensitivity analysis

 

Implementing Liquidity Stress Testing

  • Developing scenarios to simulate liquidity stress events
  • Interpreting stress test results to make informed decisions

 

Workshop on Stress Testing

  • Conducting a hands-on stress test using sample banking data

 

Day 4: Developing Liquidity Risk Management Policies

 

Liquidity Risk Management Frameworks

  • Key elements of a robust liquidity risk management framework
  • Policies for managing short- and long-term liquidity

 

Liquidity Monitoring and Reporting

  • Establishing liquidity metrics and dashboards
  • Communication and escalation protocols for liquidity issues

 

Case Studies

  • Examining real-world examples of effective and ineffective liquidity management

 

Day 5: Contingency Funding Plans and Final Workshop

 

Contingency Funding Plans (CFPs)

  • Importance of CFPs in managing unexpected liquidity events
  • Developing CFPs tailored to organizational needs
  • Sources of contingency funding

Integrating CFPs with Liquidity Policies

 

  • Building alignment between CFPs and liquidity risk management policies
  • Testing CFP effectiveness

 

Final Workshop

  • Group activity: Developing a comprehensive liquidity risk management plan and presenting it to the class

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Warehouse Operations and Inventory Management Training Course     Duration 2 Days – 14 hrs.   Overview   This course provides a practical understanding of warehouse operations and inventory management for personnel who supervise, review, or audit warehouse processes. It covers the movement of goods from receiving through dispatch, with emphasis on warehouse layout, storage systems, picking strategies, stock rotation, inventory accuracy, and operational controls.   Participants will learn to identify process weaknesses, investigate stock discrepancies, reduce shrinkage, and interpret warehouse productivity indicators. The course connects day-to-day warehouse activities with the records, controls, and performance measures needed for effective supervision and auditing.   Objectives  

  • Explain warehouse processes and their impact on inventory accuracy and service performance.
  • Evaluate warehouse layouts, storage systems, and product locations.
  • Identify appropriate controls for receiving, put-away, storage, picking, and dispatch.
  • Apply First-In, First-Out (FIFO) and First-Expired, First-Out (FEFO) principles.
  • Compare picking strategies based on order characteristics and operational requirements.
  • Identify causes of inventory discrepancies and recommend corrective actions.
  • Develop a cycle counting approach based on inventory value, movement, and risk.
  • Recognize sources of shrinkage and recommend preventive and detective controls.
  • Interpret warehouse productivity and inventory performance KPIs.
  • Review warehouse processes using supporting records, observations, and control evidence.
        Target Audience  
  • Warehouse supervisors, team leaders, and managers.
  • Inventory controllers and stock control personnel.
  • Logistics and distribution supervisors.
  • Internal auditors and operational compliance personnel.
  • Supply chain and operations professionals.
  • Personnel responsible for reviewing warehouse controls and performance.
  Prerequisites  
  • Basic familiarity with warehouse, logistics, or inventory activities.
  • General understanding of business processes and operational documentation.
  • Basic numerical skills, including percentages and simple calculations.
  • Basic spreadsheet skills are helpful.
  • No prior experience with a specific Warehouse Management System (WMS) is required.
   

Course Outline

  Day 1: Warehouse Processes, Layout, and Storage Controls Module 1: Warehouse Operations and Process Controls  
  • Warehouse roles within the supply chain.
  • End-to-end flow: receiving, put-away, storage, replenishment, picking, packing, and dispatch.
  • Physical stock movement and corresponding system transactions.
  • Responsibilities, authorization, and segregation of duties.
  • Common operational weaknesses and audit evidence.
  Module 2: Warehouse Layout and Storage Systems  
  • Functional zones, movement paths, and space utilization.
  • Receiving, storage, picking, staging, and dispatch areas.
  • Storage options: floor stacking, shelving, pallet racking, and bin storage.
  • Fixed and dynamic location systems.
  • Product slotting based on movement, size, handling needs, and compatibility.
  • Layout bottlenecks and their effects on productivity and inventory control.
  Module 3: Receiving and Put-Away  
  • Purchase orders, delivery documents, and expected receipts.
  • Quantity, condition, and item identification checks.
  • Recording shortages, overages, damage, and discrepancies.
  • Controls for acceptance, quarantine, and release.
  • Put-away rules and location confirmation.
  • Traceability through labels, barcodes, lot numbers, and serial numbers.
  • Timely recording of receipts and stock movements.
  Module 4: Storage, Stock Rotation, and Replenishment  
  • Storage discipline and location integrity.
  • FIFO and FEFO principles, applications, and limitations.
  • Batch, lot, and expiry-date management.
  • Controls for slow-moving, obsolete, damaged, and expired stock.
  • Replenishment of picking locations.
  • Supervision and review of stock rotation compliance.
    Day 2: Order Fulfillment and Inventory Accuracy Module 5: Picking Strategies and Order Fulfillment  
  • Discrete, batch, zone, and wave picking.
  • Selecting picking strategies for different order profiles.
  • Pick paths, location sequencing, and travel reduction.
  • Replenishment coordination and stock availability.
  • Picking verification and error prevention.
  • Packing, staging, and dispatch confirmation.
  • Handling short picks, substitutions, cancellations, and returns.
  Module 6: Inventory Records and Accuracy Controls  
  • Item master data, units of measure, and location records.
  • On-hand, available, allocated, and quarantined stock.
  • Transaction controls for receipts, transfers, issues, returns, and adjustments.
  • Common causes of physical and system stock mismatches.
  • Barcode scanning and WMS control points.
  • Inventory reconciliation and supporting documentation.
  • Measuring inventory accuracy and interpreting discrepancies.
  Module 7: Cycle Counting and Physical Inventory  
  • Cycle counting versus full physical inventory.
  • ABC classification and risk-based count priorities.
  • Count frequency based on value, movement, and discrepancy history.
  • Count preparation, blind counting, and movement controls.
  • Recounts, variance investigation, and adjustment approval.
  • Root cause analysis and corrective action follow-up.
  • Reviewing the effectiveness of the counting program.
  Module 8: Shrinkage Reduction and Inventory Protection  
  • Sources of shrinkage: loss, damage, theft, misplacement, and recording errors.
  • Access controls and accountability for stock movements.
  • Controls for high-value and sensitive inventory.
  • Returns, write-offs, scrap, and disposal controls.
  • Exception reporting and unusual transaction patterns.
  • Investigating recurring losses and unexplained adjustments.
  • Preventive and detective controls for shrinkage reduction.
    Day 3: Performance Management, Process Review, and Improvement Module 9: Warehouse Productivity and Inventory KPIs  
  • Receiving productivity and dock-to-stock time.
  • Put-away productivity and replenishment performance.
  • Picking productivity and order accuracy.
  • Inventory accuracy and cycle count variance.
  • Space utilization and storage capacity.
  • Shrinkage, damage, and expiry indicators.
  • Defining KPI formulas, data sources, and reporting boundaries.
  • Interpreting trends while balancing speed, accuracy, and service.
      Module 10: Supervising and Auditing Warehouse Processes  
  • Process mapping and identification of critical control points.
  • Reviewing procedures against actual warehouse practices.
  • Tracing transactions from documents to systems and physical stock.
  • Reviewing approvals, access rights, and segregation of duties.
  • Identifying control gaps and recurring process exceptions.
  • Documenting findings with clear supporting evidence.
  • Prioritizing corrective actions and tracking closure.
  Module 11: Warehouse Improvement Planning  
  • Identifying bottlenecks, unnecessary movement, and rework.
  • Improving layout, slotting, and picking arrangements.
  • Addressing inventory discrepancy root causes.
  • Standardizing transaction recording and exception handling.
  • Assigning improvement owners and measurable targets.
  • Monitoring results and sustaining operational improvements.
  Module 12: Capstone — Warehouse Operations and Inventory Improvement Plan  
  • Review a warehouse scenario containing layout, transaction, inventory, and performance information.
  • Identify weaknesses across receiving, put-away, storage, picking, and dispatch.
  • Recommend appropriate FIFO or FEFO controls.
  • Develop a cycle counting and inventory reconciliation plan.
  • Propose controls to reduce shrinkage and improve traceability.
  • Select relevant KPIs and define their calculation and reporting requirements.
  • Produce a prioritized improvement plan with responsibilities and expected outcomes.
 

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