Congratulations to Microsoft, winner of the Alexander Hamilton Silver Award in Liquidity Management!

Microsoft does business in nearly every country around the world, with more than 400 legal entities generating over $200 billion in annual revenue. To repatriate earnings back to the United States from abroad, most subsidiaries issue dividends to the parent company each year. This process is crucial because it ensures that excess cash is available for use by Microsoft corporate, rather than languishing in bank accounts overseas.

"We do cash concentration whenever possible, but that concentrated cash still belongs to the subsidiaries," explains Edda Kuhlmann, senior treasury manager with Microsoft. "To make those funds available to corporate, we use the dividend." The dividends are particularly important for subsidiaries in countries that restrict participation in Microsoft's centralized cash-pooling structures.

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Meg Waters

Meg Waters is the editor in chief of Treasury & Risk. She is the former editor in chief of BPM Magazine and the former managing editor of Business Finance.