Foon Yew High School may be little known in some circles within Malaysia’s education sector, but it holds lofty ambitions.
The non-profit high school educates 11,000 young adults in Malaysia’s Johor Bahru between its two campuses. But it wants to school thousands more by completing the construction of a third one in the same place.
Foon Yew has raised 40 million ringgit (US$9.6 million) so far, and is now seeking donations for another 45 million ringgit to complete the project. The school is banking on its good name to meet its fund target, and recently adopted innovative treasury solutions that support operations, governance and transparency.
“We deal with thousands of students. That makes us careful in the management of funds. Transparency is paramount,” says Tong Sing Chuan, who chairs the committee of management at Foon Yew. Tong expects to complete the construction of the third campus next year.
Malaysia’s largest independent Chinese school operates outside the country’s public school system. All expenses are borne by the school and its revenue comes from fees and community contributions and donations.
To achieve greater cash management efficiency, Foon Yew collaborated with United Overseas Bank (Malaysia) to find solutions for the cumbersome receivables reconciliation and the lack of visibility with accounts that resided in multiple banks.
The treasury initiative, which enabled Foon Yew to win the Best Liquidity Solution - ESG award at the recent The Asset Treasury Awards, has been structured to facilitate the school’s multi-point collection, giving it real-time visibility via a built-in collection report, and improving payables processes.
The ability to view incoming funds enables Foon Yew to manage and forecast its cash flow more effectively and in a timely manner. By automating their reconciliation of receivables, specifically the collection of school fees, the school has managed to save time and administrative effort.
Foon Yew was able to maximize interest income on idle funds. The liquidity management structure was refined, from a one-to-one structure to a multiple-to-one structure, resulting in a marked gain of 30,000 ringgit in interest for 2018 against 2017.
Foon Yew is also making a conscious effort to make the switch to e-payments from the usual issuance of cheques.
“For private schools, these initiatives are maybe easier to implement. But for those of us who rely on state money, we need more courage. We need the committee to embrace change. It wasn’t easy,” says Tong.
The implementation of Foon Yew’s cash management goals for 2019 is well underway. The planned solutions will go the extra step in assisting the school in their fees collections. This includes alternative methods for parents to perform the payments, and also more refined ways in tracking the collected fees via direct debit.
“We’re now developing e-wallets for our students,” adds Tong. The digital wallets will allow for a “one-touch system” that cuts across payments, simplifying liquidity management.
“We are likely among the first to adopt this e-wallet system. We aim to have a more professional way of managing our liquid assets,” he adds.