Corporate Treasuries Becoming More Involved in Management of Entire Business Process

Traditionally focused largely on the conversion of collections into cash, the treasury function has become much more involved in the management of the entire business process and is called on to become more of a strategic advisor to the business, according to two studies conducted by CFO Research and underwritten by software group SAP.


The reports find that as companies look for new sources of growth, treasury is becoming a valuable partner in the process. “Treasury has moved from a transactional service provider to a strategic adviser with strong execution capabilities,” said one chief financial officer (CFO).


Companies are looking for the treasury aspect of their business to be less insulated, and to become a more inclusive corporate activity reaching across non-traditional lines, such as operational efficiencies, investor relations, and even employee benefits.


The research found that globalisation has played a major part in the changing role of the Treasury. In order to expand, companies need the ability to track cash flows and anticipate revenue flows from multiple geographies. This will “require new skill sets within the Treasury function,” said a director of finance in the study, attuned to the greater complexities of cross-border finance.


To make faster decisions on a global scale, treasury functions also need enhanced banking relationships, and upgraded banking technology that allows real-time access to multiple accounts on a consolidated basis, the reports conclude. Increasingly companies, are looking to ‘cloud’-based banking as necessary to increase visibility into their financial position and to forge better partnerships and communications with their banks.


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