In today’s volatile and uncertain business environment, treasury practices have become increasingly more complex.
As the guardians of their organizations’ assets, management accountants need to be aware of the new challenges and opportunities presented by the evolving nature of treasury.
A newly published Chartered Global Management Accountant (CGMA) resource, Treasury and Cash Management Essentials, provides a practical guide to help management accountants add value to the business by deepening their understanding of key treasury practices.
Developed by the Association of International Certified Professional Accountants (the Association) and the Association of Corporate Treasurers (ACT), the interactive guide identifies key components of the modern treasury function and provides tools and resources to help management accountants expand capabilities in these areas.
The guide also emphasizes the importance of alignment, understanding and close co-operation between the management accounting, tax and treasury functions to achieve effective decision making on investments, funding and risk strategies.
“Every business deals with treasury issues but many don’t have a dedicated treasury function,” says Peter Spence, associate technical director, management accounting, Association of International Certified Professional Accountants.
“Management accountants have a broad skillset that includes business acumen and advanced analytical abilities, and are uniquely positioned to engage with treasury matters. Our new toolkit is an important asset to help management accountants extend their understanding of treasury practice in support of this growing business need.”
“Treasury is a dynamic function that sits at the heart of every business," comments Sarah Boyce, associate director of policy and technical at the ACT. "Whether or not it is actually called treasury, it is the finance function that determines the financial strategy and policy, advising on where and how to invest, organizing the funding and controlling the financial risks involved.
“Drawing on the ACT competency framework, which defines the skills and capabilities needed for treasury success, this toolkit provides a valuable insight into the key treasury activities and offers a structured introduction to this complex area.”
The guide illustrates:
- how liquidity, access to cash, and cash management are the most fundamental elements of the treasury function
- how a risk management framework will provide a mechanism to develop a structured approach to financial risks across the entire organisation by creating the means to identify, assess, evaluate and respond to these risks
- the importance of having treasury activities supported by written treasury policies so the board and management can delegate financial decisions about the business in a controlled manner