Corporate Treasurer’s challenging Role

A treasurer in any department play’s a key role. Any institute, industry or a large organization will have a treasury section which requires knowledgeable people to handle it.

Treasury is a sector which involves several key risks related to interest rates, credit, currency, commodity and operations. Large organizations face some or all of these risks to varying degrees. Corporate treasurers generally manage corporate finances and ensure a judicious use of surpluses in Investments and money markets.

Treasurers serve as financial risk managers that seek to protect a company’s value from the financial risks it faces from its business activities. When a risk arises, it can arise from any and many sources, the role requires an understanding of many businesses and the ability to relate and communicate with various financial professionals.

Much before the 20^th century, many companies were small, family owned and family run, but toady with the evolution of public ownership many large international conglomerates have boomed that trade publicly on one or many global exchanges.

The CFO (Chief Financial Officer) is responsible for analyzing and reviewing financial data, reporting financial performances, preparing budgets and managing financial expenditure and costs. Along with checking the corporation’s financial health, integrity and security, he is also responsible for carrying out the Board’s directive in organizational policies associated with the financial exposure of an organization, while transacting any third party financial arrangement. Adherence to policies will be monitored to avoid preventable financial exposure.

In many Banks and corporate organizations, lack of proper risk management leads to several external influences. There are many corporate solutions in the Market to handle these risks. Majority of these risk management tools comes with a large numbers of bells and whistles, making the product expensive or difficult to use and manage.

What an organization requires is, fully integrated solution covering cash, debt and investments, financial risks treasury accounting, basically a straight forward Treasury and Risk management solution. Companies need to ensure that their corporate financial strategies are appropriately aligned, then ensure the returns are adequate and that appropriate risk management techniques are deployed. 

It is clear that executive management and corporate treasury departments have and will need to respond to this new environment. Secure banking relationships and sources of financing have become more precarious.

Executive management now requires more information and reassurance. Assumptions about risks and hedging strategies will routinely be more robustly challenged and tested. Corporate treasurers will need greater knowledge of the financial markets together with the ability to make strategic assessments and communicate them effectively to executive management. It is likely to be an exciting and challenging time to be in treasury management.

Arowana Consulting Limited, joined hands with certain leading Corporate Organizations and Treasury Domain experts to develop a simple product called Arowana Risk and Treasury Solution (ART) which is suitable for any Corporate Organization, involved with day to day Market operations in the Money Markets and Currency Markets.

Treasurers are increasingly assuming more strategic roles in companies. They have moved beyond managing working capital to becoming increasingly involved with working with a company's senior management to manage risk and boost the bottom line.