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- #4 Whether it knows it or not, almost every business of any size ‘does’ treasury: the administration of its financial assets and holdings with the aim of optimizing liquidity, ensuring the right investments are made and reducing risk. The Principles outline the importance of relationships and communication that drives better decision making. They also provide guidance on the process of presenting the insight gained from analyzing relevant information that is critical to the value creation process.
- #5 It covers working capital management, currency management, corporate finance and financial risk management. enable its functions to run smoothly. By optimizing liquidity and cost of capital, it actually has a core role in increasing return on equity and driving shareholder returns.
- #7 The treasury department is responsible for a company’s liquidity treasury to compare plan, actual and forecasts results when asked the following questions by the CFO: a. Its 9AM - where in the world is my cash and in what currency?? (cash position) b. It is 11AM – Do I invest or borrow? (liquidity management) c. End of the day – Will I be over borrowed, over exposed or under invested next period and how will I know? (risk management and proper use of metrics)
- #8 Asset Liability Management (ALM) : is critical for both lowering the risk of not having enough funds to operate and to increase the competitiveness of the business through its cost of funds. Trading And Hedging Portfolio Management company-wide Integration/Projects Funds Transfer Pricing (FTP)
- #16 Treasury Management includes cash management.
- #17 for the better and smooth functioning of the business, i.e. the company must be able to fulfil its financial obligation when they become due for payment, such as payment to suppliers, employees, creditors, etc.
- #19 Manage financial risk to allow the financial institution to meet its financial obligations, as they fall due and also ensure predictable performance of the business. Mitigate Losses that has the potential to affect the company’s profitability and growth in any way.