A few of the main focus areas of treasury operations are as follows:
1) Cash Flow-Receipts and Disbursements: Accelerating the collection of cash receipts and mobilization or consolidation of cash, cheque clearing and enhancing effectiveness of lockboxes, wire transfer systems, credit card payments and electronic commerce initiatives to optimize cash utilization. Operate and design effective and control oriented payment and disbursement systems.
2) Bank and Financial Institution Relations: Assess global banking and financial institutions links among themselves and also with domestic ones and know ways to maximize the value of these links. Improve the value received from financial and banking products and implement more efficient methods and account structures to strengthen global cash and treasury risk management. Review financing arrangements and capital structure to maximize the utilization of financial resources and minimize their cost.
3) Cash Management Controls: improve and assess controls to minimize exposure to fraud and another risk. This also supports and strengthens internal control initiatives.
4) Cash Forecasting and Information Reporting: Enhance the accuracy, reliability and timeliness of data from domestic and international cash forecasting processes and models; and develop the effectives of treasury information reporting.
5) International Cash Management: Optimize global cash and treasury risk Management through enhancing Foreign Exchange (FX) management system.
6) FX and Interest Rate Management: Evaluate foreign replace and interest rate practices and strategy to know measure monitor, and manage such activities. Also, assess opportunities for enhancement.
The two major focus regions of treasury operations are:
(i) Fund management, and
(ii) Financial risk management.
The former comprises cash management and asset liability mix. Financial risk management comprises forex and interest rate management apart from commodity prices and managing equity and mitigating risks linked with them.