Businesses face a lot of financial risks that can potentially put them out of business. That’s why risk management is such an important factor for a business to succeed. The responsibility of managing this risk rest significantly on the shoulders of the corporate treasury.
The treasurer not only helps businesses manage risks. It helps firms establish a cash culture without relying completely on spreadsheets and numerous bank accounts. The corporate treasurer has gone beyond a nice to have to a must-have.
Who is a corporate treasurer?
Corporate treasurers are professionals that manage money and financial risks for businesses. A corporate treasurer may be seen as the right arm of the chief financial officer. As they help to develop financial policies and strategies. The corporate treasurer deals with existing and expected cash. Simply put, the role of the treasurer is to ensure the availability of the right amount of cash, at the right time, at the right place, and in the right currency.
In dealing with risks, the corporate treasurer is responsible for accessing the pros and cons of business expansion projects. Exchanging foreign currency, interest rates loans, or running out of cash are also risks that the treasurer must manage. Sometimes a business has excess cash and wishes to invest to earn extra revenue. The treasurer must investigate and recommend creditworthy financial security issuers.
Many external and internal factors impact a business financially. The corporate treasurer keeps a close eye on these factors and sets up policies and strategies to mitigate any potential risks to the business.
Where does a corporate treasurer work?
A corporate treasurer can function in both large and small firms. Government agencies, NGOs, for-profit organizations, and small businesses all need the services that a corporate treasurer provides. The role they perform is globally relevant and so they can work anywhere in the world.
In businesses with no structure for a treasury department, treasury functions are still carried out. This is possible because sometimes, a team member takes on the duties of the corporate treasurer.
Often we find corporate treasurer roles combined with other roles like the corporate controller/ corporate treasurer. There’s also a combination of vice president and corporate treasurer roles. In some firms, the vice president takes on financial planning and analysis role together with being the corporate treasurer.
Corporate treasurer roles are available for entry-level candidates to professionals. And some of the job titles with corporate treasury roles are listed below.
- Relationship managers and transaction services analysts
- Treasury analysts, treasury dealers and treasury accountants
- Risk and cash managers
- Finance directors or financial controllers
- Credit risk and financial analysts
- Group treasurers, tax directors and head of treasury operations
- Managing directors and company secretaries
- Chief financial officers (CFOs) and Chief executive officers (CEOs)
Key skills for corporate treasurers
- Analytical skills: corporate treasurers are financial strategists and to be effective they need to be able to analyze data. Some level of IT skills for data collection and presentation is also beneficial.
- Numeracy skills: Although the corporate treasurer is not restricted to number crunching, it is an essential skill. Corporate treasurers with good numeracy skills can pay the kind of attention to detail and accurately manage company funds.
- Interpersonal skills: The treasurer must work closely with management and operational staff. They must liaise with company bankers and investors and so excellent interpersonal and communication skills are a must.
Qualifications for corporate treasurer roles
Many treasurers are accountants who took on treasury activities and have gone on to build careers in the field. To put yourself on the path of becoming a professional corporate treasurer, you need a university degree. The degree could be in finance, business studies, accountancy, banking or economics. Any related degree plus at least one year of treasury work experience also works.
Having an Association of Corporate Treasurers (ACT) qualification and membership make you increasingly qualified. Financial professionals who want to further their careers in treasury management will take examinations administered by the ACT.
The key professional qualifications offered by the ACT include a Certificate in Treasury Fundamentals, Certificate in Treasury. Diploma in Treasury Management, Advanced Diploma in Treasury Management and International Cash Management.
How much does a corporate treasurer earn?
The salary for corporate treasurers is quite competitive and the recruitment rate is on the rise. In the last few years, there has been an increase in corporate treasury recruitment at all levels. This signals an upward surge in the opportunities in corporate treasury as a career.
At the graduate entry-level, corporate treasurer salaries in the UK usually start from £25,000 per year. Senior treasurer roles can earn from £100,000 per year.
The current average treasurer salary in the United States is $218,882. However, the range falls between $177,866 and $269,321.
How much you earn as a treasurer depends on several factors. They include your level of education, certifications, work experience and additional skills such as IT skills.
Association of Corporate Treasurers in the U.K (ACT)
The Association of Corporate Treasurers in the UK is a leading advocate for professionalism in corporate treasury. Globally, it is viewed as the benchmark for excellence and professionalism in corporate treasury. It has over 7,000 members worldwide. Membership for the Association is split into 5 levels. You can join via student membership or business membership. There are also an affiliate, fellowship and associate membership levels.
The certifications offered by the ACT stop at an MBA level and is the only professional qualification in treasury management in the UK. Corporate treasurers often take the Diploma in Treasury Management training offered by the ACT. The diploma is a core treasury qualification with three mandatory subjects. They are treasury management, risk management for treasury and corporate finance for the treasury. Additional subjects include trade finance, tax and regulation for treasury working capital and financial reporting.
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