Core functions of treasury management include raising funds through capital markets, managing cash flow, aligning a company's corporate and financial strategies, managing business risks and controlling treasury operations. The treasury department reports to the board on the company's financial situation and possible future risks.
The functions of treasury management vary across companies depending on the responsibilities given to the department by the executive board. Other treasury functions include the appraisal of investments to ensure that resources are allocated to the most promising opportunities. Treasurers monitor a company's cash flows to ensure that its cash needs are met at minimum cost by constantly reviewing the impact of a company's corporate policies on working capital.
Treasurers are responsible for optimizing a company's capital structure by diversifying sources of capital and creating new partnerships. Treasurers plan for a company's pensions to minimize future risks and create certainty. The treasury department maintains an active relationship with a company's bankers and appraises the banks on a company's finances and future borrowing needs. The department also maintains a company's relations with credit rating agencies that rate its debt.
A company's treasury department issues credit to deserving customers according to predetermined criteria. If a company acquires another company, the treasury department may advise the company on the acquisition.