Treasury management involves the administration of a company’s financial assets to optimize liquidity, reduce risk, and manage cash flows. It includes activities such as cash management, investments, risk management, and financial planning. Effective treasury management ensures that the company has the right amount of cash available at the right time to meet its obligations and invest in opportunities. It also involves managing financial risks that arise due to fluctuations in interest rates, currency exchange rates, and market prices. The core goal is to maximize the efficiency of a company’s financial resources while minimizing risks.
Key Takeaway: Treasury management focuses on optimizing liquidity, managing risk, and ensuring efficient financial resource use.