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AFP Press Release

Survey: Companies Refocus on Cash Management, Liquidity, Metrics

Amid financial upheaval, corporate treasury’s role is recognized as critical, AFP survey shows

BOSTON –– November 7, 2011 –– Companies today are placing a greater value on the historic role of their treasury department in managing cash and liquidity as a direct consequence of  the current economic and credit environment, according a survey by the Association for Financial Professionals (AFP) released today at the AFP Annual Conference.  At the same time, treasury responsibilities continue to expand to include critical finance activities ranging from accounting and SEC compliance to financial planning and analysis to serving as a valued internal financial consultant to the company. 

The AFP Strategic Role of Treasury Survey, underwritten by SunTrust, found that the role of corporate treasury, the subset of finance that assures that a company has enough cash on hand to meet its needs, in the last five years has become more strategic than operational. Not surprisingly, companies are also keeping a close eye on how they measure financial performance. 

“At many companies, treasurers and their staff are interacting directly with senior management, including the board. Their expertise in forecasting and budgeting is even required at the business unit level as companies seek to calculate ROI on a project basis,” said Jim Kaitz, AFP’s president and CEO.  “Time is also critical.  Companies need to know how they are performing according to plan, so we are seeing an increased focus on financial metrics.”  

"SunTrust is pleased to sponsor the 2011 Strategic Role of Treasury Survey,” said Eric Brewer, Executive Vice President of Treasury & Payment Solutions at SunTrust Banks, Inc. “This timely report captures the perspectives of senior-level financial professionals and offers analysis which highlight emerging trends and subtle shifts in the treasury function.”  

Key survey findings: 

Eighty-one percent of senior-level financial professionals report that treasury is playing a greater strategic role in their organizations than it did five years earlier.   

Treasury’s greater strategic role is the result of: 

             * Increased importance of cash management and liquidity given economic and credit market volatility (78 percent) 

* Senior management and boards seeking increased visibility into liquidity and risk 

 exposures (70 percent) 

* Closer monitoring of financial metrics on projects and other activities (44 percent) 

Treasury takes a leadership role key finance functions, including bank relationship management, global treasury management, borrowing, investing and cash flow forecasting. 

Treasury also plays critical roles in financial risk management, working capital management, financial planning & analysis, risk management, mergers & acquisitions, counterparty risk analysis, business continuity planning, enterprise risk management and capital structure.   

            * In 87 percent of organizations, the treasury group acts as an internal financial  

            consultant to other departments. 

            * This expanded strategic scope has occurred even while many treasury departments  

            committed a greater percentage of resources to traditional cash management  

            responsibilities.  The dual expansion was able to occur due to automation, professional  

            development leading to expanded employee skill sets, and by recruiting employees with  

            broadened skill sets. 

View the full report on www.afponline.org/research     

About AFP®  

The Association for Financial Professionals (AFP), headquartered outside Washington, D.C., serves a network of more than 16,000, members with news, economic research and data, treasury certification programs, networking events, financial analytical tools, training, and public policy representation to legislators and regulators. AFP is the daily resource for the finance profession.  

AFP's global reach extends to over 150,000 treasury and financial professionals worldwide, including AFP of Canada; London-based gtnews, an on-line resource for the treasury and finance community; and bobsguide, a financial IT solutions network. 

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