Treasury

The treasury is a department or function responsible for managing the finances of an entity, whether a national government or a private company. It encompasses cash management, funding, debt issuance, investments, and risk management, as well as accounting, financial reporting, and governance. In practice, the treasury seeks to ensure liquidity, optimize capital structure, and support strategic objectives.

In government, the treasury (often a ministry of finance or treasury department) plans and executes fiscal policy, prepares budgets, and monitors spending. It oversees revenue collection or coordinates with tax and customs authorities, manages public debt, and issues government securities. It may manage cash balances, coordinate with the central bank, supervise financial markets, and implement sanctions and regulatory duties as assigned.

In the corporate sector, the treasury manages liquidity and funding. Key activities include cash flow forecasting, bank relationships, payment processing, treasury operations, short-term investments, and cash pooling. It plans capital structure, negotiates debt facilities, and oversees hedging of exposure to foreign exchange, interest rate, and commodity risks. It collaborates with finance, risk management, auditors, and compliance to ensure financial stability.

The treasury is distinct from the central bank, which typically manages monetary policy, currency issuance, and lender-of-last-resort functions, while the treasury concentrates on public or corporate finances, budgeting, and debt management.