If you've been thinking that your workload has increased, it may be small comfort to know that it's not just your imagination: According to a recent report by AFP (Association for Financial Professionals), the treasury function is both expanding and growing in importance. More than 80 percent of treasurers interviewed say they currently play a more strategic role than they did five years ago. An even greater percentage – 84 percent – expect their role to continue to expand.
Several factors are driving these shifts. One is the growing importance of most treasury functions to the overall health of many companies. For instance, more than three-quarters of respondents cite the increasingly critical nature of liquidity and cash management, given the upheaval in the economy over the past few years. To be sure, many companies recently have been able to stockpile cash. However, the memory of tighter, more onerous bank lending terms a few years ago appears to have left an impression.
In addition, management and boards are demanding greater visibility into cash flows, 70 percent of respondents say. That's also boosting the profile and role of treasury.
At the same time, many treasurers are working more closely with their counterparts in the operating and business units, in such areas as vendor negotiations, supplier finance, M&A, and leasing and real estate. "Treasury is no longer a silo, a back-office, transaction-oriented function," the report states. For instance, more than 90 percent of treasurers with organizations of $1 billion or more in revenue get involved with mergers and acquisitions. They're helping to evaluate targets, analyze the proposed transactions and work with investment banks.
However, just because treasury is expected to do more doesn't mean that getting additional resources is a given. Treasury departments continue to run lean; only 16 percent of respondents report an increase in staffing. In fact, about one-third of respondents cite a lack of resources as the biggest obstacle to treasury's ability to effectively take on additional responsibilities.
Still, there's a bright side to treasurers' ongoing efforts to do more with less: Treasurers' recent pay raises have topped those of their CFO counterparts, according to a 2011 survey, also by AFP. Treasurers' pay rose by an average of 3.7 percent, while CFOs got 2.8 percent, on average.
