Following the Money: Treasury Functions and Accountancy Functions in Large Companies

The finance sector may seem like some great monolithic edifice, but of course, like any industry, it is full of sub-divisions and specializations. Some of these functions are disconnected from one another. Others are in constant collaboration. Take for example the relationship between the accounts department and the treasury department. Some people think these functions are indistinguishable but in reality they are very different.

Accountancy and Finance

Any large company will have a treasury function and an accountancy function. The focus of these two departments is often categorized in terms of future and past actions. Accounting is closer to book-keeping in the sense that you manage and prepare financial statements and records. Accounting involves analysis and creation of financial documents whereas finance may involve the control and management of assets. Accountancy is more about compiling, tracking, assessing and presenting information. Ensuring paper trails, in a sense. Financial management involves making actual decisions about the future of an enterprise; establishing how best to invest money and secure liquidity etc.

Treasury management departments are usually overseen by a Chief Financial Officer (CF0). The role of the CFO encompasses aspects of strategic planning, capital management, investor relations, financial reporting etc. The more complex the organization, the greater likelihood that these responsibilities will be delegated. Across areas such as processing and cash control there will often be an overlap between the accounts department and treasury.

Differences and Overlaps

Treasury management is closer to overall financial management, with one or two omissions such as inventory. Treasury is highly dynamic. It requires good people-skills and fast decision making. The concerns of treasury are immanent whereas the concerns of accounting are often retrospective. Treasury involves the management of risk, the management of liabilities and assets, the management of cash, and the management of important relationships (suppliers, investors etc.). It involves ongoing collaboration with other managements.

The accounts department usually prepares information for the rest of the organization, for instance, entries necessary to process payments etc. Documents prepared in the accounts department will circulate throughout other departments. They will be utilized by managers, executives, taxation authorities and investors.

Accountancy and Treasury Management Jobs

Accountancy and treasury management positions are some of the most popular jobs in Canada at the moment. They are competitive and well paying sectors with good opportunities for career advancement and diversification. They also have comparatively low unemployment rates, less than half the Canadian average.

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