Treasury Management Versus Cash Management

Abstract

Using a database of Spanish companies, this paper analyses the treasury management responsibilities assumed by financial departments and develops a model to confirm those responsibilities. We have developed an explanatory model that brings together the main functions of the treasurer by means of two concepts: (i) basic cash management, which groups the management of collections and payments, liquidity monitoring in banking operations, short-term treasury forecasts, the management of banking balances on value date and negotiation with financial organizations; and (ii) advanced cash management, which includes the management of the financing of treasury deficits, the management of the positioning of treasury peaks and the management of financial risks. In this way, the definition of cash management is empirically corroborated.

Keywords: Cash management, liquidity management, factorial analysis

JEL Classification: G21, G30