Treasury management systems help companies manage the cash and liquidity needed to pay employees, suppliers, or shareholders. This type of software system can also be used to manage financial risks related to liquidity, to track investments and debt, and forecast. Accountants and finance managers use treasury management system solutions to track the ability of the company to convert its assets into cash (also known as liquidity) to meet financial obligations. Top executives and company owners use treasury reports and dashboards within treasury management systems to improve the financial strategy of the company and to share financial information with shareholders, members of the board of directors, and business partners.
Treasury management systems can vary in complexity and functionality. Some treasury management technology companies focus mostly on cash management for SMBs, while others specialize on liquidity management for large companies. This type of system needs to integrate with accounting software and ERP systems to gather the financial information required to manage liquidity. Since liquidity is an essential indicator of the financial performance of a company, treasury management systems also integrate with corporate performance management software.
To qualify for inclusion in the Treasury Management Systems category, a product must:
- Automate cash management processes across multiple business entities
- Define schedules for internal and external movements of funds
- Comply with local and global financial standards and regulations
- Include forecasting capabilities to identify liquidity trends
- Deliver dashboards and reports on cash positions and liquidity
- Manage different types of risks such as currency and interest rate fluctuations
- Provide a holistic view of risks and opportunities related to cash management
