The treasury is the area of ​​the company that is responsible for managing its cash flows, which basically translates as the money that enters and leaves the company. It is of critical importance when it comes to guaranteeing the financial solvency of any company and thus avoiding cash shortage situations.

Despite its importance, it is a process that is not always given enough importance or how it is managed is not known. Therefore, in this article, we will explain some of the main basic methods for treasury control and the tools you can use for this task.

3 ways to keep track of your treasury

There are different methods to keep track of the treasury, but in this article we will explain three of the most common.

The treasury budget

The treasury budget is a document that allows the company to plan and control its cash flows. In essence, it is used to anticipate the company’s future cash inflows and outflows and thus forecast the available cash balance in a given period. It allows the company to plan its financing needs and make decisions accordingly.

To prepare a treasury budget, you need to have a good understanding of the company’s past and present cash flows, as well as future projections of income and expenses.

The treasury budget is a valuable tool for short-term treasury management and should be updated regularly to reflect changes in the company’s financial situation.

The cash book

The cash book is another of the most important and effective treasury control applications. It is a tool that allows the company to record all cash transactions that are made. This book records both the company’s income and expenses, as well as any cash transactions, such as withdrawals from ATMs or deposits into bank accounts.

It can be carried out in a manual or digital format, depending on the needs of the company. In either case, it is essential that this cash book is up to date and accurate so that the company has a clear view of its financial situation.

For this reason, most companies, in their daily activity, decide to rely on technological tools to manage it appropriately, such as Excel sheets or treasury software.

The bank book

The bank book is the last of the treasury control tools that we will analyze in this article. It allows the company to keep a record of all transactions that occur in the company’s bank accounts, including deposits, cash withdrawals, transfers and any other movement of funds in the company’s bank accounts.

The bank book is important for long-term treasury control as it allows the company to track its bank balances and detect any discrepancies or errors in banking transactions. Additionally, the bank book is useful for performing bank reconciliation, which is the process of comparing the company’s accounting records with the bank records in order to ensure that they match.

Like the cash book, the bank book can be kept in a manual or digital format, but it is much more effective to use specific software that performs these tasks for us and thus avoid as much human intervention as possible.

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