This lesson examines the regulatory and governance frameworks that ensure treasury operations are controlled, compliant, and secure. 

7.1. Governance and Regulatory Compliance

Treasury operations must comply with a complex regulatory environment. The University of Birmingham’s module on “Ethics, Governance and Regulation in Treasury” examines “the key drivers of the legislation and regulation of corporate governance and treasury operations.”  It also explores the “purpose and principles of reporting measures, both internal and external.”  The ACT’s Certificate in International Cash Management includes a topic on “Regulation and Digital Controls.” 

7.2. Internal Controls and Operational Risk

Internal controls are essential for mitigating operational risk. The ACT Competency Framework identifies “developing treasury policies and procedures” and “internal controls and audit considerations” as key areas.  Controls include:

• Segregation of Duties: Separating front, middle, and back office functions.

• Authorisation Levels: Defining clear limits for transaction approvals.

• Managing Fraud and Cyber Risks: Implementing controls to prevent and detect fraud. 

7.3. Developing Treasury Policies

Treasury policies provide the framework for operational decision-making. Topics covered include “Developing and implementing treasury policies,” “Regulatory compliance and governance,” and “Treasury control frameworks.”  A strong policy framework ensures that treasury actions are aligned with the organisation’s risk appetite and strategic goals