How treasury management services can help improve cash flow and protect against fraud Featured

8:00pm EDT July 26, 2010

Now more than ever before, business owners are focused. They’re focused on production, payables, receivables and, of course, the bottom line.

In the past, a business owner may have passed bookkeeping and banking duties on to a staff member without giving it a second thought. Now, owners are adding oversight of their books and banking to their already long to-do lists.

Many business owners are turning to their banks and utilizing treasury management services — online services that help companies accelerate cash flow, increase visibility and control over payments, reduce or eliminate exception handling, decrease exposure to fraud and lighten staff workloads.

“Treasury management services help a business save time and money, and they offer peace of mind,” says Ed Jurek, a senior business relationship manager for Wells Fargo Bank. “They allow you to do more with less.”

Smart Business spoke with Jurek about treasury management services and how they can help improve cash flow and protect against fraud.

How are treasury management services used to improve cash flow for businesses?

Basically, treasury management services allow a business to receive cash more quickly and provide more control over outgoing payments. The ability to automatically transfer funds between accounts means you’re not waiting around for checks to cash or deposits to clear.

With ACH transfers, for example, you can pay bills just days before they’re due, rather than sending out a check weeks in advance. With a lockbox, you have a P.O. Box address for customers to send payments to, and then the bank picks up the payments and deposits them into your account. Deposits are made daily as checks are received.

Besides improving cash flow, these services save you time, because you don’t have to do all the banking paperwork, spend time at the bank, and travel to and from. Plus, you can conduct banking business at any time; you’re not confined to the normal branch hours.

Why is it important to improve cash flow?

Many business owners that never had cash flow problems in the past have them now, due to the fluctuating economy. And these owners can’t take advantage of cash discounts and/or they can’t buy in bulk. Because of these issues, collections are more important than ever. You can’t afford slow pays or no pays. Without a steady flow of incoming funds, you’re dead in the water.

Again, this is where treasury management services come in. With smooth, automated collection, processing and documentation processes, for example, you’ll be able to receive payments efficiently and effectively, which, in turn, can improve your cash flow.

How have new technologies enhanced treasury management services?

While some business owners are still leery of conducting business online, every business uses cell phones and computers. And treasury management services enable a business to utilize the same technologies that the bank does. It’s like having your own ‘branch’ right in your office.

With treasury management services, you immediately know about any transactions that post to your account; you have up-to-date information at your fingertips. You can quickly and easily view your accounts, conduct wire transfers, make deposits and resolve disputes — and you do it all online, from your office.

Even though treasury management services enable you to conduct all of your banking online, don’t think the personal touch is gone. Your bank and bankers are always there to guide you through the process. Treasury management services don’t eliminate banking relationships — they enhance them.

How can you measure the ROI of treasury management services?

The time and money you save using treasury management services will be well worth your investment. Are you or your staff members wasting time on clerical tasks and running to and from the bank? Do you have more productive ways those people could be spending their time? If the answers are yes, then you have a need for treasury management services. Your ROI is right there — more work can be done with less staff in less time.

How do business owners unknowingly set themselves up for fraud?

Often the person writing the checks and keeping the books isn’t the person who actually holds the account. A large part of fraud comes from internal embezzlement. If you’re not watching your accounts carefully, you could become a target for fraud.

I understand that businesses are forced to do more with less and are working with leaner staffs, but without the proper controls in place for your bookkeeping and banking, you could have a very tempting situation that even a normally trustworthy employee may not be able to resist.

How can treasury management services help a company reduce exposure to fraud?

Conducting your banking online provides high security and reliability. Plus, you take away the ability for someone in your office to fudge the numbers or embezzle funds. Treasury management services give you a real-time view of what’s happening with your accounts, so you can always be aware of any inconsistencies.

Another way treasury management services help protect against fraud is through positive pay — an automated fraud management service that matches the account number, check number and dollar amount of each check presented for payment against a list of authorized checks issued by the company. All three components of the check must match exactly or the bank will present it as an exception.

Ed Jurek is a senior business relationship manager for Wells Fargo Bank. Reach him at or (832) 251-5516.