Corporate Treasury Management

100 Hours / 12 Months / Mentor Supported

Course Overview:

Case Studies: No solution is complete without real world examples. This group is a repository of real life cases of corporate failures due to improper risk management and lack of controls. The treasury debacles at Allied Irish Bank, P&G, Gibson Greetings, Sumitomo and Lufthansa are discussed to give an understanding of practical issues in treasury management. Treasury practitioners and policy makers can review their methods and systems, and help the treasury function become more effective.

Foreign Exchange Management: This course group provides an in-depth understanding of the various risks (transaction, translation and economic exposure risks) a corporate is exposed to, when dealing in foreign exchange. The sources of these exposures and techniques to mitigate them, using different financial instruments are discussed. Various caselets in the form of simulations are provided for better understanding. A 10-point checklist for sharing currency risks in long-term contracts is one of the highlights of this course.

Funding and Investments: The short-term and long-term financing needs and methods that cater to funding and investments of a corporate through money and capital markets form the focus of this course group. An overall view of managing corporate risk exposure at a portfolio level is also provided.

Implementation: Implementation of a treasury strategy is fundamental to a streamlined treasury. In its endeavor to achieve this, our product has an entire course group dedicated to implementation issues. Some of the topics include treasury software systems available, a framework for formulating a policy statement (with illustrations). Control issues affecting the treasury function are explained with practical caselets keeping in view the norms set by regulatory bodies. The later part of the course group deals with accounting issues as under FAS133 and IAS139.

Interest Rate Risk Management: Financial markets have seen an enormous growth in fixed-income obligations, which in turn has increased volatility of interest rates. The management of interest rate risk using various derivative instruments (futures, swaps and options) forms the focus of this course. The mechanics and application of these instruments for hedging, arbitrage and speculation purposes are discussed. Caselets and simulation exercises facilitate better understanding of interest rate risk management.

Treasury Analytics: The concept of yield curve analysis, different analytical techniques like duration, convexity and basis point value, which form the basis for understanding the overall risk measurement framework are the elements of this course group.
The practitioner is introduced to the Value-at-Risk (VaR) methodology to measure risks.

Trading Operation Controls: This e-learning course on 'Trading Operation Controls' is designed to help users understand the logical sequence of events involved in trade life cycle. An in-depth discussion of role and structure of front, middle and back office.

Course Outline:

CTM - Case Studies
1. Treasury Management – Scope and Importance
  • What is Treasury Management?
  • Structure of Treasury Management
  • Functions of Treasurer and Controller
2. Overview of Risk Management
  • Concept of Risk
  • Risk Management Process
  • Determination of Business Objectives
  • Identification of Risks
  • Measurement of Risk
3. Sumitomo
  • The Sumitomo Copper Trading debacle
  • How the copper market was manipulated
  • The lessons we learn from the case study
4. Lufthansa
  • Alternatives before Lufthansa to hedge it’s FX risk
  • Lufthansa’s hedging strategy
  • Outcome of Lufthansa’s hedging decisions
  • Treasury Performance Measurement
  • The lessons we learn from the case study
5. Allied Irish Banks
  • Importance of Treasury Control
  • Trading strategy
  • Flaws in Allfirst's treasury control
6. Procter & Gamble (P&G)
  • The relationship between Bankers Trust and Procter & Gamble
  • The details of the deal
  • The claims and counter claims between the players
  • The outcome and the lessons learnt from a study of this case
7. Gibson Greetings
  • The role Bankers Trust played in contributing to Gibson Greetings colossal losses
  • The details of the swaps and Restructuring
  • The lessons we learn from the case study
CTM - Foreign Exchange Management
1. Treasury Management – Scope and Importance
  • What is Treasury Management?
  • Structure of Treasury Management
  • Functions of Treasurer and Controller
2. Overview of Risk Management
  • Concept of Risk
  • Risk Management Process
  • Determination of Business Objectives
  • Identification of Risks
  • Measurement of Risk
3. Translation Exposure
  • Translation Exposure
  • Translation Methods
  • Accounting Treatment Under Fasb No. 8 and 52
  • Hedging Translation Exposure
4. Transaction Exposure
  • Steps in measuring Transaction Exposure
  • Spot Markets Vs. Forward Market Hedge
  • Hedging- Other Alternatives
5. Economic Exposure
  • The impact of Forex on Operations
  • Interface with Sourcing, Pricing, Production siting, Marketing and R&D
  • Fixed Vs. Variable costs
  • Exchange Rates:The impact on competitiveness
  • Management of Economic Exposure or Operating Exposure
6. Case Studies- Foreign Exchange Exposure

Currency risk exposure experiences of:

  • Volkswagen
  • Rolls Royce
  • Laker Airways
  • Lessons Learnt from these Case Studies
7. Currency Risk Sharing Agreement
  • Sharing Currency Risk in Long-term Contracts
  • Evaluating Agreements for Currency Risk Sharing
  • Range Forward vs. Currency Risk Sharing Agreement
CTM - Funding and Investments
1. Treasury Management – Scope and Importance
  • What is Treasury Management?
  • Structure of Treasury Management
  • Functions of Treasurer and Controller
2. Overview of Risk Management
  • Concept of Risk
  • Risk Management Process
  • Determination of Business Objectives
  • Identification of Risks
  • Measurement of Risk
3. Short-term Financing
  • Working Capital Concepts
  • Working Capital Issues
  • Working Capital Cycle
  • Aggressive and Conservative Approach
  • Sources of Short-Term Financing
4. Long-Term Financing
  • Considerations of Issuers and Investors
  • Sources of Long-term Finance
  • Merits and Demerits of:
    - Retained Earnings
    - Equity Capital
    - Preference Capital
    - Debenture Capital
    - Term Loans
5. Money Markets
  • Money Market
  • Money Market Instruments
  • Coupon Bearing Instruments
  • Discount Instruments
  • Risks involved in Money Market
6. Capital Markets
  • Capital Markets
  • Funding and Investing
  • Debt and Equity
  • Factors Affecting Capital Markets
7. Portfolio Management
  • Portfolio Risk and Return
  • Capital Allocation
  • Optimal Portfolio
  • Modern Portfolio Theory
  • Performance Measurement
CTM - Implementation
1. Treasury Management – Scope and Importance
  • What is Treasury Management?
  • Structure of Treasury Management
  • Functions of Treasurer and Controller
2. Overview of Risk Management
  • Concept of Risk
  • Risk Management Process
  • Determination of Business Objectives
  • Identification of Risks
  • Measurement of Risk
3. Treasury Management Systems
  • Software Applications :The description of several different Treasury Management Systems , their functions and features
4. Treasury Policy
  • Treasury Policy
  • Developing a Treasury Framework
  • Elements of Policies in Specific Areas
  • Treasury Performance
5. Treasury Controls
  • Treasury Control -Introduction
  • Importance of Treasury Control
  • Case Study - Sumitomo
  • Framework of Treasury Control
  • Treasury Audit
  • Sarbanes Oxley - Impact on Treasury Control
6. Accounting for Derivatives
  • Accounting of Derivatives under FAS 133
  • Fair Value Hedges
  • Cash Flow Hedges
  • Foreign Currency Hedges
  • Accounting Under IAS 39
Corporate Treasury Management - Interest Rate Risk Management
1. Treasury Management – Scope and Importance
  • What is Treasury Management?
  • Structure of Treasury Management
  • Functions of Treasurer and Controller
2. Overview of Risk Management
  • Concept of Risk
  • Risk Management Process
  • Determination of Business Objectives
  • Identification of Risks
  • Measurement of Risk
3. Interest Rate Futures
  • Interest Rate Futures
  • Forward Rate Agreement (FRA)
  • T-bill Futures
  • Eurodollar futures
  • T-bond futures
4. Interest Rate Options
  • Interest Rate Options
  • Over-the-Counter Options
  • Calls and Puts on LIBOR
  • Caps, Floors and Collars
  • Exchange Traded Options
  • Embedded Options
5. Interest Rate Swaps
  • Interest Rate Swaps
  • Basic Structure
  • Price Quoting Conventions
  • Pricing & Valuing Interest Rate Swaps
  • Variants of Interest Rate Swap
  • Swaption
6. Case Studies – Applications of Interest Rate Derivatives
Corporate Treasury Management - Treasury Analytics
1. Treasury Management – Scope and Importance
  • What is Treasury Management?
  • Structure of Treasury Management
  • Functions of Treasurer and Controller
2. Overview of Risk Management
  • Concept of Risk
  • Risk Management Process
  • Determination of Business Objectives
  • Identification of Risks
  • Measurement of Risk
3. Yield Curve Analysis
  • Concept of Yield Curve and its Types
  • Various Theories under Yield Curve Analysis
  • Types of Interest Rates and their Computation
  • Bond Arbitrage Strategies
  • Yield Interpolation
  • Applications of Yield Curve Analysis
4. Duration
  • Concept of Duration and Modified Duration
  • Computation of Duration for different types of bonds
  • Relationship between duration, yield, coupon and maturity
  • Duration of a Portfolio
5. Basis Point Value (BPV)
  • Concept of Basis Point Value
  • Relationship between BPV, Duration and Modified Duration
  • BPV for On-Balance Sheet items
  • BPV for Off-Balance Sheet items
  • BPV of a Portfolio
6. Convexity
  • Concept of Convexity and its Properties
  • Convexity of a Portfolio
  • Impact of price change on convexity
  • Positive and Negative Convexity
7. Value-at-Risk
  • Concept of Value-at-Risk
  • Ways of expressing VaR
  • VaR Calculation
  • VaR Conversion
    1. One confidence to another
    2. One horizon to another
  • VaR Methods
  • Historical Simulation
  • Monte Carlo Simulation
  • Variance-Covariance Method
Trading Operation Controls
1. Trade Life Cycle
  • Basic concepts in trade life cycle
    • Front office
    • Middle office
    • Back office
  • Logical sequence of events in trade life cycle
  • Concept of Straight Through Process (STP)
2. Front Office Controls
  • The role and structure of the front office in a trading institution
  • The importance of front office in the financial institution's trading activities
  • The different methodologies of measuring and managing market risk
  • The techniques used by trading institution to summarize market risk
  • The market-risk limits that are used to control the risks that arise in trading activity
3. Middle Office Controls
  • The techniques used for determining market prices for liquid instruments and illiquid instruments.
  • The valuation methodologies that are used in the middle office for marking trade positions.
  • The pricing models which are used to value and hedge financial securities.
  • The characteristics of the pricing model review process.
4. Back Office Controls
  • Various functions performed by the back office
  • Processing of payments and delivery or receipt of securities, commodities, and written contracts by back office staff
  • Role of back office in:
    • Confirmation of trading transaction
    • Settlement of transaction process
    • Foreign payments
    • Reconciliations
  • Netting and types of netting

All necessary materials are included.


System Requirements:

Internet Connectivity Requirements:
  • Cable and DSL internet connections are recommended.
Hardware Requirements:
  • Minimum Pentium 400 Mhz CPU or G3 Macintosh. 1 GHz or greater CPU recommended.
  • 256MB RAM minimum. 1 GB RAM recommended.
  • 800x600 video resolution minimum. 1025x768 recommended.
  • Speakers/Headphones to listen to Dialogue steaming audio sessions.
  • A microphone to speak in Dialogue streaming audio sessions.
Operating System Requirements:
  • Windows Vista, 7, 8, 8.1, 9, 10
  • Mac OSX 10 or higher.
  • OpenSUSE Linux 9.2 or higher.
Web Browser Requirements:
  • Google Chrome is recommended.
  • Firefox 13.x or greater.
  • Internet Explorer 6.x or greater.
  • Safari 3.2.2 or greater.
Software Requirements:
  • Adobe Flash Player 6 or greater.
  • Oracle Java 7 or greater.
  • Adobe Reader 7 or greater.
Web Browser Settings:
  • Accept Cookies
  • Disable Pop-up Blocker.


** Outlines are subject to change, as courses and materials are updated. Software is not included with the purchase of the course, unless otherwise specified. Students are responsible for the purchase and installation of the necessary course software. **