# The first treasury policy for a scaling company Source: https://firmaadvisory.com/insights/first-treasury-policy Last updated: 2026-10-01 TYPE html> First Treasury Policy for a Scaling Company | FIRMA Advisory [Skip to main content](#main) By [Federico Lleonart](https://firmaadvisory.com/federico-lleonart) · Published October 1, 2026 · Updated October 1, 2026 · 6 min read What should a scaling company's first treasury policy contain? A liquidity buffer, approved banks and limits, rules for surplus cash, an FX approach, clear approvals and regular reporting. Keep it short enough to follow, have the board approve it and review it every year as the business grows. Growth companies often hold more cash than ever after a funding round, with fewer rules than ever about how to manage it. The founders and the first CFO make the decisions, usually case by case. That works until it does not. A bank failure, a large FX loss or an investor question shows that the company needs written rules. ## Why does a scaling company need a treasury policy? A treasury policy turns individual judgment into agreed rules. It protects the company from concentration risk, unauthorized decisions and avoidable losses. It also answers questions others will ask. Investors, lenders and auditors want to know where the cash is, who can move it and what it may be invested in. Finally, it frees management time. Once the rules are set, routine decisions no longer need a meeting. ## What should the first policy contain? The first policy should be short. Six sections cover what a scaling company needs. ### Liquidity buffer The buffer is the cash the company must always keep available for operations. It is usually expressed in months of operating outflows, based on the cash forecast. Where the company operates in several currencies, set the buffer per currency. A buffer in dollars does not pay salaries in euros. ### Banks and counterparty limits The policy names the approved banks and sets a maximum share of cash at any one of them. That single rule limits the damage if one bank fails or freezes accounts. ### Surplus cash Surplus cash above the buffer can earn a return, within rules the board approves. The policy sets the allowed types of deposit or instrument, the maximum maturity and the minimum credit quality. The policy does not pick investments. It sets the boundaries within which treasury chooses. ### FX The policy says which currency exposures the company hedges, which it accepts and who decides. For many scaling companies, the first rule is simply to hold enough of each operating currency. Hedging can come later, once exposures are measured and the cost of FX is known. ### Approvals and delegations The policy states who can open accounts, change signatories, move cash between banks, invest surplus cash and trade FX. Each authority comes with a limit. Dual approval should apply to every payment above a set amount, and to every change of bank details. ### Reporting Treasury reports cash, forecast, counterparty exposure and compliance with the policy. Monthly reporting to the CFO and quarterly reporting to the board is a common starting point. A one-page dashboard is enough at the start. It should show the numbers against each policy rule. ### Worked example: turning rules into numbers The table applies illustrative rules to a hypothetical company holding USD 60 million. The rules and figures are invented to show the arithmetic. They are not a recommendation for any specific company. | Element | Illustrative rule | Illustrative result | | --- | --- | --- | | Liquidity buffer | Three months of operating outflows of USD 4 million | USD 12 million kept in operating accounts | | Reserve tier | Six further months of planned net spend of USD 3 million | USD 18 million in short deposits | | Strategic tier | Cash above the buffer and the reserve | USD 30 million under board-approved rules | | Counterparty limit | No more than 40% of total cash at one bank | A maximum of USD 24 million per bank | With a USD 24 million limit per bank, the company needs at least three banks for its USD 60 million. That conclusion alone changes how many companies set up their banking. ## What the bank sees From the bank side, a company without a treasury policy is a sales opportunity. Bankers will propose deposits, structured products and investment options that suit the bank. A written policy changes the conversation. When the policy names the allowed instruments and limits, proposals outside those limits stop quickly. Credit teams also read treasury policies when a company asks for a facility. A clear policy on liquidity and counterparties signals a well-run finance function. A policy also helps when a bank asks for more business. Treasury can point to the limits instead of negotiating each request from scratch. Banks notice counterparty limits too. A company that spreads its cash across several banks is a client each bank wants to win more of. ## How does the policy connect to the cash forecast? The policy sets the rules, and the forecast supplies the numbers. Without a forecast, the buffer is a guess and the strategic tier has no clear size. A rolling forecast of receipts and payments, updated weekly or monthly, is enough for most scaling companies. It shows when the buffer will be tested and how much cash can safely earn a return. Over time, forecast accuracy itself becomes a reporting line. Large misses are a reason to raise the buffer until the forecast improves. ## What should the board see each quarter? A short treasury report keeps the board informed without adding work. It should cover a few items, each compared with the policy. - Total cash by currency and by bank, against the counterparty limits. - The liquidity buffer, against the policy minimum. - Surplus cash by tier, with maturities and returns. - Any breach of the policy and how it was resolved. - Changes in banks, signatories or approval limits. ## Who should approve the policy, and how often should it change? The board should approve the policy, on the CFO's recommendation. That gives treasury a clear mandate and gives the board a standard to test against. Review it every year, and sooner after a funding round, an acquisition or a move into a new country. Growth changes the numbers behind every rule. ## Which mistakes make a first policy fail? Most first policies fail by being either too long or too vague. These are the common traps. - Copying a large corporate's policy that nobody in a small team can follow. - Setting a buffer without a cash forecast behind it. - Naming approved banks but no limit per bank. - Allowing surplus cash investments without a maximum maturity. - Writing the policy and never reporting against it. ## Is your company ready for its first treasury policy? A quick checklist shows whether the foundations exist. - Is there a cash forecast covering at least the next quarter? - Does someone own treasury, even part time? - Is cash spread across more than one bank? - Are signatories and payment approvals documented? - Does the board receive any report on cash and banks today? If most answers are no, start with the forecast and the bank structure, then write the policy around them. ## What comes after the policy? The policy is the first step of a treasury build-out. A reliable forecast, a bank structure that can absorb new entities and payment controls follow, then the first treasury hire. A structured [treasury build-out](https://firmaadvisory.com/treasury-build-out) puts those steps in the order banks and investors expect. If treasury capacity is the bottleneck, read [when a company needs an interim treasurer](https://firmaadvisory.com/insights/when-to-hire-interim-treasurer). Once surplus cash grows, [cash management in 2026](https://firmaadvisory.com/insights/cash-management-2026) covers how to put it to work. [](https://firmaadvisory.com/federico-lleonart) [Federico Lleonart](https://firmaadvisory.com/federico-lleonart) Federico Lleonart is the founder of FIRMA Advisory and its Head of Treasury Advisory. Formerly in cash management at J.P. Morgan and Barclays, he advises CFOs and private equity firms on treasury, banking and FX. [Read his full profile.](https://firmaadvisory.com/federico-lleonart) * * * This insight reflects general analysis and observations from FIRMA Advisory's work in treasury, banking, and cross-border financial advisory. It does not constitute investment advice, financial advice, or a recommendation in respect of any specific security, transaction, or financial decision. For analysis specific to your organization, contact us at [contact@firmaadvisory.com](mailto:contact@firmaadvisory.com). ## Continue reading ### [When a company needs an interim treasurer](https://firmaadvisory.com/insights/when-to-hire-interim-treasurer) Treasury cover before the first hire. ### [Cash management in 2026](https://firmaadvisory.com/insights/cash-management-2026) From cash visibility to cash deployment. ### [Measuring your FX spread](https://firmaadvisory.com/insights/fx-spread-mid-market) How to measure the cost of FX. ## Discuss your financial priorities with us. 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