Treasury Management & Capital Structure

The CFO is the chief liaison between the company and its existing and prospective lenders and capital sources. Like an annual checkup with the doctor, a company needs to periodically evaluate the type and cost of capital currently in place. Often the problem-set requires the CFO to raise additional capital.

To do this, the CFO seeks the sources of capital that allow the company to fund its business strategy at the lowest effective borrowing cost. This seemingly simple goal becomes trickier when competing interests arise, such as when banks, owners or the President/CEO have specific credit limits, asset reserve requirements or other terms they demand. Add to that mix retaining a minimum cash flow and investing excess cash in short-term securities and you can see the balancing act required of the CFO.

In order to discharge this responsibility the CFO must have contacts across a broad spectrum of lenders and capital sources in the local markets and beyond. The CFO can deliver a significant benefit by streamlining the selection process by virtue of contacts within capital institutions, as well as being familiar with the current criteria of those institutions. This is not a matter of being on good terms with Don Corleone, but it is requisite that your financial officer has strong relationships with a variety of local lenders and equity investors who target Colorado firms like yours.