Why you need a treasury policy, even in an SME
In many Swiss SMEs, cash management remains informal: the owner approves payments on the fly, reserves are assessed "by feel" and bank signing authorities are never updated. It works as long as the company is small and predictable. As soon as suppliers, international clients or the administrative team grow, the absence of clear rules leads to payment delays, duplicate authorisations or, worse, uncontrolled outflows.
A treasury policy is not a bureaucratic manual: it is a set of simple rules that define who can pay what, how much liquidity to keep available and how to monitor cash flows. In Switzerland, where payment terms are often short (30 days net) and financing costs remain sensitive despite lower rates than in the past, well-calibrated treasury governance protects solvency without blocking those who need to buy materials, pay salaries or close an urgent order.
This guide proposes a concrete model for SMEs with 5–50 employees: adaptable to GmbH, AG or sole proprietorship, compatible with Swiss accounting standards (Swiss GAAP FER) and with the duty-of-care obligations under the Code of Obligations (CO).
The four pillars of an effective policy
Before writing detailed procedures, set the guiding principles. A good treasury document for SMEs rests on four pillars:
Separation of duties
The person who records an invoice should not be the only person authorised to pay it. Even with few employees, separation can be logical (recording vs approval vs execution) rather than physical.
Clear and proportionate thresholds
Define amounts within which a manager can act independently. Thresholds that are too low paralyse operations; thresholds that are too high expose you to risk. Review them at least once a year or after a significant change in revenue.
Documented minimum reserve
Establish how much liquidity to always keep available to cover salaries, VAT, OASI/LPP contributions and fixed expenses. The reserve is not "tied-up capital": it is an operational buffer with a numeric target.
Traceability and review
Every payment must leave a trace (payment order, bank transfer, company card) verifiable in accounting. A monthly treasury check takes only a few minutes if data is organised — and is consistent with the obligation to keep proper books under Art. 957 et seq. CO.
Payment rules: from order to execution
The heart of the policy is the payment authorisation flow. Here is a typical model for a Swiss SME with annual revenue between CHF 1 and 20 million:
| Stage | Responsible party | Action | Control |
|---|---|---|---|
| 1. Invoice receipt | Administration | Recording with date, amount, IBAN, order reference | Duplicate check and consistency with purchase order |
| 2. Operational approval | Cost centre manager | Confirmation of service/product received and amount correctness | Digital approval or signature on payment list |
| 3. Financial authorisation | Manager / Management | Validation according to delegation thresholds | Comparison with budget and cash availability |
| 4. Execution | Treasurer / online banking | SIC bank transfer or QR-bill payment | Reconciliation within 48 hours in accounting |
Recurring payments (rent, leasing, SaaS subscriptions, insurance policies): add them to a treasury calendar with fixed due dates. Approval can be one-off at the start of the year for stable amounts, with quarterly review.
Urgent payments: provide for an accelerated procedure — for example verbal approval documented by email with execution within 24 hours and formal ratification on the next payment list. The exception must remain an exception, not routine.
Credit cards and small payments: set a monthly card limit and a list of permitted categories (travel, office supplies). Receipts must be submitted by month-end; transactions without documentation are reversed by the responsible manager.
Delegations and thresholds: giving autonomy without losing control
Bank signing authorities and collective signatures are governed contractually with the bank, but the internal policy must align with them. A common mistake in SMEs is having unlimited signing rights for multiple people without updating who actually operates today.
| Single amount | Authorisation | Typical SME example |
|---|---|---|
| Up to CHF 500 | Operations manager + company card | Materials, courier expenses, small purchases |
| CHF 501 – 5,000 | Department head + administration | Regular suppliers, maintenance, minor consulting |
| CHF 5,001 – 25,000 | Manager / management board member | Current investments, deposits to strategic suppliers |
| Over CHF 25,000 | Dual signature (e.g. manager + board chair/shareholder) | Machinery, acquisitions, multi-year contracts |
| Any amount — new payee | IBAN verification and phone confirmation | Protection against invoice manipulation fraud (BEC) |
Adapt thresholds to your revenue: a practical rule is that the operations manager threshold should not exceed 0.5% of annual revenue, while the manager threshold should stay below 2%. Document delegations in a signed annex and communicate them to the bank. In case of absence (holiday, illness), appoint a substitute with a temporary delegation of defined duration — avoid permanent "backup" signatures that are never revoked.
Liquidity reserves: how much to hold and where
The treasury reserve should not be confused with accounting working capital or with the legal reserves required under the CO (Art. 671 et seq. CO for AG and GmbH). It is a management target: immediately available liquidity to meet foreseeable obligations without resorting to costly credit or delaying critical payments.
Calculating the minimum reserve
Add up for a typical quarter:
- Monthly gross payroll × 1.5 (covering salaries + social security contributions OASI/IV/EO, LPP, occupational accident insurance)
- Average VAT provision for the reporting period (often quarterly)
- Rent, leasing and utilities for 2 months
- 20% of average monthly variable operating expenses
The total is your minimum operating reserve. Many Swiss SMEs target 1.5–3 months of fixed costs; seasonal businesses may require more.
Account structure
Separate at least three levels of liquidity:
- Operating account — daily payments, target balance = 2–4 weeks of outflows
- Reserve account — deposit or separate account, limited access, approved transfers only
- VAT and tax accounts — periodic provision for VAT (federal tax) and for cantonal and federal tax deadlines (income tax, withholding tax, etc.)
Avoid mixing reserve and operating funds in the same account: it makes the real buffer invisible and facilitates impulsive spending.
If liquidity exceeds the target reserve by more than 30%, consider a short-term deposit or early repayment of high-interest debt. If it falls below the minimum threshold, activate a plan: defer non-urgent investments, accelerate customer reminders, temporary use of factoring or operating credit — always with explicit management approval.
Monitoring: the weekly dashboard that is enough
A treasury policy only works if it is monitored. For an SME, a complex ERP is not needed: five indicators updated every week and reviewed in a 30-minute monthly meeting between management and administration are sufficient.
| Indicator | Formula / source | Attention threshold |
|---|---|---|
| Net cash balance | Bank accounts – pending payments | Below minimum reserve → recovery plan |
| DSO (Days Sales Outstanding) | Trade receivables / average daily revenue | Over 45–60 days (sector-dependent) |
| DPO (Days Payable Outstanding) | Trade payables / average daily purchases | Consistent with contractual terms, no more than 10 days late |
| Operating cash flow | Collections – operating payments for the month | Negative for 2 consecutive months → cost review |
| Variance vs budget | Actual outflows / treasury budget | Variance > 10% on recurring line item → analysis |
Accounting software used by Swiss SMEs — including cloud tools integrated with e-banking — can automate much of this dashboard. The goal is not real-time data perfection, but sufficient visibility to decide before a liquidity problem becomes a payment crisis with suppliers, social security authorities or tax authorities.
Implementation in five steps
You do not need to start from scratch. Here is a realistic path that can be completed in two to three weeks without stopping operations:
- 1
Map current flows
List all bank accounts, active signatories, who pays what today and where processes get stuck. Identify payments without dual control.
- 2
Calculate the minimum reserve
Use the typical quarter method described above. Compare with the current balance and define a plan to build or optimise the reserve.
- 3
Draft the policy (2–4 pages)
Include payment flow, delegation thresholds, rules on cards and cash, exception handling, tax calendar and control frequency. Avoid legal language: it must be readable by those who approve payments every day.
- 4
Align bank and accounting
Update bank signing authorities, configure e-banking limits, connect accounting to accounts for automatic reconciliation. Verify that the chart of accounts distinguishes operating liquidity, reserves and dedicated tax accounts.
- 5
Train the team and schedule the annual review
A one-hour meeting is enough to explain the new rules. Plan a formal review every 12 months — or after an organisational change, a significant increase in revenue or an attempted or successful fraud incident.
Common mistakes and how to avoid them
Excessive controls that slow everything down
If every invoice under CHF 200 requires the owner's signature, suppliers wait and the team works around the rules. Solution: low thresholds for small amounts and post-approval only for low-risk categories, with monthly sample audits.
Policy written but never applied
A document in a drawer does not protect you in a dispute with an auditor or a tax assessment. Integrate the rules into accounting software (approval workflows) and the monthly closing process.
Reserve only "on the Excel sheet"
Mentally setting aside CHF 50,000 as a reserve while the operating account drops below zero does not work. Physically separate accounts or use sub-accounts tracked weekly in accounting.
Ignoring invoice manipulation fraud
Swiss SMEs are targeted by fraudulent emails that alter IBANs on legitimate invoices. Introduce the rule "new payee = phone verification" and limit who can change supplier bank details in your ERP system.
Balance between control and agility
A well-designed treasury policy does not turn an SME into a bureaucratic office: it frees management time, reduces cash surprises and builds trust with banks, suppliers and employees. Rules must be rigid enough to prevent errors and abuse, but flexible enough to allow an operations manager to pay a critical supplier within the day.
Start simple: a four-stage payment flow, three delegation thresholds, a calculated minimum reserve and a weekly dashboard. Refine over time, measuring not how many approvals you collect, but how many liquidity problems you avoid and how much time you save on reminders, manual reconciliations and last-minute decisions.
With orderly accounting, up-to-date delegations and consistent monitoring, treasury stops being a daily worry and becomes an operational advantage — precisely what distinguishes Swiss SMEs that grow sustainably from those that oscillate between excessive caution and invisible risk.