Why You Need a Charter, Not Just a Meeting

Most healthcare platforms move cash by phone call. The CFO asks the controller to move $2M to the reserve. The controller does it. There is no written approval, no documented threshold, no record of why the decision was made.

That works at $20M of annual revenue. It does not work at $200M. Once your platform crosses meaningful scale, your audit committee will want a cash management committee with a documented charter. This article is that charter.

Scope

The committee owns five decisions. Reserve sizing and replenishment. Sweep rule configuration and exceptions. FDIC coverage strategy and IntraFi enrollment. Bank relationship management and vendor selection. Material cash movements above defined thresholds.

Anything outside those five decisions is operational and lives with the treasury team. Anything inside requires committee review.

Membership

Five voting members at a typical platform: CFO (chair), CEO, controller, treasury lead, and one independent board member (usually the audit committee chair). Non-voting attendees include the platform's external auditor partner and lead PE sponsor representative.

Smaller platforms can run a three-person committee: CFO, controller, board representative. The principle is the same.

Cadence

Weekly: 30-minute working session. Review prior week sweep activity, exception queue, balances against reserve target, any approvals needed for the next 7 days.

Monthly: 60-minute review session. Approve any material policy exceptions from the prior month, sign off on the monthly treasury report before it goes to the board, review FDIC coverage status and any banking relationship changes.

Quarterly: 90-minute review session. Approve any changes to the cash management policy. Review bank vendor performance against SLAs. Confirm reserve sizing model still appropriate given current DSO trends.

Approval Thresholds

The committee approves cash movements above documented amounts. Typical thresholds at a $200M revenue platform:

• Movements between operating reserve and yield-bearing reserve: pre-approved automation, no committee review

• One-time wires between $250K and $2M: CFO approval, committee notified

• One-time wires above $2M: committee approval required

• New bank relationship: committee approval required

• Material policy changes: quarterly committee approval, board notification

Documentation

Every committee decision is documented in a one-page minutes file. Date, attendees, decisions taken, action items, next review date. The audit committee receives a quarterly summary.

This sounds like overhead. It is the cheapest insurance you will buy. When a regulator, lender, or sponsor asks how cash decisions get made at your platform, you hand them the binder. The conversation ends in 10 minutes.

What This Replaces

The committee replaces ad hoc cash decisions. It replaces the phone call between CFO and controller. It replaces the weekly anxiety about whether the reserve is right. It replaces the audit committee question that everyone dreads.

If your platform does not have a cash management committee yet, start one this quarter. Use the template above. Adjust thresholds and cadence to your platform's size. The first three meetings will feel like overhead. By meeting four, your team will wonder how you ran without it.