FREE CTP Study Guide 2026: All 5 Treasury Domains, Built to the Exam

This free CTP study guide teaches to the Certified Treasury Professional exam from the Association for Financial Professionals (AFP) — all five performance domains AFP tests, organized exactly the way the exam is built.^[1] It is a broad, applied exam covering how a corporation manages its cash, liquidity, capital, risk, and technology, so this guide is deep: real teaching of the high-yield concepts and formulas, not a summary.

And it’s interactive, not a wall of text: every domain has a built-in checkpoint quiz, hover-able glossary terms, and concept questions, so you learn by doing.

Read it domain by domain, test yourself at each checkpoint, then round out your free CTP study resources with our practice questions and flashcards.

CTP Exam Snapshot

AFP weights some domains far more heavily than others — spend your time accordingly. AFP publishes the breakdown as question-count ranges out of 170, not fixed percentages; the shares below are derived from those official ranges. Maintaining corporate liquidity is by far the largest block — roughly a third of the exam:^[1]

The percentages are derived (the range midpoint divided by 170), because AFP states only the question ranges. Treat them as study-weighting guidance, not exact published figures.^[1] About 10–15% of the exam requires calculations — they cluster in the cash conversion cycle, NPV, IRR, WACC, and short-term yield math, so make sure you can work those by hand.

1 · Maintaining Corporate Liquidity

Roughly a third of the exam — the single largest domain. This is the heart of day-to-day treasury: making sure the company has enough cash, in the right place, at the right time, at the lowest cost. It spans working capital, collections and disbursements, payment systems, and short-term investing and borrowing.^[1]

Working Capital & the Cash Conversion Cycle

Working capital is current assets minus current liabilities — the resources that fund operations. The most-tested measure in all of treasury is the cash conversion cycle, which tells you how long cash is tied up before it comes back:

Each piece matters. Days inventory outstanding and days sales outstanding stretch the cycle out; days payable outstanding pulls it back in. A shorter — or negative — CCC means the firm finances less working capital and has more cash free to invest or pay down debt.

Collections & Cash Concentration

Treasury speeds up collections and pools cash so it can be put to work. A lockbox sends customer payments to a bank-controlled post office box for faster processing and clearing, cutting collection float. Funds from many accounts are then swept into a concentration account for control and investment — most efficiently using zero balance accounts, which net to zero each day, or notional pooling, which offsets balances for interest without moving the money.

Disbursements & Float

On the payment side, treasury manages outflows to keep cash as long as possible while still paying on time. Controlled disbursement gives an early-morning total of the checks that will clear so the account can be funded precisely. Disbursement float (the lag before a payment clears) used to be a lever, but faster electronic clearing has shrunk it.

Cash positioning — determining the day’s available cash — ties collections and disbursements together so the treasurer can invest a surplus or cover a shortfall before the cutoff.

Payment Systems

Choosing the right payment rail is a high-yield, frequently tested skill. Each system trades off speed, cost, finality, and value:^[6]

Fedwire is real-time, gross, and final — best for large, urgent payments. CHIPS nets large-value, mostly international dollar payments. ACH batches low-value, high-volume payments cheaply. RTP and FedNow settle instantly, 24/7. Remember that SWIFT is a messaging network — it carries payment instructions, not the funds themselves.

Short-Term Investing

Excess operating cash is invested under a written policy whose first priorities are safety and liquidity, with yield last. The core money-market instruments are:

Commercial paper stays at or under 270 days specifically to avoid SEC registration, which lowers its cost.^[7] A repo is a collateralized way to invest cash overnight, so it carries less risk than unsecured paper.^[8]

Short-Term Borrowing & Forecasting

To cover shortfalls, treasury draws on short-term funding: a line of credit or revolving facility, commercial paper (for top-rated issuers), or bank loans. A compensating balance requirement raises the effective cost of a credit line.

All of this rests on cash flow forecasting — projecting inflows and outflows over a horizon so the treasurer knows in advance whether to invest or borrow. The choice of method (receipts-and- disbursements for the short term, distribution or statistical models for longer horizons) is a common exam topic.

2 · Capital Structure & Long-Term Capital

About a fifth of the exam — the second-largest domain. This is corporate finance: how a company raises long-term funding, what that funding costs, and how it decides which long-term investments to make. The math here (WACC, NPV, IRR) is the most computational part of the exam.^[1]

Cost of Capital (WACC)

The weighted average cost of capitalis the firm’s hurdle rate — the blended return it must earn:

Capital Budgeting (NPV & IRR)

Capital budgeting evaluates long-term projects. The two main rules are net present value and the internal rate of return:

For independent projects, NPV and IRR usually agree. For mutually exclusive projects, follow NPV when the two conflict, because NPV measures value added in dollars. Always use incremental, after-tax cash flows, ignore sunk costs, and include relevant opportunity costs. The payback period and profitability index are secondary screens.

Capital Markets & Raising Capital

Long-term funding comes from the capital markets. Debt is raised by issuing bonds (which pay a coupon and return principal at maturity) or taking term loans; equity is raised through an initial or follow-on public offering, or kept internally as retained earnings.

Bond prices move inversely to interest rates, and longer maturities and lower coupons are more rate-sensitive — the same duration logic that drives interest-rate risk in Domain 4. Treasury weighs the lower after-tax cost of debt against the financial risk it adds.

Capital Structure & Payout Policy

Capital structure is the debt-versus-equity mix. More debt increases financial leverage — magnifying returns to equity but also raising the risk of distress — while operating leverage comes from fixed operating costs. Firms target a structure that minimizes WACC.

On the payout side, a company returns cash to shareholders through dividends or share repurchases; the decision balances signaling, taxes, and the firm’s reinvestment opportunities.

3 · Internal & External Relationships

The smallest domain — roughly 9% of the exam — but easy points if you know it. It covers how treasury works with its banks and financial service providers, and the accounting, governance, and reporting foundations treasury relies on.^[1]

Bank Relationship Management

Bank relationship management is the work of selecting, evaluating, and managing banking partners. New services are usually competed through an RFP(request for proposal) or RFI, scored on price, capability, service levels, and creditworthiness. Companies typically maintain a small group of core banks to balance redundancy against the cost and complexity of many relationships, and they reward credit providers with ancillary, fee-generating business (the “share of wallet” idea).

Account Analysis & the Earnings Credit Rate

Banks bill treasury services on an account analysis statement — a monthly itemization of services, volumes, and charges. Many banks apply an earnings credit rateto the company’s collected balances; this soft credit offsets fees but is not paid out as interest. Know the balance definitions cold:

Accounting & Governance Fundamentals

Treasury must read the numbers it manages. The three financial statements link together: the income statement (accrual revenue minus expenses), the balance sheet (assets = liabilities + equity), and the cash flow statement (operating, investing, financing), which reconciles accrual income to actual cash. Good governance— clear policies, segregation of duties, and board oversight — and high ethical standards underpin everything treasury does, because it controls the company’s money.

4 · Monitoring & Controlling Risk

About 15% of the exam. Treasury is the front line for financial risk and a key player in enterprise risk. This domain covers identifying exposures, hedging them, preventing fraud, and meeting regulatory and operational-control requirements.^[1]

Enterprise Risk Management

Enterprise risk management takes a firm-wide, portfolio view of risk rather than handling each risk in a silo. The standard process is to identify, assess, prioritize, and respondto risks in line with the company’s risk appetite. The four classic responses are to avoid, reduce (mitigate), transfer (insure or hedge), or accept a risk.

Financial Risk: FX & Interest Rates

The biggest financial risks treasury manages are foreign-exchange and interest-rate risk. FX risk comes in three forms:

Companies hedge with forwards, futures, options, and swaps, or naturally by matching foreign revenues to foreign costs and using netting across intercompany flows. Interest-rate risk — that rate moves change borrowing costs or investment values — is managed with interest-rate swaps, caps, and matching the duration of assets and liabilities.

Payments Fraud & Internal Controls

Treasury owns most of the company’s payment fraud controls. On checks, positive pay matches every check against a company-supplied issue file; payee positive pay adds the payee name; reverse positive pay flips the process so the company approves presented items.

On electronic payments, ACH debit blocks and filters stop unauthorized debits, and dual control requires two people to release a payment. Strong segregation of duties — separating who initiates, approves, and reconciles — is the foundational internal control.

Regulatory, Operational Risk & Insurance

Treasury must comply with rules such as SOX (internal controls over financial reporting), KYC/AML requirements, and the UCC articles governing payments. Operational risk — failures of people, process, or systems — is mitigated with controls, documentation, and business continuity planning.

Risks that can’t be hedged or controlled away are often transferred through insurance. The key idea is choosing the right response — avoid, mitigate, transfer, or accept — for each exposure.

5 · Treasury Technology

About 15% of the exam. Modern treasury runs on technology, and AFP made it a full domain. This covers the systems that give treasury cash visibility and automation, how those systems connect to banks, and the security and emerging tech reshaping the function.^[1]

Treasury Management Systems & the ERP

A treasury management systemcentralizes cash positioning, forecasting, payments, debt and investment tracking, and risk management. It pulls in bank data automatically and connects to the company’s ERP, so transactions flow into the general ledger without rekeying. The whole technology stack fits together like this:

Most new systems are cloud-based (SaaS), which lowers IT overhead and speeds updates. The single biggest benefit a TMS delivers is real-time, global cash visibility — the foundation for every liquidity and forecasting decision.

Bank Connectivity & Data Standards

Systems talk to banks over several channels: direct host-to-host links, SWIFT, and increasingly APIs for real-time data and payments. Bank reporting arrives in standard formats — legacy BAI2 and the modern ISO 20022 XML standard, whose rich, structured data improves straight-through processing and reconciliation. Common ISO 20022 message families are pain (payment initiation) and camt (cash management and statements).

Security & Emerging Technology

Because treasury moves money, data security is paramount: encryption, strong access controls, multi-factor authentication, and continuous fraud monitoring. Emerging tools include APIs for instant connectivity, electronic bank account management (eBAM) to digitize account administration, and artificial intelligence for forecasting and anomaly detection. The exam expects you to know what these technologies do and the control and security considerations they raise, not to implement them.

How to Use This Study Guide

A study guide is a map, not the whole territory — use it alongside AFP’s Essentials of Treasury Management and our practice tools, weighting your time toward the heaviest domains.^[4] With pass rates around 43–51%, disciplined, spaced practice is what separates a pass from a fail.^[2]

CTP Glossary

Quick definitions for the terms you’ll see most across the CTP exam:

Account analysis statement

A monthly bank statement detailing the services a company used, their volumes and charges, and any earnings credit applied.

ACH (Automated Clearing House)

A batch electronic network for low-value, high-volume credit and debit transfers such as payroll and vendor payments. Low cost; settles in one to two days (or same day).

Available balance

The funds in an account a company can actually use — the collected balance after the bank's funds-availability holds.

Bank relationship management

Selecting, evaluating, and managing a company's banking partners and the services they provide, often via an RFP process.

Capital budgeting

The process of evaluating and selecting long-term investments using rules such as NPV, IRR, payback, and the profitability index.

Capital structure

The mix of debt and equity a firm uses to finance its assets. More debt raises expected return on equity but also financial risk.

Cash conversion cycle (CCC)

The number of days it takes to turn investments in inventory and receivables into cash, net of the time taken to pay suppliers. CCC = DIO + DSO − DPO; lower is better.

Cash positioning

Determining the day's available cash position to decide whether to invest a surplus or cover a shortfall.

CHIPS

The Clearing House Interbank Payments System — a private, net-settlement network for large-value, mostly international U.S.-dollar payments.

Commercial paper (CP)

Short-term, unsecured corporate debt with maturities of 270 days or less, usually sold at a discount, used to fund working capital.

Compensating balance

A minimum deposit a borrower agrees to keep with a bank as part of a credit or service arrangement.

Concentration account

A central account that pools funds from multiple subsidiary or function accounts for better control and investment of cash.

Controlled disbursement

A service giving a company early-morning notice of the exact total of checks that will clear that day, so it can fund the account precisely.

Days inventory outstanding (DIO)

The average number of days a company holds inventory before selling it. A component of the cash conversion cycle.

Days payable outstanding (DPO)

The average number of days a company takes to pay its suppliers. Higher DPO (within terms) keeps cash longer.

Days sales outstanding (DSO)

The average number of days it takes a company to collect cash after a credit sale. Lower DSO frees up cash.

Earnings credit rate (ECR)

A soft, non-cash rate a bank applies to collected balances to offset account-analysis service charges; it cannot be paid out as interest.

eBAM

Electronic bank account management — digitizing the opening, maintenance, and closing of bank accounts and signer records.

Economic exposure

The long-run risk that exchange-rate changes alter a firm's competitive position, future cash flows, and market value.

Enterprise risk management (ERM)

A firm-wide, structured process for identifying, assessing, prioritizing, and responding to all of a company's risks in a coordinated way.

ERP integration

Connecting treasury tools to the enterprise resource planning system so transaction and accounting data flow automatically.

Fedwire

The Federal Reserve's real-time gross settlement system for large-value, time-critical payments, settled individually and finally.

Financial leverage

The use of debt (fixed financing costs), which magnifies the effect of a change in operating income on net income.

Float

The time delay between when a payment is initiated and when the funds are actually available. Includes mail, processing, and availability float.

Forward contract

A customized, over-the-counter agreement to buy or sell an asset at a set price on a future date.

Hedging

Using financial instruments — forwards, futures, options, or swaps — to reduce or offset an exposure to financial risk.

Internal rate of return (IRR)

The discount rate that makes a project's NPV equal zero. Accept a project when its IRR exceeds the WACC.

ISO 20022

A global, XML-based financial-messaging standard carrying rich, structured data; adopted by Fedwire and CHIPS and used for payments and reporting.

Line of credit / revolver

A pre-approved bank borrowing facility a firm can draw on as needed; a revolving facility can be drawn, repaid, and redrawn over its term.

Lockbox

A bank-operated collection service: customer payments go to a post office box the bank controls, speeding processing and clearing.

Money market fund (MMF)

A mutual fund investing in short-term, high-quality instruments (T-bills, commercial paper, repos) used by corporations for liquid, low-risk cash investment.

Net present value (NPV)

The present value of a project's incremental after-tax cash inflows minus its initial outlay, discounted at the WACC. Accept when NPV is positive.

Netting

Offsetting payables against receivables (often intercompany) so only the net amount is settled, cutting transaction and FX costs.

Notional pooling

Combining the credit and debit balances of several accounts for interest purposes without physically moving the funds.

Operating leverage

The use of fixed operating costs, which magnifies the effect of a change in sales on operating income.

Positive pay

A bank fraud control that pays only checks matching a company-supplied issue file and flags the rest for review.

Real-time payments (RTP/FedNow)

Instant, 24/7/365 credit-transfer systems that settle individual lower-value payments immediately and irrevocably.

Repurchase agreement (repo)

A short-term collateralized loan: one party sells securities and agrees to buy them back at a higher price; the difference is the repo rate.

Straight-through processing (STP)

Fully automated, end-to-end transaction processing from initiation to reconciliation with no manual rekeying.

Swap

An agreement to exchange streams of cash flows, such as fixed-for-floating interest payments or two currencies.

SWIFT

A global messaging network banks use to transmit secure payment and trade instructions; it moves messages, not money.

Transaction exposure

The risk that a contracted future foreign-currency cash flow changes in value before it settles. The most commonly hedged FX exposure.

Translation exposure

The accounting risk that arises when a foreign subsidiary's statements are consolidated into the parent's reporting currency.

Treasury bill (T-bill)

A short-term U.S. government discount security (maturities up to one year) used as a safe place for short-term cash.

Treasury management system (TMS)

Software that centralizes cash positioning, forecasting, payments, debt and investments, and risk management, integrating with bank data and the ERP.

Weighted average cost of capital (WACC)

The blended, after-tax cost of a firm's debt and equity, weighted by their market-value proportions. The firm's hurdle rate.

Working capital

Current assets minus current liabilities — the short-term resources a firm uses to fund day-to-day operations.

Zero balance account (ZBA)

An account swept to exactly zero each day by automatic transfer to or from a master concentration account, centralizing cash and minimizing idle balances.

Free CTP Study Materials & Resources

Everything you need to prepare for the CTP exam is free here — no paywall, no sign-up. This guide is the foundation; pair it with the rest of our free CTP study materials for active recall, timed practice, and last-minute review:

• CTP Practice Test — exam-style questions across all five treasury domains, with explanations.
• CTP Flashcards — active-recall decks for the high-yield formulas, payment systems, and treasury concepts.

CTP Study Guide FAQ

References

1. 1.Association for Financial Professionals. “CTP Test Specifications.” AFP. ↑
2. 2.Association for Financial Professionals. “CTP Exam Scoring.” AFP. ↑
3. 3.Association for Financial Professionals. “CTP Eligibility Requirements.” AFP. ↑
4. 4.Association for Financial Professionals. “Essentials of Treasury Management, 8th Edition.” AFP. ↑
5. 5.Association for Financial Professionals. “CTP Exam — At a Glance.” AFP. ↑
6. 6.Board of Governors of the Federal Reserve System. “Fedwire Funds Service.” Federal Reserve. ↑
7. 7.Board of Governors of the Federal Reserve System. “Commercial Paper.” Federal Reserve. ↑
8. 8.Federal Reserve Bank of New York. “Repo and Reverse Repo Agreements.” Federal Reserve Bank of New York. ↑
9. 9.U.S. Securities and Exchange Commission. “Money Market Funds — Investor.gov.” Investor.gov / SEC. ↑

Sources for the concept answers

Every answer in the CTP concept questions above is drawn from an official primary source:

1. Association for Financial Professionals. “Certified Treasury Professional (CTP) — Body of Knowledge.” Association for Financial Professionals.

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