At the sharp end (TT Sept05 p18-20)

Treasurers need to carefully consider what limits to set to avoid concentrating counterparty risk in one place.Sarbanes-Oxley provides a framework on materiality of losses that can be extended to counterparty exposures. Management of exposures can be made more efficient by structuring documentation to match treasury operations. Treasurers need to think the impossible – what does happen in a doomsday scenario?