What is the function of a liquidity committee?

The function of a liquidity committee is primarily focused on overseeing liquidity risk management practices. This includes ensuring that the organization maintains sufficient liquid assets to meet its short-term obligations and assessing potential financial risks that could impact liquidity. The committee plays a crucial role in determining the strategies and policies needed to effectively manage liquidity, monitor the liquidity profile regularly, and respond to changing market conditions.

In contrast, the other options pertain to different areas of business operations. Developing marketing strategies is focused on promotional activities and customer engagement, while managing human resources deals with employee relations and staffing. Analyzing financial statements involves reviewing a company's financial documents to evaluate performance but does not directly relate to the management of liquidity risks. The specific focus of the liquidity committee on risk management ensures that the organization can navigate financial challenges effectively.