A treasury is a side's total accumulated Shmuckers. A treasury is not a physical storehouse of gold or coins, but is a construct of natural Moneymancy common to all sides. At the start of a turn, the income of all cities and other sources of Shmuckers is paid into the treasury, and the total upkeep of all units on a side is paid out of the treasury, automagically.
Unlike a purse, there is no upper limit to the amount of Shmuckers a treasury can hold.
Should a side's capital be captured, the value of the Shmuckers in the side's treasury is transferred to the treasury of the side which claims the capital site.