Explain about centralised treasury function, Financial Management

Assignment Help:

Q. Explain about Centralised treasury function?

Treasury departments are usually a feature of larger companies than Frantic although it is perhaps beneficial to consider the benefits of such departments to assess what if any practices might reasonably be adopted. Fundamentally treasury centralisation is an issue concerned with economies of scale. The advantages of treasury departments are numerous and include

- Consolidating bank accounts to create also a single account through which all cash resources are managed or a virtual single account with automatic offset between different accounts. Such an approach maximises put down interest that is typically higher on larger cash balances for positive balances whilst minimising overdraft costs for negative balances.

- Borrowings is able to be arranged in bulk thus accessing lower rates.

- Foreign exchange management is enhanced. In the same manner that cash balances are effectively consolidated then so can foreign exchange risk without the need to enter into expensive hedging agreements. Foreign exchange risk consolidation is a extremely common practice.

- Treasury expertise is able to be developed within a single department thus enhancing the quality of resource management generally.

- Precautionary cash balances while centralised are probable to be lower than when considered on an individual account basis.


Related Discussions:- Explain about centralised treasury function

What are the aspects of receivables management, Q. What are the Aspects of ...

Q. What are the Aspects of Receivables Management? Scope or else Aspects or Receivables Management: - Extent of receivables management is quite wide. It comprises the following

Pvif, how do we get the pvif of a perpetuity

how do we get the pvif of a perpetuity

Semi-strong-form of efficiency, Semi-Strong form level of Efficiency This...

Semi-Strong form level of Efficiency This level states that share prices reflects all available public information. (past and present information). If the market has achieved thi

Project on investment banking house, The Project to be Addressed by the Pap...

The Project to be Addressed by the Paper: You have just graduated from CCI's MBA program and have secured a position as a fund manager for a well known investment banking house

Short sales, Short sales  : Short sales of a security means borrowing o...

Short sales  : Short sales of a security means borrowing of an underlying security by an investor from other investors who are holding it (in Demat account) and selling it with

What is the maximum additional short-term funding, B.J. Industries has a cu...

B.J. Industries has a current ratio of 2.5, with $2.5 million in current assets.  Due to sales growth, the company wants to expand accounts receivable and inventories by

Explain the term- market penetration, Explain the term- Market penetration ...

Explain the term- Market penetration A strategy which pursues to increase sales of existing services or products to the same market. Price reduction strategies Aggre

Operating cycle, applicability of operating cycle in poultry

applicability of operating cycle in poultry

The process of review and audit of internal control systems, The process of...

The process of review and audit of internal control systems The board of directors are responsible for review and maintenance of internal controls. Management  of  the  company

Zero-coupon bonds, All the bonds are not making periodic coupon payments. ...

All the bonds are not making periodic coupon payments. Zero-coupon bonds are those bonds where the bondholder realizes interest by buying it at a deep discount to its face

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd