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ACCA Applied Knowledge · Business and Technology · The relationship between accounting and other business functions

Which activity is normally part of the treasury role rather than the financial reporting role in a larger organisation?

Managing foreign currency exposure and investing short-term surplus cash is a treasury activity, as treasury handles liquidity, funding and financial risk. Preparing the statement of financial position is financial reporting, and posting supplier invoices is routine transaction processing.

  1. AManaging foreign currency exposure and short-term cash investmentCorrect
  2. BPreparing the annual statement of financial position
  3. CPosting supplier invoices to the purchase ledger

Explanation

Treasury manages liquidity, borrowing, investment of surplus cash and currency and interest rate risk. Preparing statements is financial reporting, and posting invoices is transaction processing in bookkeeping.

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