Question 7 Saturn Plc is a UK-based service company with a number of wholly owned subsidiaries and interests in associated companies throughout the world. The company is quoted on the London Stock Exchange and is ranked 12th on the FTSE 100. In response to the rapid growth in the company, the Managing Director has ordered a review of the company's organization structure, particularly the treasury function. The Managing Director holds the opinion that a separate treasury department should be established. At present, treasury functions are the responsibility of the Chief Accountant. Required: a) Discuss the main responsibilities of a treasury department in a company such as Saturn Plc and explain the benefits that might accrue from centralizing treasury activities. [15 marks] [Word limit - 500 words] b) Describe the issues which might arise if the company established a separate treasury department as a profit centre rather than a cost centre. [10 marks] [Word limit - 300 words] Question 7 Saturn Plc is a UK-based service company with a number of wholly owned subsidiaries and interests in associated companies throughout the world. The company is quoted on the London Stock Exchange and is ranked 12th on the FTSE 100. In response to the rapid growth in the company, the Managing Director has ordered a review of the company's organization structure, particularly the treasury function. The Managing Director holds the opinion that a separate treasury department should be established. At present, treasury functions are the responsibility of the Chief Accountant. Required: a) Discuss the main responsibilities of a treasury department in a company such as Saturn Plc and explain the benefits that might accrue from centralizing treasury activities. [15 marks] [Word limit - 500 words] b) Describe the issues which might arise if the company established a separate treasury department as a profit centre rather than a cost centre. [10 marks] [Word limit - 300 words]