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CIMAPRO19-P03-1 Exam - Topic 3 Question 107 Discussion

Which of the following statements best explains why a corporate treasury department should be established as a cost centre rather than a profit centre?
A) The Treasury Department should not be encouraged to speculate.
B) The Treasurer should not have a great deal of responsibility.
C) There is no way for the Treasury Department to generate revenue.
D) The Treasurer has the ability to manipulate the Department's reported profit.

CIMAPRO19-P03-1 Exam - Topic 3 Question 107 Discussion

Actual exam question for CIMA's CIMAPRO19-P03-1 exam
Question #: 107
Topic #: 3
[All CIMAPRO19-P03-1 Questions]

Which of the following statements best explains why a corporate treasury department should be established as a cost centre rather than a profit centre?

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Suggested Answer: A

by Jacquline at May 31, 2026, 11:52 AM

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Rhea
10 hours ago
Exactly, D could lead to ethical issues. Better to avoid that.
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Dorathy
6 days ago
D is risky. Manipulating profits isn't a good practice.
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Lindsey
11 days ago
True, but A feels more aligned with treasury's role.
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Shelia
16 days ago
C could work too. Treasury doesn't generate revenue directly.
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Juan
21 days ago
I agree, A makes sense. We need stability in treasury.
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Tiera
26 days ago
I think A is the best choice. Speculation can lead to risks.
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Reuben
1 month ago
B) seems off, treasurers need responsibility!
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Ricki
1 month ago
Wait, are we sure there's no revenue potential?
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Tawna
1 month ago
D) totally agree, profit manipulation is risky.
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Portia
2 months ago
C) is spot on, they can't really generate revenue.
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Willard
2 months ago
A) makes sense, no need for speculation.
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Marvel
2 months ago
I lean towards option A as well, but I wonder if there's more to the responsibilities of the treasurer that we should consider.
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Jeannine
2 months ago
I remember a practice question that discussed the responsibilities of a treasurer, and it seemed like option D could be a concern if they have too much control over profits.
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Gearldine
2 months ago
I'm not entirely sure, but I feel like option C could be right since the treasury mainly manages funds rather than generating income.
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Melina
2 months ago
I think option A makes sense because if the treasury is a profit centre, they might take unnecessary risks.
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