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Ask the Tutor ACCA FM

Treasury bills

BBrian4y ago
Dear sir Could you please tell what’s the difference between Treasury bills and treasury shares I get confused Thank you
John MoffatJohn MoffatTutor4y ago#1
Treasury bills are debt borrowing by the government (like loan stock issued by companies except that they are short term borrowing). Treasury stock are shares in a company that have been bought back by the company but have not been cancelled - they are not relevant for Paper FM.
BBrian4y ago#2
sir with regards to treasury bills ... why would the government burrow money from companies sir
John MoffatJohn MoffatTutor4y ago#3
The government doesn't borrow money only from companies. All governments borrow money so as to help finance government spending. They issue debt just like companies issue debt and anyone can invest in the debt (and receive interest) - not only companies.
BBrian4y ago#4
oh thank you sir plus im also confused with the terms issueing debt and investing in debt issuing debt is the party who burrows the money or funds and investing in debt is the party lending or giving funds or money . am i correct sir ? ( if im not mistaken )
John MoffatJohn MoffatTutor4y ago#5
Correct.
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