Printer FriendlyBeing able to recognise currency risks and knowing which cost effective and competitive risk control technique to use is valuable to all those responsible, directly or indirectly, for international purchases and sales. This includes International Purchasing and Sales Managers, Commercial Managers, Estimators, Contract Administrators and Financial & Treasury Managers, Credit Managers, Bankers and Lawyers, etc.
Foreign currency risk originates in the international
purchasing/sales department long before the commitment to a transaction.
It can remain unidentified and unmanaged throughout the bidding/purchasing or tendering/contracting process. Once the buying or selling contracts become effective it is too late to cost effectively control the FX risk. Eventually the cost will be reflected in the Profit & Loss Account as an unbudgeted increase in expenditure or a shortfall in revenue.
Sometimes the rate of exchange movement is favourable and improves profit margins. However, nobody gets the credit for this windfall, only the criticism for exposing the company to potential FX loss.
Knowing when and where FX risks can be first
identified, enables continuous monitoring and control throughout the
transaction.
If you are importing or exporting, for expert commercial foreign exchange services, speak to us at Raphael's Bank.
Quick and easy foreign exchange deals via our branch network, treasury centres or over the Internet.
More information.