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متابعة

Can you give some criteria for decisions facing the currency exposure in the short term?

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تم إضافة السؤال من قبل Nadjib RABAHI , Freelancer , My own account
تاريخ النشر: 2016/06/21
Vaiyapuri Gopalakrishnan
من قبل Vaiyapuri Gopalakrishnan , Manager - After Sales , M/s Saud Bahwan Automotive llc

Foreign exchange exposure is classified into three types viz. Transaction, Translation and Economic Exposure. Transaction exposure deals with actual foreign currency transaction. Translation exposure deals with the accounting representation and economic exposure deals with little macro level exposure which may be true for the whole industry rather than just the firm under concern. Foreign exchange exposure is said to exist for a business or a firm when the value of its future cash flows is dependent on the value of foreign currency / currencies. If a British firm sells products to a US Firm, cash inflow of British firm is exposed to foreign exchange and in a case of the US based firm cash outflow is exposed to foreign exchange. Why we are so skeptical about this exposure? Simple! It is because the exchange rates tend to change or fluctuate.

Ahmed Mohamed Ayesh Sarkhi
من قبل Ahmed Mohamed Ayesh Sarkhi , Shared Services Supervisor , Saudi Musheera Co. Ltd.

Agree with expert ansewrs above

 

Emmanuel Wamweta
من قبل Emmanuel Wamweta , production supervisor , Tembo Steel Rolling

I agree with & endorse Mr.Vaiyapuri's excellent and insightful submission, it makes perfect sense.

Thanx for the invitation