Forex exposure : risk management & accounting methods in the Singapore context

• Main Authors: Tan, Winnie Wee Ni, Goh, Soo Fung, Tan, Lip Kee
• Other Authors: Nanyang Business School
• Format: Final Year Project
• Language: English
• Published: 2014
• Subjects: DRNTU::Business
• Online Access: http://hdl.handle.net/10356/59770
• Institution: Nanyang Technological University

The objective of the study is to survey the practices of foreign exchange risk management and translation of financial statements in Singapore listed companies. Volatile exchange rates in recent years have increased the risk faced by corporations. It is therefore important to gain an understanding of how listed companies manage their foreign exchange risk and how they account for their foreign exchange transactions which has a great impact on their reported earnings. This provides the motivation for this project. The literature review covers corporate strategy for forex risk management, the internal and external hedging techniques and translation methods. A questionnaire was designed to capture information on these aspects of foreign exchange management and translation methods in Singapore listed companies. In addition, a review of annual reports of selected listed companies was carried out to complement our survey. Recommendations and some further research are also discussed in the report.