Abstract

This paper examines some of the fundamental problems involved in foreign exchange risk management. The author examines the particular problems facing U.K. companies in the acquisition of finance and its investment oil an international basis. The analysis places these decisions within the context of strategic planning and concentrates upon the group of problems which relate to raising loans in strong foreign currencies; investments and fixed assets located overseas in territories with weak currencies; and finally the net current assets of foreign subsidiaries trading in territories with weak currencies. The author suggests that changes in accounting convention will force companies to concentrate rather more on some of these issues which have perhaps not received the attention they so rightly deserve.

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