Foreign currency forward contract

Foreign currency forward contract

Agreement that obligates its parties to exchange given quantities of currencies at a prespecified exchange rate on a certain future date.

Forward Currency Contract

An agreement between two parties to exchange two currencies at a given exchange rate at some point in the future, usually 30, 60, or 90 days hence. A forward currency contract mitigates foreign exchange risk for the parties and is most useful when both parties have operations or some other interest in a country using a given currency. Forward currency contracts are over-the-counter contracts.
References in periodicals archive ?
This exposure can be mitigated through a foreign currency forward contract.
The fair value of a foreign currency forward contract will be affected by changes in the exchange rate, and the fair value of a put option for an available-for-sale security will be affected by changes in the fair value of the underlying security.
For example, assume a taxpayer undertakes to purchase a piece of equipment to be used in its trade or business and simultaneously enters into a foreign currency forward contract (because the contract price was denominated in a foreign currency) to "fix" the price of the equipment in U.
For certain foreign currency derivatives, such as a foreign currency forward contract, Sec.
The impact of the sale of equity investment in MIBRAG includes the loss on settlement of our foreign currency forward contract of $21.
The proper treatment of foreign currency forward contract hedges of assets and liabilities denominated in a foreign currency is not easily discernible from the examples provided in the relevant statements (SFAS 52, Foreign Currency Translation; SFAS 133, Accounting for Derivative Instruments and Hedging Activities; SFAS 138, Accounting for Certain Derivative Instruments and Certain Hedging Activities--an amendment of SFAS 133; and SFAS 149, Amendment of Statement 133 on Derivative Instruments and Hedging Activities) or from the implementation guides from the FASB Derivatives Implementation Group (DIG).
Caroline Rook, Chief Financial Officer, commented, "The realized portion of our foreign currency forward contract gain, or actual cash generated, was $4.
By investing in their related unhedged, parent iShares ETFs (EFA, EWG and EWJ) and implementing foreign currency forward contracts, iShares Currency Hedged ETFs provide an easy and cost-effective way to mitigate unwanted currency risk.
As a result, income before foreign currency forward contracts (gains)/losses, finance and income tax expenses of CAN 7.
Although the definition of a foreign currency contract provided in 1256(g)(2) may be read to include a foreign currency option contract, the legislative history of the Technical Corrections Act of 1982, which amended 1256 to include foreign currency contracts, indicates that the Congress intended to extend [section] 1256 treatment only to foreign currency forward contracts that are traded on the interbank market.
Risk strategies: Foreign currency forward contracts, interest rate swaps, commodity swaps.
d) Non-cash items include the effects of (i) stock-based compensation expense, (ii) purchase accounting, (iii) non-cash mark-to-market revaluation of foreign currency forward contracts and unrealized gains or losses on revaluations of the U.

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