Kantox launches a new FX management tool: FX accounting reports

We have improved Kantox currency risk management tool by adding a new feature that boosts efficiency: periodical reporting of “mark to market” positions for all clients. Reporting can be a painful process for finance departments, especially in companies working with multiple currencies. An international company could easily have forward contracts in 10 to 15 currencies to hedge the underlying risk of assets and liabilities denominated in each currency.Having to calculate the value of all hedges manually is both complicated and time-consuming. Financial managers first need to get the exchange rates for all exposed currency pairs, then calculate the value of those open positions at the forward rate and finally assess the overall difference between the historical and “mark-to-market” value of their hedges.The client will have access to the mark to market value of the forwards contracts always in the sold currency.The accounting differential is calculated according to the difference between the current rate at month-end, and the forward rate locked by the client on his contract.

(Total amount of currency sold * actual forward rate) - (Total amount of currency sold * Forward rate) = Accounting differential

For instance, a European company that purchased a forward contract of USD 100.000 in April 2016, would reflect a positive accounting differential on the M2M valuation of its December report:

(100,000 * 0.9501) – (100,000 * 0.8014) = 14,870

To aide financial managers conquer this formidable task, we developed a new tool that radically improves the accounting process. From now on, financial managers will have instant access to monthly “mark-to-market” valuation reports on all their forward contracts. This feature simplifies our clients accounting reporting – particularly for those practising hedge accounting.These reports are available for each month, synchronising with standardised accounting periodicity. To further ease the burden on accounting and finance departments, the reports are downloadable in either .xlsx or .csv format.In Kantox we understand our clients’ problems and create technological solutions adapted to their needs. We are once again proud to provide a unique feature that simplifies the work of CFOs and financial managers in the face of complex currency management.

Do you want to see how the M2M reporting tool works? Contact with a Kantox expert