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Range Forward

A range forward is a derivative contract that protects buyers against adverse market movements, allowing them to benefit from favourable spot rate movements within a certain range that lies between the strike and barrier rate. Due to their complex nature, range forwards are not the most suitable products for corporate treasurers wishing to protect their […]

Ratio Knock-out Forward

A ratio knock-out forward is a structured option contract that allows the purchaser to lock in a more favourable exchange rate than with an outright forward, for a predefined ratio amount, on condition that the spot rate does not hit or exceed the knock-out rate. If this occurs, the contract is automatically cancelled. Due to […]

Realised gains and losses

Realised gains and losses is an accounting concept to define the results obtained after the sale of an asset or the settlement of a product or service liability claim is performed at a different value to the value at which the transaction was recorded in the accounting books. This term is very familiar to international […]

Reconciliation

Reconciliation is an accounting concept that refers to the process of confirming that a set of two records are in agreement. More info Payments Hub Currencies Payment reconciliation is an important task for accounting teams. It involves comparing an account payable with what has actually been paid or, in the case of an account receivable, […]

Reference Exchange Rate (Central Bank)

The Reference Rates are the exchange rates fixed by central banks for all currencies, usually on a daily basis. They are based on a regular daily concertation procedure involving all of the banks governed by that central bank. The European Central Bank sets the euro reference exchange rates at 14:15 in a daily conference call […]

Remeasurement Currency Risk

In currency terms, Remeasurement Currency Risk is a treasury concept referring to the risk currency volatility poses to a company’s financial statements due to alterations in the value of assets and liabilities denominated in foreign currency when a remeasurement is carried out. Remeasurement is the process of re-assessing the value of all of a company’s […]

Repatriation of profits

Companies with profits made in foreign countries under a different currency periodically repatriate their profits into the company home currency. Operating in more countries means access to more customers and thus, greater sales and profits. However, without correct management of exchange rate risk, these profits can quickly dwindle. Example of “repatriation of profits” The Japanese […]

Reporting currency

Reporting currency is a financial term used in the corporate treasury to define the currency used by a parent company in the financial statements to make easier the understanding of their financial reports. Many large businesses work with international providers and export their products to foreign markets which generate transactions in different currencies. As part […]

Reserve currency

A reserve currency is a currency that central banks hold as part of their foreign exchange reserves. This currency is often used for their international transactions. Reserve currencies are always strong currencies with a major role in international trade. They are therefore often also defined as a hard currency or safe-haven currency, as these have […]

Reset Forward

A reset forward is a derivative contract that protects buyers against adverse movements in currency markets, allowing them to benefit from favourable movements within a certain range, limited by the predefined trigger level. Due to their complex nature, reset forwards are not the most suitable products for corporate treasurers wishing to protect their profits from […]