The writer is very fast, professional and responded to the review request fast also. Thank you.
Below are for IBM and Amazon:
– The location(s) in the annual report where the company provides disclosures related to its management of foreign exchange risk.
– The types of hedging instruments the company uses and the types of hedges in which it engages.
– The manner in which the company discloses the fact that its foreign exchange hedges are effective in offsetting gains and losses on the underlying items being hedged.
Amazon.com is a global company that started as an online book seller and has grown to a massive international force for selling and shipping products. Their offerings have also grown outside of their typical space as an online retailer to media and even space travel.
The first place in the companies 2018 annual filing with the SEC that we see any mention of foreign currency is in the statement of cash flows where it is reported that in 2018 351 million dollars was lost in foreign currencies effect on cash and cash equivalents.
The first important disclosure that we see about foreign currency states that in stores and subsidiaries across the globe period reports and ongoing accounting is done in the local currency. These statements are only translated into US dollars at the end of the year with the consolidated financial statements. To make this possible many of the accounts are translated using the current exchange rate at the end of the period and revenues and expenses are translated using an average of the periods exchange rate to disclose statements in US dollars.
Throughout the financial statements it is not mentioned if specific financial instruments are used to hedge against foreign currency risk. They do state that excess cash is held in safe and AAA rated money market accounts or foreign government bonds. This may be how they are hedging against foreign currency risk by keeping money that is earned abroad in safe investments in the host country. This would protect against exchange risk by allowing investments to remain in the host currency until a favorable exchange rate can be found.
Required:
Discuss the differences noted in how IBM handles foreign exchange risk. Speculate as to why there are differences based on what has been researched about IBM and what was posted about Amazon.
Show more
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more