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Pages:
1 page/≈275 words
Sources:
1 Source
Style:
APA
Subject:
Accounting, Finance, SPSS
Type:
Essay
Language:
English (U.S.)
Document:
MS Word
Date:
Total cost:
$ 5.27
Topic:

Apple Inc. Hedging Instruments

Essay Instructions:

Many companies make annual reports available on their corporate web page, often under an Investors tab. Annual reports also can be accessed through the U.S. Securities and Exchange Commission's EDGAR system.
To find these reports, click the Filings tab toward the top right of the screen. From the drop-down menu, click Company Filings Search. Type in a company name in the Company Name search box. Then, search for 10-K in the Filing Type search box.
Access the most recent annual report for your favorite international company to complete the following requirements.
Identify the location(s) in the annual report where the company provides disclosures related to its management of foreign exchange risk.
Determine the types of hedging instruments the company uses and the types of hedges in which it engages.
Determine 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.

Essay Sample Content Preview:

Apple Inc. Hedging Instruments
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Apple Inc. Hedging Instruments
Hedging instruments
Apple utilizes hedging instruments to control financial risks to make sure the company is safe from future losses due to foreign exchange risks. The hedging instruments employed comprise:
Forward contracts which is a form of agreement that permits the company to sell its assets at a defined price on a future date (Campbell et al., 2014). This helps Apple hedge its foreign currency exposure and interest rate changes.
Options give a company the right to transact on its assets at an agreed price before or at the agreed duration. Apple uses this to hedge against fluctuations occurring in foreign exchange rates and interest rates.
Future contracts. This involves an agreement to transact on the company’s assets at a future date on prices agreed today (Campbell et al., 2014). It is a good hedging instrument that prevents the company ...
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