Netting and Matching

You really should watch our free lectures because this is explained in full (the lectures are a complete course for Paper F9 and cover everything needed to pass the exam well!)

Netting is using foreign currency receipts to make payments in the same currency – only the net amount is then at risk and needs hedging.

Matching to creating an expense in the same currency and of a similar amount to foreign currency income. As the exchange rate changes, then both the income and expense change by a similar amount.

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