Prior to setting up an effective netting system,the company should know the

Question

Quizplus · Accepted Answer

An effective netting system requires understanding of current and expected daily cash flows in all currencies the company deals with, to manage and offset the receivables and payables efficiently across different currencies. Economic and translation exposures are related to the value change in foreign currencies and financial reporting, respectively, and are not directly related to the operational setup of a netting system.

Prior to Setting Up an Effective Netting System,the Company Should