Differentiate between “Financial Documents” and “Commercial Documents” Financial documents Financial documents mean bills of exchange, promissory notes, checks or other similar instruments used for obtaining the payment of money. Commercial documents Commercial documents mean invoices, transport documents, documents of title or other similar documents or any other documents whatsoever not being financial documents.
What is Cross Rate? The exchange rate of major international currencies are quoted with reference to their base currencies e.g. in London with reference to Pound sterling and in New York with reference to US Dollars. At times for transactions between two currencies whose rates are not quoted, a third currency rate may have to… Read More »
What is Foreign Exchange? The foreign exchange is defined in different ways, e.g. Webster Dictionary as “transferring of funds to settle accounts with firms or residents in a foreign currency.” Encyclopedia Britannica: as the system by which commercial nations discharge their debts to each other and H.E. Evitt : “the means and methods by which… Read More »
Spot Deal A spot deal is one where foreign exchange is sold or purchased for immediate delivery or latest delivery within two days. the rate at which such deals are conducted is known as the spot rate. In majority of transactions currency is bought or sold for immediate delivery. “Spot” rate refers to transaction that… Read More »