The Usage of Derivatives as a Hedging Instrument for Export Companies

Nermin Çıtak () and Fatma Kurt
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Nermin Çıtak: Marmara Üniversitesi, İşletme Fakültesi, İşletme Bölümü, İstanbul, Türkiye
Fatma Kurt: Türk Eximbank A.Ş., İstanbul, Türkiye

Muhasebe Enstitusu Dergisi - Journal of Accounting Institute, 2020, vol. 0, issue 62, 11-22

Abstract: Export has become an indispensable element of business life due to the growth of international economic relations and developments in technology. Companies tend to export to different markets to distribute their risk, increase their sales, and maximize their earnings. Financial risk is one of the risks faced by businesses during export transactions. Therefore, export companies benefit from derivative products to minimize or eliminate their financial risks. In this study, to what extent derivative products are used as hedging instruments, which derivative products are used against what kind of financial risks, and how these derivative products are treated in accountancy are examined. Consequently, if export companies use derivative products as hedging instruments, they prefer forward transactions against currency risks, and they keep company records within the scope of hedge accounting.

Keywords: Export; derivatives; hedging instruments (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:ist:imeder:v:0:y:2020:i:62:p:11-2

DOI: 10.26650/MED.2020672174

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