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What makes foreign currency dealings risky

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Reference no: EM132479136

Barings Bank Case (from text & other available information):

  1. General Reading on Foreign Exchange
  2. David Allen. 1999.Currency Risk: The Plot. Financial Management
  3. Sara Lee's Coffee Sales Create Buzz, Wall Street Journal. 2008.
  4. Factbox: UBS trader joins rogues' gallery of financial crime, Reuters; Thu Sep 15, 2011 11:36am EDT (see Rogues Gallery)
  5. Useful Websites for the Barings case:
  6. Analytical article: Barings Debacle
  7. Story: Barings - BBC
  8. Understanding Futures: Investopedia

Case Questions: Using the Readings and Websites above to further your understanding of the case and underlying concepts, answer the following questions:

Question 1) What makes foreign currency dealings risky?

a) Discuss briefly the different types of risks.

b) How do firms address these risks? Which risk do you feel is most difficult to manage? Discuss.

Question 2) Why did Barings collapse? Could this collapse have been prevented? Discuss.

Question 3) What are key insights from the case related to:

a) Global trading and securities

b) Accounting and control

Question 4) What ethical insights can you draw from this and other instances of fraudulent behavior (see Rogues Gallery)? What factors, including the risk management strategy contribute to this? Comment.

Reference no: EM132479136

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