The solution will cover International Financing Methods, Financial Transaction Risks, Legal Requirements for the Documents, Letter of Credit Transaction, Incoterms for Imports and Exports, Finance, Documents, and Logistics.© BrainMass Inc. brainmass.com October 17, 2018, 1:51 pm ad1c9bdddf
International Financing Methods:
The Uniform Custom and Practice for Documentary Credits (UPC) is a document that contains standardized rules for issuing and handling letters of credit, which is published by the International Chamber of Commerce and the international banking community (Shaffer, 2011). The UPC creates the standard for letter of credit, established regulations by which banks process letter of credit transactions, and defines the rights and responsibilities of all parties to the credit (Shaffer, 2011). Letters of credit transactions are governed or regulated by the UCP only to the extent that it states that it is to be interpreted according to the UCP. The UCP is used by judges in deciding letter of credit cases, and references it in every reported decision on international letters of credit (Schaffer, 2011).
Financial Transaction Risks:
The risks of financial transaction when buying and selling goods in foreign countries are delivery risk and payment risk. Delivery risk is the risk to the buyer that the seller will fail to ship the goods as stated in the sales contract (Schaffer, 2011). The payment risk is the risk to the seller that the buyer will fail to pay as promised (Schaffer, 2011). Both risks can result in litigation that can develop from the breach of the sales contract and the risk of fraud (Blodgett & Wilson, 1993). The bank is not concerned about what the parties promised to do under the contract, rather that the buyer presents required documents to the bank. These documents include commercial invoice, bill of lading, insurance policy, etc. required by the letter of credit. The purposes of these documents are to serve as customs declaration, a document of title of goods, and liability coverage against damage (Schaffer, 2011).
Legal Requirements for the Documents:
The legal requirements for these documents are as follows: 1) commercial invoice; must be provided by the person or corporation that is exporting an ...
The Solution provides a short explanation of the financial terms: International Financing Methods, Financial Transaction Risks, Legal Requirements for the Documents, Letter of Credit Transaction, Incoterms for Imports and Exports, Finance, Documents, and Logistics.
International trade guidelines and information
In this module, you will research information related to international finance, documents, and logistics.
Without financial resources, your company will not be able to purchase goods and services. In your opinion, how does a company finance international transactions?
When dealing with foreign countries, financial transactions can be risky. Before your company ships goods to a company located in La Republica de Caspa, you need to ensure that the foreign country will pay your company for the goods. Similarly, if your company orders goods from a company located in Russavia, you need to ensure that your company will receive the products it ordered instead of boxes filled with rocks.
Research letter of credit transactions, the uniform customs and practice for documentary credits (UCP), sources of trade financing, and other topics related to finance. Interview someone involved in international finance at your company. Prepare a paper evaluating the various methods of financing and the risks of financial transactions when buying and selling goods and services to foreign countries.
In addition, research the documents involved in international transactions. Provide the names and purposes of the most important documents. Analyze the legal requirements for these documents. Relate the use of Incoterms to import and export contracts. Considering the audience of your practical guide, include copies of documents for reference in your guide.
The final part of this module's paper should address the transportation of goods. What laws govern the transportation of goods from one country to another? Analyze the roles and responsibilities of the buyer, seller, carrier and freight forwarder? Evaluate which party is liable in the event goods are damaged in transit. Interview someone from risk management at your company to obtain information related to insurance and risk management.
Also, analyze how finance, documents, and logistics are affected by culture, ethics, and e-commerce. Make note of any pending regulations or laws that could affect your company in the future.
Write a 2-4 page paper showing your research on finance, documentary requirements, and logistics. Include links, references, and sources you have used and follow the proper guidelines for citing legal texts. Also provide a statement regarding which specific topics related to your research would be appropriate for inclusion in the International Business Law and Practices Guidelines document you are developing. Provide a rationale for your decisions.
Present your work in Microsoft Word document format.View Full Posting Details