Foshan Nationstar Optoelectronics Co.Ltd(002449)
Feasibility analysis report on carrying out forward foreign exchange settlement and sales and foreign exchange option business I. background of the company's carrying out forward foreign exchange settlement and sales and foreign exchange option business
The forward foreign exchange settlement and sale and foreign exchange option business carried out by the company are closely related to the daily business needs. In order to effectively control the foreign exchange risk, prevent the adverse impact of the sharp fluctuation of exchange rate on the company's finance, improve the use efficiency of foreign exchange funds and reasonably reduce financial expenses, the company plans to continue to carry out the forward foreign exchange settlement and sale and foreign exchange option business.
2、 Overview of the company's forward foreign exchange settlement and sales and foreign exchange options business
Forward foreign exchange settlement and sales refers to the signing of forward foreign exchange settlement and sales contracts between the company and financial institutions, which stipulate the foreign exchange currency, amount, exchange rate and time limit for the settlement and sales of foreign exchange in the future. When due, the settlement or sales of foreign exchange shall be handled in accordance with the contract.
Foreign exchange option is an option to buy or sell a certain amount of foreign exchange assets at the specified exchange rate within the time agreed in the contract. After paying the corresponding option fee to the option seller, the option buyer obtains a right to conduct an agreed amount of foreign exchange settlement and sales transaction with the option seller at the agreed price on a certain agreed date in the future.
3、 Necessity and feasibility for the company to carry out forward foreign exchange settlement and sales and foreign exchange option business
In recent years, the internationalization process of RMB has accelerated, the marketization trend of RMB exchange rate is obvious, and the exchange rate elasticity and fluctuation have increased. Two way fluctuation will become the new normal of China's exchange rate. In order to control exchange rate risk exposure and reduce the impact of exchange rate fluctuations on the company's benefits, the company will continue to carry out forward foreign exchange settlement and sales and foreign exchange options business according to actual needs.
The forward settlement and sale of foreign exchange and foreign exchange option business carried out by the company is mainly aimed at export business, but it does not rule out expanding import business in the next 14th Five Year Plan period. The basic business model, combined with the spot exchange rate quotation, locks the exchange rate price in advance according to the contract collection and payment time and the forward foreign exchange rate quotation provided by various financial institutions, so as to control the exchange rate fluctuation risk faced by the company and minimize the impact of foreign exchange fluctuation on the company.
The above foreign exchange business of the company is mainly based on the actual needs of business operation to achieve the purpose of hedging and does not participate in arbitrage transactions. The company has a long history of import and export, and relevant personnel have considerable experience in foreign exchange business operation. The financial institutions cooperated by the company have good qualifications and can provide better services related to foreign exchange management. In addition, the company's own management norms can effectively prevent risks in foreign exchange business operation, which has good feasibility.
Since carrying out the above business in 2018, the company has achieved the purpose of controlling foreign exchange risk.
4、 Risk analysis of forward foreign exchange settlement and sale and foreign exchange option business
(I) risk analysis
The company carries out foreign exchange forward settlement and sale and foreign exchange option business, follows the principle of locking exchange rate risk and hedging, does not carry out speculative and arbitrage trading operations, and carries out trading entrustment according to the company's predicted collection and payment period and amount when signing the contract. Forward settlement and sale of foreign exchange and foreign exchange options business can reduce the impact of exchange rate fluctuations on the company when the exchange rate fluctuates sharply, but there will also be certain risks: 1. Market risk: in the case of significant deviation between the exchange rate trend and the expectation, the cost expenditure of the company after locking the exchange rate may exceed the cost expenditure when it is not locked, resulting in potential losses.
2. Operational risk: when the company carries out the above business, if the operators fail to report and approve according to the specified procedures, or fail to accurately, timely and completely perform the relevant business, it may lead to transaction loss or loss of trading opportunities;
3. Legal risk: when the company signs business agreements on forward settlement and sale of foreign exchange and foreign exchange options with financial institutions, it shall handle business in strict accordance with the requirements of the agreement. At the same time, it shall pay attention to the company's capital position and other financial conditions to avoid losses caused by breach of contract.
(II) risk control measures taken
1. Select the forward foreign exchange settlement and sales and foreign exchange option business with simple structure, strong liquidity and controllable risk to carry out hedging business, which can only be carried out within the limit authorized by the board of directors, and strictly control its transaction scale.
2. Formulate standardized business operation process and authorization management system, allocate full-time personnel, clarify post responsibilities, and engage in the above businesses within the scope of authorization; At the same time, strengthen the business training and professional ethics of relevant personnel, improve the quality of relevant personnel, and establish a timely reporting system of abnormal conditions to avoid the occurrence of operational risks to the greatest extent.
3. Strengthen the management of accounts and funds of financial institutions, and strictly enforce the approval procedures for capital prediction, allocation and use.
4. The company regularly supervises and inspects the normalization of the above business hedging, the effectiveness of the internal control mechanism and the authenticity of information disclosure.
5、 Conclusion
The company's forward settlement and sale of foreign exchange and foreign exchange options business is carried out around the company's main business. It is not a forward foreign exchange transaction solely for the purpose of profit, but based on specific business operations, with hedging as a means, with the purpose of avoiding and preventing the risk of exchange rate fluctuations and the goal of protecting normal operating profits; The company has formulated the management system for forward settlement and sale of foreign exchange and foreign exchange option trading, which has been implemented in the actual business operation. The targeted risk control measures taken by the company are effective and feasible; By carrying out forward foreign exchange settlement and sales and foreign exchange option business, we can lock in the transaction cost or income at the future time point and realize the asset preservation for the purpose of avoiding risks.
Combined with the above business operation experience of the company in the past, it is necessary and feasible for the company to carry out forward foreign exchange settlement and sales and foreign exchange option business, which can effectively reduce the risk of exchange rate fluctuation.
Foshan Nationstar Optoelectronics Co.Ltd(002449) board of directors
January 24, 2022
