Foreign Exchange Procedure

Purpose

These procedures relate to the processes to be followed in relation to purchases and receipts in Foreign Exchange.

The procedures aim to achieve a just and coordinated approach by the University of Otago in dealing with Foreign Exchange.

Organisational scope

These procedures apply to all University foreign exchange dealings.

Content

Foreign Exchange Contracts

Approved purchase orders for purchases in foreign currencies over NZ$50,000 should be hedged. The approved purchase order and estimate of the date of payment should be provided to the Treasury Accountant, Financial Services Division as soon as the purchase order has been signed. The Treasury Accountant will purchase a hedging contract with the bank and forward the details back to the Department. This is the price the Department will be charged for the purchase of the goods.

For regular annual expenditure items such as library book purchases, membership fees and standard consulting fees, where the total of forecasted purchases is over NZ$50,000 in any one currency the contracts should be purchased by the Treasury Accountant when the budget is approved.

When the forecast dates for external foreign exchange settlements are not able to be met, the University should still purchase the contracted currency and should place the funds purchased in a foreign exchange bank account until the purchase is able to be made. Any interest gained on holding these foreign balances will not be available to Departments.

Contact for further information

For further information, please contact:

The Treasury Accountant
Email fsd.treasury@otago.ac.nz