The assignment has been designed to allow you to develop and use your knowledge and skills in understanding key strategic treasury level issues, particularly foreign exchange exposures, of a multinational company. Multinational organisations face many types of risks such as reputational, operational, credit, liquidity, foreign exchange, catastrophe risks amongst others. Clearly these risks vary in magnitude, frequency and relevance across different organisations. Many multinational organisations take different approaches to managing treasury risks, e.g. foreign exchange exposures, interest exposures, funding (short term liquidity funding and longer-term capital structuring).
Required:
Review the 2019 financial statements of BP plc, briefly explain and analyse the three main types of foreign exchange risks it faces, and then analyse how and why the company might choose to mitigate, or not to mitigate, these risks noting possible advantages and disadvantages of each technique.
Note: Your report should be at a strategic level and written in management style.
Word count: Maximum 2,500 words including quotations and in-text citations.
Guidance materials
The following resources are available to assist you with your assignment preparation. They can all be found through myLIBF or your course website:
• Guidance on referencing –
Note: It is important that you familiarise yourself with all elements of this;
• Module specification;
• Student handbook;
• Guidance for how to approach your assignment – in the study skills area;
• Submission information; and
• Understanding your similarity report.
The following reading section is provided as a pointer to students in starting their research, which should be much broader than the guidance articles suggested. Although the examiners take every care in providing relevant articles and the links are checked before release of the assignment, we are not able to guarantee that a link will remain viable for the duration of the research phase of the assignment. The readings may be specific, for example, a journal article or a chapter of a book or more general, in terms of a whole book where you are required to determine key areas that link to your assignment and use this as a basis to broaden your own independent research.
