Award in Finance of International Trade

This section addresses the financing requirements for businesses trading internationally:

• The financial needs of importers and exporters
• Managing the working capital cycle in international trade – supply side, stock side and sales side
• Sources of finance, incorporating short, medium and long term trade finance
• Interpreting business accounts – financial and management accounting applicable to importing and exporting businesses; balance sheet management, profit and loss accounts, cash flow forecasts
• Factors influencing profitability of a business trading in international markets
• Managing a business overseas

This section addresses the financial and commercial risks which arise in international trade:

• Contract risk - reviewing how contracts are formed and how businesses should detail commercial terms of sale
• Payment risk - how businesses manage and mitigate against payment risk through products and services such as credit referencing and export credit insurance
• Currency risk - how currency risk arises and the methods by which importers and exporters manage currency risk, services available from banks and financial service providers
• Managing performance risk (Quality Assurance) through effective business processes
• Trade Documentation – Commercial, Customs and Transport Documentation used in international trade and how businesses utilise documentation to manage the physical and financial supply chain
• Trade Compliance Risk, regulatory and compliance requirements covering sanctions compliance, anti-money laundering, ‘know your customer’, bribery and corruption, export licenses
• Transport and Logistics Risk – where risk and control passes in the trade journey, with specific reference to Incoterms and Cargo Insurance

This section details the methods of payment applicable in international trade

• The Payment Risk Ladder from the different perspective of importers and exporters
• Open account trading – how open account trading operates, and managing demands for credit terms
• Letters of Credit – the role of Letters of Credit from an importer and exporter perspective, how they operate in a practical environment and how businesses can mitigate against discrepancies
• Documentary (Bank) Collections – the operation and role of Documentary Collections from an importer and exporter perspective
• Payment in Advance, when advanced payment should apply in an international trade transaction
• Perspectives on Trade Finance
• Bonds and Guarantees – the different types of bonds and guarantee that operate in international trade from a performance and financial perspective
• Standby Letters of Credit
• Countertrade
• Short, Medium and Long Term Trade Financing tools
• Government support for Trade Finance – UK Export Finance and the role of Export Credit Agencies
• Overseas (Institutional) Support for Trade Finance