THE MANAGEMENT OF FOREIGN EXCHANGE RISK AND CORPORATE PERFORMANCE IN NIGERIA ECONOMY (A CASE STUDY OF UNITED BANK OF AFRICAN PLC, ILORIN)

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  • Name: THE MANAGEMENT OF FOREIGN EXCHANGE RISK AND CORPORATE PERFORMANCE IN NIGERIA ECONOMY
  • Type: PDF and MS Word (DOC)
  • Size: [160 KB]
  • Length: [42] Pages

 

PROPOSAL

INTRODUCTION

International trade and capital flows require foreign exchange market because common despite increase in economy interdependence in the world, each country maintain its own nationals medium of exchange. The official foreign market in Nigeria is made up of the Federal ministry of Finance and the Central bank of Nigeria as the Apex institutions, authorized dealers including commercial and merchant bank, development bank and bureau de exchange.

STATEMENT OF PROBLEM

The Britton woods conferences [1994] established a fixed exchange rate system whereby each currency had a fixed party [value] in relation to the dollar.

In Nigeria, the manufacturing or better still corporate sectors defend heavily on imported raw materials machineries. Spare parts and services. However foreign exchange did not pose any problem on them simply because of the exchange rate.

OBJECTIVE OF THE STUDY

The research work focused on the risk associated with fluctuation in foreign exchange rate and its effect the performance on co-operate Organization in Nigeria. The specific Objectives of the study are as follows:

  1. To exchanges the risk fluctuation in exchange rate and control association with currency management in the multi currency settings.
  2. To investigate on the policies one government co-operation have and how effective this policies have been.
  • To prefer recommendation based on research finding.

RESEARCH QUESTIONS

  1. Does the various exchange policies help their organization din its corporate performance?
  2. Does fluctuation in the foreign exchange rate affect your net income?
  • Do you feel the impact of competition in the faces of the development?
  1. Does profitability of the organization depend of the defendant between the naira and other major currency?
  2. Does your unit lost fluctuate?

 

 

STATEMENT OF HYPOTHESIS

Base on the research question and objective of study. The following hypothesis stated will be tested.

HYPOTHESIS 1

HO: change in exchange rate control is not determined by the manger.

HYPOTHESIS 2

H1: fluctuation exchange rate control is not determine by the manger

HYPOTHESIS 3

HO: fluctuating exchange rate control does not associate with management of currency in multi currency setting.

SCOPE AND LIMITATION OF THE STUDY

It is essentially importance to state that the study focus on the general appraisal of the foreign exchange policy in Nigeria ha this involve an assessment of how objective realized and attendance respect of the Policy.

The research will be in historical and case study research which may be limited by insufficient finance, lack of enough time, lack of cooperation from the respondents and the case study. This may hinder through research.

ORGANIZATION OF THE STUDY

The organization of the right from chapter one comprises the introduction which is sub divided into six sub section as follows: background of the study, statement of the study, statement of research question, while chapter two dealt with the literature review. The Third Chapter dealt with research methodology and the Fourth Chapter dealt with data analysis and presentation while the last Chapter comprises summary, conclusion and recommendation.

DEFINITION OF TERMS

EXCHANGE CONTROL

A mechanism by which a country scale site hanness its foreign exchange resources and rationalization for the settlement of international indebtedness while ensuring their sale favorable development of the domestic economy activities without diminishing the value of its currency [NWARACTIC 1982].

 

 

 

 

TABLE OF CONTENT

Title page

Certification

Dedication

Acknowledgement

Proposal

Table of Content

CHAPTER ONE

1.1 Introduction                                                                     1

1 .2 Statement of the study                                                   5

1.3 Objective of the study                                                                6

1 .4 Research question                                                           6

1 .5 Statement of hypothesis                                                 7

I .6 Scope and limitation of the study                      8

1.7 Organization                                                                    8

1.8 Definition of terms                                                          9

CHAPTER TWO

2.1 Literature review                                                                        10

2.2 The evolution of foreign exchange                                 11

2.3 Nigeria foreign exchange reserve                                   12

2.4 The main causes of fluctuation in the exchange      12

2.5 Factor limitation fluctuation in the exchange      15

2.6 How foreign system operate in Nigeria                      17

2.7 The foreign exchange rate                                               19

2.8 Foreign exchange transaction                                         20

2.9 The foreign exchange risk management                      21

2.9.1 Elimination of exchange risk (forward exchange) 22

2.10 Limit to the exchange price of credit instruments 27

2.11 Control of foreign exchange                                          28

2.12 History briefing of united Bank for African (UBA) 29

CHAPTER THREE

3.1 Research methodology                                                    31

3.2 Research design                                                                          31

3.3 Type and source of data                                                  32

3.4 Sampling size of the study                                              32

3.5 Sampling technique                                                         32

3.6 Instrumentation                                                                          33

CHAPTER FOUR

4.1 Data presentation analysis and the Interpretation, introduction                                                                                   34

4.2 Data analysis and interpretation                          34

4.3 Testing of hypothesis                                                      45

4.4 Hypothesis on foreign exchange policies                   46

4.5 Testing of hypothesis on the requirement for listing in FEM  (Foreign Exchanging Market)                                         48      CHAPTER FIVE

5.1 Summary of finding                                                        50

5.2 Conclusion                                                                                  52

5.3 Research recommendation                                              52

5.4 Suggestion for future studies                                          54

Reference