Page 18 - Chapter 22 - Foreign Exchange (Cont.)

Fec's (Forward Exchange Contracts)

 Agreement to buy or sell a certain amount of

foreign currency at a future date at an agreed

exchange rate

No effect on taxable
 To avoid risks associated with income on TD, -

currency fluctuations account for foreign
exchange gain/loss

 Ruling exchange rates: from TD to end of
yoa/realisation date

Transaction End of YOA Realised

FEC Forward rate Forward rate for Spotrate

(FR) remaining period

(MRFR)