Cash Flow In Foreign Exchange Compliance

This article focuses on the general checklists regarding the category of cash flow in foreign exchange compliance. It is an important area of the foreign exchange compliance and therefore traders must be aware of the guidelines set by the regulatory authority for cash flow in forex compliance.

Presented below is the list of the important guidelines which will help you to know details about the cash flow according to foreign exchange compliance. let us have a look at the following details.

• The guidelines regarding cash flow in foreign exchange compliance state that all the disbursements must be carried out through check with an exception if there is petty cash where it is not sensible to make the disbursement by check, because of the inconvenience and costs of writing, signing and then cashing the check.

• Following the cash flow in forex compliance requires that there should be a responsible person who will give his approval regarding all invoices in writing prior to payment.

• All the disbursements made by branch offices must be reviewed properly.

• There should be a proper record maintaining documents related to authorizing use of qualifying bank accounts.

• There should be a listing giving details about all kind of cash receipts in cash flow in foreign exchange compliance.

• The copies of customer checks prior to depositing them should be made and maintained for further references.

• The checks must be endorsed restrictively when received.

• The third-party checks received from customers must be reviewed in order to make sure that the initial payee is not required to be an NFA Member.

• The bank reconciliations papers must be prepared on a timely basis.

• There should be a limited access to signature plates used to sign checks

• There must be a proper review of checks and wires received so that it can be ensured that they are from owners of the account to which they are to be credited. Therefore maintaining proper cash flow according to foreign exchange compliance

• The disbursements to a third party must be permitted only with specific written authorization from the account owner on file.