The effects of hedging operations at foreign companies' cash flow; Case study

In this study, the effects of hedging operations on the cash flow of a company was investigated to protect the company from the risks which may occur at the moment and future. Firstly the concept of the risk has been explained and the types of risks have been examined. Then, in order to reduce or eliminate the effects of the risks, risk management techniques have been analyzed in conjunction with the hedging operations.The methods to be used in hedging transactions have been explained and one of these methods which is non-firm hedging method; derivative products method has been handled deeply. After giving these cognitive concepts a sample study has been done. In this study 99 pieces of the hedging operation which were made by a foreign trade company have been analyzed. As a result of this hedging operation it is seen that the company earned 3.965.621,03 profit as of 31.03.2016. As a consequence it is clearly seen that hedging operations affect companies' cashflow in a considerable amount. In this sample study, 6 of dued hedging operation are registered to accounting reports in accordance with tax procedure law.