ABSTRACT
THIS appendix demonstrates how CBS Inc. has combined several contrasting elements into a coherent foreign-exchange exposure management program. CBS takes a highly risk-averse approach to the management of foreign-exchange exposures, but one that is also very active and involves more than $1 billion in foreign-exchange contracts annually. The program is highly centralized, but it involves the netting and hedging of all exposures at numerous decentralized subsidiaries. Generally, the CBS approach aims to neutralize any negative effects of foreign-exchange-rate changes on the income statement by hedging transaction exposure and selected economic exposure.
