Financial document

Document relating to payment.

The bill of exchange is the financial document most commonly used in collections and letters of credit.

Promissory notes are sometimes used in collections.

Forward contract

A contract for the sale or purchase of a given amount of foreign currency at a future time at a rate of exchange that is fixed when the contract is made.

Fixed forward contract

Currency is bought or sold at a given future date.

Forward option contract

Currency must be bought or sold within a given period of time.

Free Alongside Ship

Incoterm

Exporter

• delivers goods alongside ship
• provides alongside receipt

Importer

• pays freight charges and insurance
• pays for export licence and taxes

Free Carrier (FCA)

Incoterm

May be used for any mode of transport. Common for containerised shipments.

Exporter

• delivers to a named place
• provides export licence
• pays export duties

Importer

• pays all costs from named place (insurance, import duties, taxes)

Free On board (FOB)

Incoterm

Seller pays for loading onto vessel, but not for carriage or insurance.

Freight Forwarders' Receipt

Transport document issued by Freight Forwarder. Not a document of title.