Abstract

Mitsubishi, the Japanese trading company has six main business groups dealing in living essentials, metals, machinery, energy, chemicals and software, logistics, tele-communications and other services. The company faces various financial risks: foreign currency risk, translation risk, transaction risk, interest rate risk and credit risk. The case outlines the risks and the mechanisms Mitsubishi employs to deal with them.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

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Keywords

Mitsubishi, Financial risk management, Risk, Enterprise risk management, ERM, Sogo Shosha, Market risk, Foreign currency risk, Transaction risk, Credit risk, Derivatives valuation, Derivatives accounting, US GAAP, generally accepted accounting principles, FAS-133 and FAS-115, Translation risk