RMGs are guidance documents. The purpose of an RMG is to support PGPA Act entities and companies in meeting the requirements of the PGPA framework. As guides, RMGs explain the legislation and policy requirements in plain English. RMGs support accountable authorities and officials to apply the intent of the framework. It is an official’s responsibility to ensure that Finance guidance is monitored regularly for updates, including changes in policy/requirements.
The Australian Government's foreign exchange risk management policy has been in place since 1 July 2002. This policy applies to all Commonwealth entities in the general government sector (GGS). The policy applies to both departmental and administered funding.
Foreign exchange risk is the risk that an entity's financial performance or position will be affected by fluctuations in the exchange rate between the Australian dollar and other currencies. The overarching principle of the policy is that GGS entities are responsible for the management of their foreign exchange risks. However, the entities must not act to reduce the foreign exchange risk that they would otherwise face in the course of their business arrangements.
To assist GGS entities in managing foreign exchange risk, Finance has published the Australian Government Foreign Exchange Risk Management Guidelines, which provide in-principle guidance to entities, and may also be used as a benchmark to assess entities' foreign exchange risk management practices.
