Investors and MNCs exporting or importing goods and services or making foreign investments throughout the global economy are faced with an exchange rate risk, which can have severe financial consequences on firms' profitability, cash flows, and their market value, if not managed appropriately. MNCs use a number of external techniques of risk (exposure) management and resort to contractual relationships outside their companies in order to reduce (or redistribute) the risk of foreign exchange losses. What are the determinants of these hedging techniques and foreign exchange exposures which pose risks to MNCs' cash flows, competitiveness, market value, and financial reporting?.