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Negotiable Instruments
Negotiable Instruments
Negotiable Instruments
(COMMERCIAL PAPER)
Introduction
WHAT IS NEGOTIABLE?
- Means transferable
- Reference for transference of the instrument among to 2 or more institutions
- (from one bank to another)
WHAT IS AN INSTRUMENT?
-In the broadest sense is a medium of exchange
-Mostly used in banking : as Checks , Drafts , Bills of exchange ,some types of
promissory notes and certificate of deposits.
Function
As a Payment
As a Credit
Forms of Commercial Papers
Written by hand in order to pay the value of money
Bearer instrument
Order instrument
Checks
Mostly common used
Offer convenience
Bills of exchange
Negotiable and unconditional written order
International trade
Drafts
Payment may be at sight or at some defined time
1. William H. Lawrence ,2002: Understanding Negotiable Instruments and Payment Systems, [on-line], [cit.
15. 3. 2012]. Available from:
http://www.lexisnexis.com/lawschool/study/understanding/pdf/NegInsCh1.pdf
2. United Nations (UN),1998: Convention on International Bills of Exchange and International Promissory
Notes , [on-line], [cit. 15. 3. 2012]. Available from:
http://www.jus.uio.no/lm/un.bills.of.exchange.and.promissory.notes.convention.1988/doc.html
3. Olivo de L., Marfa y Ricardo Maldonado, 1996 :Estudio de la Contabilidad General. Editorial Tatum,
Valencia, [on-line], [cit. 17. 3. 2012]. Available from:
http://www.ives.edu.mx/bibliodigital/Ingenierias/contabilidad/La%20Letra%20de%20Cambio%20y%20el
%20Pagar%C3%A9.pdf