TNAG-0765-FCO40-969-Minting-of-coins-for-Hong-Kong-1978 — Page 70

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Glossary of Terms

ANNEX 2

A fund of assets (external and/or local) usually required by law to be maintained at a value equivalent to the total of notes and coins issued and in circulation, and usually bearing interest.

Brilliant Uncirculated or Specimen Coins

Coins that have been set aside immediately after minting and

thus have a bright, untarnished surface without marks etc.; but they have a quality of finish lower than that of proof coins.

De-legal Tender

Subject to the granting of a minimum statutory period of

notice, the issuing authority may call in any currency notes or coins

for exchange for a new series of notes and coins of equivalent nominal

face value. On the expiry of the period of notice, the notes or coins

concerned cease to be legal tender. The issuing authority may at its

discretion continue to exchange notes and coin for ones of equivalent

face value of the current series after they have ceased to be legal

tender.

Demonetisation

In this report, this term is used to signify an issuing

authority's final renunciation of all liability to give value for notes

or coins which have ceased to be legal tender but which have not been

handed in for redemption or exchange.

Legal Tender

The quality of legal tender is assigned to physical currency

by legislation, which prescribes that a creditor (including a vendor

of goods or services) is obliged to accept such currency in discharge of the obligation of the person tendering it. Bank notes are always

legal tender for a transaction of any amount, whereas coins are

normally limited to a maximum aggregate face value for each transaction.

Physical Currency

Bank notes and coins as contrasted with bank money or

scriptural money, i.e. claims on financial institutions (such as banks),

which are acceptable when transferred from one holder to another in

discharge of obligations, which are exchangeable on demand into