The Euro & Database Conversion

What does it Mean For Your Organisation?

General Issues

Is your country ready?

  • Can you convert sooner rather than at the last minute?
  • Specific rounding requirements e.g. calculating VAT

  • Is there a Euro manager in your company?

  • Do you have a project team in place?

  • Are your staff aware of the impact of the euro? Are they able to deal with it?

  • Sales / telesales, purchasing, finance etc.

  • What is the scope of the conversion within your company?

  • Where are your base / reporting values and associated exchange rates?
  • how many different databases do you have?

  • How much historical data do you want to convert?

  • Most application packages will not function correctly where base/reporting values are in mixed currencies.

  • Are you acquiring another company or being taken over?

  • Are your systems compatible?
  • Having your database converted may affect the price you pay or the valuation of your company.

  • Are any Government grants or assistance available?

  • There will be significant costs and resources involved.

  • How many applications do you use? Is there a conversion upgrade / solution available for each one?

    Have you modified or enhanced your application?

  • Do you have in-house systems?

  • Does your NCU use at least 2 decimal places?

  • Your database and applications will require 2 decimals in order to use the Euro

  • Any new product announcements / Sales Campaigns?

  • Consider pricing in Euro now
  • Sales brochures printed in NCU and Euro

  • You may need to have the facility to convert back to your NCU from Euro

  • Your country may decide to leave the EMU, necessitating a return to NCU

  • Are you working with multi-company databases?

  • Some companies base / reporting currency may not be member NCU and not require conversion.
  • You may need to convert different companies at different times.

  • Financial Issues

    Will you need to re evaluate your pricing structures?

  • Profit margins, discount structures, standard costs.

  • Conversion of low value items, such as standard costs, may introduce large percentage swings e.g. 50 ITL Lira converts to .03 Euro which converts back to 58 Lira - a 16% swing

    Re-calculation of previously submitted regulatory documents

  • VAT, Intrastat returns

  • Materiality threshold

  • What type of variances will be tolerated / acceptable?

  • Reconciliation plans

  • How will the conversion be verified and variances dealt with?

  • Fixed assets

  • Depreciation calculations

  • Are your suppliers / customers able to use the Euro

  • They can transact in NCU's until 31st Dec 2001.
  • Purchasing / sales contracts expressed in NCU's will not be valid post 31st Dec 2001

  • When can you convert your bank accounts?

  • When will your bankers have facilities in place?

  • What do your auditors say?

  • Country specific requirements

  • After conversion will your credit limits still be valid?

  • Credit limit checking may require adjustment

  • Payroll

  • Labour rates will change to Euro - does that affect employee remuneration, they may be happy to accept a net increase due to rounding but not a net decrease!
  • Bonus structures e.g. a bonus calculated at .5 NLG per item processed
  • Payroll interface to ledgers

  • When can you convert?

  • Very few calendar month ends fall on weekends during 2000 & 2001.
  • How is your fiscal year structured?
  • Finance need to be able to reconcile the conversion process
  • Normal period / year end tasks still need to be done
  • The business may need to have live systems during bank holidays etc.
  • Possible business / factory shutdowns / annual holidays

  • The live conversion of databases and reconciliation will take 3 to 4 days? Will your business be prepared for any delays in financial reporting or a possible shorter reporting period?

    An accessible copy of the pre-converted databases will be required for some time post-conversion for reconciliation and inquiry purposes.

    Electronic Interfaces

  • Do you send / receive data between data centers within your organisation?
  • EDI
  • Payroll Bureau
  • Regulatory

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    Human Resources Issues

    Euro conversion team

  • IT staff - to do database conversion
  • Finance staff - to reconcile data
  • Senior management - to give go ahead to project
  • Representatives from all areas of the business - to discuss impact

  • External consultants and or project managers may be required

    All employees will require some degree of training on the impact of the Euro

    Application testing will be required

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    Hardware Issues

    Do your PC's and Printers support the Euro symbol?

  • Upgrades may be required and can be actioned now

  • Does your AS/400 and attached printers support the euro symbol?

  • PTF's are available and can be actioned now

  • Consider CCSID's

  • Are your Point of Sales systems euro ready?

    Is there sufficient DASD available for duplicate copies of your databases?

  • You may need 3 databases - 1 live euro, 1 test euro, 1 pre conversion NCU

  • Is there a separate AS/400 available for

  • Test conversions?

  • Application testing?

  • Are you planning to upgrade your AS/400?

  • If so, consider doing so prior to conversion project - you may need all the performance you can get in order to perform the conversion in the time allocated by the business.

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    Software Issues

    Are you planning an upgrade to a new version of your application software? Will it be finished in time to do a conversion before 31/12/2001?

    Do your applications have database conversion utilities available from the vendors?

  • Can you rely on these utilities being supplied?
  • Do they work?
  • Can they convert any modifications to the database?

  • Modifications to databases / In-house databases

  • A conversion program will be required for every file that contains base / reporting values and associated exchange rates.
  • There can easily be more than 1,000 files contained in a company's AS/400 based databases that contain values / exchange rates that need to be converted.

  • Do you have multi-company applications / databases?

  • You may need to convert a subset of companies or to convert companies at different times.

  • Can your application and related databases support decimal places?

  • The euro will introduce decimals in member countries such as Portugal and Italy.

  • Do your applications perform specific rounding calculations based on your current NCU and country requirements? Always round up for VAT in Italy.

    Do you have any hard coded value tests and currency symbols within your applications or modifications?

    Generally multi-currency application software should not be affected by a change in base / reporting currency e.g. no code changes required

    What is your data integrity like? Is it often corrected by the use of DFU or SQL?

  • Data problems will become apparent during reconciliation and should be resolved prior to live conversion so as not to affect the reconciliation period.

  • Query / Reporting tools

  • Hard coded currency codes / symbols
  • Value tests
  • Exchange rates used in calculations

  • Will conversion to the Euro affect any extracts to PC's?

  • Spreadsheets can be used extensively and there may be a need to check calculations
  • Currency codes / symbols
  • Value tests

  • Do you know how to configure your environment to reflect the change in base currency?

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