Post on 02-Feb-2016
description
euro@ms400.com
www.ms400.com
A Compliant Solution for the Euro
Your Business & the Euro
euro@ms400.com
www.ms400.com
Presentation Format
• The Euro
• EM4
• EM4 Processes
euro@ms400.com
www.ms400.com
The Euro
• Requirements
• Time-scales
euro@ms400.com
www.ms400.com
The Euro
• What is it?– A New Currency
• When will it exist?– 1st January, 1999
• Why?– Major move towards a single market
euro@ms400.com
www.ms400.com
Impact
• Monetary amounts to be paid or accounted for
• Fixed Timetable
• Defined Calculation Algorithms
euro@ms400.com
www.ms400.com
The Euro
• Effective start of economic and monetary union.– Begins 1st January, 1999– Euro becomes a currency in its own right– NCU’s replaced by the Euro– Fixed Conversion Factors
• Ref.. Articles 2 & 3 of Reg.. 109L(4)
euro@ms400.com
www.ms400.com
The Euro
• After 31st Dec. 2001, amounts still expressed in NCU shall be deemed to be expressed in Euros converted at the official rates.
• From 1st Jan. 2002, notes and coin will be introduced with all NCU currency being withdrawn by 1st July 2002(latest).
euro@ms400.com
www.ms400.com
The Euro
• Why does the Euro require special handling?
• What is different?
euro@ms400.com
www.ms400.com
Conversion Factor:-• Shall be adopted as one euro expressed in the
terms of a NCU.
• Shall be adopted with 6 significant digits.
• Shall not be rounded or truncated
euro@ms400.com
www.ms400.com
Conversion Factor:-
• Shall be used for conversions either way between the euro and the NCU
• Inverse rates derived from the conversion rates shall not be used
euro@ms400.com
www.ms400.com
NCU -> NCU
• Triangulation– First convert to euro– Euro amount may be rounded to not less than 3
decimals– Then convert to target NCU
euro@ms400.com
www.ms400.com
French Franc
Euro
Guilder
Triangulation
Divide
Multiply
euro@ms400.com
www.ms400.com
NCU -> Out Currency
• First NCU to Euro using Conversion Factor
• Then Euro to Out Currency using Exchange Rate (GCC)
euro@ms400.com
www.ms400.com
French Franc
Euro
Sterling
Partial Triangulation
Divide
Multiply
euro@ms400.com
www.ms400.com
Out Currency -> NCU
• Out Currency to Euro using Exchange Rate (GCC)
• Then NCU to Euro using Conversion Factor
euro@ms400.com
www.ms400.com
Sterling
Euro
Irish Pound
Partial Triangulation
Multi
ply
Multiply
euro@ms400.com
www.ms400.com
Other Solutions ?
• Only if they achieve the same result
euro@ms400.com
www.ms400.com
Guiding Principle
• No Compulsion
• No Prohibition
euro@ms400.com
www.ms400.com
Legally
• Contracts which specify the use of a currency should be completed in that currency
• I.e. Order in FRF, Invoice in FRF, expect payment in FRF
euro@ms400.com
www.ms400.com
Commercially
• Customer owes 50,000 DEM, previously invoiced in DEM.
• Offers to pay in Euros
• Do you say ‘No Thanks, I invoiced you in DEM’ – or
• Take the money and lodge it.
euro@ms400.com
www.ms400.com
Nice to Have!
• Dual Currency Invoices– Not Mandatory– Dual Pricing mainly aimed at Consumers
• Dual Currency Screen Display– Not Mandatory– Most Screens do not have room
euro@ms400.com
www.ms400.com
Nice to Have!
• Dual Currency Reports– Not Mandatory– Lack of Print Positions– If system reports already cater for multiple
currencies, EM4 will apply.
euro@ms400.com
www.ms400.com
Germany Italy Ireland
Belgium Spain
Luxembourg Portugal Finland
Netherlands France Austria
The EuroParticipating Countries
euro@ms400.com
www.ms400.com
The Euro - Business Impact
• Dual Currency Scenario– Unusual Event– Little Experience
• Specific Conversion Rules– Being Close Will Not Do
euro@ms400.com
www.ms400.com
Euro - Company Switchover
• Base Currency Conversion
– Open / Closed Items
– Sub-ledgers
– Business History
euro@ms400.com
www.ms400.com
The Transition Period Impact
• Side by Side Currencies
• Application Software
– Fine in 2002(After Conversion)
• Transition Solution
euro@ms400.com
www.ms400.com
DEM 1.97632 PTE 202.137
BEF 40.7675 FRF 6.61214
LUF 40.7675 IEP 0.771961
NLG 2.22742 FIM 5.98726
ITL 1942.03 ATS 13.9020
ESP 167.388
Conversion Factors1/1/98
euro@ms400.com
www.ms400.com
EM4 Overview
euro@ms400.com
www.ms400.com
Who Are We ?Founded: June 1996
Manus Bray and Bill Chisholm20+ years of AS/400 ConsultancyExtensive Experience of SystemsImplementation and Development
Company Mission :
To Become a Market Leader in the Development of First Class End-User Products to Support Existing and Future AS/400 Environments
euro@ms400.com
www.ms400.com
Millennium Solutions Reference Sites
• Waterford Crystal Ltd Ireland
• Ciba Speciality Chemicals Worldwide
• ITT USA
• Leo Laboratories Europe
• Sara Lee / Douwe Egberts Worldwide
• CIC Video Europe
• Unichem PLC UK
• Johnson & Johnson Worldwide
• Rhone Poulenc Rorer Worldwide
• BioMérieux Japan
euro@ms400.com
www.ms400.com
History Of EM4
• Ciba Specialty Chemicals & Millennium relationship out of MS4– Multiple Installations
• Ciba was looking for a solution– Generic BPCS Solution
• Millennium & Ciba agreed an approach.
euro@ms400.com
www.ms400.com
Impact on Finance Dept.
Between 1st January 1999 - 31st December 2001, businesses with multiple companies within EU member states will need to change their base and/or global currency to the Euro.
Existing transactions will differ from one company to another as they are relative to the time at which the transactions were
processed.
euro@ms400.com
www.ms400.com
Impact on Finance cont.All in-line data will be converted to the
equivalent Euro amount
=> historical data such as Sales History and Order History will remain relative
=> their graphical representations will remain constant.
This ensures that investors and shareholders do not notice a rise/fall in share value or company performance over that period of time.
euro@ms400.com
www.ms400.com
Impact on Finance
The Finance department must be able to ensure that the company's turnover is not affected, although the annual turnover and profit is now illustrated in Euros.
euro@ms400.com
www.ms400.com
Impact on IT
It is ultimately the IT department's responsibility to ensure that
• the project runs smoothly, • meets the deadlines assigned and • remains within budget.
euro@ms400.com
www.ms400.com
Impact on IT cont.The application structure will determine
the level of IT involvement required. For complex applications where calculated
values and field relationships need to be defined, there will be a requirement for
more IT involvement than in an application where all financial fields are independent.
euro@ms400.com
www.ms400.com
Impact on IT cont.
After the conversion has completed, the maintenance of the application
is retained by the IT department.
euro@ms400.com
www.ms400.com
EM4 - What is it?• Software Application
• Similar Approach to MS4
• Joining of Business & Software Skills
• Partner Committed to Beta Testing &
Implementation
euro@ms400.com
www.ms400.com
EM4 - The Solution
• Search Engine• Fields
• Code
• Encapsulated Code
• Calculation Routine
• Produces Compliant Application
euro@ms400.com
www.ms400.com
EM4 - The Solution
• Calculator for Exceptions
– Exceptions will Exist
– Rules Must Be Used
– Uses Same Calculation Routine
euro@ms400.com
www.ms400.com
EM4 - The Solution
• Automated Conversion Tool
– You Need to Apply the Rules
– Planning & Testing Needed
– Uses Same Calculation Routine
euro@ms400.com
www.ms400.com
The Environment is Fixed but
Will there be changes?
euro@ms400.com
www.ms400.com
EM4 - Future Proof
• Additional Currencies
• Different Transition Periods
• Changes during Transition
euro@ms400.com
www.ms400.com
EM4 Technical Information
For technical information regarding EM4, please download our technical presentation from the website www.ms400.com
or contact us by
phone: +353 1 403 5400
email: euro@ms400.com