A Compliant Solution for the Euro Your Business & the Euro

Presentation Format The Euro EM4 EM4 Processes

The Euro Requirements Time-scales

The Euro What is it? –A New Currency When will it exist? –1st January, 1999 Why? –Major move towards a single market

Impact Monetary amounts to be paid or accounted for Fixed Timetable Defined Calculation Algorithms

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)

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 From 1st Jan. 2002, notes and coin will be introduced with all NCU currency being withdrawn by 1st July 2002(latest).

The Euro Why does the Euro require special handling? What is different?

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

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

NCU -> NCU Triangulation –First convert to euro –Euro amount may be rounded to not less than 3 decimals –Then convert to target NCU

French Franc Euro Guilder Triangulation Divide Multiply

NCU -> Out Currency First NCU to Euro using Conversion Factor Then Euro to Out Currency using Exchange Rate (GCC)

French Franc Euro Sterling Partial Triangulation Divide Multiply

Out Currency -> NCU Out Currency to Euro using Exchange Rate (GCC) Then NCU to Euro using Conversion Factor

Sterling Euro Irish Pound Partial Triangulation Multiply

Other Solutions ? Only if they achieve the same result

Guiding Principle No Compulsion No Prohibition

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

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.

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

Nice to Have! Dual Currency Reports –Not Mandatory –Lack of Print Positions –If system reports already cater for multiple currencies, EM4 will apply.

The Euro Participating Countries

The Euro - Business Impact Dual Currency Scenario –Unusual Event –Little Experience Specific Conversion Rules –Being Close Will Not Do

Euro - Company Switchover Base Currency Conversion –Open / Closed Items –Sub-ledgers –Business History

The Transition Period Impact Side by Side Currencies Application Software –Fine in 2002(After Conversion) Transition Solution

Conversion Factors 1/1/98

EM4 Overview

Who Are We ? Founded: June 1996 Manus Bray and Bill Chisholm 20+ years of AS/400 Consultancy Extensive Experience of Systems Implementation 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

Millennium Solutions Reference Sites Waterford Crystal LtdIreland Ciba Speciality ChemicalsWorldwide ITTUSA Leo LaboratoriesEurope Sara Lee / Douwe EgbertsWorldwide CIC VideoEurope Unichem PLCUK Johnson & JohnsonWorldwide Rhone Poulenc RorerWorldwide BioMérieuxJapan

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.

Impact on Finance Dept. Between 1st January st 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.

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.

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.

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.

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.

Impact on IT cont. After the conversion has completed, the maintenance of the application is retained by the IT department.

EM4 - What is it? Software Application Similar Approach to MS4 Joining of Business & Software Skills Partner Committed to Beta Testing & Implementation

EM4 - The Solution Search Engine Fields Code Encapsulated Code Calculation Routine Produces Compliant Application

EM4 - The Solution Calculator for Exceptions –Exceptions will Exist –Rules Must Be Used –Uses Same Calculation Routine

EM4 - The Solution Automated Conversion Tool –You Need to Apply the Rules –Planning & Testing Needed –Uses Same Calculation Routine

The Environment is Fixed but Will there be changes?

EM4 - Future Proof Additional Currencies Different Transition Periods Changes during Transition

EM4 Technical Information For technical information regarding EM4, please download our technical presentation from the website or contact us by phone: