IRISH business has long been lectured on being prepared for the euro. But now some practical help is at hand with the launch of the Forfas EMU business awareness campaign.
Information aimed at helping small and medium sized companies prepare for the changeover is now available, Forfas's information pack recommends that each small/medium sized company designates responsibility to someone with a broad understanding of the business. That person would have to research the transfer to the euro and its implications for the business.
The company would ultimately have to decide at what stage it would transfer its own business dealings to the euro. All companies have the option of changing their accounting and pricing 19 euros as soon as the new currency is created in 1999. But there is no obligation to changeover - until the actual notes and coins are introduced in 2002. In practice, this would mean that many companies would be doing business in both national currencies and the euro during the changeover period.
Their policy would also be influenced by transfer dates arranged by their suppliers and customers.
One of the greatest areas of change would be in information technology. During the changeover period between 1999 and 2002, systems may have to be able to deal in both pounds and euros. Necessary changes to computer systems should be done at an early stage, in conjunction with changes made by suppliers and customers, according to Forfas. The fact that the `year 2000' issue will arise during this period should not be forgotten.
The information pack contains 16 documents. The first is an overview of the campaign, the second answers some of the most prevalent questions. The third displays the timeframe for transition. This is followed by documents on the issues for business and a business impact analysis document with a chart to evaluate the commercial impact of EMU.
There are documents on marketing, sales and distribution, and on production, product development and purchasing.
Accounting and finance, information technology and legal aspects of the changeover to the euro are also dealt with in the pack, along with the need to deal with changes in training.
The euro will create contractual difficulties. Contracts which extend beyond the EMU date, or involving non EMU countries would need to be reviewed. The evolution of EU law also needs to be monitored.
How soon a company would transfer to the euro would be dictated by the impact the change would have on the company. The areas of competitors, suppliers, customers, the organisation within the company and the type of products and services it supplies need to be individually assessed. Then the overall impact needs to be calculated.
There are clear competitive, cost and efficiency advantages of preparing for the change at an early stage. Waiting until 1998 or later could prove costly in the lone run.
