Ensure that your financial software can accommodate the Euro

THE INTRODUCTION of the new European Union currency - the Euro - next year could prove as large a problem as the Year 2000 issue for SA companies with strong links to EU-based organisations, as well as local subsidiaries of EU organisations.
That's the view of John Olsson, marketing director of software development house Hill Cunnington, who says companies likely to be affected by the Euro should ensure that their financial software is able to accommodate an additional currency. It must also allow for automatic conversions bertween the currencies, he said.
The general ledger must be able to hold at least two, but preferably three sets of figures such as a home currency, for example the Rand, a trading currency, which could be the Euro; and a reporting currency like DM, Francs or dollars.
In addition the financial software must be able to simultaneously process all relevant values for each currency without data having to be re-input, enabling payments to be made, invoices received and reports compiled in any currency, he said.
According to Olsson, the ability of financial software to accommodate multi-currency demands depends on its underlying design. Some are already able to deal with multiple currencies but many are not.
Once businesses have multi-currency enabled software in place, all they have to do is 'switch over' on a pre-determined date and from then on, all transactions will be recorded and calculated in the relevant currencies.