PraxIS March 2001
Managing reality in Information Systems - strategies for success
Systems Modelling Ltd. http://www.sysmod.com
IN THIS ISSUE
E-Business / Security
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Welcome to PraxIS!
This month, we are pleased to announce that the Business Application Software Developer's Association have approved Patrick O'Beirne of System Modelling Ltd. in Ireland as a tester of application software against the EU-wide BASDA EMU standard.
This year is the last chance for companies to make the euro changeover, so we remind you of our consultancy services in euro training , euro compliance software testing and BASDA certification , and the book+CD on euro conversion , to help you succeed!
We appreciate any feedback or suggestions for improvement. If you have received this newsletter from anybody else, we urge you to sign up for your personal copy at http://www.sysmod.com - it's free!
To help readability, hyperlinks in the text are given in full URL format at the end. Let me know if this does not work for you.
Patrick O'Beirne, Editor
There are now only a few months to go before the final changeover - our euro training workshop  can be customised for your business - ask for details.
BASDA approve SML as software tester for euro compliance standard
The Business Application Software Developer's Association have approved Patrick O'Beirne of System Modelling Ltd. in Ireland as a tester of application software against the EU-wide BASDA EMU standard.
The second level of the BASDA standard covers account and base currency conversion to the euro, and the ability to support IEP and Euro transactions before and after the changeover.
The SML test cases are designed to highlight errors and adjustments expected to arise in the transitional period for accounting software that is adapted for the euro. They cover the "price accordion" effects, detecting the use of inverse rates, rounding, truncation, accounting with master and detail records, and account and base conversion in the transition scenario. The specific test data for any given base currency uses sensitive data points that are most likely to give rise to differences in conversion and rounding.
We place particular stress on the communications from the vendor to the customer, whether it be in documentation, training, actual conversion factories, or helpline support. The better prepared the users are, the more accurately their expectations will match the results, and the least amount of time is wasted explaining non-material differences in a post-conversion audit.
There is only a short time frame left for company conversions, and we see an increasingly obvious trend for users to leave the conversion to the last minute. The more efficient and well-justified the conversion process is, the more smoothly their customers, suppliers, auditors, and employees will experience the changeover. This can only be of benefit to the success of the entire euro project in the eurozone.
Caution on misuse of term "Conforms to BASDA" in surveys
The Accounting Software Buyers Guide in 02/2001 Computerscope magazine in Ireland contained a table of a survey of software packages with a checkbox under various categories. The table has a column heading "Conform to BASDA Euro Guidelines" but that term is not defined anywhere in the article. Therefore the reader is left to infer that those packages that ticked that box have BASDA certification, which is not true in all cases. We need to correct the possibility of a misleading inference by the reader.
The "BASDA EMU Specification for Application Software" version 4.0 27/5/99 is a reference standard for product certification. It may be used by companies as a guide, which is why it is generally available for a small charge. The EMU Accreditation Standard is freely available from BASDA - the EMU specification is chargeable at GBP 50.00.
A claim to "conform to BASDA guidelines" is not the same as having BASDA certification/accreditation. Neither is it the same as BASDA membership and displaying the BASDA membership logo. This dilutes the meaning of the term and degrades the value to those who have gone to the trouble of independent testing and review against the BASDA standards.
Of the table, only nine packages are allowed to display the BASDA "accredited" logo. Twenty packages, whose suppliers ticked "conform", were making self-certification statements without BASDA authority. This is not to say that the packages above would not pass our testing if they underwent it. But the reader should not be encouraged to misread the table and infer an independent validation where none exists.
It is important to point out that almost all the packages that have been tested fell down on the test initially - requiring some changes to be made to meet the tight BASDA Accreditation Standard. Some were functionality changes but every software producer has had to considerably beef up their communications to customers and user documentation. Users need to understand that rounding differences are inevitable and they must understand exactly how their package handles them - there are different solutions possible.
Also be aware that the standard has been updated since the first awards were made: the original conversion & triangulation standard applied to 1998/99, and the current base conversion standard which is what is required now, for 2001. Single-point (level 1) compliance is no longer good enough for the final base/account changeover needs. Eurotown Loughrea  participants had to change well before any other SME and found the software vendors not ready, because the vendors were expecting a generally late changeover.
For more information, see www.basda.org  > "Accreditations" > "EMU Accreditation"
BASDA has now launched the next level of its EMU Accreditation Programme which covers base currency conversion - Level 2. Software auditors from the Dutch member firm of Ernst & Young certified CODA Financials Version 7.0, Scala Version 5.1, SunAccount 4.2.5-4, Systems Union SunAccount 4.2.6, Oracle Financials 11, CASH2000.h
The following packages have now been certified for BASDA EMU Accreditation by Systems Modelling, the second approved tester for certifying application software against the BASDA EMU standards:
SquareSum Dream v2.10
Are you sure your software applications can support all the requirements for the business changeover to the euro? Get an independent assessment on their "compliance" or "euro-readiness" with our euro software certification service. 
National Euro Conference Ireland Feb 19 2001
Forfás  press release: "Business Preparation for Euro is Now Urgent; Latest Survey Suggests Many Firms are Behind Schedule; Loughrea Project Providing Practical Guide"
The Forfás Survey of December 2000 found:
Sources of information: Banks 68% at the top. Internet
Loughrea Eurotown  Case studies presented were:
News'n'Choose newsagents took four months to manually dual price 150,000 items. The proprietor, Leo McGuinness, says that the most important requirement for retailers and their staff in Jan 2002 is a sense of humour. Pricing issues remain (the penny sweet), but as he is across the road from the bank he sees no cash problems.
Gerard Dervan has a retail fashion business. Started dual price labelling in Feb 2000, expects to finish next month. Accounts software not yet ready. Awaiting an upgrade in time to change base in Jan 2002. Worries about cost of handling extra change, banks have assured him they have "elaborate plans to assess our requirements for the new currency". He needed to upgrade pricing labellers and EPOS system.
Maura Conroy of Irish Drilling (45 employees) said she had to manually start a new system in euro because their accounting package did not have a conversion procedure. Some rounding problems in payroll and Lotto syndicate calculations caused confusion and needed understanding.
EUBusiness online workshop "Euro notes and coins"
The EUbusiness online discussion forum on Wednesday 21 February, debated the euro changeover issues. Fears of chaos at the tills in the first days of the euro cash changeover - with exploding queue sizes, loss of revenue for retailers, and anti-social behaviour as customers vent their rage - are 'not exaggerated', according to the participants in the online debate. You can read the full transcript online  at EUBusiness.
EVA ( European Vending Association) has published the latest version of their guide in their"euro-kit". The guide contains detailed indications on how to prepare the business to the euro, as well as how to adapt the equipment. See their website for their January 2001 newsletter (PDF) .
Small unit price conversion and rounding
FEE (Federation of European Accountants) raised a question about the conversion and rounding of small unit prices (PDF)  to the new scale of values in euro. The European Commission in reply quoted Europaper 22 “Generally, for prices which are displayed with a high level of accuracy in the national currency unit, a similar level of accuracy should be used when they are displayed in the euro unit.” Consequently, the application of ad hoc solutions, rounding practices, conventions or national provisions for a higher accuracy is not excluded by Community legislation.
Advice to accountants and auditors about the change to the euro
In preparing and auditing the year 2000 accounts, this is the last systematic opportunity accountants and auditors will have to advise their clients about the need for early and adequate preparation for the introduction of the euro. A letter and enclosures  in nine languages has been sent to all the national accountancy body members of the Fédération des Experts Comptables Européens (FEE) . It includes advice on practice management issued by the Institute of Chartered Accountants in Ireland, a suggested audit checklist, and Advice published by the Compagnie Nationale des Commissaires aux Comptes (in French).
Euro Fit Campaign
The Irish Exporters Association (Tel: 01-661 2182) is holding a series of 'Euro-Fit' seminars  around Ireland aimed at members, importers and exporters. The topics include Managing the Transition (AIB), Strategies for the Euro-zone (Forfás), and Is your software Euro-fit? (SML)
Children's Cent Candy Cash Churn
When the UK and Ireland changed in 1971 from having 240 old pence to the pound to 100 new pence, children were the first to notice that the price of sweets went up from 1 old penny to 1 new penny, a 2.4 times increase in price. This time around, their children may have a chance to get back. Suppose there still will be 1 cent sweets, and also that there will be small corner shops who take on insufficient euro coin float and run out of copper coins for change. If these retailers are willing to take in small euro coins and give back old money to get rid of it, the following opportunity presents itself:
1) Tender a 2p coin (worth 3c) to a shop, ask for one 1c sweet, and receive 2c in change.
2) Go to a shop short of euro coins, hand over 2c and receive the correct equivalent of twopence.
3) Repeat from step 1.
If your organisation has a web site on the euro, you can provide your web site visitors with answers to frequently asked questions on EMU and the euro currency, by a link to our comprehensive FAQ. This list of Frequently Asked Questions and their answers  is rated by Yahoo.com EMU page  as the #2 "Related Web Site" after the European Commission itself. If you do quote from our website, it's good practice to provide the reader with a link back to the source.
Many of the readers of this newsletter are influencers who provide euro advice and services to business. Why not help them and give yourself some heavyweight support by giving your clients a copy of my book+CD "Managing the euro in information systems: strategies for success" 
E-Business / Security
The Nigerian Fraud now in your email inbox.
For years, businesses have been receiving faxes from addresses in Nigeria (or Sierra Leone or similar countries) from a person allegedly wishing to hide some money offshore. In return for personal and bank details, the recipient is promised a share in some millions. This is followed up by requests for "good faith deposits" or other cash advances until the target realises what is going on. Now these scam letters are arriving by email. I simply show all the headers and forward them to the Garda Bureau of Fraud Investigation. US readers should look at the website of the 419 Coalition,  which recommends forwarding them to usss.treas.gov. The UK accountancy magazine  reported that three Nigerians were convicted of this fraud at Southwark Crown Court in January 2001. More info is also on the Scambusters web site .
Project Management Proverbs
Too few people on a project can't solve the problems - too many create more problems than they solve.
Software Quality topics
The Process Group Post newsletter is free and available at: http://www.processgroup.com/newsletter.htm 
Controlling the Subversive Spreadsheet
EuSprig is issuing a Call for Papers for the 2001 conference on Spreadsheet Risks, Development and Audit Methods at Vrieje Universiteit, Amsterdam, July 5-6 2001. The theme of the 2001 conference is "Controlling the Subversive Spreadsheet". The programme will concentrate on spreadsheet development and audit tools and methods. Eusprig are seeking papers (up to 5000 words) from academics and management summaries (up to 2000 words) from academics and business people - Spreadsheet users, developers, auditors and accountants - who can contribute to the prevention, detection and correction of errors in spreadsheet models and applications. Submit draft papers by 31 March 2001 to the EuSprig web site  or contact David Chadwick, Information Integrity Research Group, University of Greenwich ( D.R.Chadwick at greenwich dot ac dot uk )
From the Silicon.com  newsletter: An earthquake brought the roof down on Microsoft supremo Bill Gates on Wednesday as he extolled the virtues of the much-hyped Windows XP operating system to an audience of educators in downtown Seattle. Gates was ushered off the stage as windows broke (nothing new there then).
BEA World, Dallas, Texas. Business
2.0 magazine  reported that Douglas Adams provided
much-needed laughs, and not a few cutting insights into the
New Economy and hi-tech. On the generation gap in adapting
to technology, for example:
 http://www.sysmod.com/maneuris.htm Managing the Euro in Information Systems: Strategies for Success
 http://www.sysmod.com/euro-web.htm Euro Web Link Directory
 http://www.sysmod.com/eurofaq.htm Euro FAQ
 http://fullcoverage.yahoo.com/Full_Coverage/World/european_monetary_union Yahoo: European Monetary Union and the euro
 http://www.sysmod.com/eurowork.htm Euro IT Workshop
 http://www.sysmod.com/eurocert.htm Euro compliance software certification service
 http://www.sysmod.com/basda.htm BASDA approve SML as software tester for EMU Accreditation
 http://www.basda.org Business Application Software Developer's Association.
 http://www.eurotown-loughrea.ie Loughrea Eurotown SME case studies
 http://www.emuaware.forfas.ie Forfás Business EMU Awareness Campaign
 http://www.eubusiness.com/cgi-bin/item.cgi?id=39284 EUBusiness workshop transcript
 http://www.eva.be/news/01_january-en.PDF European Vending Association newsletter
 http://www.euro.fee.be/Archive/ec/rounding.pdf EC on the conversion and rounding of small unit prices.
 http://www.sysmod.com/fee02en.htm FEE advice to auditors and accountants
 http://www.euro.fee.be/ FEE Euro web site
 Irish Exporters Association seminar schedule
 http://www.iqpc.co.uk/cgi-bin/templates/98369168094616699218600002/genevent.html?event=1484 IQPC Conference: Critical Strategies for Euro Implementation POSTPONED
 http://home.rica.net/alphae/419coal/ The 419 Coalition the "Nigerian Scam"
 http://www.scambusters.org/NigerianFee.html Scambusters on the Nigerian Scam
 http://www.processgroup.com/newsletter.htm The Process Group newsletter.
 http://www.gre.ac.uk/~cd02/eusprig European Spreadsheet Risks Group
 http://www.silicon.com News site
 http://www.business2.co.uk Business 2.0 magazine
Copyright 2001 Systems Modelling Limited, http://www.sysmod.com . Reproduction allowed provided the report is copied in its entirety and with this copyright notice.---------------------------------------------------------------------------------------
ABOUT THIS NEWSLETTER
"Praxis" means model or example, from the Greek verb "to do". The name is chosen to reflect our focus on practical solutions to IS problems, avoiding hype. If you like acronyms, think of it as "Patrick's reports and analysis across Information Systems".
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