UK companies and software vendors await a review later this month to see if they can reverse the government's earlier rejection of making Vat payments in the euro currency.
The Business & Accounting Software Developers Association's (Basda) some time ago provided software vendors with a technical specification that properly reflects EC regulations regarding accounting for the euro, which met with considerable applause in the UK.
According to Basda chairman Dennis Keeling, software vendors wanted to provide UK users with the ability to pay and account in euros, but the Treasury blocked that idea, saying that accounting in euros is a no-no at the moment.
Government spokespeople say this was an issue over managing exchange rate differences, but sources close to the Treasury acknowledged the government is more concerned with framing the legislation so that eagle eyed accountants won't be able to exploit potential loopholes that might allow companies to avoid tax.
Basda put a lot of pressure on the Treasury at the end of last year, but according to Keeling, "They have stone walled, deferring another review until February."
Following the impasse, Basda issued a statement saying that its members were being advised not to put the facility into software and that companies experiencing difficulties with handling the problem should contact Basda. But according to Keeling, there have been no cries for help.
"It looks like most are staying in sterling - no one's insisting on doing euros," he said.
On the certification front, Basda recently announced that SAP, Baan for Coda, Navision, Scala, Tas Books and Squaresum Dream were the first batch of accounting products to meet the Basda technical specification for handling EMU. Another 30 are in the pipeline but Keeling warns the process is not as simple as some vendors think.
"Two failed, one got through on a second go and the second is having to do a re-think. It's all about accuracy," he said.
Netherlands based Moret Ernst & Young undertake the independent testing for Basda compliance at a cost of #8,000.
According to Keeling, the next stage is to finalise localisation issues into the specification. Keeling is hopeful the localisation of laws covering the euro will be relatively simple: "It looks as though the Vat debacle we saw in 1992/93 won't be repeated," said Keeling.
Initially, it was thought that issues like rounding for the French 'three centime' currency conversion rule would give developers additional headaches, but this as well as oddities regarding reporting periods on a change to euros are, "Likely to be left as recommendations rather than become mandatory," he added.
** For the full story on Emu, see today's analysis section **
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