To
these 5 economic criteria, one can add 2 political exceptions
who have "opted out" : Denmark and the United Kingdom. These
member states will be able to choose to adopt or not to
adopt the single currency when they satisfy the 5 criteria.
(Data)
conversion: Historical data will have to be converted
to euros. The degree of complexity will be determined by
the data structures used within existing applications.
Conversion
date: the date on which a company decides to convert
its accounting base currency to the euro.
Conversion
rate: the rate set by the European Central Bank for
converting the national currency to the euro.
EMU:
Initials meaning Economic and Monetary Union, concerning
all aspects of the project of installation of the euro.
ECU:
is the name of the 'basket' for european currencies: European
Link Currency. The ecu will disappear on 1 January 1999
and be replaced by the euro.
EMI:
The European Monetary Institute is the european body
charged with the setting up of the new european single currency
and in particular the fixing of the exchange-rates with
the national currencies on 1 January 1999. At that time,
this institute will be transformed into European Central
Bank.
Euro
Zone: is the zone where the national currency of the
Member States of the European Union will be replaced by
the euro.
Fiduciary
currency: is from the Latin fidus (confidence), and
the name of the concrete and tangible form of the currency:
i.e.: coins and notes. It only represents a small part of
the money supply.
Multi-currency
software: software that is designed to handle multi-currency
invoices and payments
National
currency: the currency of a nation prior to converting
to the euro.
Parity:
allows the translation of the price in one currency into
another. When currencies are quoted on the financial markets,
one speaks about exchange rates rather than of parity. In
the case of the euro, one will not be able to speak about
exchange rates but about fixed and final parities between
the euro and the european currencies of the 'In' countries.
Phased
approach: the means of operating the company's accounting
system so that it will be able to report in the denominated
national currency and the euro simultaneously
Rounding:
Specific rules will be introduced regarding the rounding
of euro amounts. Applications will need to ensure that these
rules are accommodated both during data conversion, and
during normal data processing calculations.
Single
currency software: software that is designed to handle
only in the denominated national currency invoices and payments
Summit
of Madrid: Meeting of the Commission and the 15 Heads
of the Member States of the European Union, which was held
in December 1995 and decided the timetable of the european
single currency and its name: the euro.
Transition
period: the period both denominated national and euro
currencies exist - 1/1/99 - 30/6/2002
Treaty
of Maastricht: Founding treaty of the european Union,
giving new shape to the old european Economic Community
(the EEC). It took place in February 1992 and gathered 15
Member States: Germany, Austria, Belgium, Denmark, Spain,
Finland, France, Greece, Italy, Luxembourg, Netherlands,
Portugal, The United Kingdom and Sweden.
Triangulation:
Monetary amounts to be converted from one national currency
unit into another must first be converted into a monetary
amount expressed in the euro unit; this amount may not be
rounded to less than three decimals and must then be converted
into the other national currency unit. No alternative method
of calculation may be used unless it produces the same result.
