The euro has become a reality. The emphasis for all businesses now passes from preparation to implementation. Transactions in the euro are commencing. Companies will have the right to pay their taxes, buy Government bonds and produce their accounts in euros. Bank statements will be available in euros. In fact, the euro can now be used for all non-cash transactions. A significant issue facing most companies is the timing of their changeover to the single currency. Each enterprise must decide on the most appropriate and suitable date within the three-year transitional period for changing over its own operations to the euro, taking its business conditions into account. For some firms, this may well prove to be early in 1999. Other firms may be able to wait until later on in the three-year transitional period, closer to the time when euro notes and coins are introduced on January 1st, 2002. The decision rests with each enterprise to determine the best course of action.

However, it is critical that key business partners such as customers and suppliers are consulted at an early stage, as their plans and priorities may well have a significant influence on the most appropriate timing of the changeover for a particular enterprise.

Some firms will insist that their suppliers deal in euros from an early stage - leaving little discretion to these suppliers in the timing of changeover to the euro if they wish to maintain existing business relationships.

At this stage, every company should be well advanced in its preparations for the euro, with a good appreciation of what the impact is likely to be on its business.

While many companies have the issues concerned well in hand, a recent survey, carried out by Forfas, suggests that there are still a significant number of Irish companies that have yet to make adequate preparation.

The most critical task for each company in preparing for EMU is to think strategically about what the new euro business environment will mean for its own operations and plan accordingly.

To do this, companies need to consider in detail what the euro will mean for the fundamentals of their business: how will competitors operate within a euro framework?

How will supply and distribution arrangements be affected? What will the impact be on existing markets? What new market opportunities will open up? What new threats to existing business will arise? From surveys of Irish business, the overall strategic impact is perceived to be favourable by the majority of businesses. However, the strategic benefits to be gained from the euro can be achieved only by good analysis and planning and solid follow-up and implementation. It is important that competitive threats to a company are identified and countered at the same time as the undoubted opportunities that will arise are exploited.

Whether a company employs 20 people or 2,000 people, operates in a manufacturing or service industry or is a local, national or multinational organisation, the euro will have a fundamental impact on business operations.

Although the issues will vary from company to company and sector to sector, the process of analysis and planning is similar for all companies. Timely and adequate preparation is the key determinant of whether companies benefit from the euro. The Forfas EMU Business Awareness Campaign has produced a range of information to assist companies with their preparations for the single currency. These are set out in readily accessible format in both printed form and on the Forfas website which has been attracting a significant number of hits from firms both in Ireland and abroad. They include:

the basic facts on EMU and the euro which every firm should know;

the key steps that firms should undertake in preparing for the euro.

The most recent publication of the EMU Business Awareness Campaign - A Guide to Conversion and Rounding - sets out the rules which must be used when converting from one member currency into and out of the euro and from one participating currency into another. Precise rules for these conversions have been set down by the EU Commission and must always be followed. The Guide provides easy-to-follow worked examples showing how these rules will operate in practice for firms. Outside the euro, Irish banks will continue to quote rates for the Irish pound against non-participating currencies such as sterling and the US dollar. These will be "synthetic" rates that are a combination of the market rate between, for example, sterling and the euro and the fixed Irish pound/euro exchange rate. There are five basic steps for any firm in dealing with the changeover to the euro. The adoption of these five steps should now be well advanced:

1. Assignment of management responsibility.

Responsibility for managing euro issues needs to be clearly assigned within the company.

2. Business Impact Analysis.

Identifying the strategic and commercial impacts of the single currency on the business is a vital task. Too many firms tend to ignore this and to focus on the functional implications. This is a mistake.

3. Identify functional implications.

The functional implications of the changeover on the day-to-day operations of a business require an examination of all the core business functions.

4. Preparation of functional work-plans.

This is the blueprint for managing the changeover process. It involves drawing up the plans for making the necessary changes, allocating responsibility and identifying the timetable. Some companies - such as banks - will have adjusted their systems over the weekend, but many will do so in the months ahead.

5. Design, test and implementation of changes.

The company needs to ensure that the changes can be implemented in good time and will produce the right results.

It is important that all companies, but particularly smaller firms, avail of existing sources of knowledge, information and support in preparing for the changeover to the euro.

These are available from a wide range of sources and it is essential that each firm proactively seeks out the information and advice it requires for its own business requirements. Otherwise, future business performance may suffer.

As well as the Forfas EMU Business Awareness Campaign, State bodies in the industrial field, industry and other representative bodies, banks and professional advisers can all provide particular assistance to owner-managed and smaller enterprises. All can help firms with their preparations for EMU and the changeover to the euro by providing knowledge on the key issues that have been identified and making practical suggestions on how to address them.

The EMU Business Awareness Campaign's wide range of information to assist businesses with their preparations is freely available to all enterprises by contacting the Campaign directly at tel: 01-6073299, fax 01-6073298. Information is also available on the Campaign's website at www.emuaware.forfas.ie