South Africa`s financial directors are burying their heads in the sand, abdicating their responsibility for the Year 2000 conversion of their business. The consequences will certainly be dire. "There is absolutely no doubt that when the legal chips are on the table, the board of directors, and NOT the IT staff, will be called on to provide answers," says Software Futures director Andrew Procter. Software Futures recently conducted a survey among financial directors, and found that the vast majority of FDs believe the problem is under control, and that their businesses will be year 2000-compliant. Procter says these findings raise serious questions regarding FDs` understanding of the year 2000 conversion process. "There are two possible interpretations of these results," he says. "Firstly, South Africa could be ahead of the United States, and the rest of the world for that matter, in their year 2000 conversion, and will be the only country to have such a high level of readiness. Alternatively - and this is the more likely scenario - financial directors are seriously misinformed, or have an unrealistic view of the situation." Procter, as well as experts from the legal and audit fields and economic observers will be providing practical advice for financial directors at a half-day seminar to be held on 18 March at the Sandton Sun and Towers Convention Centre. The conference is designed to equip financial directors with practical tools and measures to effectively manage their company`s year 2000 conversion. "Year 2000 is not only an IT problem, but a business problem which must be managed at the highest level," says Procter. "There are many aspects of the business which fall out of the IT arena, and these can only be managed effectively by board members." Factors include managing business risk, ensuring continuity by developing contingency plans for key business areas, corporate-wide conversion management, and supply chain compliancy management. "The implications go way beyond 1 January 2000," says Procter. `There are audit implications, the impact on the market, and litigation issues which will persist well into 2000 and 2001, and probably until 2005. Not least, documentation and records of the conversion must be kept in order to prove due diligence. "The board must acknowledge its fiduciary duty, and they will be unable to plead ignorance, since Year 2000 is now a high publicised issue." Procter says there is no doubt that South Africa is at least six months behind the United States in its conversion process. "Apart from the lack of time, most companies haven`t yet commited the money to ensure compliance; 35% of our respondents stated that they are using their existing maintenance budgets to do the conversion. This is hopelessly inadequate, and financial directors are going to have to dig into profits to come up with the funds for conversions."
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