IMPLEMENTATION OF EURO IN SLOVENIAN MUNICIPALITIES

1
IMPLEMENTATION OF EURO IN SLOVENIAN
MUNICIPALITIES

• VILMA MILUNOVIC

SKUPNOST OBCIN SLOVENIJE
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INTROCUTION OF THE PRESENTATION

• the master plan for the euro changeover in
  Slovenia
• Euro implementation in slovenian municipalities
• key elements of successful implementation

3
THE MASTER PLAN FOR THE INRTODUCTION OF THE EURO

• the prudent introduction program
• informing the public
• setting the legal framework

4
THE LEGAL FRAMEWORK

• the adoption of the umbrella law
• the euro adoption act
• supporting regulations
• the act on the dual display of prices
• other regulation adjustments
• the payment system
• the accounting system
• changes in the system of public administration
  on the local level

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BASIC PRESUMPTIONS

• the fixed rate of conversion 1 239,640 SIT
  
• the principle of the continuity of contracts
• (EC regulation 1103/97)
• reference interest rate SITIBOR was replaced
  with EURIBOR
• the exchange rate of Bank of Slovenia was
  replaced by the reference exchange rate of the
  European Central Bank
• the values shall be rounded on two decimals

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THE BIG BANG

• simultaneous introduction of the cash and book
  money with a short period of dual circulation
• up till to the 9.pm of 31. December the bank
  cash-points operated in tolar
• 3 hours of system break down from 9.pm to 0.00
  the cash-points were shut down
• from 0.00 hours of 1. January cash-points start
  to operate in euro currency
• the dual circulation period lasted for 14 days

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THE IMAPACT ON ACCOUNTING SYSTEM

• all the records in bookkeeping for the year
  2006 are closed in tolars
• annual reports and financial statements for the
  year 2006 are draw up in the old currency
  (tolar)
• all data up to 31. December 2006 are stored in
  tolars
• no conversion of financial statements for the
  previous year is to be done officially
• the opening accounts and analytical records are
  converted in euro using the official conversion
  rate
• from the 1. January 2007 all accounting
  activities and financial statements are in euro
  currency

8
PAYMENT SYSTEM

• banks, shops, companies, public administration
  officies had to adapte their payment transactions
  
• consumers the dual pricing rests till the 30.
  June 2007
• new paying instruments, money orders,....are
  prescribed
• invoices issued until 31. December 2006 were
  nominated in tolar but after 1. January are paid
  in euro
• tax statements, withholding tax statements
  calculated in tolar are paid in euro after the 1.
  January 2007

9
CASH DESK OPERATING

• euro cash requirements assure in time the
  sufficient store of petty and hard cash for the
  first working days
• introduce the use of POS terminals as much as
  possible
• security measures to avoid the abuse and
  falsification of euro bank notes
• put conversion table explaining and informing
  the conversion of fines, administrative fees and
  charges for public services on visible places in
  office

10
ADJUSTMENT OF INFORAMATION SYSTEMS

• prepare the chart of the all necessary changes
  on the key areas of responsibility
• check off all software programs and information
  system
• set time limits for adjustments of the
  information system for the changeover on euro
• test the changes introduced in the system
• dont forget training of the staff for the use
  of new applications in euro has to be done

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BUDGET PROCESS IMPLICATIONS

• we prepare the budget proposal in the uniform
  information application at the state level
• the preparation of the budget proposal for the
  2007 was prepared in tolar
• the final budget proposal was adopted in euro,
• ... by rounding the amounts some minor
  differences come out in adopted budget
  accounts!

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PUBLIC TARIFFS, FINES...

• all ladders, tariffs of taxes or fines defined
  in decrets and other regulations remained
  unchanged
• this amounts are converted in using the
  official rate of conversion rounded off to two
  decimal points
• administrative stamps remained in use and were
  replaced in the time of two months with the new
  issue denominated in
• as adopting changes or new laws after the 1.
  January 2007 tolar is replaced with euro wherever
  necessary

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INFLUENCE AREAS OF MUNICIPAL OPERATION

• direct day to day working operations in municipal
  administration
• relations with citizens /customers
• relations with business partners

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OPERATIONAL ISSUES

• the support of institutional system to
  municipalities
• the problem of rounding
• unjustified rise of prices
• the new euro-value framework in our heads