A blog that looks at all aspects of project and program finances from budgets, estimating and accounting to getting a pay rise and managing contracts.
Written by Elizabeth Harrin from RebelsGuideToPM.com.
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Date
Transcription:
I’m standing on the banks of Lake Como in Italy and as I’m here I thought it would be a good opportunity to talk to you about managing projects where you’ve got budgets in two currencies. And I’ve done that. I’ve managed a project where I have had contribution from the French office and contribution made by the UK office.
Managing two different currencies was actually a very difficult thing to do because it meant that overall project accounting was very difficult, very difficult to manage two sets of accounts, if you like, two sets of who was spending what and how that added up to an overall budget figure to put on my steering group reports.
So my advice to you would be to avoid doing that if you possibly can. Make sure if you are getting contributions, people are paying different things from different countries, then you try to convert all of that into one main currency and use that as the way that you report to your stakeholder groups.
The other thing that you could do when you’ve got multiple currencies is to fix your exchange rate so where a contribution from one country or an office in one country or a team in one country might cost a particular amount in Euros, as we’re in Italy, when you wait a couple of weeks that same contribution might be worth something different. So agree with your finance office how you’re going to convert, fix a particular exchange rate and use that for the life of the project.
Posted on: June 24, 2011 04:09 PM |
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