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The Impact of the Dissolution of or Defection from the Euro

Euro Dissolution White Paper

This white paper represents the summary of a roundtable of Silicon Valley-based treasury professionals discussing the impact of the dissolution of or defection from the Euro.

The discussion was moderated by Hedge Trackers’ founder Helen Kane.

The conversation centered on key areas of concern for treasury (operational cash issues, currency hedge programs, and derivative accounting) and more strategic concerns for the company at large (legal and reporting). Participants focused on defining the risks and areas of concern, rather than on the question of ―if there would be a Euro event. There was a consensus that should the need arise, companies will only have a weekend to manage a defection from the Euro: a stark contrast to the 2 years of preparation for the Euro rollout in 2000. This also led to a discussion of what disclosures should or might companies be making about the Euro now. Most audit firms are already requiring Euro denominated sovereign debt holders to make substantial disclosures at 12/31/11.

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