Company Reports - Y2K promises 'premature'
Confident claims by UK companies that they have beaten the millennium bug ‘will come back to haunt them’, according to a report out this week.
An analysis of 350 annual reports from FTSE 250 companies by accounts monitor Company Reporting, found only 64 mentioned the millennium bug and only two had a contingency plan in place.
The year-2000 compliance statement of #225m turnover packaging manufacturer Blagden Industries was singled out for its ‘misplaced confidence’. Its annual report told shareholders that its systems would be compliant by the end of 1998, at a cost of #800,000.
Graeme Farmer, assistant editor of Company Reporting said: ‘Companies year-2000 statements say everything will be all right. But if the project goes belly-up their promises to investors will come back to haunt them.’
Ian Hugo, assistant director of independent watchdog Taskforce 2000, said financial directors should head year-2000 projects: ‘Compliance programmes are often tackled at too junior a level.’
Last year, Scottish Widows said it would not invest in companies unprepared for 2000. General insurance will not cover the problem because it is not an unforeseen risk.
Company reporting, page 16.