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To: stox19 who wrote (9515)	1/20/1999 10:28:00 PM
From: MACA	Respond to of 10786

U.K. Economy Threatened by Year 2000 Business Failures: Survey London, Jan. 20 (Bloomberg) -- The U.K. economy faces a ''grave'' threat from the potential bankruptcy of major U.K. companies that are not prepared for computer failure in Year 2000, according to an independent campaigning group. ''The threat to the economy could be grave if large companies are not prepared,'' said Robin Guenier, executive director of Taskforce 2000. He was commenting on a survey showing 16 percent of companies had not completed an audit of their systems, the first step towards Year 2000 compliance. The survey, carried out by forecasting consultancy Business Strategies for Taskforce 2000 and legal firm Dibb Lipton Alsop, aimed to get detailed responses from companies about the stage they have reached in identifying and solving potential problems associated with the change of date in computers from 1999 to 2000. It comprised 62 respondents to an anonymous postal questionnaire of 1000 companies. The 62 firms represented a combined turnover of 73 billion pounds and combined employees of 700,000, according to Adam Swash, a survey manager for Business Strategies. A further 45 percent of companies responding had not completed a full inventory of all systems, such as embedded microprocessors, the survey said. ''The Government has been saying for over a year that big business is on course. This survey shows this is not so. If it is right, we have been misled about the readiness of large companies,'' said Taskforce 2000's Guenier. ''I am not predicting an apocalyptic meltdown but if a proportion of the top companies are not ready, we are possibly facing bankruptcy and a risk to employment and supply chains,'' he added. Bankruptcy Looms This would not happen immediately on Jan. 1 2000, Guenier said, but given companies' dependence on computers, firms could fail in a matter of months if accounting procedures and factory process controls are not working. The amount that companies have budgeted for contingency planning is also low, at around 10 percent, the survey showed. Of the budget that has been set aside for solving Year 2000 problems, only 44 percent of companies had spent 60 percent of their budget, indicating they were well behind in testing their systems, Guenier said. Forty eight percent of firms surveyed said they estimated the cost of solving any computer problems at up to 1 million pounds and 6 percent estimated the cost to be over 50 million pounds. Thirty four percent of respondents intend to try and recover these costs from their systems suppliers, and 94 percent of those would consider suing their suppliers to recover costs but 53 percent of those had not checked to see if the relevant time limit had passed, according to the survey. In addition, the survey showed there was a high level of ignorance about the broader significance of Year 2000 compliance such as in the area of health and safety regulations. 03:47:34 01/20/1999