Running the finances for an international group has its challenges but none greater at present than making currency hedge decisions. Back in November the US$ was at 2.06 and threatening to stay weak and although the Euro had been strengthening steadily it was still over 1.41 and expected to weaken and I was happy. Of course, as a business with significant US and European operations we want a stronger $ and Euro but I’m the finance guy and it’s my job to protect the downside. So with Dollar protection in place at around 2 and my Euros still OK at 1.41 I was doing well with my layered cover.

Now, a week back into the New Year and we see the Euro reach an all time high against Sterling and the $ pushing under 1.97. I reach for my Reuters monthly poll from November, contributed to by more than 50 of the finest financial institutions in the land and find that only one of them had forecast the $ at less than 1.98 and not one of them had seen anything less than 1.37 for the Euro. So I console myself with the thought that my overseas business CEOs will be pleased with the new relative strength of their businesses even though my currency cover is looking a bit sick.

I think I’ll go back to IFRS; they seem so much more comprehendible.