Re: [office-formula] euroconvert

[robert_weir@us.ibm.com]

"Andreas J. Guelzow" <aguelzow@math.concordia.ab.ca> wrote on 12/02/2009 
02:19:07 PM:

> Is this function really just a synonym for multiplication with one of a
> small selection of factors, or is in fact more happening here (such as
> truncation or rounding of the result)?
> 

Certainly, there are very simple mathematical facts at the core of this 
function: a list of a dozen conversion factors from legacy national 
currencies to the Euro.  But the bankers made it a bit more complicated.

The main complication is the EC's Rule 1103/97:  
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31997R1103:EN:HTML

Especially note Articles 4 and 5, where specific rules for rounding are 
specified and what was later called the "triangulation rule" is specified 
for conversion between legacy currencies using the Euro as a intermediary 
format.  Now why this added complexity, you might ask?  I'm not sure, but 
my guess is they wanted to publish a simple list of N conversion factors 
and not an N^2 factors, some of which would be inexact, or favoring one 
direction or another, introducing arbitrage opportunities, etc.  In any 
case, the intent of this function is to implement the canonical conversion 
from Rule 1103/97.  In fact, we should probably reference that Rule in the 
definition of the function.

-Rob