Testing for Year 2000 Readiness

Guideline No. 16.5

Testing for Year 2000 Readiness

The Joint Year 2000 Council has recently published a paper that addresses testing for Year 2000 readiness. The paper identifies the goals of Year 2000 testing, the elements that can make up a successful testing programme, and the key factors that need to be considered in developing a testing strategy. This paper should provide useful guidance to the management of authorized institutions ("AIs") in their development and implementation of testing processes. I am enclosing a copy of the paper for your reference.

The paper stresses that testing is the cornerstone of a successful Year 2000 project. Many sources indicate that resources required for testing typically make up more than half of total project costs. It is only through a sound testing programme that AIs can be assured that their Year 2000 preparations have been thorough and that significant problems will not develop either internally or with key business partners. In addition, a sound testing programme may also achieve several other broad objectives such as maintaining consumer confidence, mitigating the legal risk and facilitating contingency planning. Given the diverse considerations in a testing process, the paper stresses that business managers need to be heavily involved in the testing process.

Since testing is the most complex and resource intensive phase of a Year 2000 programme, it is likely that institutions will encounter further slippage and budget overruns during testing which will impact upon their compliance date. It is therefore essential for institutions to commence testing as early as possible to identify problems and maximise the time to fix them. As mentioned in my letter of 3 April 1998, all institutions are expected to have completed the modification and testing of individual systems, and tested the interaction of modified systems with other systems with which they interface directly by the end of this year. This will then enable institutions to undertake wider testing that may be required during 1999, including with external parties.

If there are any questions on the above, please contact our Mr Vincent Lee at 2878-1384.