KPMG: KPMG records 67 significant millennium bug failures world-wide in the first week of 2000

Story Filed: Friday, January 14, 2000 1:29 PM EST

JAN 14, 2000, M2 Communications - According to figures collated by the KPMG/BBA Year 2000 Research Centre, 67 significant Y2K related failures were publicly reported throughout the world in the first seven days following the January 1st date change. These ranged from the serious - reported failures in nuclear power plants and the US nuclear arsenal - to the inconvenient, with problems worldwide reported in the new MP3 internet music system.

In compiling their figures, KPMG has not included Y2K failures prior to 1st January, such as the UK EFTPOS machines, reports which were initially ascribed to Y2K but on closer investigation were non-related computer failures and reports of what turned out to be pre-event panics. Gambia was a classic example of the latter with many predictions of large scale collapse in this country. However the Gambian authorities filed a green all-clear report on key systems with the International Y2K Co-ordinating Commission on January 2nd

Commenting on the summary, Malcolm Marshall, KPMG Information Risk Management Partner said

"Fortunately most of the world survived January 1st unscathed. A big fear for the date change was the non-compliant embedded chips. These seem to have been identified successfully and replaced.

"But there were still some worrying failures, particularly on safety control systems such as those used in nuclear power stations. Such failures demonstrate that there were real problems.

"However Y2K isn't over yet. The most difficult to detect problems could prove a greater threat than dramatic failures such as complete system shutdowns which are spotted immediately. Organisations need to be vigilant in the following areas:

* Other significant date changes such as February 29th leap year date, month and year ends. Financial institutions could find this a particular problem in the calculation of interest and security maturity dates.

* Situations where identified Y2K problems were fixed in-house with a temporary patch. These are like the thin spare wheels in many cars - they will get you so far but shouldn't be use for a long period and certainly not at speed

* D-I-Y systems developed by business users rather than software engineers and which determine large sums of money - particularly among actuaries and derivative trading operations

* Situations where a computation error is ignored and allowed to continue, growing unnoticed

"One of the lessons of Y2K has been the widespread problems created by local customisation of software, carried out some time in the past, where no one remembers exactly what was changed and where there is no documentation showing what was done. All organisations should now have tighter procedures developed from their Y2K programmes.

"Overall the outcome so far is better than we could have hoped for just a few months ago, but organisations still need to maintain vigilance during the rest of the year".

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-- Martin Thompson (mthom1927@aol.com), January 19, 2000