What it means
The punt, also called the Irish pound, was Ireland's national currency for most of the twentieth century. When Ireland joined the euro area, its exchange rate against the euro was locked at a single fixed figure, so converting old amounts is a matter of simple division rather than looking up a market rate.
Euro notes and coins replaced punt cash in the early 2000s. For a business, the code still appears in places where history is kept.
Long-dated contracts, old loan agreements, pension records, company accounts and historical price series may all be stated in punts. Anyone building a long-term data set of Irish companies needs to convert the older figures into euros to compare them fairly with newer ones.
Conversion uses the fixed rate. One euro equals 0.787564 punts, so you divide a punt amount by 0.787564 to get euros, or multiply euros by 0.787564 to get punts.
The rate does not move, which is why it is easier than converting a floating currency. An important nuance is that euro figures are not adjusted for inflation.
A punt amount from decades ago converts to the same number of euros as it would have on the changeover date, but prices then were different. Analysts comparing old and new figures often adjust for inflation separately.
The punt is also a useful case study in currency history. Before the euro, it traded against other currencies such as sterling and the German mark and was part of the European exchange rate mechanism, so its value could change.
Investors in that period faced exchange rate risk that no longer exists inside the euro area. For day-to-day finance work, the main lesson is to record the original currency and the conversion method whenever old data is restated.
Auditors and buyers reviewing a long record like to see how each figure was derived, and a short note explaining the fixed rate avoids confusion later.
In practice
Real-world examples.
Example
A data analyst at an investment firm is building a 30-year earnings history for an Irish food company. The older accounts are in punts, so she divides each figure by 0.787564 to put the whole series in euros. The growth trend can then be read on a single scale.
Example
A solicitor reviewing an old mortgage document finds a loan stated as 150,000 IEP. Dividing by 0.787564 gives about 190,461 euros, which he uses when calculating what the original debt would be worth in modern terms. He records both figures in his file so that the client can see exactly how the conversion was done.
Example
A collector of old banknotes in Dublin sees a punt note advertised at an online auction. The seller prices it in euros, which shows that the punt has become a collector's item rather than money for everyday use. Its value now depends on rarity and condition, not on its face value.
Formula
Calculation
Euros = Punts / 0.787564
Suppose an old Irish property lease from before the changeover shows an annual rent of 787,564 punts. The euro equivalent is 787,564 / 0.787564 = 1,000,000 euros.
To go the other way, 1,000,000 euros x 0.787564 = 787,564 punts. If you then want a dollar figure, you apply a separate dollar-euro exchange rate for the date you need, because only the punt-to-euro link is fixed.Case study
Seen in the real world.
Shamrock Foods Group is a fictional Irish company preparing for a sale. Its advisers need 25 years of financial statements to show buyers a long-term growth record, but the earliest 10 years are stated in punts.
The finance team converted every punt figure by dividing by 0.787564, noting the method in a footnote so that buyers could trace it. Revenue of 15,751,280 punts in the oldest year became 20,000,000 euros.
In this illustrative case the converted figures made the growth line smooth and easy to read, and buyers could see steady expansion. The team also added an inflation-adjusted view alongside, so nobody mistook nominal growth for real growth. Buyers' advisers later said the clear footnote saved several rounds of questions.
Watch out
Common mistakes.
- Multiplying punt amounts by the rate instead of dividing, which gives the wrong direction of conversion.
- Using a market exchange rate for the punt after the changeover, when the rate was permanently fixed.
- Comparing old punt figures with modern euro figures without allowing for inflation.
Questions
People also ask.
What is the fixed rate for the Irish punt?
One euro equals 0.787564 punts, and it was set permanently when Ireland joined the euro.
Is the punt still legal tender?
No. It was replaced by the euro, although arrangements existed for exchanging old notes and coins for euros.
What does IEP stand for?
It is the three-letter ISO currency code used for the Irish pound, called the punt.
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