Character encoding issues: Pound-sign "£" becomes a "ú" - why?

Hello, I'm experiencing some odd character encoding issues. My PHP webpage is displaying test from a MySQL database. What happens is that I export data from an SQL Server database to a MySQL (4.0) database. Somewhere along the line the British currency pound-sign "£" becomes a "ú" (u with somesort of accent on it!). I cannot figure out why this is happening and what to do about it. I could use a PHP routine to find-and-replace the chars but surely there is a way to tackle the root problem? Any ideas gang? Alex