This is the finding of one survey on how the strategic insights of finance and accounting professionals weigh on business resilience
In an international survey of 737 C-level and 746 finance and accounting (F&A) professionals across the US, Canada, UK, Germany, France, Singapore and Australia, respondents’ lack of confidence over the visibility their company had over cash flow suggests that many global organizations could be making decisions without an accurate, up-to-date view of company liquidity.
This comes despite findings that suggest that visibility over cash flow and other financial metrics could be the key to weathering the current growing global economic storm.
Some 22% of respondents were anticipating growing pressure and scrutiny over company financials as a result of ongoing economic uncertainty and indicated their view that it can take seven to 12 months before they start to feel confident about the economy again.
With recessionary fears on the rise, 42% of respondents indicated concern that prospects or customers will have less income to spend, which could impact sales/ revenue. Also:
- 41% were worried that their organization will face higher costs
- 48% of Singapore respondents agreed to prompts that understanding cash flow in real time is going to become more important for their organization in the face of economic uncertainty, compared to 96% in the rest of the world indicating they could be more confident in the visibility they currently have over cash flow. Of those Singapore respondents indicating belief that visibility could be improved, 56% were worried their organization was making decisions based on inaccurate or out-of-date information, and 50% also indicating that the lack of visibility over cash flow made them less confident that their organization can remain competitive over the next 12 months
- 62% of C-suite and F&A professionals indicated predictions that their organization’s financial reporting will come under increased scrutiny over the next year, with 50% of these respondents indicating that financing will be harder to secure, and 55% expecting the ability to view their companies’ financial data in real time will be a must-have over the next 12 months
- 68% of Singapore CFO respondents indicated that they were responsible for ensuring their company’s well-being during an economic downturn, compared to 30% of all other respondents who indicated that this was the responsibility of their CEO
- 37% of Singapore respondents identified manual/human errors during the month-end close process as a pressing issue, and 37 indicated they faced overdue and unsettled intercompany balances, followed by 36% indicating they did not have enough automated controls for the volume of data
- Overall, respondents indicated the following as the three biggest challenges in the coming year: reduced budget for their department; increasing regulations and scrutiny; and the ability to provide accurate data quickly enough to help their organization respond to market changes
- The data suggests that, in response to increasing financial pressure, organizations need to look internally for ways to optimize working capital and processes. Organizations that are using robust and comprehensive data to make rapid, intelligent decisions are likely to be in a stronger position to adapt to adversity using the strategic insights that strong F&A functions can offer.
According to Marc Huffman, CEO, BlackLine, Inc., which commissioned the survey: “Finance & Accounting is caught in the eye of the storm, with CFOs and those who report into them feeling the pressure. There is widespread acknowledgement that better visibility over financial data, processes and working capital is needed if organizations want to weather the storm. In the coming months company leaders across the world will need to carefully consider how their organization can respond and remain competitive, agile and resilient.”