Summer 2015 CFO Survey

Grant Thornton LLP conducts its CFO Survey twice a year with CFOs and other senior financial executives across the United States. The summer 2015 survey took place between June 23 and July 22, with 912 CFOs and comptrollers participating. The survey has a confidence interval of +/- 3.24% at a 95% confidence level. Questions ranged from the state of the economy to the effects that current regulation changes are having on business growth.

Featured findings of the Summer 2015 Survey include: More than half (55 percent) of CFOs say uncertainty in the U.S. economy is a major concern that could impact their businesses’ growth in the next 12 months
  • This is despite the fact that most CFOs expect the U.S. economy overall to remain the same (49 percent) or improve (43 percent) in the next 12 months
  • This data is consistent with Fall 2014 survey findings, which found that 47 percent of CFOs believed the economy would improve in the coming year and 44 percent expected it to remain the same
  • This indicates that factors other than the overall health of the economy are presenting a barrier to growth

Congressional dysfunction around tax, currency fluctuations and a looming rise in interest rates are hindering aggressive growth
  • Particularly frustrating for CFOs is the dysfunction in Congress over a bill to extend more than 50 popular tax provisions that expired at the end of 2014; in past years, negotiations dragged on into December
    - According to this survey, more a third (37 percent) of executives are acting as though the extension will not occur
    - 26 percent are assuming some amount of risk that it will not occur, and are planning accordingly
    - 9 percent assume fully that the extension will occur
    - Especially striking is the fact that more than half (51 percent) of companies that actually use the provisions are doing all their planning with the assumption that the extension will not occur
  • A strong USD had reduced the value of revenues and earnings from overseas operations and depresses revenue growth for U.S. companies
    - North American companies lost $28.9 billion due to currency swings in the first half of 2015 -- more than six times the level of the same period in 2014
  • The U.S. Federal Reserve has offered mixed signals on whether or not they will raise interest rates at a policy meeting this September
    - While the labor market appears to have stabilized, inflation remains low
    - Fed officials have given conflicting statements on if and when they will raise rates, setting the stage for a potential cliffhanger debate at the policy meetings

Cybersecurity is also a major source of worry and uncertainty for financial leaders.
  • Nearly half (44 percent) of CFOs say the most significant cybersecurity risks are the unknown risks
  • 57 percent say it is the potential for undetected breaches that worries them the most
  • Interestingly, more public companies (47 percent) fear they are at risk of reputation loss compared to private companies (31 percent)

Regulatory and compliance burdens also top the list of concerns for finance chiefs.
  • 45 percent of CFOs say that increasing costs of compliance present the biggest challenge to growth
  • 31 percent say that keeping up with the volume and complexity of regulations is their number-one challenge

In this environment, financial executives are averse to riskier growth strategies.
  • 80 percent say they plan to pursue growth strategies in existing markets
  • Most CFOs (54 percent) plan to fund growth in the coming year by leveraging existing cash reserves and 47 percent say they will use debt financing
  • Recent enthusiasm for mergers and acquisitions (M&A) may be waning

CFOs are aggressively looking to develop and hire new talent.
  • 70 percent of CFOs say finding and retaining the right talent is a critical need for supporting growth
  • 40 percent expect their business’s new hiring to increase in the next six months; 52 percent expect hiring to remain the same
  • 67 percent plan to increase salaries in the coming year, holding steady since 2014

Download the report PDF.