Deloitte: Economic, Political Worries Depress Large Company CFOs’ Expectations

By Rob Starr, Content Manager, Big4.com

Deloitte’s CFO Signals survey shows the most somber year-over-year expectations in the 10-quarter history  of the survey. It found that 40 percent of CFOs report rising pessimism this quarter about their companies’ prospects (up from 28 percent last quarter). The outlook in the U.S. is worse with 47 percent of CFOs less optimistic.

The concerns about the global economy that have been high in recent surveys only escalated this quarter. When asked about their most worrisome risk overall, for example, nearly 60 percent of CFOs mentioned domestic or global economic conditions, with one third of those specifically citing European conditions.

About one-quarter of CFOs cite government- and regulation-related issues as their most worrisome risk, with frequent mention of the impending fiscal cliff, possible changes to tax and regulatory policy and the potential impact of U.S. elections on policy and equity markets. CFOs say their companies’ top three challenges are revenue growth from existing markets (58 percent, about the same as last quarter), framing and/or adapting strategy (41 percent, up from 30 percent) and talent (34 percent, down from 41 percent).

The Deloitte CFO Signals survey was conducted for the third quarter of 2012. More than 80 percent of the 85 CFO respondents were from companies with more than $1 billion in annual revenues and three fourths were from publicly traded companies.

Each quarterly CFO Signals report analyzes CFOs’ opinions in five areas:  CFO career, finance organization, company, industry and economy. For more information about Deloitte’s CFO Signals, or to participate in the survey, please contact NACFOSurvey@deloitte.com.