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Regional differences are biggest challenge for UK CFOs

More than half (51 per cent) of chief finance officers (CFOs) and finance directors based in the UK say that “regional differences” are the most challenging factor in financial planning and reporting.

Regional variations can include compliance regimes, legal structures, management culture and levels of IT support, according to Accountagility, the financial products provider that carried out the survey. CEO Robert Gothan said: “The market is increasingly turning its focus to financial planning, because businesses are looking for greater accuracy and predictability in their global budgets and forecasts. By adding more flexibility to their processes and tools, finance teams can ensure that planning and reporting reflect real time accounts and forecasts, and also unlock accurate business insights that can help drive performance more effectively.”

How treasury centralisation and IFRS are easing regional differences

The challenge of regional variations in financial reporting, legal environment and IT will be greater if companies have limited centralisation and still allow local entities a certain amount of autonomy in their financial operations.

However, as CTMfile reported recently, global financial reporting is becoming increasingly standardised, with the International Financial Reporting Standards (IFRS) now required in 83 per cent of the biggest economies in the world

At the same time, large companies are tending to move towards the centralised treasury model, which provides not just greater control and economies of scale but also the means to establish standardised procedures and incoming data sources from regional entities. For an excellent example of how one multinational did this, read Shell’s global treasury management: the lessons from their centralisation journey

This item appears in the following sections:
Cash & Liquidity Management
Global Cash & Liquidity Management
Global Cash Visibility
Cash Flow Management & Forecasting
Cash Flow Forecasting

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