Cash Flow

49% of Finance Professionals Worry Cash Flow Data is Unreliable: Weekly Stat

Confidence in cash flow visibility is low among financial and accounting professionals, data shows.
49% of Finance Professionals Worry Cash Flow Data is Unreliable: Weekly Stat
Photo: Dilok Klaisataporn

Reliance on data is the foundation of any finance executive looking to create accurate forecasts and allocations. Yet a recent survey by Blackline found nearly half (49%) of executives have multiple issues with the accuracy of their data to counteract the things impacting their businesses, such as customer spending power, inflation, interest rates, and the rising price of goods and services.

To put themselves in a position for success, the data financial teams use to make decisions must be as accurate as possible. According to new data, financial professionals’ confidence in their data is drastically declining. 

Impact on Cash Flows

The economy’s negative outlook has executives worried about impacts on their cash flows. Forty-three percent of those surveyed and over half (55%) of CEOs told Blackline they are concerned about rising interest rates resulting in late payments by their customers. While 42% are worried about customers or prospects having less to spend, 41% also said their organization expects higher costs. 

The external impacts on cash flow consistency and accuracy aren’t limited to a particular industry. Nearly all (98%) of respondents said they could be more confident in the visibility of their cash flow. 

While 49% of respondents said they are concerned that their poor cash flow data is leading to misinformed decision-making, a significant amount believes this will impact their company’s ability to survive. Forty-four percent said the lack of cash flow visibility damages their confidence that the business can remain competitive over the next year. 

Marc Huffman JPG 1.jpg

  Marc Huffman

“There is no doubt that those using robust and comprehensive data to make rapid, intelligent decisions will be in a stronger position to adapt,” said  BlackLine CEO Marc Huffman. “In this environment, it’s likely that greater emphasis than ever will be placed on the strategic insights that finance and accounting can offer the business.”

Increased Scrutiny

As the economic outlook for the next twelve months continues to be poor, real-time financial data will be “key to survival” according to the survey. Rising pressures on CFOs will result in more data-reliant decision-making.

The survey found that nearly two-thirds (62%) of executives and finance and accounting professionals predict their company’s finances will come under increased scrutiny in the next year. Sixty-three percent believe all types of financing will be harder to secure, and a nearly identical (62%) amount of respondents told Blackline that financial data in real-time is a “must-have” for their company’s survival over the next year.

 

When it comes to the responsibility of ensuring well-being, respondents’ answers were scattered on a specific role to expect leadership from. While less than a third (30%) of respondents said this was the responsibility of the CEO, two in five (41%) of CFOs said they were responsible for ensuring their company’s well-being in an economic downturn. With rising scrutiny expected, CFOs will need accurate data now more than ever to properly allocate capital and track resources. 

“Economic instability and volatility have increased over the past few months, adding more uncertainty to an already challenging and unpredictable global business environment,” said Huffman. “Once again, finance and accounting are caught in the eye of the storm, with CFOs and those who report into them feeling the pressure.”

“There is widespread acknowledgment that better visibility over financial data, processes, and working capital is needed if organizations want to weather the storm,” he continued. “Company leaders across the world will need to carefully consider how their organization can respond and remain competitive, agile, and resilient in the coming months.”