Corporate Finance

Finance Roundup for Executives

Be informed, get involved, and shape the world through finance. Read CFO.com's most recent headlines and standout stories.
Kerry MarunaApril 6, 2016

Standout Stories

Threats and opportunities… Ask a business prognosticator what’s in store for 2016, and likely you’ll hear how gloomy the outlook is — particularly overseas. But ask a finance chief, and you may get a response along the lines of that provided by Vsevolod Rozanov, CFO of Sistema, a diversified collection of large Russian businesses. “It is not a time of crisis,” Rozanov says,“but a different reality. It presents threats but it also presents significant opportunities.”

Similarly level-headed comments were recently made to CFO by other finance leaders at several globe-spanning enterprises. Far from pushing the panic button, these finance chiefs are thinking about the best ways to gird their companies to continue to build on gains made in recent years. “We’re appropriately frugal,” says David Carter, CFO of Suncorp Bank in Australia, “but we’re not backing away from investment. We’ve got to keep investing if we want to have a bank that’s sustainable into the future.” Read article

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Automobiles and the Internet… Averages are a convenient way to characterize a lot of numbers, but are just as often misleading. The “average” U.S. driver reportedly spends around 275 hours a year driving a car, (according to the 2015 AAA Foundation for Traffic Safety Survey) and spends (on average) 38 additional hours stationary. The U.S. Department of Transportation Federal Highway Administration estimates that the average driver travels about 13,500 miles in a year, so the average speed of the average car driven by the average driver must be 49 mph — which doesn’t match my experience at all closely, and probably doesn’t match yours either.

As cars get more “connected” and capable of generating continuous data streams related to location, performance, and driver behavior, another average emerges — the 25 gigabytes per hour of data that (on average) will get sent to the cloud by each connected vehicle — 6,875 GB (6.875 terabytes) a year if all that data is stored. If all the 253 million passenger cars and light trucks (the current IHS automotive estimate) in the United States were “connected,” which likely won’t happen for a decade or more, we’d be sending  about 1,740 exabytes (one billion gigabytes) to the cloud every year. By the time the worldwide passenger vehicle fleet is fully connected (say around 2035), even if we don’t have driverless autos everywhere, there will likely be 2 billion vehicles, creating nearly 14 zetabytes of data annually. That’s about 4 times as much data as the entire planet created, from every source, in 2015. Read article

Headlines

IMF Urges ‘Increased Vigilance’ Over Insurers

The sector’s increased contribution to systemic risk necessitates a “more macroprudential approach” to regulating it, the IMF says.

 

Supply Chain Anti-Fraud Measures Lacking

A Deloitte poll finds only 29.3% of organizations use analytics to mitigate supply chain fraud and financial risks.

 

My Car, My Data?

There is a deep ambivalence prevailing in the auto industry regarding ownership of the data generated by the connected car.

 

Walgreens Boots Alliance Narrows 2016 Forecast

Sales rose 14% for the second quarter but still fell short of analysts’ projections.

 

U.S. Trade Deficit Widens 2.6% to $47B

Economists see trade subtracting at least seven-tenths of a percentage point from GDP growth in the first quarter.

 

Exchange Operator Testing IPO Waters Again

BATS Global Markets is making a bold move by trying to list at a difficult time for new issues.

 

PayPal Withdraws Plan for Facility in North Carolina

The payments company says its decision was prompted by a new law in N.C. that discriminates against the LGBT community.

 

Flex and Flexibility

CFOs at large companies around the world agree: Keep your options open.

 

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