See how CFOs really feel about business in the Valley [ 2016 ]
In spite of recent events, the threat of global recession and the plunging price of oil, chief financial officers in the Phoenix and Tucson areas generally have a favorable economic outlook for 2016, according to the Arizona CFO Spotlight Survey 2016 by BeachFleischman PC.
The annual independent, voluntary study was conducted during the fall of 2015. BeachFleischman PC reports the survey is “intended to provide CFOs with information regarding their CFO peers’ thinking across a variety of industries and topics in the Phoenix and Tucson markets.”
CFOs play a critical role in creating and implementing successful business strategies. An article in the Harvard Business Review noted, “The hard data and empirical mindset that the CFO brings to the table can be invaluable in setting and executing the company’s game plan, especially when it comes to forecasting trends or managing government and regulatory relationships.”
Responses to the survey from Phoenix CFOs showed more than 58 percent are very optimistic about the 2016 business outlook and another 25 percent are somewhat optimistic.
More than 70 percent indicated they expect an increase in revenue this year.
In Tucson, the outlook was even more positive with 91 percent of CFOs saying they are somewhat or very optimistic about the 2016 business climate. And 72 percent of respondents expect to see higher revenues in 2016.
Immigration legislation is a hot topic in this year’s presidential election, and it is an important issue for a border state like Arizona. But as far as business goes, it doesn’t seem to be a big concern for the CFOs surveyed. More than 69 percent said regulation and policy around border security and immigration will have very little impact on their businesses in the coming year.
Similarly, environmental policy has been an area of major focus for the federal government. Yet among local CFOs, 69 percent responded that state environmental policies have minimal impact on their companies and organizations.
The biggest concerns identified by CFOs were:
- Available skilled talent (57 percent)
- Business-friendly city and county policy (56 percent)
- Improved educational system (49 percent)
- Updated physical infrastructure (29 percent)
- Better tax incentives (24 percent)
- Regulatory cost reductions (22 percent)
When it comes to factors that could influence company revenues in 2016, CFOs listed consumer confidence first and labor costs second.
Health care change is another national issue attracting attention the past few years. Nationally, the trend is to shift costs from employers to workers. The survey found more than one-third (36 percent) of area CFOs are concerned about the risk of providing health care benefits in a time of rising costs. Almost 33 percent indicated they plan to shift costs to employees and to change providers.
Other topics covered in the survey include:
- Cross-border trade
- Data security
- Reputation management
- Risk management
- CFO contributions
- And more
The survey was sponsored by Bank of Arizona, The Phoenix Business Journal and Inside Tucson Business. It included responses from 77 participants. Companies included in the survey had average annual revenue of $94 million and an average of about 400 employees. The average tenure of CFOs queried was 11 years.
Those who would like a copy of the complete survey results can register at the BeachFleischman PC website.
BeachFleischman, one of Arizona’s largest locally-owned CPA firms, provides services that help Phoenix and Tucson Arizona business owners save taxes, preserve wealth, improve accountability, enhance profitability and achieve compliance. If you are interested in learning more about how their team of certified public accountants can help your business, please contact BeachFleischman.com or call Tracy Hughes, CPA at (602) 265-7011.