Chief financial officers (CFOs) are facing significant cash management challenges regardless of whether their organisation is cash-rich or cash-poor, according to a report by Ernst & Young (E&Y).
The report, entitled ‘Drought or Drowning? Cash Challenges for CFOs at Both Ends of the Liquidity Spectrum’, says that the uncertainty in the economy of recent years meant that there were many CFOs who found themselves in both situations. It identifies the complexities at both ends of the liquidity spectrum and assesses the opportunities and considerations to help CFOs steer their company through the challenging economic environment.
It adds that cash hoarding is a problem both for governments seeking for ways to stimulate growth and for smaller companies desperate for finance. The report suggests that in the eurozone, corporates collectively hold around €2 trillion, FTSE 100 companies in the UK hold around £750m and the figure for US companies is in excess of US$2 trillion.
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A survey by Hays Treasury finds that more than one in three regard it as the main issue over the next 12 months, but new technology and cybercrime is a close second.
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