PracticeAccounting FirmsQuarter of CFOs prepared for euro breakup

Quarter of CFOs prepared for euro breakup

CFO confidence suffers sharpest fall since 2007, its third major decline in five years, Deloitte survey finds

WORRIES ABOUT recession and a breakup of the euro have knocked fragile CFO confidence in the business environment, according to a Deloitte survey.

The Deloitte CFO Survey, which polls the views of 137 finance directors and CFOs of UK businesses, found that a breakup of the euro was perceived as the biggest threat to UK corporates.

CFOs now see a 36% probability of one or more countries leaving the single currency by the end of this year, up from 26% in March, with almost a third saying their own plans for coping with a breakup of the single currency are “all made” or “at an advanced stage”.

Business confidence has also been hit by the UK’s return to recession. On average, CFOs see roughly a one-in-two chance that the recession will continue to the end of this year or that the economy will hit a triple-dip recession within the next two years.

Uncertainty has had a corrosive effect on risk appetite and 80% of CFOs say this is not a good time to take risk onto their balance sheets. However, only 4% cited the cost or availability of finance as having influenced recent changes in investment plans.

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