22 May 2008
British business remains calm in face of uncertain economic outlook
British business is remaining upbeat despite the current economic slowdown, with over 60% of finance directors anticipating a growth in company sales over the next few months, according to a Quarterly Economic Survey released today (Friday) by the Chartered Institute of Management Accountants (CIMA).
Finance directors are feeling optimistic despite the pending economic uncertainty with over 40% expecting the total number of staff employed in their organisations to grow throughout 2008.
However, this confidence is fragile with almost half of the finance directors surveyed believing that the credit crunch is likely to provoke a full-blown recession. Only 15% thought a recession would be unlikely.
This mixed feeling is repeated with 35% of businesses anticipating possible budget cuts with 75% of them saying that temporary/agency staff would be the first to go followed by administrative support at 61%.
The forecast for graduate recruitment also appears gloomy with more than half of companies saying that they are not planning to recruit any graduates during 2008. This could prove a challenge for final year university students embarking on their careers this summer.
Meanwhile, finance directors are convinced environment issues need to be taken more seriously with 79% saying that energy companies should be doing a lot more with 74% agreeing that the UK Government should also be doing a lot more to help the environment. Indeed, nine out of ten British businessmen say Governments should take the lead in tackling global warming. However, they recognise their own responsibilities too with a staggering 95% of them saying business has to play its part in tackling global warming issues.
Fraud is another major concern for British business with 55% of finance directors saying employee fraud poses the greatest risk for their organisations, followed by 40% believing computer fraud to be a significant risk. Fraud can often be linked to poor remuneration and policies prompting employees in certain industries to take risks, with bonuses linked to excessive practices. The way to combat fraud, according to 95% of finance directors, is to use effective technology and IT security anti fraud measures to protect organisations from risk.
Charles Tilley, Chief Executive, CIMA comments:
'CIMA members work at the very heart of business and are able to give us a clear view of how organisations are truly responding to the current economic climate. The results from this survey show that the real picture is far more complex for British business than might be expected. While the majority of finance directors forecast a growth in company sales during the next few months, almost half still believe that the credit crunch is likely to provoke a full-blown recession.'
'There is also a very strong awareness of the important role organisations have to play in tackling global warming along with the growing threat organisations are facing from fraud by their own employees.'
The CIMA Quarterly Economic Survey conveys the opinions of 200 CIMA finance directors across the UK working in manufacturing, retail, financial services and the public sector.
ENDS
For further information, please contact:
Claire Grewer
Press Officer, CIMA
+44 (0) 20 8849 2300
claire.grewer@cimaglobal.com
CIMA (the Chartered Institute of Management Accountants) is the only international accountancy body with a sole focus on business. It is a world leading professional institute that offers an internationally recognised qualification in management accountancy, focusing on accounting in business in both the private and public sectors. It is the voice of 164,000 students and members in 161 countries. CIMA is committed to upholding the highest ethical and professional standards of members and students, and to maintaining public confidence in management accountancy. For more information about CIMA, please visit http://www.cimaglobal.com/.
CIMA is responsible for the education and training of management accountants who work in industry, commerce and not-for-profit organisations and has more members in the public sector than any other UK based accountancy body. CIMA prides itself on the commercial relevance of its syllabus, which evolves continually to reflect the latest developments in global business. CIMA has been awarded superbrand status in the UK for a second year in a row this year and for the first time in Sri Lanka. According to independent research conducted by the University of Bath School of Management, CIMA’s syllabus and examination structure are the most relevant to the needs of business of all the accountancy bodies assessed. See the CIMA Difference report for further information at www.cimaglobal.com/thecimadifference.
