Central Europe CFO Survey 2018

Key findings

Economic outlook

• 85% of CFOs think inflation will increase in 2018
• CFOs are predicting average GDP growth of 2.4% in their countries (0.5 percentage points [pp] more than in 2017)
• 55% expect interest rates to rise during the year

Business environment outlook

• A significant majority – 69% of respondents – do not think 2018 will be a good time for companies to take on more risk.
• 44% believe the impact of interest rates on their business is too small to influence company strategy

Company growth outlook

• 91% of CFOs expect workforce costs to increase in 2018
• Only a small fraction of CFOs, 13%, expects CAPEX to fall in 2018.
• Nearly half (46%) of CFOs expect their workforce to expand in 2018, slightly more than in the 2017 survey.
  

The report is divided into four main chapters. The first three are on the macro-economic outlook, CFOs’ personal perspectives on the operating environment and their expectations for the performance of their own companies. The fourth chapter is a special focus on robotic process automation (RPA), covering their expectations of this key area of the digital economy.

Economic confidence remains on an upward trajectory
Positive expectations for factors like GDP, unemployment, inflation and interest rates abound across most markets. In particular, GDP growth is regarded positively, with predictions ranging from 1.8% in Ukraine to 2.9% in Slovakia.

Challenges fail to reduce widespread business optimism
The concerns that many CFOs have about external uncertainty at both a country and a company level are preventing many from taking more risk onto the balance sheet. Their chief worries relate to their ability to attract highly skilled employees and manage an overall increase in the costs of doing business.

Expectations of rising company revenues
Company perspectives are little different from those of 12 months before, as shown by a small rise in our Company Perspective Confidence Index. This suggests that CFOs believe their companies’ financial prospects over the next 12 months are good and that there is a high likelihood that their revenues will increase.

The inevitable rise of RPA
In this era of company digitalisation, CFOs are quick to recognise that ongoing process automation – across the business, but particularly in the finance department – is inevitable. However, few regard their own businesses as advanced adopters of RPA and many find it difficult to estimate the possible savings that it could deliver.
Specific findings in this area included:

• Only 7% think their companies are advanced in robotic process automation 
• 62% of CFOs believe that the greatest beneficiaries of process automation will be their company operations
• 33% are unsure about the size of automation gains, whether already achieved or yet to come
   

About the survey

This annual questionnaire tracks the latest thinking and actions of CFOs representing largest and most influential companies in the Central European region. It explores top-tier CFO issues across four areas:

• Business environment
• Company priorities and expectations
• Finance priorities
• Digital transformation of finance function

The findings discussed in Deloitte Central Europe CFO Survey 2018 represent the opinions of 584 CFOs based in 12 Central European countries: Bulgaria, Croatia, the Czech Republic, Hungary, Latvia, Lithuania, Poland, Romania, Serbia, Slovakia, Slovenia and Ukraine.