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KPMG: FX, tax & COVID-19 most important "stay-awake" issues for Nigerian CFOs
A new report by multinational consulting firm, KPMG says that Chief Financial Officers of companies operating in Nigeria remain discouraged about the prospects for growth in the economy in the remaining part of 2021, but they remain optimistic about the prospects of growth of their various organizations and industries. The report also identifies foreign exchange availability as the most important stay-awake issue for CFO's followed by tax and the Covid-19 pandemic. Tola Adeyemi Partner and Head of Audit Services at KPMG joins CNBC Africa for more.
Fri, 02 Jul 2021 16:17:50 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Foreign exchange availability, taxation, and the COVID-19 pandemic are the top concerns for CFOs in Nigeria, impacting economic growth prospects.
- CFOs are focusing on cost optimization and efficiency improvements, leveraging technology and remote working to drive operational efficiency.
- Government intervention is needed to address urgent issues such as security, infrastructure, and power to create a conducive business environment.
A new report from multinational consulting firm KPMG sheds light on the current sentiments and challenges faced by Chief Financial Officers (CFOs) of companies operating in Nigeria. The report indicates that while CFOs are apprehensive about the economic growth prospects for the remainder of 2021, they remain optimistic about the growth potential of their respective organizations and industries. The top issues that are keeping CFOs awake at night, according to the report, are foreign exchange availability, taxation, and the ongoing impact of the COVID-19 pandemic. Tola Adeyemi, Partner and Head of Audit Services at KPMG, delved into the key findings and insights from the report in an interview on CNBC Africa. Adeyemi highlighted that the effects of the COVID-19 pandemic have continued to linger into 2021, with CFOs expressing concerns about the fiscal and monetary policy implications and other socio-political issues that have emerged in the first half of the year. Foreign exchange availability, heavily influenced by oil prices and government policies, remains a critical issue for CFOs, impacting the overall growth of the economy. In response to the challenges posed by the current economic situation, CFOs are focusing on managing the bottom line through efficiency improvements and cost optimization. Companies are adopting a risk-based approach to cost management, leveraging technology to drive operational efficiency. Remote working has become a prominent feature, leading to increased investments in IT infrastructure and cloud-based technologies to support productivity in the new normal. Urgent issues that CFOs want the government to address include security, infrastructure, and power, as these challenges continue to hamper business operations and breed uncertainty. Adeyemi emphasized the need for concerted government action to tackle these critical issues and create a conducive business environment. Looking at the African Continental Free Trade Agreement (AfCFTA), CFOs acknowledge its enormous potential to boost intra-Africa trade and enhance the competitiveness of Nigerian companies. However, they underscore the importance of implementing policies that will facilitate effective participation in the agreement and enhance companies' efficiency. CFOs and companies alike are urged to develop robust strategies for the AfCFTA, recognizing that the impact will be more pronounced in the medium to long term. Adeyemi concluded the interview by stressing the importance of ongoing efforts to navigate the economic challenges and capitalize on opportunities for growth amid a changing landscape.
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