CG1004_CFO

What Manufacturing Chief Financial Officers Have to Say

April 21, 2010
On March 22 Thorugh April 5, 2010, Grant Thornton LLP Conducted a Survey Among Chief Financial Officers. 496 U.S. CFOs and Senior Comptrollers were Surveyed. Among this Large Group, 92 Officers were from Manufacturing Companies. See What These Manufacturing Chief Financial Officers Had to Say

See what questions were presented to 92 manufacturing chief financial officers and how they responded.

1. Your company is:

ItemCount    Percent % 
Public49 53.26%
Private 4346.74%

2. The revenue size of your company is:

ItemCount    Percent %
Between $1 billion to $5 billion2830.77%
Between $100 million and $500 million2527.47%
Greater than $5 billion2021.98%
Between $500 million and $1 billion1314.29%
Less than $100 million55.49%

3. The state in which you are headquartered:

ItemCount  Percent %  ItemCountPercent %
Michigan 9 9.89%  Kansas 2 2.20%
New Jersey 8 8.79%  Maryland 2 2.20%
California 7 7.69%  Massachusetts 2 2.20%
Texas 7 7.69%  Minnesota 2 2.20%
Ohio 6 6.59%  Missouri 2 2.20%
Florida 5 5.49%  Wisconsin 2 2.20%
North Carolina 5 5.49%  Arizona 1 1.10%
Georgia 4 4.40%  Idaho 1 1.10%
Indiana 4 4.40%  Kentucky 1 1.10%
Illinois 3 3.30%  Nebraska 1 1.10%
New York 3 3.30%  Rhode Island 1 1.10%
Oregon 3 3.30%  South Carolina 1 1.10%
Pennsylvania 3 3.30%  Tennessee 1 1.10%
Connecticut 2 2.20%  Washington 1 1.10%
Iowa 2  2.20%     

4. Over the next six months, do you expect the U.S. economy to:

ItemCountPercent %
Improve4346.74%
Remain the same4346.74%
Worsen66.52%

5. Over the next six months, do you expect your company’s financial prospects to:

ItemCountPercent %
Improve5559.78%
Remain the same3335.87%
Worsen44.35%

6. Over the next six months, do you expect prices or fees charged by your company to:

ItemCountPercent %
Improve5459.34%
Remain the same3134.07%
Worsen66.59%

7. Over the next six months, do you expect your headcount to:

ItemCountPercent %
Improve4650.00%
Remain the same2325.00%
Worsen2325.00%

8. When do you believe the U.S. economy will come out of recession?

ItemCountPercent %
20114650.00%
Second half of 20102426.09%
Later than 20111718.48%
First half of 201055.43%

9. The best way to create jobs is:

ItemCountPercent %
Cut corporate tax rate3440.00%
Cut personal income tax rates2630.59%
Tax credit for new hires1416.47%
Government stimulus programs89.41%
R&D credits33.53%

10. Is your company reducing average costs per employee in any of these employee benefit and compensation areas?

ItemDecreaseSameIncreaseTotal
Salary raises27.2%
25
55.4%
51
17.4%
16
92
Bonuses38.0%
35
50.0%
46
12.0%
11
92
Stock options/equity based compensation32.6%
28
66.3%
57
1.2%
1
86
401 (k) match22.8%
21
73.9%
68
3.3%
3
92
Health care benefits26.4%
24
68.1%
62
5.5%
5
91
Life insurance benefits7.7%
7
90.1%
82
2.2%
2
91
Disability benefits7.7%
7
91.2%
83
1.1%
1
91
Average %23.1%70.7%6.1%635.0

11. About which type(s) of pricing pressure are you most concerned? (You may select more than one.)

ItemCount    Percent %
Raw materials (e.g., food, metals)6270.45%
Employee benefits (e.g., health care, pensions)4955.68%
Energy2831.82%
Insurance910.23%
Other44.55%

12. Are you having difficulties accessing credit in general?

ItemCountPercent %
No7180.68%
Yes1719.32%

13. Compared to this time last year are you more or less worried about your organization.

ItemCountPercent %
Less Worried4955.68%
About the same3337.50%
More worried66.82%

14. The FASB and IASB will be shortly releasing an exposure draft regarding revenue recognition. The objective is to clarify the principles for recognizing revenue and to create a joint revenue recognition standard for US GAAP and IFRSs that companies can apply consistently across various industries and transactions. Are you aware of this project?

ItemCountPercent %
No6068.18%
Yes2831.82%

15. Do you believe financial statements are too complex to be useable by the average investor?

ItemCountPercent %
No5260.47%
Yes3439.53%

16. Does your company currently provide nonfinancial measures (Key Performance Indicators) about your organization in its financial statements?

ItemCountPercent %
No4250.60%
Yes4149.40%

17. Who do you view as the primary users of your financial statements?

ItemCountPercent %
Current shareholders2833.73%
Creditors1619.28%
Management1315.66%
Current owners of equity interests67.23%
Potential shareholders56.02%
Regulatory agencies56.02%
Research (sell side) analysts56.02%
Rating agencies33.61%
Other11.20%
Potential owners of equity interests11.20%

18. Does your firm prepare financial statements according to International Financial Reporting Standards (IFRS)?

ItemCountPercent %
No6375.90%
Yes2024.10%

19. Do you support a move to IFRS?

ItemCountPercent %
Yes4453.01%
No, would like to continue using GAAP3946.99%

20. Ideally, who should set U.S. accounting standards for companies that file with the SEC?

ItemCountPercent %
A national independent board supervised by a national regulator (e.g. the Financial Accounting Standards Board)4456.41%
An international independent board supervised by international entities such as the International Organization of Securities Regulators (e.g. the International Accounting Standards Board)2228.21%
A national regulator (e.g the Securities and Exchange Commission)911.54%
The global accounting profession (e.g. the International Federation of Accountants)22.56%
A body designated by an international entity such as the Organization for Economic Cooperation and Development, the United Nations Council on Trade and Development or the World Trade Organization11.28%

21. During 2010 and 2011, the FASB and the IASB plan to issue standards that will include major revisions to the current accounting for revenue recognition, financial instruments, leases, financial statement presentation, insurance contracts, and the conceptual framework. How should these standards be implemented in the US?

ItemCountPercent %
Using an incremental approach where no more than one major standard takes effect in a given reporting year to allow time for preparers and users to understand and implement the changes.2835.90%
The standards should be implemented first in IFRS; US companies can make the transition on adoption of IFRS2025.64%
The Boards are moving too quickly to implement major changes and should defer major changes in the financial reporting model until the projects have been more fully developed and discussed.1620.51%
Using a "big bang" approach where all of the standards are effective for the same reporting period to improve the financial reporting model as quickly as possible.1417.95%

22. Should there be different recognition and measurements principles for public entities and nonpublic entities?

ItemCountPercent %
No4458.97%
Yes2228.21%
Don't know10 12.82%

23. Should nonpublic entities be allowed to use simpler recognition and measurement principles when preparing financial statements?

ItemCountPercent %
No3747.44%
Yes3544.87%
Don't know6 7.69%

24. In the coming year, do you believe your aggregate state effective tax rate will:

ItemCountPercent %
Increase4761.84%
Remain the same2628.95%
Don't know/not applicable2 7.89%
Decrease11.32%

25. With regard to international taxation, you are most concerned about:

ItemCountPercent %
Transfer pricing2735.53%
Overall global compliance burden1925.00%
Repatriation of offshore earnings1823.68%
Risk management in developing countries1013.16%
Mergers and acquisitions22.63%

26. Is your company currently taking any actions in anticipation that federal tax rates will change?

ItemCountPercent %
No5370.67%
Yes2229.33%

27. What types of actions? (Check all that apply)

ItemCountPercent %
Reorganization of business structure2051.28%
Acquisition of capital assets923.08%
Acceleration of dividend payments820.51%
Other (please use text box below to describe)820.51%
Disposition of capital assets717.95%
Modification of terms on installment sale(s)410.26%

28. Does your company plan on taking any action in anticipation of the current administration's international tax proposals?

ItemCountPercent %
No5067.57%
Yes2432.43%

29. What types of decisions or actions? (Check all that apply)

ItemCountPercent %
Foreign tax credit planning1537.50%
Cash repatriation1435.00%
International reorganization1230.00%
International supply chain changes1230.00%
Other (please use text box below to describe)922.50%