BUYING POWER

CFO Survey Shows Split Decision on Impact of Interest Rates on Spending

MENLO PARK, CA -- How are falling interest rates affecting corporate spending? It depends on whom you ask, suggests a new survey. While 48 percent of chief financial officers (CFOs) cited interest rates as having no impact on business expenditures, half (50 percent) of respondents said prevailing rates are factored into their purchasing decisions. Fourteen percent of those polled noted that interest rates have a significant impact on how they spend their firms' money.

The survey was developed by RHI Management Resources, North America's largest consulting services firm providing senior-level accounting and finance professionals on a project basis. It was conducted by an independent research firm and includes responses from 1,400 CFOs from a stratified random sample of U.S. companies with more than 20 employees.

CFOs were asked, "How much of an impact do interest rates have on the purchasing decisions you make for your company?" Their responses:

 

Significant impact 14%
Somewhat of an impact      36%
No impact 48%
Don't know/no answer    2%
100%

"Executives must carefully evaluate whether purchases make good business sense for the company over the long term, particularly with expenditures such as new technology or equipment," said Paul McDonald, executive director of RHI Management Resources. "Immediate business needs notwithstanding, interest rates are a key consideration for many CFOs during this assessment and can also impact other financial decisions including budgeting, forecasting and product pricing."

RHI Management Resources has locations in major cities throughout North America, Europe and Australia, and offers online job search services at www.rhimr.com.

 

 

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