New York (Nov. 21, 2002) -- Predicting a bleak economic outlook for 2003, most middle market chief financial officers plan to focus on containing costs to maintain their companies' financial health during the next year, according to a survey by American Express.
More than two-thirds of middle market CFOs believe that the economy will stay flat, act erratically or decline further in 2003, American Express reported. As a result, most managers polled will rely on containing costs to maintain the financial health of their firms during the next year, according to the survey of 485 middle market CFOs.
"This is a marked departure from the late 1990s when companies placed phenomenal growth and increased revenues over cost containment," said Anre Williams, senior vice president and general manager, U.S. Middle Market, American Express Corporate Services. A copy of the report can be found at www.americanexpress.com/cforeport.
Containing or reducing indirect expenses, such as office supplies, express shipping, telecommunications, travel and entertainment, and computer equipment is a priority for three-quarters of respondents. Forty-four percent will place tighter restrictions on indirect expenses other than T&E, while 29 percent plan to further restrict T&E spending.
According to the poll, strategies to improve expense management include: setting and enforcing indirect expense spending policies, such as issuing preferred vendor lists for office suppliers and other purchases; using technology to simplify expense management; leveraging aggregated expense data to qualify for supplier discounts; discontinuing cash advances and check reimbursement in favor of corporate cards; integrating back-office systems; and improving vendor management.
-- Electronic Accountant Newswire staff
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