The study, titled "The CFO’s Playbook for 2024," surveyed over 500 UK financial decision-makers and revealed that nearly half of the respondents (50%) anticipate 2024 will be "easier" than 2023, compared to 35% who predict it will be more challenging and 15% who expect conditions to remain unchanged from the previous year.

This optimism appears amidst declining concerns about inflation, which has seen a 20% drop since 2023. Consequently, businesses are setting more ambitious targets. Almost three-quarters are now prioritising cash growth as their main goal, marking a 163% increase in the number of British firms focusing on this objective from the previous year. Other aims for last year included improving efficiencies (24%), a priority that has risen significantly in 2024 with over half of the businesses (55%) identifying it as a crucial goal, and stabilising the company (22%), which has shifted towards growing talent (38%) this year.

However, challenges such as financial health and spending visibility are hindering growth for many businesses. A quarter of UK firms are looking to cut expenditure, yet only a third believe they have excellent control over spend management. This issue is compounded by the fact that only 28% are confident in their understanding of their financial health and performance, a statistic that decreases to 13% among businesses with 250-499 employees.

A significant barrier to effective spend management is the ambiguity surrounding the definition of expenses. Nearly half (47%) of UK businesses view expenses and spend as distinct, yet only 24% have clear guidelines for their finance teams on the differentiation. This lack of clarity means that finance teams often do not accurately track transactions as part of their spend management strategy until they exceed £10,000, indicating that many items of expenditure are potentially being overlooked.

Thorbjørn Fink, COO of Pleo says: “For businesses to meet their revenue growth and saving goals of 2024, they need to ensure they have full visibility and insights into all outgoings. When there is real pressure on financial growth, companies can no longer afford to silo their outgoings into expenses (e.g. low-cost items such as coffees, lunches, subscriptions) and spend (e.g. LinkedIn ads, business travel, office rent). Choosing to ignore low-cost items means CFOs are needlessly putting blinkers on and, in the process, only getting half of the spend management picture.”

Maintaining strict control over expenditure not only leads to more profound insights and reduces instances of duplicate spending but also diminishes the necessity for drastic cost-cutting measures. Amidst this, 21% of firms are turning to renewable energy solutions to mitigate their energy expenses, identified as the primary challenge (24%) for businesses in 2024. Additionally, a notable number of organisations are reassessing salaries.

The study unveiled that one in five UK companies are contemplating salary reductions for remote workers, a strategy that could affect 16% of the workforce. Furthermore, 41% of companies are summoning employees back to the office. The prevailing rationale for this move is that "other companies are doing the same" (30%), with performance-based insights and employee feedback each cited by 29%.

Despite these adjustments, the outlook for employment levels in 2024 is optimistic. Only a quarter (25%) of businesses anticipate the need to reduce their workforce in 2024, a marked improvement from the previous year, when 42% were implementing staff reductions. Moreover, the data indicates a 27% increase in the feasibility of new hires, suggesting a more stable employment landscape for the coming year.