The Deloitte third annual New Zealand CFO survey released yesterday surveyed 133 CFOs in the first half of March from a range of locations, industries and business sizes.
Deloitte Dunedin audit partner Mike Hawken said the New Zealand economy continued to perform well, underpinned by localised construction activity in Christchurch and Auckland.
It had been helped along by low interest rates and a recovering United States economy.
''CFO optimism, though, has been somewhat moderated by the easing of Asian economic growth, particularly out of China, and falling commodity prices - primarily in the dairy sector.
''Given the level of optimism regarding the local economy and the general positive outlook, it is interesting this hasn't translated into leverage on company balance sheets. Risk aversion is playing a prominent role in decision-making.''
The ongoing uncertainty in global markets seemed to be dampening company risk appetites, which could ultimately create a drag on economic growth, he said.
The foundations for growth off the back of good economic conditions were apparent but growth was being approached very cautiously, he said.
In the 2015 survey, 46% of CFOs surveyed reported they were either somewhat more optimistic or significantly more optimistic about their company's financial prospects compared with December.
Last year, 58% were more optimistic and in 2013, only 37% were optimistic about their company's financial prospects.
A net 45% of respondents reported higher-than-normal levels of external financial and economic uncertainty.
While that was lower than the net 64% reported in 2013, uncertainty had made a comeback this year from the net 36% reported last year, Mr Hawken said.
Slightly more than half of CFOs believed the time was right for taking a greater risk on to their balance sheets.
The ''risk divide'' emerged as a theme in last year's survey and continued this year.
Risk aversion remained a dominant theme with 56% of CFOs reporting their organisations to be risk-averse compared with the broader marker and others in their industry, despite risk-takers reaping the benefits through higher revenue growth, he said.
''This cautious approach is perhaps driven by the rebound in uncertainty around external conditions and the continued spectre of disruptive changes.''
The CFOs surveyed said the board did not set the risk appetite in 41% of the businesses. CFOs reported the board and management views on risk were divergent.
The results suggested a need for greater alignment between boards' and executives' attitudes on risk.
A considered, aligned and healthy appetite for risk could be a strong driver of an organisation's growth strategy, Mr Hawken said.
Highlights
• CFOs continue to take a passive approach to growth, indicating they favour organic expansion, followed by increasing product and market reach.
• Forty-one percent of CFOs expect the official cash rate to remain at 3.5%; 44% predict it might fall to 3.25% or lower.
• Nearly three-quarters of respondents predict the value of the New Zealand dollar to sit at less than US80c in 12 months. This is in sharp contrast to 2014 when 93% predicted the dollar would appreciate to US85c.
• A net 59% of CFOs think New Zealand corporate balance sheets are optimally geared and a net 41% report no plans to change their levels of gearing in the coming year.
