Its close to a year since the implementation of GST, and a significant percentage of the country's chief financial officers believe that it had a positive impact on the overall business climate, says a Deloitte survey.
Its close to a year since the implementation of GST, and a significant percentage of the country’s chief financial officers believe that it had a positive impact on the overall business climate, says a Deloitte survey. According to Deloitte India’s annual CFO Survey, 77 per cent CFOs believe that GST has had a positive impact on the overall business.
Moreover, 57 per cent of CFOs are now willing to take greater business risks, as the next couple of years are expected to be a period of consolidating gains from recent reforms.
“Introduction of GST necessitated a relook at the existing business models by CFOs. It had far-reaching implications on business functions, where the impact was on taxation, finance, legal, IT systems and supply chain. Overall, GST’s value proposition has been appreciated by CFOs,” said Porus Doctor, Partner, Deloitte India.
As per the survey, the GST impact reflected better on revenue and supply chain, and 58 per cent CFOs saw an improvement in ease of doing business. On the other hand, the industry witnessed negative impact on the working capital (as responded by 66 per cent CFOs) and finance cost (according to 55 per cent CFOs) post GST implementation.
The survey further noted that 53 per cent CFOs believe there will be increase in organisation’s headcount over the next 12 months. While digitisation may reduce manual intervention, the increase in headcount would possibly come from operations growth and requirement for new skill sets and geographical expansion.
Although 83 per cent CFOs are optimistic about increase in revenue, only 45 per cent are hopeful of an increase in operating margins. This is driven by concerns over productivity improvements and increasing costs with changing technology and regulatory requirements.
Regarding the economic outlook, two-third of the respondents were positive about economic prospects in the near term, as many as 94 per cent were optimistic over the next 2-3 years.
The survey represents the viewpoints of over 250 CFOs in India. The respondents included CFOs from listed and unlisted companies (from both private sector and PSUs), Indian and multinational companies.