11 Challenges Finance Staff Foresee in the Second Half of 2024

For finance staff only, as we approach the second half of 2024, what is your biggest challenge or concern for Q3 and Q4 this year? Here is what 10 thought leaders have to say.

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Navigating Potential Economic Slowdown
Ensuring Accurate Tax Planning
Adapting to Regulatory Changes
Stabilizing Returns Amid Market Volatility
Accessing Reliable Integrated Data
Managing Comprehensive Business Risks
Anticipating Interest Rate Volatility
Mitigating Global Market Volatility
Maintaining Cash Flow in Uncertainty
Addressing Regulatory Compliance Complexity

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Navigating Potential Economic Slowdown

As the founder of Flycast Media, a B2B digital marketing agency, my biggest worry for the rest of 2024 is a possible economic slowdown. This could mean tighter client budgets, more competition, and changes in the marketing strategies clients need. Managing accounts payable efficiently becomes very important in these uncertain times.

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Despite these challenges, we are dedicated to delivering results. We are ready to adapt and help our clients succeed no matter what the economy does. Simplifying our AP processes and staying flexible will be key to handling potential financial hurdles and continuing to provide excellent services.

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Shane McEvoy, MD, Flycast Media

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Ensuring Accurate Tax Planning

The biggest challenge as we approach Q3 and Q4 of 2024 is ensuring accurate tax planning and compliance amidst an evolving regulatory landscape. With over 40 years in the tax profession and experience as a Senior Manager for the 38th largest CPA firm in America, I can attest that the complexity of tax law can create significant hurdles for finance teams.

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One specific concern is the accurate estimation and payment of quarterly taxes. This is crucial to avoid underpayment penalties and cash flow issues. In my tenure at U.S. Trust, I oversaw a tax group responsible for thousands of fiduciary, individual, and estate tax returns. We regularly adjusted quarterly payments based on projections of income and expenses, which is a practice I highly recommend. This proactive approach can mitigate surprises during year-end tax filings.

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Additionally, overlooking retirement contributions can have long-term impacts. During my time managing the tax planning for a Forbes 400 family, I saw the benefits of maximizing contributions to retirement plans like 401(k)s and IRAs. These accounts offer significant tax advantages and contribute to long-term financial security. Ensuring employees are educated and encouraged to invest consistently in these plans is vital for both their personal financial health and the overall stability of our financial planning.

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Lastly, accurately reporting all sources of income is essential to avoid tax penalties and audits. Employees often have multiple income streams, from freelance work to investments. At Pace & Associates CPAs, we emphasize meticulous record-keeping throughout the year. This practice helps minimize discrepancies during tax filings and mitigates the risk of audits, ultimately leading to smoother fiscal periods ahead.

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John F. Pace, CPA, Tax Partner, Pace CPA

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Adapting to Regulatory Changes

The biggest challenge facing our finance team as we head into the latter half of 2024 revolves around adapting to the dynamic regulatory landscape. With anticipated changes in financial regulations, ensuring compliance while maintaining operational efficiency is paramount.

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Our focus is on deploying enhanced compliance mechanisms and training to stay ahead of these updates, safeguarding TheStockDork.com's agility and maintaining our standing as a trusted resource in the investment community.

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Adam Garcia, Founder, The Stock Dork

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Stabilizing Returns Amid Market Volatility

As we approach the second half of 2024, my biggest concern lies in maintaining stable investment returns amid potential market volatility and economic uncertainties. Given the current environment of high but stabilizing interest rates, ongoing geopolitical tensions, and the looming presidential election, the investment landscape can be unpredictable.

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Having led BlueSky Wealth Advisors through various market cycles, including the rapid rate hike of 2022 and the recovery in 2023, I understand the importance of staying vigilant and flexible.

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One concrete example is the rapid adjustment we witnessed last year. The Fed's aggressive rate hikes created shocks across the real estate, banking, and tech sectors, leading to significant market fluctuations. Similarly, this year, although we expect interest rates to fall, unforeseen economic triggers could still cause disruptions. Ensuring client portfolios remain diversified across asset classes is essential. Diversification helped our clients last year, as bonds rebounded when interest rates fell, balancing the stock market's recovery.

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Additionally, with GDP growth decelerating as per economists' predictions for the first three quarters of 2024, we must prepare for a possible slowdown. This could tighten consumer spending and impact corporate earnings. Our strategy involves emphasizing quality stocks with solid fundamentals and maintaining an adequate allocation to safe-haven assets like bonds. History has shown that strategic asset allocation can help navigate both bullish and bearish phases, and staying committed to long-term financial plans remains our best approach.

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David Blain, CFA, Chief Executive Officer, BlueSky Wealth Advisors

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Accessing Reliable Integrated Data

Having access to reliable, timely, and integrated data is one of the biggest problems FP&A professionals face today. Finance teams may find it difficult to make wise judgments in the absence of this vital data, which could result in inefficiencies and lost opportunities.

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The issue is that many finance leaders think they don't have enough resources to accomplish their strategic goals. This involves shortages of staff and technology in addition to financial limitations.

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FP&A teams can utilize data connections and integrations to ensure their datasets are always in sync in order to solve this problem. This technology reduces the possibility of errors and increases the accuracy of financial reporting by connecting multiple data sources and automatically updating information in real-time.

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This problem can also be solved by FP&A teams using continuous planning, a technique that allows them to plan, forecast, and analyze their data in real-time. Finance teams can quickly adjust to market fluctuations and spot emerging trends and opportunities by using continuous planning.

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Eric Croak, CFP, President, Croak Capital

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Managing Comprehensive Business Risks

In Q3 and Q4 of 2024, my biggest concern is managing comprehensive risk in an increasingly interconnected and volatile business environment. With my experience at Reliant Insurance Group, I've seen how various risks, such as cyber threats and compliance issues, can impact financial stability. For example, cyber liability insurance has become crucial for tech firms we work with, protecting them from data breaches and cyber-attacks. Companies of all sizes need to prioritize robust cybersecurity measures to mitigate potential losses and regulatory fines.

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Another significant issue is maintaining accurate payroll and claims management, which directly affects workers' compensation coverage. I've noticed that over 80% of payroll audits are done incorrectly, leading to inflated Experience Modification Rates (EMR). Ensuring rigorous oversight and accurate data entry during payroll audits can prevent unexpected premium hikes. For instance, having an insurance advisor coordinate with claims adjusters and medical providers can streamline the claims process and reduce financial strain.

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Finally, the evolving economic landscape demands flexible financial protection strategies, like business income insurance. As we saw with retail businesses impacted by hurricanes, general insurance that covers loss of income is pivotal. This coverage helped those businesses stay afloat during crises by compensating for lost income. Customizing insurance plans to reflect specific operational risks, whether for tech firms or retail stores, ensures a business can navigate disruptions without significant financial setbacks.

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Ben Klesinger, Co-Founder and CEO, Reliant Insurance Group

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Anticipating Interest Rate Volatility

As we navigate into the latter half of 2024, the paramount challenge lies in adapting to rapidly changing interest rates and their impact on investment strategies. Anticipating the potential volatility in global markets requires a meticulous approach to risk management.

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A deeper understanding of these shifts earlier would have further refined our strategic planning, ensuring robust financial health and the ability to leverage opportunities in an uncertain economic landscape.

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Jonathan Gerbe, President, RVW Wealth

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Mitigating Global Market Volatility

As we approach the second half of 2024, my biggest concern for Q3 and Q4 is navigating the potential volatility in global markets due to uncertain economic policies and geopolitical tensions. The ongoing fluctuations in interest rates and the impacts of inflation are particularly worrisome as they could affect investment returns and borrowing costs significantly.

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Additionally, the potential for regulatory changes in key markets where we operate could require rapid adjustments in our strategy and operations. My focus is on enhancing our risk management processes and ensuring that our portfolio is resilient enough to withstand market shocks.

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Preparing for these scenarios involves closely monitoring global economic indicators and maintaining flexibility in our financial planning to adapt quickly to unforeseen changes. This proactive approach is critical to safeguard our assets and ensure steady growth through the remainder of the year.

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Shawn Plummer, CEO, The Annuity Expert

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Maintaining Cash Flow in Uncertainty

As we approach Q3 and Q4 of 2024, my biggest concern is managing cash flow amidst economic uncertainty and market fluctuations. With my background as a fractional CFO and CPA at Profit Leap, I understand the critical importance of maintaining a steady cash flow for small businesses. One strategy we've implemented to combat this is developing comprehensive cash-flow forecasts. This involves gathering financial data, analyzing historical trends, and creating a forecast model that is regularly reviewed and adjusted. This has allowed us to effectively predict and manage cash-flow disruptions, ensuring businesses can navigate financial highs and lows confidently.

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Another significant challenge is leveraging technology and analytics to inform decision-making. With the implementation of Huxley, our AI Business Advisor Bot, we've been able to provide actionable insights to small business owners. For instance, using analytics tools to track website traffic and user behavior has provided valuable insights for enhancing online visibility and customer engagement. This data-driven approach helps identify areas for improvement and optimize operational efficiencies, ultimately contributing to better financial performance and growth.

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Additionally, adjusting to evolving market conditions and regulatory changes remains a concern. Ensuring that the business remains agile and adaptable is key. For example, during the annual planning phase, we focus on strategic alignment and contingency planning to set clear goals and prepare for unexpected twists. By regularly monitoring progress and being responsive to changing circumstances, we can adjust our strategies to stay on track and achieve long-term success. This proactive and flexible approach has been essential in navigating the ever-changing business landscape.

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Russell Rosario, Co-Founder, Profit Leap

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Addressing the Inefficacy of Traditional Collections

As we move into the second half of 2024, one of the key challenges that finance teams will face is the ineffectiveness of traditional collections methods. Based on our experience at Centime, where we help businesses optimize their financial operations, the limitations of these outdated practices are becoming increasingly evident.

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The Real Cost of Traditional Collections in 2024:

Limited Working Capital: When collections processes fail to secure timely payments, businesses face limited working capital, which is essential for sustaining daily operations and supporting growth initiatives.
Cash Flow Uncertainty: Unreliable payment schedules create cash flow uncertainty, hindering accurate financial planning and growth forecasting.
Reduced Efficiency: Teams are forced to spend significant time on manual collections efforts, which detracts from more strategic activities that could drive business performance.
Negative Customer and Employee Experience: Constantly chasing payments can strain customer relationships and lower employee morale as they deal with repetitive, non-value-added tasks.

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A Modern Solution: To mitigate these issues, adopting advanced software solutions like Centime's Autopay is crucial. Autopay streamlines the collections process by automating payment reminders and follow-ups, allowing finance teams to focus on strategic growth initiatives while improving both customer and employee experiences.

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BC Krishna, CEO, Centime

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Addressing Regulatory Compliance Complexity

As we approach the second half of 2024, my biggest challenge is the increasing complexity of regulatory compliance. With evolving tax laws and stricter enforcement policies from the IRS and state agencies, ensuring that we remain compliant while optimizing our financial strategies requires meticulous attention to detail and constant vigilance.

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Also, I am deeply concerned about the potential impact of economic fluctuations on our cash flow and revenue forecasts. Navigating these challenges demands a proactive approach bolstered by robust data analysis and strategic foresight.

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Dana Ronald, President of Tax Crisis Institute, Tax Crisis Institute

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Conclusion

As we move through the second half of 2024, finance teams face a myriad of challenges, from navigating economic uncertainties to ensuring regulatory compliance. However, the inefficacy of traditional collections methods stands out as a particularly pressing concern, with significant downstream effects on cash flow, working capital, and overall business efficiency.

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At Centime, we recognize that outdated approaches to collections are no longer sustainable in today’s fast-paced business environment. That’s why our solutions, like Autopay, are designed to modernize and streamline your financial operations. By automating key processes and reducing manual workload, Centime empowers finance teams to focus on strategic initiatives that drive growth and improve both customer and employee experiences.

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In a world where timely and efficient collections are critical to maintaining financial health, adopting advanced solutions is not just an option but a necessity. As you plan for the rest of 2024, consider how modernizing your collections process with Centime can help you navigate these challenges with confidence and ease.

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11 Challenges Finance Staff Foresee in the Second Half of 2024

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