RISK MANAGEMENT

Covering the bases

It’s a perfect storm (like Chris Farley’s El Niño), brought on by a confluence of economic and natural forces.

Building repair and replacement work is getting expensive, while the risk of loss from catastrophes (CATs) like windstorms, floods, and wildfires means risk managers and finance pros have a tough task in protecting their commercial property portfolios. But insuring these risks seemingly becomes more difficult (and expensive) with each renewal period.

And it isn’t like simply forgoing a property insurance policy is the solution. “CFOs don’t want to save $3 million [in premiums] but take on $400 million of risk in an earthquake-prone or a windstorm-prone area,” Michael Serricchio, a managing director with insurance broker Marsh’s captive solutions practice, said. “When insurance is cheap, you buy it. And when it gets hard like it is now [the] last few years, you pivot and you do different, creative things.”

One alternative that decision-makers are exploring more is captive insurance, according to experts who spoke with CFO Brew.

For more on creating insurance captives, click here.—AZ

PRESENTED BY FLOQAST

Ready, set, go public

Got your sights set on an initial public offering? It’s game-changing for your biz, but it can be a (very) bumpy road to navigate for accounting and finance teams.

That’s why FloQast created their practical guide: The IPO Playbook for Finance & Accounting Teams. It’s designed to help you conquer the challenges you might meet on the road to IPO. Key insights include:

• a high-level overview of the current state of the IPO market
• choosing your IPO journey
• tips and tricks for going public

With this guide, you’ll have all the info you need to go public with confidence. That’s right. The road to IPO success can actually be a smooth one.

Get IPO-ready.

ACCOUNTING

Oops, we did it again

Accountants—they’re just like us. Well, in the sense that they make costly mistakes on the regular.

According to a newly published Gartner study conducted in July 2023, 18% of accountants make financial mistakes at least daily.

The survey polled just under 500 respondents working in the controllership function, and screw-ups were the name of the game: A third of accountants made errors a few times weekly, while 59% said they made several errors every month. Hard relate.

But these mistakes aren’t necessarily the result of pure recklessness or oversight, per the survey. A closer look revealed many errors were associated with capacity constraints.

“While capacity issues aren’t new to accounting, demands on accounting staff capacity continue to rise,” Mallory Barg Bulman, senior director of research in the Gartner Finance practice, said in a statement tied to the report. “In the past three years, 73% of accountants report that their workload has increased because of new regulations, and 82% say economic volatility has increased demands for their work.”

For more on accounting errors, click here.—NP

CFOS

Enabling creativity

Diya Sagar joined AWA Studios in October as the independent graphic-novel publisher’s inaugural CFO, after previously working for one of the studio’s lead investors, Lupa Systems. Sagar spoke with CFO Brew about her experience as a company’s first CFO and how she fills the role of a strategic partner.

This interview has been lightly edited for length and clarity.

What are some challenges as a company’s first CFO versus someone who’s stepping into a CFO’s office that’s already been established?

Coming in as a first CFO, I’m really focused on bringing a financial lens to everything that we do [and] into decision-making. And really, that goes to the heart of our business model. Every deal that we do, anything that we’re working on, we have to think about, “What is the right business model for this company?” Because it will change based on the decisions that we make that relate to those projects.

Continue reading here.—AZ

TOGETHER WITH PLAID

Need to know. 81% of consumers feel safer when an app asks them to verify their identity at sign-up. A pretty telling number, TBH. Want more game-changing insights? Check out Plaid’s Fintech Effect 2023 report for deets on the pivotal consumer trends shaping digital finance. Give it a read.

MARKET FORCES