Financial Visibility Helps CFOs Address Tariff Uncertainty

Uncertainty in financial markets is not new, but the scope and speed of today’s disruptions are unprecedented.

As geopolitical tensions, fluctuating tariffs and economic unpredictability continue to ramp up, today’s chief financial officers (CFOs) find themselves at the forefront of navigating a role, and a world, that has evolved into a strategic pillar for operational resilience and business planning.

“For good or bad, we’ve been through these times before,” Matt Carey, senior vice president, office of the CFO at FIS, told PYMNTS. “The question CFOs should ask is: do we really have good visibility into all of our liquidity management?”

Too many organizations decentralize their working capital, making it difficult to gain a comprehensive view of cash flow. According to Carey, this fragmentation directly impacts receivables and collections, leading to inefficiencies and precluding CFOs from mitigating risk and building a more stable financial infrastructure.

“CFOs need to ask, what are we doing from a receivables collection standpoint? How are we making sure we’re getting invoices out quickly and collecting as effectively as possible?” Carey said.

If finance leaders don’t have ready answers on hand, he said, they may not be doing enough to lead the way.

With global supply chains under constant pressure, the ability to adapt and secure financial stability is critical. Rising costs due to tariffs and material shortages are increasingly requiring CFOs to be proactive in mitigating supply chain risks. One strategy companies are leveraging is bulk purchasing to lock in lower prices.

“There’s technology that can help,” Carey said. “But it really depends on the industry. If I’m a computer manufacturer and I have a bunch of chips on order from my suppliers, I can’t just change my chip supplier overnight.”

“If I have visibility into my working capital, I can negotiate better agreements and pre-buy materials like aluminum or steel,” he added, noting that for companies lacking large reserves, supply chain financing solutions present an alternative. “That’s a win-win for businesses, suppliers, and even banks, who favor these financing arrangements.”

The key to these strategies? Visibility.

“If you don’t have a centralized view of your financials, it’s tough to negotiate with an upper hand,” Carey said. “Banks love when companies have clear financial visibility because it mitigates risk. Risk mitigation is what payments and finance are all about. If you demonstrate accurate liquidity management, it strengthens credit ratings and lowers the cost of capital.”

This same visibility can be used to navigate periods of operational uncertainty.

“People used to think the ERP (enterprise resource planning) was the center of the CFO’s office. But the reality is, many large companies that have gone on acquisition sprees have multiple ERP systems, making it difficult to centralize financial data,” said Carey.

Instead, treasury management systems (TMS) are emerging as the glue connecting disparate financial data.

“A full TMS integrates different ERP instances, connects to banking partners, and consolidates financial information,” Carey said. “This is crucial for liquidity management, FX strategy and improving credit ratings.”

In a dynamic and fluctuating environment, CFOs must also prioritize FX risk management. One key strategy is leveraging modern tools to optimize collections and minimize exposure. Efficient receivables management is a crucial component of FX strategy.

“Too many companies have outdated collection systems,” Carey said. “They’re still working like it’s 2005, with teams making phone calls and sending late invoices … Companies need to prioritize collections based on real data.”

He noted: “If I’m collecting cash in multiple currencies, I need to prioritize which ones to collect faster.” He added that advanced banking tools, such as netting solutions, can enable CFOs to consolidate FX positions and lock in rates.

At the same time, artificial intelligence (AI) is proving to be a powerful tool for CFOs seeking to enhance financial forecasting and operational efficiency. Cash forecasting has traditionally been done through spreadsheets, an approach that falls short in today’s complex financial environment.

“There’s a lot of promise in AI, but the biggest immediate benefit is in cash forecasting,” Carey said. “AI enables CFOs to model ‘what-if’ scenarios with unparalleled accuracy … AI can run real-time analyses on interest rate shifts, FX fluctuations and supply chain costs, providing best-case and worst-case forecasting models.”

With so many moving parts, how do CFOs ensure their organizations remain resilient? According to Carey, it boils down to proactive visibility and the right technological investments.

“It’s about positioning your organization for resilience, ensuring your financial strategy can withstand volatility while optimizing growth opportunities,” he said.

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