A poll of more than 1200 senior finance executives by CFO Europe together with Tilburg and Duke University ranks the ten top external and internal concerns in Europe, Asia and America (Jason, 2009).

High in all regions we find as external concerns; consumer demand, interest rates, currency volatility and competition.

For the internal concerns the ability to forecast results together with working capital management and balance sheet weakness ranked highest. This is concerns that balance simulation addresses with the purpose of calculating the effects of different strategies. Adding the uncertainty of future currency and interest rates, demand and competition you have all the ingredients implying the necessity of a stochastic simulation model.

The risk that “now” has surfaced should compel more managers to look into the risk inherent in their operations. Even if you can’t plan for an uncertain future you can prepare for what it might bring.

Karaian, Jason (2009, May). Top Ten Concerns of CFO’s. CFO Europe, 12(1), 10-11.