Natural disasters, war, joblessness and interest rates rattle accountants.
by Rick Telberg
At Large
It’s an interesting time to be asking about the economic outlook ? considering natural disasters, wars, poverty, oil prices, and interest rates. So maybe it’s a little surprising that most CPAs share some degree of optimism, particularly for their own businesses and livelihoods.To be sure, when we ask accountants and financial executives how their outlook on the economy and business conditions may be changing, we’re hearing less optimism than before: 45 percent of respondents agree that “I’m somewhat less optimistic and confident” and 22 percent agree that “I’m much less optimistic and confident.” Only 16 percent of respondents agree that they are much more or somewhat more optimistic and confident. In addition, when asked to evaluate the economy six to twelve months from now, the majority of respondents, about 61 percent, say the economy is bound to be even worse. At this time a year ago, only 21 percent of respondents said they expected the economy to be worse.
And it’s not just the economy that accountants don’t feel so positive about.
When asked about “myself and my family,” more than half (51%) of respondents say there would be no change; and when asked about “our customers,” 40 percent say there would be no change, and, unfortunately, another 40 percent say their customers would be worse off. A year ago, only 14 percent of respondents expected their customers to be worse off.
On the other hand, and on a more positive note: nearly one-third of respondents (30 percent) say that business conditions in the country would be better for their own businesses than they are now. This is a great mind-set: these people are not just saying that things will remain the same, but that they sense an improvement down the road.
It appears that much of the pessimism that respondents are indicating is coming from recent events.
Maybe, just maybe, there’s enough confidence, particularly in terms of family and jobs, to drive the economy through 2006.
(First published by the AICPA)