Exec CPAs Fear Economic Slowdown

A joint poll of the AICPA and North Carolina Flagler Business School found that about three of five of the 1,500 executive CPA respondents were at least somewhat pessimistic about economic prospects during the upcoming year with only about one in nine showing optimism. Nevertheless, a plurality of respondents (slightly over a two-to-one margin) believed that their own firm would be fine. About four in seven agreed with two other recent moves: the tax rebate stimulus package and the move to allow foreign-based companies to file U.S. financials using IFRS without reconciliation to U. S. GAAP.

The despair amongst executives is not a good sign; a lack of confidence in the economy often becomes a self-fulfilling prophecy even if financial fundamentals are acceptable. Bush, Congress and the Fed have tried several short-term approaches (tax rebate, interest rate cuts to name two), now structural strengthening of the economy, perhaps by taking another look at government regulations, is the next step.