The AICPA released the results of their first quarter AICPA Economic Outlook Survey this morning, and the results show that executives are taking a more tempered approach when it comes to expectations for profit, revenue and expansion in the coming year.

The Survey polls chief executive officers, chief financial officers, controllers, and other certified public accountants in U.S. companies who hold executive and senior management accounting roles.

However, optimism about those key performance indicators still remains high, but there has been less enthusiasm since last quarter, the survey finds.

“It’s important to note that we’re seeing higher optimism on most business indicators we track than we did a year ago,” stated Arleen R. Thomas, AICPA’s senior vice president of management accounting and global markets. “But it’s also clear we’re seeing a reset this quarter on expectations for several key categories, and that’s something to be mindful of going forward.” 

The CPA Outlook Index—a comprehensive gauge of executive sentiment within the AICPA survey— fell four points in the first quarter to 74, the first time it’s dropped since the fourth quarter of 2012. The index is a composite of nine, equally weighted survey measures set on a scale of 0 to 100, with 50 considered neutral and greater numbers signifying positive sentiment.

Other findings in the survey include:

  • “Domestic Competition” is now the No. 2 challenge for businesses, up three spots from last quarter. “Regulatory Requirements/Changes’ remains the top challenge.
  • The number of survey takers who said their businesses are hiring immediately dropped slightly from 23 percent last quarter to 21 percent this quarter. A majority of respondents (52 percent), however, continue to say they have the right amount of employees.
  • Some 64 percent of businesses said they expect to expand in the next year, down from 71 percent last quarter.
  • Anticipated growth for profits in the coming year dropped from 3.9 percent last quarter to 2.8 percent. Revenue growth expectations also fell from 4.7 percent to 3.6 percent.
  • Some 47 percent of survey takers said the decline in oil prices has had a somewhat positive impact on their business, while 28 percent said it was neutral.

For the full report, head to the AICPA's site here.