According to the second quarter AICPA Economic Outlook Survey released on Tuesday - which polls CEO's, CFO's, and other senior accounting management in the U.S. - executives grew less confident about prospects for the U.S. economy over the past quarter, and are reining in profit and revenue expectations for their organizations in the coming year. 

While a majority (52 percent) of respondents still expresses optimism about the U.S. economy, there has been a significant reduction of that notion from the first quarter mark of 68 percent. The category is still up narrowly from a year ago, however, when it stood at 51 percent.

“We’re clearly seeing more caution from accounting and finance leaders amid questions about the momentum of the recovery,” stated Valerie Rainey, chair of the AICPA’s Business and Industry Executive Committee and CFO of INTTRA, an e-marketplace for the shipping industry based in Parsippany, N.J. “On the positive side, there are signs that businesses are investing for growth through anticipated spending on technology and training, among other categories.”

This marks the second straight quarter of decline in optimism about survey takers’ own businesses, reflected in part through modest expectations for growth in profit (2.4 percent) and revenue (3.2 percent) over the next 12 months, down from post-recession highs of 3.9 percent and 4.7 percent, respectively, in the fourth quarter last year.

The CPA Outlook Index fell two points in the second quarter to 72, the second consecutive drop. 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. 

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Other key findings of the survey include:

  • Sentiment about the global economy remains negative – only 28 percent of survey takers expressed optimism about this category
  • Hiring remains stable. About 55 percent of respondents say their businesses have the right amount of staff. Twenty-one percent said they have plans to hire immediately, which is in line with last quarter’s survey.
  • Most companies (61 percent) expect to expand. Some 22 percent expect to stay the same size, while 17 percent expect to contract. Only 53 percent of the largest businesses ($1 billion-plus in sales) expect to expand, however, down from 77 percent in the previous quarter.
  • Optimism for the retail trade leapt dramatically to 85 percent, and headcount is expected to rise 4.6 percent for the sector in the next 12 months, tops for any industry. The technology sector continues to be volatile, with optimism dropping after a sharp increase last quarter.
  • While optimism in the construction sector declined to 63 percent from a high of 87 percent in the first quarter, growth in construction hiring is expected to be strong at 3.2 percent after falling off in the first quarter to 2.7 percent. 

The second quarter AICPA Business and Industry Economic Outlook Survey was conducted May 12-27, 2015, and included 570 qualified responses from CPAs who hold leadership positions, such as chief financial officer or controller, in their companies. The overall margin of error is less than 3 percentage points.
For a full copy of the report, head to the AICPA's site here