Hoosier CPAs Paint Positive PicturePosted: Updated:
Results of a survey of nearly 100 executive-level Indiana certified public accountants suggest an optimistic economic outlook for the next year. The survey was conducted by the Indiana CPA Society. The majority of respondents were either "very optimistic" or "moderately optimistic" about the growth of their companies and the economy as a whole. Tax reform and government regulation were among the factors mentioned as having the greatest effect on economic growth. October 22, 2014
INDIANAPOLIS, Ind. - While the economy continues to be an area of concerns and questions, Indiana's trusted business advisors - CPAs in both public accounting and in business and industry - are optimistic about the potential for economic growth in the next six to 12 months.
In a recent poll conducted by the Indiana CPA Society (see 2014 Economic Outlook Survey infographic), nearly 100 Indiana CPAs who serve in roles of either managing partner in CPA firms of all sizes or chief financial officer in public or private companies were asked about prospects for economic growth. Specific segments surveyed included these five economies:
-The U.S. economy
-Their local economy (city or county)
-Their firm or company
A majority of respondents were either "very optimistic" or "moderately optimistic" about economic growth in all five segments. The most optimism was indicated for their own firm or company with 69 percent. Indiana's economy also received a high degree of optimism with 60 percent. The CPA's local economy came in at 52 percent optimistic, while the U.S. economy and the industry that the CPA’s firm or company serves were both at 51 percent.
Perhaps even more telling was that the level of pessimism (a combination of "moderately pessimistic" and "very pessimistic") was relatively low in all segments. The CPA's firm or company was just 15 percent, Indiana's economy 18 percent, the CPA's industry 20 percent, the U.S. economy 21 percent, and the CPA's local economy 22 percent. Neutral responses regarding the five economies ranged from 16 percent to 29 percent, with the CPA's industry being the highest neutral response and the CPA's firm or company the lowest.
Survey respondents were also asked to comment on the factors that will either aid or prevent economic growth. Here is a sampling of those responses:
-"Federal tax reform will be a major factor in aiding economic growth."
-"Excessive government regulation will prevent economic growth. Improving education and investment in infrastructure will aid economic growth."
-"The continued migration to the cloud has been boosting our revenue and will continue its momentum. While it has had a negative impact on a less profitable portion of our business, the positive impact on a more profitable revenue stream is more than out performing against the negative performance areas."
-"Job growth will help the economy, both manufacturing and service. The problem is finding qualified personnel to fill the positions. With 10,000 people per day turning 65, they have a choice of retiring or continuing to work. They face the reality of going on fixed income or working longer to be able to afford to retire."
-"I don't think we’re looking at inflationary pressures for the foreseeable future. A bigger risk, albeit small, would be getting into a deflationary cycle if consumers and businesses remain pessimistic and don't make purchases. The Fed’s ability to keep rates low will help. An increase, particularly if it is large and rapid, would be a shock that would hurt growth. Demographics will have a large, positive impact on my particular business."
-"There are factors headed in both directions. Instability in the world, our national debt, the student loan bubble and the Fed backing off on propping up the economy will need to be overcome. On the positive side, which I believe outweighs the negative, we’ll continue to see increased job creation and increased economic activity from pent up demand and lower consumer debt. These items will factor into a slowly improving economy."
Survey respondents represented 22 counties from throughout the state of Indiana including Allen, Daviess, Delaware, Elkhart, Floyd, Grant, Greene, Hamilton, Hancock, Huntington, Johnson, Kosciusko, Lake, Madison, Marion, Monroe, Posey, Ripley, St. Joseph, Tippecanoe, Vanderburgh and Vigo counties.
The industries of the survey respondents covers a cross section of Indiana's businesses. In addition to public accounting firms, the list included industries such as automotive, banking, construction, distribution, health care, insurance, landscape services, legal, manufacturing, not for profit, printing, public education, real estate, restaurant, technology and transportation.
About the Indiana CPA Society:
Currently, more than 8,200 CPAs in public practice, industry, government and education are members of the Indiana CPA Society. INCPAS serves the public interest as well as its members. Its members are required to abide by the CPA profession's code of conduct. INCPAS members also receive access to quality educational programs provided by the Society, resources that enable them to better perform their job functions, and peer networking for information sharing that broadens their skills and knowledge base. Society members are trusted advisors to Indiana's business community. INCPAS will celebrate its 100th anniversary in 2015. For more information, visit incpas.org.
Source: The Indiana CPA Society