EY Finally Embraces the Disruptive Technology That is Microsoft Outlook
This is the biggest news to come out of EY! since the big rebranding: To: US Personnel March 21, 2014 From: Xxxxx, Xxxxxxx, Americas Administration Leader Microsoft Outlook deployment begins in the USI’m very pleased to announce that on April 7, 2014 the US firm will begin migrating to Microsoft Outlook, […]
AICPA Outlook Survey: This Double-Dip Recession Just May Be Happening
Just in time for President Obama’s jobs conversation to a joint session of Congress, the AICPA has released its latest quarterly economic outlook survey results. Long story short: sentiments aren’t high among financial professionals surveyed.
The outlook for the U.S. economy turned negative in the third quarter for the first time since 2009 as prospects for recovery waned and concerns about a second recession rose, according to the latest AICPA Economic Outlook Survey of Chief Financial Officers, Controllers and CPAs in executive and senior management accounting roles.
The CPA Outlook Index, a broad-based composite index that captures the expectations of CPA financial executives and management accountants, declined 8 points to 58 this quarter, down from 66 in the prior period. The survey, conducted in August, tallied 1,305 qualified responses from CPAs who hold leadership positions, such as chief financial officers or controllers in their companies.
“For the second consecutive quarter, the CPA Outlook Index declined as turbulence in the political and economic environment eroded the sense earlier this year that a recovery was taking hold,” said Carol Scott, AICPA vice president for business, industry and government. “A majority of our CPA members in executive financial roles now fear a second recession may be likely.”
The decline in the CPA Outlook Index was fueled by a sharp drop in sentiment about the U.S. economy.
A whopping 61 percent majority of respondents said they think it is “somewhat likely” or “very likely” the U.S. will fall into a double-dip recession. Only 9 percent of CPAs serving in executive positions expressed optimism about the U.S. economy in the third quarter, down 24 percentage points from 33 percent who were optimistic in the second quarter.
It is reasonable to point out here that though the CPA Outlook Index turned negative this quarter, it is still above the 4-year low of 32 in the first quarter of 2009.
U.S. economy optimism plummeted a whopping 28 points from 53 to 25. Of the major index components, none changed positively quarter-over-quarter for 2011.
While the outlook for respondents’ own organizations is not as rosy as it was earlier this year, it has not dropped as sharply as the outlook for the US economy. Optimists also still outnumber pessimists, with 41% of the CPA decision-makers indicating that they are optimistic about the outlook for their own organizations over the next 12 months, while only 21% are pessimistic. Expectation for expansion also dropped again this quarter but a majority of respondents (53%) still expect to expand at least somewhat in the next 12 months. This is down from 61% who expected expansion last quarter.
Executive summary of the survey results can be found here.
CPAs Aren’t As Optimistic As They Used to Be on the Economy
Straight from the horse’s mouth, or, in this case, the CPAs:
According to the latest AICPA Economic Outlook Survey, chief financial officers, controllers and CPAs in executive and senior management accounting roles are far less optimistic now about the direction of the U.S. economy than they were in the first quarter of 2011.
The CPA Outlook Index, a broad-based composite index that captures the expectations of CPA financial executives and management accountants, declined three points to 66 this quarter, from 69 in the prior period.
“The flush of optimism we experienced earlier this year has given way to more moderate expectations for the U.S. economy,” said Carol Scott, AICPA vice president for business, industry and government. “While the CPA Outlook Index is still positive relative to the dark days of the recession, our members are concerned about rising energy costs and inflation, health care costs and continuing weakness in demand.”
The pullback in optimism follows an upbeat assessment in the prior quarter and signals the two-year-old U.S. economic recovery has lost momentum, Scott said. The survey shows that expectations for corporate expansion and hiring have moderated and the outlook for revenues and profits declined. Concerns about inflation continued to rise, driven by higher energy costs. The outlook for capital spending remained largely flat with information technology the only sector enjoying improvement.
It’s worth noting that while optimism for the US economy declined sharply this quarter, it is still higher than it was for the 4th quarter of 2010. Slightly more than one quarter of respondents (27%) expressed a pessimistic outlook for the US economy, driven by concerns about unemployment, government debt and rising prices.
Check out the full survey here, Valium not included.
SHOCKER: Accountants Have a Conservative Outlook on the Economy
Surprise, surprise! CFOs, controllers, and CPAs are only slightly skeptical about the economic outlook these days. Surely it’s not because our industry has been pounded harder than others, in fact we’ve weathered the storm better than most.
The fourth quarter AICPA-UNC Business and Industry Economic Outlook Survey sheds some light on where CPAs’ heads were at in Q4 2009:
Expectations among Certified Public Accountant executives for the U.S. economy remained pessimistic in the first quarter as the recovery proved sluggish amid signs of potential growth in manufacturing and a slightly improving outlook for organizations, according to a new nationwide survey conducted by the American Institute of Certified Public Accountants and the University of North Carolina’s Kenan-Flagler Business School.
“It is good to see signs of optimism, especially from the manufacturing sector,” said Carol Scott, CPA, AICPA vice president for business, industry and government. “Unfortunately 40 percent of our CPA members in business and industry — chief financial officers, controllers and CPA financial professionals – are now telling us that they do not expect their business to return to pre-recession levels until 2012 and beyond.”
Such a conservative bunch, those little accountants.
Interestingly enough, the latest survey shows a shift in the collective thinking of CPAs, who had shown uncharacteristic optimism in previous 2009 survey responses. What gives, guys? Know something we don’t that you’d like to share with the class? Perhaps reality has finally bit down and left a mark on a traditionally recession-proof industry.
In a recent “unscientific” straw poll of AICPA Insider readers, CPA Trendlines’ Rick Telberg shares CPAs’ top 10 concerns, not surprisingly dominated by the number one concern for accounting professionals, the economic outlook. Firms are cutting costs and slicing away the “flash”, meaning no stupid tchotchkes for you!
Will this back-to-basics approach change CPAs’ outlook for the quarters ahead or simply keep everyone afloat until things do genuinely begin to look up? If nothing else it means better service for clients and maybe a little less fear for accounting practitioners who are ultimately the ones who have to deal with any shift in the industry outlook. Clients will always be around, it’s the qualified professionals I’m a tad worried about.
We’ll let you know what happens with the next survey but are not afraid to wildly speculate that respondents will continue to pull back the optimism and stick to conservatism as usual.
Jr Deputy Accountant and Michael Panzner Discuss 2010 Part II: The Impotent Fed; An Election Year; Waiting for the Recovery
In case you missed part one of JDA’s 2010 Outlook interview with Financial Armageddon’s Michael Panzner, you can find it on Going Concern here.
For the first half of my 2010 talk with Panzner, I focused on the other shoes left to drop; commercial real estate, political backlash, and the threat of the massive bubble still being inflated in China. But even bears have their bright sides and Panzner is no different. So what do we have to look forward to this year? Oh crap, more doom and gloom; sorry, I got my interviews mixed up.
Panzner points to our leaders’ missteps throughout the crisis as a major factor that could place a damper on any hope of recovery. “Many of the problems and imbalances that helped about the crisis have gotten worse,” he says, “That means people have less in reserve than they did before, and many have not positioned themselves for a ‘new normal.’ That suggests the next leg down, economically speaking at least, could be much worse than what we’ve experienced so far.” If only we’d been prepared for the worst instead of coddled into believing everything is better, eh?
When asked to take a guess as to when the Fed would finally raise interest rates, Panzner gave an interesting answer. “In my view, the Fed is no longer in control – of the economy or its destiny. For the most part, market and other forces, not the FOMC, will determine what happens to interest rates in future.” So I guess it doesn’t matter when they’ll raise rates, markets are no longer listening. Or are they?
A big picture sort of guy, Panzner identifies sociopolitical threats as another major concern this year, and with this being an election year (hello, Scott Brown anyone?), I’m willing to go on the record as agreeing wholeheartedly with him (shock). “Wait and see what happens to the social and political mood if and when the economy rolls over,” he says ominously.
Oh, believe me, JDA is waiting. And waiting. And waiting. Still no rollover but dammit, I’ll still be here twiddling my thumbs.
Hopefully I’ll get a chance to check in with Panzner again come summer to see where we are.
Editor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
The JDA and Michael Panzner Discuss the Year Ahead
Editor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
The last time I spoke to Financial Armageddon’s Michael Panzner for Going Concern, it was about how to prepare for the worst (while not necessarily hopin in September of last year. This time around, it’s the beginning of the year so even though I’m late, it’s time to discuss the 2010 outlook.
Panzner can also be found writing at When Giants Fall and Huffington Post and if you don’t know his bio, it’s here.
First of all, before we could get to anything I had to have him explain his strong dollar policy again:
“There are a number of reasons why I expect a technical rally in the dollar even though my long-term view remains quite negative,” he said, “The fact is that even if the fundamental outlook is poor, prices can still rise in the short run if too many people — speculators and investors — are short or if other factors temporarily gain in importance.”
This explains why he seemed spooked by recent market behaviors, like everything from March 2009 on. You know, when things started getting wonky. Panzner is a classy bastard so he’s not about to make conspiratorial statements about the behavior of markets but let’s just say his feeling is that they’re performing less rationally these days. No shit. Might be all that fishy stuff going on but who am I to speculate?
He points to massive speculation and gigantic stockpiling in commodities, specifically oil. Gee, wonder who is behind that. He recognizes that China is at least attempting to clamp down on speculation.
He also admits to having underestimated how people will behave with free money. I find that statement incredible; didn’t we see the houses, big screens, and Hummers? It was obvious at the time and it feels obvious now. “Last time they speculated like there was no tomorrow, they were worried tomorrow would never come,” he says. Again, this from the man who brought us Financial Armageddon.
Interestingly, Panzner says if he could do the book over, he would have better predicted the contagious nature of the financial crisis. It scared the shit out of me when I read it for the first time in 2008. It didn’t seem sluggish at all the way he’d imagined it. In fact, I’ve been waiting for the bottom to drop out for months now after seeing how he painted it.
As far as threats go, he pretty much agrees with most of what I identify as the largest (the Fed’s dumb behavior, sociopolitical pressures, blahblahblah) and adds a few. He’s with most of us who feel CRE still has to drop, which places additional pressure on smaller banks. There are also the usual suspects; conflicts in the Middle East putting pressure on energy markets and municipal debt problems. Birmingham, Alabama is not an isolated incident, in other words.
I know Caleb gets pissed when I write too much so I think we’re good on the economic outlook for now, lest he come flame me as Guest. Whatever. Back with Part 2 on Monday: What comes after?
Five Year Outlook: Will You Be an Accountant?
Stupid question you say? Okay but a recent survey done by E-conomic says a nearly half of our friends across the pond want to be doing something else in five years because the tax and financial reporting regulation will continue to be a nightmare.
The difference between wanting to do something else and actually doing something else is well, sorta big.
Accountancy Age:
Anders Bjornsbo, E-conomic’s operational director, said: “It’s alarming that half the accountants we spoke to said they were thinking of leaving the profession. While that’s unlikely to happen, it is perhaps illustrative of the dissatisfaction and disillusionment felt by accountants today.”
Dissatisfaction and disillusionment is something that has been discussed here in spades on our exodus post. But people getting out of the numbers game altogether? Bah. That just doesn’t strike us as a trend we’ll see soon. The survey indicates that most of you will seek advisory gigs as more compliance work moves offshore, “[T]hree quarters seeing themselves moving away from their traditional role to a more profitable consultant and business adviser position.”
That sounds about right. Despite the widespread misery, there are too many jobs out there that pay well. And let’s face it, you guys like money. You’re not going to leave it all behind to join the clergy or become philosophers.
Discuss your outlook and if you’re leaving the traditional accountant life behind for the advisory world or if you’re a lifer as tax/audit/financial reporting. And if you’re leaving all the glamor for the Peace Corps, let us know about that too.
Busy Season Outlook: Open Thread
You may have noticed that the posting schedule here at GC has ran a bit longer the past few days. This is no accident. We were given a friendly reminder on Monday:
Caleb, this is busy season, I expect review comments an hour later for the next few months. That is all.
Well! Since we’re always with you in spirit, we’ll be happy to oblige this request.
We failed to mention it in our outlook on Tuesday since we figured it was understood that the new year marks the beginning of the end of your lives for the next 3ish months.
Then we remembered that it has been prophesied by many of you that this particular busy season will be the worst in recent memory due to layoffs and the ongoing (?) exodus.
So we present you with our busy season open thread. Discuss whatever you like. Will it indeed be the worst ever or will you dominate as usual? For some of you, it’s your first busy season. Are you soiling yourself from all the horror stories or have you found the right drug cocktail to keep you both focused on your work and oblivious to time passing? Go.
Our Attempt to Give an Outlook on 2010
As is the wont of many fine publications, we’ll take a moment of your otherwise 100% chargeable day to dispense our outlook for 2010.
Many stories that were big in 2009 will be again and some stuff will just come out of nowhere. Here’s our stab at what we think you’ll be reading about in this corner of the blogosphere:
• Layoffs – Will forced ranking continue or will we go back to the heyday when only new associates that ran naked through the hotel lobby at national training get let go?
• The return of raises? – We’ve already got one guarantee courtesy of Bob Moritz but what about the rest of usual suspects?
• The PCAOB’s fate – The SCOTUS decision could put an end to the Monday morning QBing.
• IFRS vs. U.S. GAAP – Despite our sincerest wishes, the debate about who will use what and when it will happen and who will overlook everything is far from figured out.
• Fraud – It’s a part of our lives. Accept it.
• The latest on the CPA Exam – Thanks to our resident expert, you will pass in 2010. Or maybe you won’t.
• Taxes – Whether it’s the IRS’s latest demonstration of efficiency or the latest attempt by Charlie Rangel to disqualify himself from his job, we’ll be sure you know everything worth knowing.
And of course we’ll be covering the latest rumors floating around your favorite firms. Whether it’s inappropriate use of email, the latest asinine cost-saving initiatives, the banishment of music, Tim Flynn’s whereabouts we’ll cover it.
Keep us updated by sending us tips and suggestions to [email protected] and we’ll serve it up.