Professional accountants that also serve as executives in their own corporations have high hopes for their businesses.
Reports late last week said a new research report by the American Institute of Certified Professional Accountants found that CPAs are predicting some of the highest levels of corporate expansion seen in its quarterly Economic Outlook Survey.
The third quarter report said plans for expansion are at their highest since early 2015 and reflect the optimism CPAs that are also CEOs, CFOs and other money managers at their firms hold for the year.
Profits are expected to grow by 2.6 percent in the next 12 months, a rate that is three times faster than what was predicted in the first quarter of 2016, researchers said. The majority of CPAs polled, 70 percent, added that they expect revenues to increase this year — 2 percent more than CPAs with the same expectation polled last quarter and 7 percent higher than Q1.
Further, 62 percent said they expect their companies to expand in the next 12 months. Executives at the largest of companies, with more than $1 billion in revenue, held the largest change in their anticipation of corporate growth this quarter. In Q2, just half of these CPAs expected growth; in Q3, that number jumped to two-thirds.
Not all the news is positive, however.
Just 10 percent of the largest corporations, and 21 percent of businesses overall, said they would be looking to hire immediately in the face of corporate growth. That finding follows recent data from several firms on a mediocre jobs growth report for the U.S., despite broader economic optimism.
“We’re seeing some stability in optimism about the U.S. economy after a few volatile quarters,” said Arleen R. Thomas, AICPA SVP of management accounting and global markets, in a statement. “The response by businesses has been variable, though, depending on the size of the company and the industry it’s in.”
“Some are ready to add new staff and make other investments, while others are taking a more cautious stance,” Thomas added.