Press Release



William Roberts
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202-286-1367 cel

Mitchell Slepian
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CPA Executives Grow Pessimistic on U.S. Economy, According to AICPA-UNC Quarterly Economic Survey 

Pessimists Outweigh Optimists by Two-to-One Margin 
Published August 12, 2010

New York, N.Y. - (August 12, 2010) — Expectations for the United States economy turned sharply negative on concerns about unemployment and a tight credit market, as pessimists outweighed optimists by a two-to-one margin among CPAs serving as C-suite executives, according to the American Institute of Certified Public Accountants and the University of North Carolina’s Kenan-Flagler Business School’s latest Quarterly Economic Outlook Survey.

“Our survey signals the nascent economic recovery that buoyed expectations last quarter is stalling,” said AICPA Vice President for Business, Industry and Government Carol Scott. “Despite a decrease in confidence, CPA’s serving in top finance and executive positions in business and industry are substantially more optimistic about their own organizations than they are about the broader U.S. economy. Companies that weathered the downturn have restructured, improved productivity and are poised for growth when business conditions such as customer demand, employment and credit rebound.”

Only 21 percent of the survey respondents expressed optimism about economic recovery, a sharp decrease from 40 percent who were optimistic in May and the lowest level since April 2009. Forty percent were pessimistic about the economy, up from 25 percent in the last quarter. Measures of optimism versus pessimism registered a combined 34 percentage-point swing toward a negative outlook, reversing the 28 percentage-point shift towards optimism recorded in the prior quarter when optimists outnumbered pessimists for the first time in two years.

Three in four, or 78 percent of respondents believe U.S. business conditions will not return to pre-recession levels until 2012 or later. Seventeen percent said conditions would return to pre-recession levels in 2011, and less than one percent said activity would rebound this year.

“The overall results confirm that the recovery has slowed, but that managers remain cautiously optimistic,” said UNC Kenan-Flagler Accounting Professor Mark Lang. “Uncertainty about the sustainability of the recovery continues to limit planned investment and hiring.  The next few months will be crucial in determining whether uncertainty resolves to the point where firms are willing to significantly increase spending and hiring.  Clearly, though, executives are skeptical about increased stimulus spending or other governmental efforts to spur economic growth.”

Twenty-four percent expressed more confidence about the prospects for their own organizations, a decrease from 40 percent who had more confidence in May. CPAs who are pessimistic about their own organizations rose slightly to 21 percent from 20 percent in the prior quarter. Fifty-four percent expect their business to expand in the next 12 months. 

As U.S. unemployment holds steady at 9.5 percent, 55 percent of survey respondents do not anticipate their organizations’ employment levels returning to pre-recession levels in the next year, compared with seven percent who anticipate staffing levels returning to normal in the next year. Less than one in ten, 9 percent, reported that their organizations were planning to hire in the immediate future.

As pessimism returned, fears of inflation have dropped substantially, with 24 percent citing concerns over inflation impacting their business in the next six months, compared to 42 percent who expressed concern in the last quarter. Twenty percent are now concerned their organizations will be impacted by deflation in the next six months.

The AICPA/UNC Kenan-Flagler Economic Outlook Survey includes two indices, the Corporate Expansion Index (CEI) and Corporate Optimism Index (COI), that consolidate expectation and optimism trends for the economy and for respondents’ own organizations. Both indices were down in this quarter for the first time since April 2009.


The Third quarter AICPA-UNC Business and Industry Economic Outlook Survey was conducted via an online questionnaire from July 21 through August 5 and included 1,584 qualified responses from CPAs who hold leadership positions, such as chief financial officers or controllers in their companies. The overall margin of error was less than plus-or-minus 3 percentage points. More information and full poll results are available online

About UNC Kenan-Flagler

The University of North Carolina at Chapel Hill’s Kenan-Flagler Business School is known for innovative research and extraordinary learning experiences. Its commitment to developing socially responsible, results driven leaders distinguishes its programs, which educate people at every stage of their careers. UNC Kenan-Flagler prepares business leaders to manage successfully in the global business environment through its Master of Accounting, MBA, MBA for Executives, undergraduate BSBA, Ph.D. and Executive Development programs. The Frank Hawkins Kenan Institute of Private Enterprise helps business and government tackle problems with impact on society. http://www.kenan-flagler.unc.edu/

About the AICPA

The American Institute of Certified Public Accountants (www.aicpa.org) is the national, professional association of CPAs, with more than 360,000 CPA members in business and industry, public practice, government, education, student affiliates and international associates. It sets ethical standards for the profession and U.S. auditing standards for audits of private companies, nonprofit organizations, federal, state and local governments. It develops and grades the Uniform CPA Examination. The AICPA publishes the website www.IFRS.com to inform members and the public about international accounting standards.

The AICPA maintains offices in New York, Washington, D.C., Durham, N.C., Ewing, N.J. and Lewisville, Texas.


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