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fewer accountants = larger client lists.
by 卡塔尔世界杯常规比赛时间 research
cpas and tax practitioners tend to know what’s happening in business. more than any other professionals, they have their fingers on the pulse of companies large and small. they understand numbers, they listen to their clients and they have the wherewithal to see where micro- and macroeconomies are headed.
more: at the irs, short on staff means short on service | tax pros offer advice for small businesses | has early tax season optimism peaked? | why the irs is still doing data entry by hand | how bullish are you this tax season? | tax season 2023: better or worse?
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when the 20223 cpatrendlines busy season barometer survey asks cpas and tax practitioners about the business and economic outlook from their view in the trenches of american business, the responses show a curious contradiction.
generally speaking, the earliest respondents are confident at the micro level – their own firms and families – but less so for their clients. they are notably concerned about the macro level – the national economy and the outlook for small businesses in general.
the causes of optimism
as for their own firms and companies, fewer than 1 percent fear business will get much worse, and only 11 percent think it might get somewhat worse. at the other end of the spectrum, just over half are counting on a better year. that leaves about 38 percent figuring the next 12-18 months will be about the same as last year.
elsewhere in the survey, respondents hinted at the causes of their optimism.
- their client lists have increased because of fewer available cpas.
- more clients and higher rates will contribute to bottom lines.
- though expanded staff may cut into profits, the extra hands will strengthen the firm.
fears for small businesses
despite expecting their own businesses to do well, respondents were substantially less bullish for their clients. not many expect their clients to do much worse, but a bearish 27 percent foresee somewhat of a downturn. half expect no change.
their fears for small business in general, across the nation, are much more pessimistic. fully half think those companies will do somewhat worse, and another 9 percent warn that they will do much worse. only 14 percent see an upturn.
that fear may be based on serious concerns for the national economy. a trepidatious 64 percent see dark skies over the purple mountain majesties and fruited plains, and only 14 percent think things might work out at the macroeconomic level.
these national numbers are even worse than they were in march of 2022, when 60 percent thought we were in for a slide. last year’s concerns for clients pretty much paralleled this year’s.
why the sour outlook?
as they monitor their clients’ numbers and help clients strategize for the future, accountants are detecting souring conditions for small-business growth.
- 26 percent see worsening conditions for revenue growth.
- 36 percent see profits declining.
- 52 percent see difficulties managing payroll costs.
- only 19 percent expect new hiring.
- 45 percent say it could get harder to access fresh capital.
- 46 percent see no improvement in supply chain issues, with 28 percent even more pessimistic.
- the only glimmer of optimism: 82 percent see stability or improvement in acquisition of new technology and automation.
advice
several respondents offer advice for small businesses.
jennifer stocker, a principal with ohio tax lady in northern ohio, says, “monitor results. hang in there! this too shall pass.”
marci taylor says in stern and cautiously optimistic words, “understand your financials, know your kpis and you’ll inevitably thrive in any recession. unless you have a clear plan for how hiring will benefit you, do not hire employees.”
jane klaus, an enrolled agent in san mateo, calif., also has good advice: “apply all the lessons learned in the last two-three years and put into place the ones that will help you manage and become more profitable.”
cpas tend to be conservative in their economic forecasts, and the early days of 2023 have done nothing to dissuade them. they generally think they themselves will weather whatever’s coming up, but there are too many unknowns – big unknowns – in the world and the nation to know how american businesses – the clients whom cpas depend on – will fare.
what’s your opinion? how’s your practice doing? what are your concerns? take the five-minute busy season survey and contribute to the professional discussion.