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CPAs see fast start for business, problems later in 1990s.

CPAs SEE FAST START FOR BUSINESS, PROBLEMS LATER IN 1990s

An annual poll of American Institute of CPAs members found 77% expect business conditions for the first half of 1990 to be as good or better than in 1989. However, only 39% expect conditions during the rest of the decade to be better than they are now. Twenty-eight percent anticipate no change in the business climate and another 24% expect conditions to be worse.

The federal deficit was cited by 38% of the CPAs polled as the most significant factor affecting the economy; 10% pointed to the trade deficit.

A nationwide poll of corporate controllers conducted by the National Association of Accountants produced a gloomier forecast. Sixty-three percent expect a recession in 1990 and 52% predict one in 1991. The corporate controllers rated, in descending order, interest rates, the federal deficit and inflation as the most serious problems the economy will face over the next six months.

On a more positive note, the new chief economist of the Conference Board expects an expansion in exports to lead the way to a 2.5-to-3% growth in the U.S. economy this year. Although cost pressures will take their toll on profits, demand from Mexico and Pacific Rim countries, in particular, will keep the economy from sliding into recession.
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Author:Burge, Marianne
Publication:Journal of Accountancy
Date:Mar 1, 1990
Words:217
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