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KPMG Global Economic Outlook forecasts slight global GDP growth

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KPMG International forecasts a slight increase in global GDP growth in 2025, followed by a dampening in 2026 due to the incoming U.S. administration’s expected policies.

The December 2024 KPMG Global Economic Outlook reflects the continued geopolitical and economic uncertainty slowing down central banks efforts to return to sustainable growth. As such, it anticipates GDP growth picking up from 3.1% in 2024 to 3.2% in 2025, before decreasing to 3.0% in 2026.

KPMG forecasts the pace of inflation will continue cooling between now (4.5%) and mid-2025 (3.5%). “Thereafter, the forecast depends heavily on the pace of tariffs and whether we see a full-blown trade war erupt,” the report reads, citing elevated geopolitical risk and the outcomes of the U.S. election, such as inflationary trade, immigration policies and tariffs. “Bond yields have already moved up in response to fears of mounting federal debt and higher inflation. Any major shift in tariffs in the U.S. could trigger retaliatory measures.”

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“The data in our latest report highlights the concerted effort that was being made by central banks throughout the world to control the cost of living and inflation challenges facing everyone, including businesses, right now,” Regina Mayor, global head of Clients & Markets at KPMG International, said in a statement. “While there was cautious optimism of a return to eventual sustainable growth, we’re now in a ‘wait and see’ phase with much depending on a future potentially driven by reciprocal tariffs.”

KPMG sees mergers and acquisition activity poised to increase with lower rates and stores of excess capital in the private equity space. However, “policy uncertainty, anti-corporate sentiment and protectionist policies” could curb large cross-border deals as heightened policy uncertainty tends to reduce the number and speed of transactions.

Fiscal policy may be more stimulative, the report says, with market participants expecting a new wave of stimulus in the form of pensions, healthcare and defense. Tax cuts are also expected to be extended in the U.S., but it remains to be seen how multinationals outside of the U.S. will be treated.

“Our latest forecast highlights the tightrope political and business leaders are now walking,” Benjamin Shoesmith, senior economist at KPMG US, said in a statement. “For many central banks, including the US Federal Reserve, we’re seeing a shift from the battle against inflation to guiding economies toward a soft landing. It’s a monumental challenge balancing price stability and employment without quashing GDP growth. The tailwind from lower rates will benefit firms and consumers and likely spark mergers and acquisitions activity. Central banks must stay the course and avoid the temptation to cut interest rates too early or too fast as this could derail progress.”

Shoesmith said that while he expects growth nearing pre-prandemic rates, volatility will also rise. He said leaders’ top concerns are policy uncertainty as a result of the U.S. election, challenges of artificial intelligence, more frequent and adverse weather events and elevated geopolitical risk.

“Our long-term view is that we can see a return to more sustainable growth that edges closer to pre-pandemic levels, but with two significant caveats,” Shoesmith continued. “The first is that central banks will need to hold their nerve and avoid the temptation to pivot on policies before they pay off. The second — and arguably most profound caveat — is the current geopolitical crisis. If the challenges facing the Middle East and Ukraine continue to deepen, leaders could be faced with a fresh set of dilemmas that run far deeper than GDP.”

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Accounting

Ted on Tech: Last-minute gift ideas

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OK, I admit it. I tend to procrastinate. I also tend to lose track of what the date is, or sometimes what year it is (just kidding on the last one). Nevertheless, I’ve been accumulating stuff for a gift guide column for a while, and it’s time to start actually writing about at least a few of them. One or all of these would be appropriate for staff, coworkers and clients, or to surprise yourself with on the gift-opening holiday (Oh! How did you know? It’s just what I wanted!)

I do a lot of reading. Physical books are my favorite, but so many books these days are available in Kindle or other electronic formats. I’ve been using a tablet for the past several years to do much of my reading, especially if I’m traveling. The tablet I’ve been using is a fairly decent one, but it’s several years old. It’s been replaced by a new TCL Tab 10 Nxtpaper. While the Nxtpaper is a very workable tablet, it’s also excellent when you want to relax with a book. The 10.4-inch screen has a resolution of 2,000 by 1,200 pixels and a brightness of 600 nits, similar to some laptops. The screen has a finish that cuts down on glare and reflection, though it’s a little hard to read outdoors in the sun. It offers several settings that change the appearance of color pages, which is great when you are reading a color book or magazine. The tablet offers 5G cellular connectivity, but right now Verizon is the only carrier supported.  What I like about the tablet is that it offers a really good reading experience. At the moment, it’s priced at $240 from Verizon, so if you (or the intended user) have service from another carrier, this might not be the best choice. I don’t use my tablets on cellular service (most of the airlines I fly offer internet connectivity, as do the hotel rooms) so the 5G connectivity feature is not a deal breaker for me, though it might be for you or the person you have in mind.

Another great gift item is a USB monitor to use as a second display for a laptop. With more people using a laptop for their main PC, being tied to a single screen can diminish productivity. My main productivity PC has a 35-inch main display and a 27-inch secondary display, so I used to feel really constrained when I’ve had to use my laptop. I’ve been using a second monitor for several years and I find it a must to get much work done when I’m at a conference. But monitor technology, like everything else, has progressed over the years, so I replaced my old USB monitor with a ViewSonic TD1656-2K. The TD1656-2K isn’t the least expensive solution, coming in at about $350, but the features make it worthwhile. It has a 16-inch 2560 x 1600 display and a touch screen. The screen offers auto-pivot, so if you want to use it in portrait mode rather than landscape, just turn the monitor and the display will flip. The cover does dual duty as a stand, and weighs 2.8 pounds with the stand, about the same as an extra laptop. The sound is actually pretty good from the two 2.5-watt speakers, and there are two USB-C ports at the left and right bottom of the display. Both of these ports support 65-watt pass-through if your laptop offers power delivery. Best of all, the 16-inch screen is larger than the one on my laptop.

Or how about a mini home theater?  Many of us, or our clients or children, don’t have room for a home theater. And gifting a large screen TV is usually not an option. Video projectors are a great way to get many of the benefits of an enhanced video experience without having to dedicate a large amount of room and wall space to a big screen TV. Or maybe you have a staff member who has to travel and make presentations. The $400 Nebula Capsule Air is one of the smallest projectors you can buy, about the size of a can of soda. It’s not tremendously bright (as is common for projectors this small and inexpensive). With a light output of 150 lumens, you’ll need to use it in a darkened room. It has Google TV built in, and an optional $140 Power Bank Tripod gives you an extra two hours of runtime, added to the two-hour run time of the Capsule Air itself.

If you have a teenager, staff member, or have a client who is into technology or the Maker movement, how about a 3D printer? A great printer for a beginner is the Bambu Lab A1 mini. The $200 price is pretty easy to handle, and at $349, you can get the Combo, which includes the printer and an accessory that provides four-color printed objects. The A1 mini is pretty much assembled out of the box. You just have to cut some zip ties and attach a few pieces. It shouldn’t take more than about 15 minutes until it’s up and running. The internet has thousands of models to print. 

Finally, if you are willing to go really overboard and have someone on your gift list who is an audiophile, a gift of a pair of in-ear monitors offers a really superior audio experience. In-ear monitors are like super bud earphones. They have a wider range than most earbuds and truer sound reproduction. When you watch a performer and notice they have ear buds while performing, they are wearing in-ear monitors. They are pretty expensive. The one I’m recommending is the $500 Sennheiser IE 600 model, but it’s far from the most expensive model available. In-ear-monitors, especially for performers, can run into the thousands.

That’s it for this time. I’ll dig further into the review pile in later blogs. Oh, and if you want to get in touch with me, you can DM me on Facebook.

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Accounting

Zoho announces payroll solution, plus other enhancements

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Business management solutions provider Zoho announced the U.S. release of its payroll solution, Zoho Payroll, on top of enhancements to its existing finance products, which include Zoho Books, Zoho Inventory and Zoho Practice.

Zoho Payroll offers users federal, state and local tax compliance across all 50 states with automated calculating, paying and filing of taxes. The product also sports automated compliance updates to keep up with changes in law and regulations. Users can configure the software for how their organizations work, with the ability to set custom salary structure, unique benefits and more. There are also features for auto-generated exportable reports allowing users to gain more visibility into payroll expenses and tax withholdings. Beyond pay, the software can also handle employee benefits, including health care, retirement savings and paid time off, and manage contributions to an employee’s 401(k), 403(b), health savings account and flexible spending account. 

The solution also offers access to a mobile-first employee self-service portal, available on iOS and Android devices, which enables employees to view pay slips, benefits contributions and salary breakdowns, modify tax-withholding preferences, and communicate with HR. 

Zoho Payroll integrates with Zoho People, Zoho Expense and Zoho Books, which enables automatic syncing of employee data, initiation of expense reimbursements, and posting of payroll journal entries

“Zoho Payroll addresses the struggles our customers were facing in finding a system to keep up with endless revisions to tax codes, maintain accuracy and compliance across departments, and generate financial reports,” said Raju Vegesna, chief evangelist at Zoho. “The growth of our array of finance apps is driven by our customers, and that will never change.”

Zoho Practice has several new capacities. The new workpapers feature automatically fetches client financial statements from Zoho Books, enabling comparisons, adjustments, document management and collaboration for review and approval. The self-service portal enables accountants to collaborate with clients who use third-party services, facilitating document requests, digital signatures and communication. The solution boasts workflow automation, custom functions and scheduling options that support tailoring of operational workflow.

Zoho Books has also introduced a suite of new features, including support for direct filing of 1099- MISC and 1099-NEC forms with the IRS, with provisions for collecting and managing W-9 forms from contractors. Furthermore, the new progress-based invoicing capacity allows businesses to invoice customers incrementally. There are also new bill pay capabilities, which lets users auto-scan bills, set up vendor approval flows, perform three-way matches for accuracy, and process batch payments. Other advanced features include revenue recognition, which automatically recognizes revenue based on contractual obligations or when the service is delivered, and fixed asset management, allowing the recording of asset details, automatic depreciation calculations, and the generating of forecast reports. 

Finally, in Zoho Inventory, advanced warehouse management capabilities—such as enhanced location tracking and labeling, stock counting, stock out alerts, and role-based access to the warehouse operations—offer more inventory control, accurate stock levels, and faster order processing. The product’s mobile apps help warehouse employees perform tasks more efficiently.

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Accounting

Bill announces 1099 filing tool

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Payment solutions provider Bill released a new tool that lets users manage their AP needs and 1099-NEC and 1099-MISC forms together from a single platform 

“Without the right technology, the process of filing year-end forms for vendors and contractors can be complicated and time consuming for SMBs, plus it can be challenging to stay compliant,” said Ariege Misherghi, senior vice president and general manager of AP, AR and accountant channel at Bill. “That is why Bill is delivering an intuitive 1099 filing solution — empowering SMBs and their accountants to quickly collect, create and file 1099s in the same place where they’re already tracking vendor payments throughout the year. With Bill, businesses can now handle this critical component of tax season with ease and get back to what they do best — serving their customers.”

The new feature allows users to request and collect W-9s directly from within the platform, removing the need to navigate between disparate software solutions. They can also pick and choose which vendors are 1099 eligible with the “1099 Filing” tab in the left hand navigation. Users can view all payments made to a vendor and categorize payments in bulk. Once payments have been categorized, the software will generate all 1099 forms. The solution can then deliver 1099s either electronically or physically via USPS to all vendors for review. Once 1099 documents have been generated and reviewed by vendors, users can file all 1099s electronically with the IRS with the click of a button, provided the state they’re in is participating in the Combined Federal/State Filing program, listed at IRS.gov. Users can pay 1099 vendors any way they prefer, including ACH, virtual cards, pay by card, international wire or Bill checks. 

W-9 collection capabilities are available now. Additional features for 1099s will be available on Jan. 2, 2025. 1099 Filing from Bill is only available to Direct and AC organizations that use Bill Accounts Payable.

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