Accounting
CFOs cautious as election looms
CFOs seem to be cautious ahead of the U.S. election in November, with 58% of CFOs saying the result of the election will be extremely or very consequential for their organization, according to a survey released Wednesday by Deloitte.
Only 3% say the CFOs surveyed believe the election will not be consequential at all. The Big Four firm’s quarterly
Inflation tops CFOs’ list of external risks. Technology transformation is the No. 1 internal risk. Only 12% of CFOs believe now is a good time to take on greater risk, down from 26% in 2Q24. A third (33%) of CFOs believe workforce issues should be a top priority for the federal government to address.
With the Federal Reserve expected to cut interest rates at its meeting Wednesday, the prospects for the U.S. economy may brighten.
“With interest rate cuts on the horizon, CFOs are evaluating financing options as more attractive for the first time since early 2022,” said Steve Gallucci, national managing partner of the U.S. CFO Program at Deloitte LLP, in a statement. “Still, their optimism could be dampened by the uncertainty around the current election, which has perhaps tempered their appetite to take risks. In 2025, CFOs will be able to consider the impact of the election results and examine how new regulations or tax policies could impact their company’s operations.”
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When asked about the economic issue they think may have the biggest impact on the operating environment for business in general, 20% of respondents cited tariffs, while 16% selected tax policy. The combined number (36%) outweighed the other answers: inflation (34%), interest rates (20%) and debt (11%).
CFOs see debt and equity financing as looking substantially more attractive than in previous quarters, with 55% of CFOs surveyed view debt financing as attractive, and 52% view equity financing as attractive — levels not seen in more than two years. The CFOs survey respondents believe revenue will increase by 2.4% in the next 12 months, with earnings growth of 2.1%, less than half the two-year survey average (4.7%). Likewise, they expect a slowdown in capital spending, with year over year growth in capital expenditures estimated at 3.4%. That’s down from 6.2% in the third quarter of 2023. CFOs project that dividend growth will slow to 1.5%, down from 2.8% a year ago.
After the election, an increase in the corporate tax rate could cut into earnings, and, in turn, result in CFOs pushing these numbers down even lower.
“Election uncertainty is perhaps affecting not just CFOs’ likelihood to take greater risks, but their perception of the economic environment across the five regional economies,” said Ira Kalish, chief global economist at Deloitte Touche Tohmatsu Limited, in a statement. “After the election, CFOs will have a clearer perspective on the political landscape in which businesses will be operating. Meanwhile, a shift in U.S. monetary policy will likely boost willingness to pursue new investments or transactions.”
CFOs’ most significant external and internal concerns reflect the challenges of the current business climate. Inflation is the top external concern (57%), followed by the economy (54%), and geopolitics (52%). CFOs’ greatest internal worry is technology transformation (49%), consistent with what was reported in the 2Q24 survey. In that report, CFOs’ most significant internal concern was Generative AI adoption.
CFOs seem to be becoming more risk averse, a trend also seen in recent quarters. Only 12% of CFOs believe now is a good time to be taking on greater risk. That’s down from 26% in 2Q24 — and well below the two-year average of 32%.
Aprio, a Top 25 Firm based in Atlanta, has acquired JMS Advisory Group, a firm that specializes in unclaimed property compliance and escheat process development, also based in Atlanta
Financial terms of the deal were not disclosed. Aprio ranked No. 24 on Accounting Today’s just released
JMS was founded in 2006 and helps clients mitigate risk and capitalize on opportunities through managed unclaimed property compliance. The team includes attorneys, CPAs, CFEs and others.
JMS has a wide range of clients, including enterprise companies, financial institutions, credit unions, insurance companies, hospitality and health care organizations.
“As Aprio continues its rapid growth, we are committed to expanding our services to meet the evolving needs of our clients,” said Aprio CEO Richard Kopelman in a statement Tuesday. “The addition of JMS gives us the opportunity to continue strengthening our position as a future-focused advisory firm. JMS’s focus on escheat management and asset recovery not only enhances our current capabilities but also allows us to deliver even more impactful solutions to help businesses navigate complex compliance challenges.”
JMS president and CEO James Santivanez is joining Aprio as a partner and provides guidance to clients on unclaimed property and state and local tax issues.
“We created JMS to make an impact nationally in the unclaimed property consulting industry, and I’m proud of our nearly 20-year history of helping clients mitigate risk and capitalize on opportunities resulting from accurate and properly managed unclaimed property compliance,” Santivanez said in a statement. “Joining with Aprio takes us to the next level, allowing us to build upon our success while providing even greater value to our clients. This is an exciting next step in our journey.”
JMS founder and director Sherridan Santivanez is also joining Aprio as a partner. He specializes in representing clients before state enforcement authorities and managing complex audits and voluntary disclosures for some of the world’s largest companies. She provides strategic guidance on audit preparation and navigates interactions with state and third-party auditors.
Aprio received a
The American Institute of CPAs and the National Association of State Boards of Accountancy are asking for comments on their proposal for an additional pathway to CPA licensure through
The AICPA and NASBA proposed the
The UAA changes would:
- Enable states to adopt a third licensure pathway that requires earning a baccalaureate degree with an accounting concentration, completing two years of professional experience as defined by Board rule, and passing the Uniform CPA Examination;
- Shift to an “individual-based” mobility model, which allows CPAs to practice in other states with just one license; and
- Add safe harbor language to ensure CPAs who meet existing licensure requirements preserve practice privileges.
The proposals come as several states are already moving forward with their own changes, including
The updates reflect feedback gathered during a late 2024 exposure draft period and forward-looking solutions being advanced by state CPA societies and boards of accountancy to increase flexibility for licensure candidates while maintaining the integrity of the CPA license.
The AICPA and NASBA are asking for comments on the proposed changes by May 3, 2025. They can be submitted through this
The UAA offers state legislatures and boards of accountancy a national model they can adopt in full or in part to meet the licensure needs of each jurisdiction.
The proposal would maintain the current two pathways to CPA licensure:
- Earning a post baccalaureate degree with an accounting concentration, completing one year of professional experience as defined by Board rule, and passing the CPA exam; and,
- Earning a baccalaureate degree with an accounting concentration, plus an additional 30 semester credit hours , completing one year of professional experience as defined by Board rule, and passing the CPA exam.
Small business employment held steady last month, according to payroll company Paychex, while wage growth continued below 3%
The
“Our employment data continues to show moderate job growth and wage growth below three percent,” said Paychex president and CEO John Gibson in a statement Tuesday. “The consistent long-term trend we’re seeing is a small business labor market that is resilient and stable with little job movement among workers. At the same time, small business owners are optimistic about future business conditions despite uncertainty about how to adapt to a rapidly evolving legislative and regulatory landscape.”
The Midwest remained the top region in the country for the ninth consecutive month with a jobs index level of 100.54. Seven of the 20 states analyzed gained more than one percentage point in February, led by Texas (up 2.11 percentage points).
Phoenix (101.92) increased its rate of small business job growth for the fourth month in a row in February to rank first among the largest U.S. metros.
Construction (3.29%) regained its top spot among industries in terms of hourly earnings growth in February, followed closely by “other services” (3.27%) and manufacturing (3.21%).
The pace of job growth in manufacturing gained 2.39 percentage points to 99.52 in February, the industry’s biggest one-month increase since April 2021.
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