Sixty percent of the CPA executives polled believe the economy will continue to improve, slightly higher than the 57 percent who responded similarly in the previous survey, which took place in June 2005. An even greater number, 74 percent, revealed a positive outlook for their own organization's prospects over the next six months.

Less than half of the respondents, 45 percent, anticipate a boost in hiring by their company over the next six months, but that is still a greater number than the 40 percent who made the same prediction in June. Only 11 percent said their organization would downsize its workforce.

Spending on information technology continues to be strong, with 55 percent saying it would increase. Only five percent predicted a reduction in spending.

"In spite of increasing concern about energy costs and other factors, we are continuing to see a good deal of optimism in the corporate sector," said Barry C. Melancon, AICPA president and CEO. "What's particularly interesting is that in an era of globalization, executives in about 60 percent of companies across the board in terms of size expect increased growth from U.S. market sources."

More CPA executives, 58 percent, foresee higher wage and salary expenses compared with 50 percent in the June survey. A smaller number, 51 percent, expect higher benefit costs; in June, 48 percent said they thought those costs would increase.

Areas of concern

More than half the respondents are more concerned than they were six months ago about costs associated with energy; employees; and materials, supplies and equipment. Not surprisingly, the greatest concern was the cost of energy, with 85 percent of the survey respondents saying they were more worried than they were six months earlier.

Other concerns include the cascade effect of the Sarbanes-Oxley Act on organizations not registered with the SEC, international instability, and the cost or availability of credit. To a lesser degree, domestic terrorism and foreign competition cause worry.

Policy issues

The survey addressed several policy issues. CPAs continue to be more concerned about the impact of changes in short-term interest rates on inflation than on unemployment. On trade relations with China, a large percentage, 70 percent, endorse the current U.S. policy of supporting gradual revaluation of the Chinese Yuan vis a vis the dollar. Twenty-three percent are in favor of treating currency manipulation as a trade violation warranting sanctions, and seven percent support imposing sanctions without declaring currency manipulation as a violation.

Asked about the plans recommended by President Bush's Advisory Panel on Tax Reform, 55 percent preferred the Simplified Tax Plan, which primarily would impact individual taxes, and 45 percent gave the nod to the Growth and Investment Tax Plan, which would include significant changes in business taxes.

The survey, conducted in December, represents the views of 1,903 AICPA members in public and privately held companies, government and not-for-profit organizations. Of that number, 216 serve as CEOs and 985 are CFOs. Of the total survey sample, 60 percent work for privately held companies.

The complete survey results are available at the AICPA Financial Management Center: http://fmcenter.aicpa.org.