CFOs' outlook toward their own companies also decreased this quarter, as the Optimism Index of CFOs' own companies sank to 71.68, the lowest level in 39 months.

When asked in the 2007 third quarter "CFO Outlook Survey" who, in their view, was to blame for the subprime mortgage defaults, 86 percent identified brokers and lenders. The second most named offender in this scenario was the credit rating agencies which were cited by 40 percent of CFO respondents. Other responses in descending order were credit rating agencies, investment dealers, investors, and the Federal Reserve.

Many believe a related effect of the global credit crisis to be the decision by the Federal Reserve's Open Market Committee (FOMC) last month to lower the federal funds rate 50 basis points to 4.75 percent. Nearly 80 percent of those CFOs surveyed agreed with the Fed's decision, and the majority (62 percent) does not anticipate the cut to impact their company's current borrowing position. While respondents do expect the federal funds rate to continue to be lowered over the next twelve months, the mean expectation by CFOs for the Federal Funds rate in September 2008 is only slightly lower at 4.50 percent.

"We are experiencing a challenging market environment characterized by uncertainty and turbulence around interest rates and credit markets, the value of the dollar, and employment and therefore, increasing anxiety about recession and/or inflation," said John Elliott, Dean of the Zicklin School of Business at Baruch College. "With economic confidence at a three-year low, CFOs face real and perceived challenges in coming quarters."

Other findings:

• CFOs give Cox a "B" rating. Overall, American CFOs view Christopher Cox's performance as satisfactory. When asked to rate his performance to date as chairman of the Securities and Exchange Commission, over 50 percent (52.2%) issue him a B grade for his overall performance while another 41 percent give him a C rating.
  
  
• Lower bonuses expected. On average, responding CFOs anticipate year-end bonuses to decrease by over three percent (mean) compared with those issued in 2006. By industry, CFOs in retail wholesale businesses anticipated the largest drop by thirteen percent.
  
  
• Big Four firms seen as too expensive. Almost 80 percent of the companies surveyed reported purchasing services from non-Big Four audit firms. Of that 80 percent, the majority purchase tax (74 percent) and auditing (68 percent) services. Some of the specific reasons listed for using these alternative audit firms are that the Big Four firms are no longer interested in this type of audit work or that their prices are too expensive.
  
  
• Companies expect greater price increase. CFOs plan to increase product prices at their own companies 2.3 percent in the next 12 months compared to 1.85 percent last quarter.