Economic optimism rebounding: CPA Canada Business Monitor

TORONTO, July 10, 2015 /CNW/ - Economic optimism among professional accountants in corporate leadership positions is creeping back upwards, according to a quarterly survey conducted for Chartered Professional Accountants of Canada (CPA Canada).

The quarterly surveys of the CPA Canada Business Monitor provide economic snap shots throughout the year. In the second quarter of 2015, 29 per cent of the respondents were optimistic about how the Canadian economy will perform over the next 12 months, up from 23 per cent the previous quarter.

It is interesting to note that in the opening quarter of the year, pessimism in the Canadian economy was running ahead of optimism for the first time since the fourth quarter of 2011. That is no longer the case.

In this latest survey, 20 per cent of the survey participants expressed a pessimistic outlook, down from 30 per cent in the year's opening quarter. About half of the respondents are neutral regarding the outlook for the Canadian economy.

Not surprisingly, oil prices remain the number one challenge to the Canadian economy in the survey.

"Optimism is moving upwards and that's welcome news," says Kevin Dancey, president and CEO, CPA Canada. "Unfortunately, there are no clear signals emerging about what lies ahead for the Canadian economy. A number of factors are at play including oil prices, Canadian household debt levels and the state of global economies."

Only 26 per cent of the survey respondents feel that lower oil prices are beneficial to the country as a whole while 35 per cent believe the price levels benefit their own company. In addition, 66 per cent of those surveyed believe the U.S. economy is growing.

Company specific

Company optimism is at 53 per cent, similar to the 50 per cent mark recorded in Q1. This is how the professional accountants surveyed feel about the prospects for their own companies over the next 12 months. In terms of challenges faced over the summer months, accommodating vacation schedules topped the list being cited by 35 per cent of the respondents.

Revenue/Profits/Employee numbers

Focusing on revenues, 60 per cent of the respondents are forecasting growth over the next 12 months, virtually the same as last quarter. For profits, 56 per cent of those surveyed anticipate an increase, also similar to Q1.  

Turning to employee numbers, 38 per cent of those surveyed are predicting growth at their company, compared to 33 per cent last quarter. Thirty-five per cent of the respondents anticipate no change while 25 per cent expect a drop and the rest do not know.

Methodology

The CPA Canada Business Monitor is issued quarterly, based on a survey commissioned by CPA Canada. The report draws upon business insights of professional accountants in leadership positions in privately and publicly held companies.

For the Q2 2015 study, emailed surveys were completed by 773 of 6,125 identified by CPA Canada as holding senior positions in industry (CFOs, CEOs, COOs and other leadership roles). The response rate was 12.6 per cent, with a margin of error associated with this type of study at ±3.5 per cent, with a confidence level of 95 per cent. The survey was conducted by Nielsen from May 28, 2015 to June 17, 2015.  A background document is available online at cpacanada.ca/businessmonitor.

About CPA Canada

Canada's accounting profession is uniting under a new single designation, Chartered Professional Accountant (CPA). The profession's national body, Chartered Professional Accountants of Canada (CPA Canada), represents and supports more than 190,000 members across the country. CPAs are valued for their financial and tax expertise, strategic thinking, business insight, management skills and leadership. CPA Canada has consolidated the operations of three national accounting bodies: The Canadian Institute of Chartered Accountants, the Certified General Accountants Association of Canada and The Society of Management Accountants of Canada. CPA Canada conducts research into current and emerging business issues and supports the setting of accounting, auditing and assurance standards for business, not-for-profit organizations and government. It also issues guidance on control and governance, publishes professional literature and develops certification and continuing education programs.

SOURCE CPA Canada

For further information: Tobin Lambie, Principal, Media, CPA Canada, T: 416-204-3228, C: 647-302-3761, tlambie@cpacanada.ca, www.cpacanada.ca