almost three in four accountants now foresee a deeper downturn for the u.s. economy.
busy season barometer:
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by 卡塔尔世界杯常规比赛时间 research
new 卡塔尔世界杯常规比赛时间 2020 busy season barometer results bear bad tidings for cpa firms, their clients, and their families. the forecast is not good. accountants know numbers, and the numbers they are seeing do not bode well.
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as the u.s. braces for a summer surge in coronavirus infections, the economy is crashing – with gdp down at an annual rate of 33 percent last quarter, and a 10 percent drop from the first quarter – the worst declines in more than 70 years of record-keeping. and new jobless claims in the latest week rose by 867,000 to 17 million.
earlier this year, before covid struck, the numbers boded just fine. the future looked good. only one half of one percent of accountants felt their clients were going to suffer a “much worse year,” and fewer than 9 percent thought their clientele might be “somewhat worse” off. plus, 42 percent figured their clients would do at least “somewhat” better in the year ahead.
the invisible enemy, all 125 nanometers of it, has changed all that. the pessimistic 9 percent of the early season has now swollen to 55 percent, according to accountants who responded in july. hardly any accountant (less than 3 percent, technically) thinks their clients will do “much better” this year, though an optimistic 14 percent persist in believing their clients will do “somewhat better.”
maybe the optimists should include the 32 percent who think their clients will do neither better nor worse than they did in 2019. even “no change” seems optimistic these days.
clients and practitioners certainly share a similar fate. the clients’ doom is the accountants’ gloom, and the latter know it.
in the sunny days of january and february, no one – yes, actually, zero percent – thought their own firms would do “much worse” in 2020. the july number is still low—1.7 percent—but a disturbing 22 percent fear a “somewhat worse” year ahead.
a minuscule 4 percent of july respondents are looking forward to a “much better” year for their firms, and 28 percent still think their firms might have a “somewhat better” year.
forced to shut down
jeff walker, with his own cpa office in stockton, calif., is managing to keep a stiff upper lip despite trouble among his clientele. he says, “a number of my business clients, which were forced to shut down during the last few months, haven’t caught up and taxes aren’t their primary concern!”
asked how their families and themselves will fare the year, respondents proffered responses only slightly less pessimistic than those for firms and clients. it’s interesting that hopes are higher for respondents’ own families than for their firms, their clients, and the rest of the country.
with everything we know in july—about covid, about school openings, about re-lockdown—a confident 51 percent say their personal economic lives will see no change from last year, and another 29 percent actually see financial improvement over last year. but 21 percent think this year will be to some extent “worse.”
compare that with the outlook for the nation. a breathtaking 73 percent now fear the nation as a whole is tilting at an angle reminiscent of the titanic. only 12 percent foresee no change. another 15 percent manage to imagine economic growth.
bankruptcy skills
dom rosa, rtrp, in roslyn, n.y., sees everything getting somewhat worse for his firm and clients, and much worse for the nation. “without the infusion of more money and loans from the government,” he warns, “there may not be much of a practice left. and there’s also the potential of another lockdown, all negatives. there is just so much a business can do to survive.”
asked what he expects to do to face a “much worse” year, michael j. munn, in bellflower, calif., says, “well, i will have to sharpen up my bankruptcy skills because i can see how this shutdown is going to put several of my clients out of business.”
while cpas and other tax practitioners are deeply affected by the financial health of their clients and their nation, they can contribute to the economic health of both, not to mention their own families. they know the numbers and what to do with them. bankruptcy isn’t the only advice needed.