For the second consecutive year, Ohio CPAs have amended their predictions for when a sustainable U.S. economic recovery
will occur, expressing continued concerns over sta te and federal financial challenges and a complicated, unpredictable
regulatory environment they say is delaying a turnaround.
Recovery will begin in 2012 or beyond, predicted 64 percent of CPAs responding to the Ohio Society of CPAs’ (OSCPA)
eighth annual Ohio Business Poll this year. In the 2009 Poll, about a third (36 percent) of respondents predicted that the
U.S. economy would begin a sustainable recovery in the second half of 2010 and 26 percent put the turnaround in the first
half of 2011.
CPAs also gave the Obama administration a ‘poor’ or ‘very poor’ rating for its impact on key national issues such as the tax
climate (79 percent), health care reform (77 percent), the business climate (77 percent) and the national economy (75
When asked to choose the top three factors delaying Ohio’s economic recovery, CPAs ranked the loss of industry and
manufacturing as primary (73 percent) followed by the state and local tax climate (67 percent) and the unpredictable
regulatory environment (57 percent).
To address Ohio’s financial problems, CPAs recommended that Ohio conduct widespread performance audits to identify cost
savings and efficiencies (61 percent) and establish a long-range financial planning process (40 percent). Both
recommendations were included in OSCPA’s Ohio Budget Advisory Task Force report presented to Gov. Strickland and state
caucus leaders in Fall 2009.
Beyond the budget, CPAs ranked their top recommendations among issues they feel need to be addressed in Ohio over the
next 12 months. They include the following: loss of jobs (88 percent), followed by government regulation (55 percent) and
municipal income tax administration (35 percent).
“Clearly, Ohio has suffered a huge loss of jobs in the recent recession, and that should be a top focus for our elected
officials,” said OSCPA Chair Peter A. Margaritis, CPA. “But there are other pressing issues affecting progress for Ohio that
need to be addressed as well.”
Margaritis said that list includes simplifying Ohio’s outdated municipal income tax collection structure. He explained in a
release that Ohio has 579 municipalities that assess an income tax, and many have diverse filing requirements. “This puts a
regulatory burden on businesses and individuals, increases administrative costs to local government entities and thwarts
Ohio’s efforts to attract out-of-state employers.”
More than half (55 percent) of CPAs responding ranked centralizing Ohio’s municipal tax collection process at the top of
priorities for reform or improvement to Ohio’s business tax structure. Others were ensuring greater uniformity of the
municipal income tax wage base (49 percent) and reducing the impact of or eliminating Ohio’s estate tax (42 percent).
A total of 79 percent of respondents predicted that it will take three or more years for Ohio’s unemployment rate to return
to the 5.8 percent level at the beginning of the recession. However, CPAs were more positive on business investment
prospects in 2011, with 45 percent of those surveyed predicting capital investments would continue at 2010 levels and 35
percent predicting they will increase. Only 15 percent forecast a decline in capital investments for the coming year.
The growing cost of health care remains a big concern for CPAs, with 56 percent of those participating in the Business Poll
forecasting increases of more than 10 percent for their companies and clients in 2011 and 29 percent expecting increases
of between 5 percent and 10 percent. Despite the anticipated extra cost, most said they would continue to offer coverage
to employees, deeming it a critical benefit and competitive advantage.
More than 500 OSCPA members responded to the November survey. Of those, 71 percent work in public accounting, 24
percent are employed in the corporate sector and the rest are educators or government employees.