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Accountancy Slice
USA
30th October 2025
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THE HOT STORY

M&A key to accounting growth

Emerging technology is transforming accounting and professional services firms, making them more efficient and competitive. However, the shortage of experienced accountants and the need for significant capital investments are pushing firms toward M&A for growth. BDO USA PC's acquisition of Horne LLP exemplifies this trend, as it gained 1,300 employees and expanded its client base. Sean Taylor, CEO of Smith + Howard, emphasizes the importance of acquiring firms that align with their service-oriented culture to ensure successful integration. As firms face capacity constraints and a shortage of skilled professionals, M&A offers a quicker path to profitability and service expansion. Taylor notes: "Growing a professional services firm today requires investment in capable experts who can help the business adopt emerging technology." The trend of consolidation is expected to continue as firms seek to enhance their capabilities and client offerings.

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TECHNOLOGY

AI's role in tax advice challenges CPAs

AI is increasingly becoming the go-to resource for taxpayers and investors seeking advice on investment strategies and tax reporting, according to a report by CPA Practice Advisor. This trend, observed as of October 2025, presents both opportunities and challenges for CPAs. While AI can provide quick answers, it may also lead clients astray with inaccurate or incomplete information. For accountants, this underscores the need to develop a strategic playbook to integrate AI effectively into their practice, ensuring they remain the trusted advisors for complex tax and financial matters. CPAs must adapt to maintain their relevance in this evolving landscape.

TAX

Trust issues: what clients want

TaxDome's recent report highlights a significant shift in client expectations for accounting firms. The study surveyed over 350 U.S. decision-makers, revealing that 92% rely on referrals when selecting an accountant, with 58% finding their current firm through peer recommendations. “Every satisfied client is more than a loyal customer—they're a potential growth channel,” TaxDome said. Clients prioritize simplicity through technology and proactive partnerships, with 85% valuing accountants who help them save money through strategic advice. Additionally, businesses earning over $1m annually are twice as likely to hire niche firms, willing to pay up to 25% more for specialized expertise. This trend indicates a growing demand for accountants who understand specific industry challenges and can provide tailored solutions.

INDUSTRY

CPA exam trends: Candidate numbers show mixed signals

AICPA has released its 2025 Trends report, revealing a decline in new CPA exam candidates, although the total number of candidates has increased from 2022's low. This shift indicates a potential stabilization in the profession's appeal after a recent downturn. For accountants, auditors, and corporate finance departments, this trend suggests a cautious optimism about the future talent pipeline. However, the decrease in new candidates could signal challenges in attracting fresh talent, impacting staffing and succession planning in firms and corporate finance teams. Monitoring these trends is crucial for strategic workforce planning.

REGULATORY

SEC intensifies reporting enforcement actions

The U.S. Securities and Exchange Commission (SEC) has released a comprehensive list of enforcement actions related to financial reporting, highlighting civil lawsuits against various entities. This initiative underscores the SEC's commitment to maintaining transparency and accountability in financial disclosures. For accountants and auditors, this signals an increased scrutiny on compliance with financial reporting standards and the importance of robust internal controls. Firms must ensure adherence to GAAP and other regulatory requirements to avoid potential legal repercussions. This development serves as a critical reminder for corporate finance departments to prioritize accuracy and integrity in their financial statements.

CFPB's 'open banking' rules blocked for now

U.S. District Judge Danny Reeves in Lexington, Kentucky, has been convinced by a coalition of banking groups to temporarily block enforcement of a U.S. Consumer Financial Protection Bureau regulation – the so-called “open banking” rule – aimed at making it easier for consumers to switch financial service providers. The Bank Policy Institute, Kentucky Bankers Association and Forcht Bank said they welcomed the judge's order. The decision "ensures banks won’t be forced to invest time and resources preparing for a rule that is currently being rewritten," they said.

ECONOMY

Federal shutdown could cost U.S. economy up to $14bn

The nonpartisan Congressional Budget Office (CBO) has said between $7bn and $14bn in U.S. GDP will not be recovered after the government shutdown. According to the federal agency's report, the shutdown will also reduce U.S. GDP by one to two percentage points in the fourth quarter of 2025. CBO director Phillip Swagel said: “In CBO’s assessment, the shutdown will delay federal spending and have a negative effect on the economy that will mostly, but not entirely, reverse once the shutdown ends.”

Fed cuts rates, signals uncertainty

The Federal Reserve cut interest rates to 3.75%–4% in its second straight reduction, while also announcing an end to quantitative tightening on December 1. However, Chair Jerome Powell cautioned that a December rate cut is “not a foregone conclusion,” revealing a split among officials. The decision came despite limited economic data due to a government shutdown. Net income and job gains remain weak, while inflation stays above target at 3%. The Fed also plans to shift maturing mortgage assets into short-term bills, signaling flexibility amid economic uncertainty and rising risks to employment.

TRADE

Trump, Xi agree on trade truce

President Trump and President Xi Jinping reached a tentative trade truce during their first in-person meeting in six years. Trump announced a 10% tariff cut on Chinese imports, reducing total tariffs to 47%, in return for China pledging stronger enforcement on fentanyl-related chemicals and easing rare earth export restrictions for one year. China also agreed to purchase “tremendous amounts” of U.S. soybeans, offering a boost to struggling American farmers. Trump rated the meeting a “12 out of 10,” expressing optimism about future relations, though analysts noted the deal lacked structural economic reforms.

CORPORATE

Concerns about weak lending standards in credit markets

Executives at the ninth Edition of the Future Investment Initiative (FII) in Riyadh, Saudi Arabia, say there are signs of lending standards weakening in the market for private lending to large companies—although fears of a risky bubble emerging in the private credit market are overblown. "The risk is when you have too much leverage and not enough liquidity you tend to have problems and I don't see us having that right now even in private credit," Anne Walsh, chief investment officer at Guggenheim Partners told attendees at the annual flagship finance conference.

Private credit bosses hit back at First Brands 'misinformation'

Executives at Blackstone, Apollo and Ares have said the firms had no exposure to U.S. companies First Brands and Tricolor at the time of their bankruptcies, and the private credit industry had been unfairly linked to the collapses. Daniel Leiter, a senior managing director at Blackstone, told a British House of Lords committee examining the rise of private markets that "There has been a lot of misinformation," and said private credit was fundamentally safer than bank funding, which risked wider contagion.

CRYPTO

Stablecoins: cash or just a mirage?

The classification of stablecoins as cash or cash equivalents is a complex issue that impacts liquidity metrics and risk perceptions for companies. Vivian Fang, the Sznewajs Family Chair in Finance at Indiana University, emphasizes that "any discussion of treating stablecoins as cash or cash equivalents must grapple with this diversity." The GENIUS Act, which regulates payment stablecoins, mandates compliance and transparency, yet many stablecoins fall outside its scope. The Financial Accounting Standards Board's ASU 2023-08 provides initial guidance but does not clarify stablecoin treatment. The lack of uniform accounting standards complicates the situation, as stablecoins vary widely in structure and rights. Without robust legal and audit frameworks, classifying stablecoins as cash equivalents could misrepresent corporate liquidity positions.
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