AICPA & CIMA, together as the Association of International Certified Professional Accountants, have set out proposals which could help bring down inflation faster.
The AICPA & CIMA inflation report includes research among their members. It finds that the current inflation problem has multiple drivers outside of monetary policy and the war in Ukraine. These include issues in labour markets and the supply side of the economy, which could be addressed through policy changes. An increase in productivity would mitigate against inflation by allowing the supply side of the economy to grow and meet demand in a non-inflationary manner.
The report highlights how management accountants are already supporting their businesses in dealing with the consequences and effects of high inflation, and how their skill sets are supporting effective mitigation strategies for their businesses. The report also shows what strategies and actions finance leaders globally are taking to mitigate against inflation for their businesses.
It identifies several additional areas where action could be taken, including:
- Addressing the labour shortages which are putting pressure on wage demands while limiting the productive capacity of businesses and increasing costs of goods and services
- Increasing resilience in supply chains and clearing supply chain backlogs to help unclog the global economy
- Reducing the tax burden for businesses while they are already under pressure from rising prices
- Providing specific support for SMEs badly hit by inflation and help drive economic recovery
- Providing certainty and stability around regulation and tax to help business’s scenario planning and investment decisions
- Ensuring fiscal and monetary policy work together to tackle inflation.