Increasing appetite for M&A, AI driving growth, survey finds

Mergers and acquisitions (M&A) and growth opportunities are on the rise, according to a survey of leaders at private companies and private-companies-turned-public.

Nearly 90% of 600-plus leaders at U.S.-based companies said they’re optimistic about future growth prospects, and 72% said they feel prepared to capitalize on major growth opportunities today, according to the KPMG study Disruption Decoded: Perspectives on Growth, AI, and Reporting From Private and Newly-Public Companies.

Many of those leaders expect growth opportunities to come through M&A, with nearly 7 in 10 anticipating an increase over the next 18 months. Specifically in accounting, private equity is already active despite lingering high interest rates, in the case of both midsize firms and large public accounting firms.

The survey canvassed leaders at private companies planning to go public in the next five years; companies that have gone public in the last five years; and companies with no plans to go public in the next five years. Among those eyeing an initial public offering in the next five years, 58% indicated that they are ready to move.

Other survey findings:

• Artificial intelligence (AI) was the most commonly cited “growth enabler,” but the top concern related to growth over the next three years was cybersecurity threats, along with a potential economic recession and increasing energy costs.

• Despite the top concern, just 54% report taking adequate measures on risk and compliance governance.

• Aside from financial statements, cybersecurity risk was listed as the most relevant area of reporting among private company leaders, followed by ethical use of AI.

— To comment on this article or to suggest an idea for another article, contact Bryan Strickland at Bryan.Strickland@aicpa-cima.com.