BUSINESS confidence in Scotland is greater than the UK average, as firms enjoy growth in turnover, profits and sales volumes and predict further increases.

But Scottish companies have, overall, trimmed their workforces over the past 12 months, and capital investment growth remains poor.

These are the findings

of a business confidence monitor published today by the Institute of Chartered Accountants in England and Wales and accountancy firm Grant Thornton.

Scottish businesses recorded a confidence score of +32.5 for the current quarter. This is greater than the UK average of +24, and up from +26.7 in the second quarter.

Businesses in Scotland reported steady annual growth across several key financial performance indicators, the ICAEW declared, with turnover, profits and sales volumes up by 4.3%, 3.7% and 3.2% respectively over the 12 months to the current quarter.

It added that, in keeping with increased optimism, companies in Scotland expected turnover, profits and sales volumes to rise by 5.9%, 6.5% and 5.8% respectively over the coming year.

However, Scottish ­companies reported a 0.5% decline in employee numbers over the past 12 months. And total salaries grew by only 1.4% over the year to the current quarter.

Annual capital spending growth in Scotland has slowed to 1.6% this quarter, according to the survey. This is weaker than the 2.3% growth reported over the year to the third quarter of 2012.

The expectation is for capital investment to increase at a slower pace over the coming year, with businesses predicting only 0.7% growth over the next 12 months.

The ICAEW noted ­confidence levels in Scotland had been on a general upward trend since the fourth quarter of 2011. It added that Scotland's score had now been in positive territory for six consecutive quarters.