AICPA addresses issues between CPA companies and lenders related to PPPs
The AICPA on Thursday offered recommendations regarding the relationship between the company and the CPA lender regarding companies that assist clients seeking financing under the Paycheck Protection Program (P3).
In the interest of advancing a clear and orderly loan application process, the AICPA recommended that the CPA contact the lender before offering assistance and performing advisory work for the client.
If the lender agrees to pay the CPA company for their services, the relationship must be documented and disclosed to the small business, the AICPA said. This documentation could take the form of a letter sent by the CPA to the client, describing the services to be provided by the CPA firm to assist and advise the client on the proper execution of the request.
The AICPA said the letter could include:
- Compile payroll reports needed to calculate average monthly salary costs, such as a P3 compliant salary cost report or payroll master report or other documents related to compensation and other eligible salary costs.
- Calculation of average monthly salary costs in accordance with PPP guidelines.
- Examination of the final request before submission.
The AICPA made the recommendations after discussions with lenders, other stakeholders and the small business finance coalition.
The AICPA said that CPA professionals can add significant value to the PPP loan application process for lenders and small businesses by assisting and advising their clients in fulfilling these requests.
Small businesses need help, AICPA said, to collect the appropriate data needed to complete applications, and lenders need to know that the information has been accumulated, calculated and reviewed in a manner consistent with the guidelines. PPP loan application. Based on this, AICPA encourages CPA companies to offer loan application advice and assistance to support their small business clients.
The CARES Act does not require a formal agency relationship between the small business and the CPA for loan counseling and assistance services. However, it indicates that the agency fees must be paid out of the lender’s fees.
The PPP was established under the $ 2 trillion CARES (Aid, Relief and Economic Security) law against the coronavirus, PL 116-136, which was enacted on March 27. to cover payroll, mortgage interest, rent and utilities.
Congress has passed $ 310 billion in additional small business funding for the P3, and President Donald Trump is expected to sign that funding into law.
the AICPA Paycheck Protection Program Resources Page houses resources and tools produced by the AICPA to help cope with the economic impact of the coronavirus.
For more information and stories on the coronavirus and how CPAs can handle the challenges of the outbreak, visit the JofAon the Coronavirus Resources page or subscribe to our email alerts for the latest P3 news.
– Ken tysiac ([email protected]) is the JofAeditorial director of.