The COVID-19 pandemic has upended lives across the country as officials struggle to curb its spread. As cities and states have put restrictions in place to slow infections, businesses of all kinds have felt the financial squeeze.
Certified public accountants have helped guide their clients through this troubling time as they try to navigate the sudden financial strain the pandemic has brought. The CARES Act provided some relief for businesses, dispersing more than $525 billion through the Paycheck Protection Program. As the time comes for businesses to apply for PPP loan forgiveness, CPAs can provide vital assistance to ensure success for their clients. Here are some things to keep in mind while helping clients with PPP loan forgiveness.
Do your clients qualify?
Your client was able to secure a PPP loan early on in the pandemic that helped them stay afloat. But, are they eligible for loan forgiveness now? This is an important question that business owners are counting on their accountant to make clear for them. CPAs need to keep their clients informed of the requirements throughout the loan process to ensure they qualify for full forgiveness. Keeping the right number of employees on the payroll and avoiding big payouts are important factors that will affect a business’s qualification for forgiveness. A CPA can help clients meet this and other requirements before submitting their application.
Completing forgiveness applications
It’s no surprise that PPP loans can be confusing, especially for business owners dealing with a mountain of stress just trying to keep food on the table for themselves and their employees. Having a good CPA on their side is an invaluable aid for business owners during these difficult times.
Steve is a partner in PwC's Risk Modeling Services practice. He leads PwC's US Climate Risk Modeling team and has more than 24 years of experience in actuarial risk and financial modeling. Steve's team is comprised of actuaries, financial analysts, PhD climate scientists, data scientists, geospatial engineers, and other climate risk specialists. His approach blends climate science with geospatial analysis and financial modeling to help clients identify, measure, and manage climate risk exposure. Projects include climate change risk assessments and quantification for both physical and transition risk, emissions optimization, and other financial and risk modeling projects. Steve has a degree in Mathematics from Saint Joseph's University in Philadelphia, Pennsylvania. He is a fellow of the Society of Actuaries and a Chartered Enterprise Risk Analyst.
Osho Jha is a co-founder of Arbol currently serving as its Chief Data Scientist. He is also a founding partner of dClimate, the first decentralized climate information ecosystem. As Chief Data Scientist at Arbol, he oversees the development of data-driven parametric products and climate risk solutions. Osho comes to Arbol with over a decade of experience as a product-focused data scientist. His experience ranges from cutting edge NLP research for DARPA resulting in a speech-to-speech translation system deployed by the U.S. military to using exhaust data for trading global equities.
Kiran Kumar Boosam is the head of Global Insurance Strategy & Portfolio at Capgemini. In his current role, he is responsible for enabling the top-line growth of Capgemini's Insurance business. He has more than 25 years of experience in P&C and Life Insurance. Kiran is a graduate in Electrical & Electronics Engineering from Andhra University.
Keeping track of expenses and documentation after the loan is received and getting the correct paperwork put together for the forgiveness application is essential. Make sure clients meet deadlines, turn in the correct forms, and stay in touch with their lender throughout the application process. Give clients the confidence that their application is thorough and accurate to give them the best chance of their loan being fully forgiven.
Staying on top of changes
Of course, the confusion that has occurred with the Paycheck Protection Program doesn’t belong just to borrowers. Some CPAs may find they have a few questions along the way as well. Lawmakers hurried to get financial assistance to cash-strapped businesses when COVID-19 shut down the country; there were bound to be a few snags and revisions to the program. The federal government has put out notices and questions and answers to clear up issues along the way, and changes have been made to the program as the pandemic raged on through the year. It’s up to CPAs to stay apprised of these changes and updates to FAQs so they can properly assist clients. There are still more questions to be answered, including tax issues, so this is a continual process.
CPAs can provide valuable assistance to their clients who are doing their best to stay in business in the midst of a pandemic. Stay informed about the PPP loan forgiveness process and give clients a reliable adviser in their corner to guide them through the process.
