Paycheck Protection Program (PPP) Update

The SBA just produced a new FAQ on May 13, 2020 (question #46) with the following question:

“How will SBA review borrowers’ required good- faith certification concerning the necessity of loan request?”

“. . . any borrower that, together with its affiliates who received PPP loans with an original principal amount of less than $2 million will be deemed to have made the required certification concerning the necessity of the load request in good faith.”

Additionally:

“. . . borrowers with loans greater than $2 million will be subject to review by SBA and if the SBA determines in the course of its review that a borrower lacked adequate basis . . . concerning necessity of the loan SBA will seek repayment . . . and if the borrower repays the loan after receiving notification, SBA will not pursue administrative enforcement or referrals to other agencies . . .”

This is indeed good news and although clear guidance has still yet to be received it does calm those that have received loan proceeds who have been nervous about keeping those funds based on recent Treasury Department statements.

Just as a lighthouse warns a ship in foggy or stormy conditions of landfall ahead your trusted advisors here at Polk and Associates can serve as your beacon to assist your business during these uncertain and often confusing times. Especially regarding the ever-changing nature of the PPP loan programs.

As your trusted business advisors, we at Polk and Associates remain committed to assist you during this extraordinary time. Please reach out to us with questions you may have as we stand with you as we weather this extraordinary crisis.

Polk & Associates

Large enough to serve a diverse clientele, yet small enough to maintain a hands-on approach, we are committed to maintaining the highest accounting and ethical standards with continuous education, extensive research resources, and excellent quality control.

Polk and Associates is a member of the Michigan Association of Certified Public Accountants, and the American Institute of Certified Public Accountants. The firm participates in the AICPA Peer Review Program, and has always received the highest level of award for its audit practice and quality control.