We have all been waiting for guidance to be issued related to accounting for forgiveness of Paycheck Protection Program (PPP) Loans. On June 10, 2020, the AICPA issued such guidance in the form of a Technical Question and Answer (TQA) 3200.18 Borrower Accounting for a Forgivable Loan Received Under the Small Business Administration Paycheck Protection Program. The TQA specifically addresses nongovernmental entities.Read More
Here we are at the end of May, and there is still no guidance that has come out under U.S. GAAP, which specifically addresses the accounting for loan forgiveness from the government under the Paycheck Protection Program (PPP). Due to the lack of such guidance at the current time, borrowers have two different ways they could account for PPP loans, as follows:Read More
As you know, the CARES Act includes a Paycheck Protection Program (PPP). Proceeds from loans under the PPP are used for various expenses including eligible payroll costs, interest costs, rent and utility costs incurred during the period between February 15, 2020 and June 30, 2020.Read More
The FASB met April 8, 2020, to discuss accounting issues surrounding COVID 19. A summary of the issues they discussed include the following:
Tentatively deferring for one year the effective dates of the new lease standard (ASC 842) for private companies to January 1, 2022 for calendar year-end companies (this is in light of the fact that the FASB recognizes that private companies may have to redirect their resources to other more pressing matters). The FASB will be issuing a proposed ASU addressing this shortly, with a 15-day comment period.
Some of the tax reform provisions will likely significantly affect financial statements. A few things that likely will be impacted by the reduction in the corporate tax rate to a flat 21 percent include the income tax provision, deferred taxes and valuation allowance assessment.Read More