AICPA addresses CPA firm-lender issues related to PPP

By Ken Tysiac

The AICPA offered recommendations Thursday for the CPA firm-lender relationship related to firms assisting clients that are seeking Paycheck Protection Program (PPP) funding.

In the interest of advancing a clear and orderly loan application process, the AICPA recommended that the CPA contact the lender before offering assistance to and performing advisory work for the client.

If the lender agrees to compensate the CPA firm for its service, the relationship should 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 performed by the CPA firm to assist and advise the client on the appropriate completion of the application.

The AICPA said the letter could include:

  • Compiling payroll reports necessary to calculate average monthly payroll costs, such as a PPP-compliant payroll cost report or master payroll report or other documentation relating to compensation and other eligible payroll costs.
  • Calculating average monthly payroll costs in accordance with PPP guidance.
  • Reviewing the final application before submission.

The AICPA made the recommendations after discussions with lenders, other stakeholders, and the AICPA-led small business funding coalition.

The AICPA stated that CPA professionals can add significant value to the PPP loan application process for both lenders and small businesses by assisting and advising their clients in the completion of these applications.

Small businesses need support, the AICPA said, in gathering the appropriate data necessary for completing the applications, and lenders need to know the information has been accumulated, calculated, and reviewed in a way that is consistent with PPP loan application guidance. Based on this, the AICPA encourages CPA firms to offer loan application advisory and assistance services in support of their small business clients.

The CARES Act does not require a formal agency relationship between the small business and the CPA as part of the loan assistance and advisory services. It does, however, state that the agency fees are to be paid out of the lender fee.

The PPP was established as part of the $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act, P.L. 116-136, which was signed into law on March 27. The PPP initially provided $349 billion in forgivable loans that businesses could use to cover payroll, mortgage interest, rent, and utilities.

Congress has passed $310 billion in additional funding for small businesses for the PPP, and President Donald Trump is expected to sign that funding into law.

The AICPA’s Paycheck Protection Program Resources page houses resources and tools produced by the AICPA to help address the economic impact of the coronavirus.

For more news and reporting on the coronavirus and how CPAs can handle challenges related to the outbreak, visit the JofA’s coronavirus resources page or subscribe to our email alerts for breaking PPP news.

Ken Tysiac ( is the JofA’s editorial director.

Where to find May’s flipbook issue

The Journal of Accountancy is now completely digital. 





Leases standard: Tackling implementation — and beyond

The new accounting standard provides greater transparency but requires wide-ranging data gathering. Learn more by downloading this comprehensive report.