1 minute read 12 Jun 2020
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How to account for proceeds from Paycheck Protection Program loans

By EY Americas

Multidisciplinary professional services organization

1 minute read 12 Jun 2020
Related topics COVID-19

Learn more about how eligible small businesses that have secured loans under the PPP should account for the money they’ve received.

The CARES Act created the Paycheck Protection Program (PPP) to provide certain small businesses with liquidity to support their operations during the COVID-19 pandemic. This latest publication produced by the EY US Professional Practice Group discusses the accounting for PPP proceeds, as either debt or a government grant, which may depend on whether an entity expects to meet the eligibility and loan forgiveness criteria.

Entities must meet certain eligibility requirements to receive PPP loans, and they must maintain specified levels of payroll and employment to have the loans forgiven. Entities that receive PPP loans should monitor developments because the US Small Business Administration is expected to provide more guidance to address questions about the program.

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Summary

Technical accounting guidance and financial reporting thought leadership related to The CARES Act, produced by the EY US Professional Practice Group.

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By EY Americas

Multidisciplinary professional services organization

Related topics COVID-19