The nonprofit community got some good news today regarding Paycheck Protection Program (PPP) loans. The AICPA Governmental Audit Quality Center released the following:
“In response to the COVID-19 pandemic, Small Business Administration (SBA) PPP loans, administered under the 7(a) guaranty loan program, are being provided through local financial institutions. While these loans have been made primarily to for-profit entities, some nonprofits have also received PPP loans. One of the most common questions we have received is whether SBA PPP loans obtained by nonprofits are subject to the Uniform Guidance single audit requirements. The good news is that we have recently received an answer to this question. Based on recent discussions with SBA staff, we have been informed that PPP loans made to nonprofits will not be subject to single audit.
“On the other hand, SBA informed us that loans made to nonprofits under the EIDL program are considered a direct loan program disbursed from SBA to loan recipients. Therefore, these loans are considered federal financial assistance and are subject to the Uniform Guidance single audit requirements.”
For more information on COVID-19 relief programs, please contact our Nonprofit and Association Services Group at 301.231.6200. Additional resources to help you guide your organization through COVID-19 can be found on our resources hub.