To touch upon this episode or to recommend an concept for an additional episode, contact Neil Amato at [email protected].
Transcript:
Neil Amato: Hi there and welcome to the Journal of Accountancy podcast. We’re going straight to the information on this episode as we enter the ultimate days of 2021. The IRS issued its annual replace of the mileage fee taxpayers could use to compute their deductible car prices. The speed for 2022 is 58.5 cents per mile, up 2.5 cents from the 2021 fee. We can even have a dialog on enterprise reduction applications and one CPA chief’s message of reflection.
Welcome again to the Journal of Accountancy podcast. That is your host, Neil Amato. This phase is an interview with Lisa Simpson, who’s Vice President—Agency Companies with the Affiliation of Worldwide Licensed Skilled Accountants. Lisa is a CPA who holds the CGMA designation, and she or he’s right here to speak about the way forward for enterprise reduction applications and the AICPA City Corridor Sequence, which by the way in which has its personal podcast, which we’ll point out afterward within the episode. Lisa, first, welcome to the podcast. Thanks for being right here immediately.
Lisa Simpson: Thanks a lot. Glad to be right here.
Amato: First, the place do issues stand on main authorities funding applications, which offered lots of of billions of {dollars} to US companies to assist climate COVID-19? Are there applications nonetheless open and providing loans or grants? What is the standing?
Simpson: It is an important query, and I am going to begin throwing out some acronyms, however I am going to attempt to outline these as we go. Let’s begin with the Paycheck Safety Program, which is one I am positive so lots of you’re acquainted with. It doesn’t appear like there may be an urge for food to begin one other spherical of Paycheck Safety Program or PPP funding in 2022. We do imagine that that program is completed, aside from the forgiveness, which we are able to discuss it in a minute.
Additionally, numerous debtors have been utilizing the EIDL program, which is the Financial Harm Catastrophe Mortgage Program. That was an present SBA program. They modified numerous the foundations round COVID-19 to offer particular mortgage attributes for that program. That can finish on December 31. The common EIDL nonetheless exists and will be a possibility for debtors who perhaps weren’t in a position to benefit from PPP or among the different applications and nonetheless are searching for different methods to finance extenuating operations, which will nonetheless be an avenue open to them.
We’ve the Shuttered Venue Operators Grant, which I affectionately name the SVOG, simply because that is enjoyable. That program was not totally utilized in its first spherical of purposes. We do not see an enormous demand proper now for that program to be reopened or re-funded. Nonetheless, as with every little thing about this pandemic, that’s topic to alter as we see new COVID variants coming into play which will impression reside performances.
We even have the Restaurant Revitalization Fund. That one was initially funded by Congress with $28 billion and that cash was allotted very, in a short time. There was a unbroken ask by a number of constituencies to re-fund this system. However at this level, once more, relying on what occurs with the following variant of COVID, we aren’t seeing that being actively labored into any pending laws. Nonetheless, there may be nonetheless numerous demand for it.
Then we have the Worker Retention Credit score, which sunsetted September 30, 2021. That was controversial as a result of it did not really get handed into laws to sundown till November. So, some confusion round that and nonetheless some uncertainty as as to if or not that would presumably be reinstated. However the forecast for that proper now’s murky.
Amato: Yeah, and that is an excellent level. At this recording, that is the state of the ERC, and we’re recording in mid-December. On that, how is the PPP forgiveness course of going? Are most loans being forgiven or are numerous them excellent?
Simpson: We’re seeing numerous motion with the 2020 loans. As of December twelfth, the most recent knowledge that the SBA had made accessible, as of our recording date, 94% of these 2020 loans had been submitted for forgiveness. Forgiveness charges are trying sturdy, relying on the mortgage quantity, there are between 98% and 99.3% being completely forgiven. There’s some nice progress there.
2021 loans are going just a little slower; 67% of these loans have been submitted for forgiveness. I believe the forgiveness charges for these really are even just a little higher than 2020 loans. Once more, relying on the mortgage quantity, they’re ranging between 99.8% and 100% forgiveness. Forgiveness goes nicely, I believe, regardless of the preliminary confusion in how funds can be utilized, adjustments in COVID intervals, and legislative adjustments as program developed. Plenty of the debtors did use these funds for his or her supposed functions and are attaining virtually full forgiveness.
Amato: One purpose that the AICPA City Corridor Sequence grew quickly in reputation in 2021 was due to you and others having the ability to present practically real-time updates on the PPP, or Paycheck Safety Program. Now that that program is actually winding down, what are among the focus areas for City Halls in 2022?
Simpson: Properly, initially, let me say that we now have an important workforce behind these of us that you simply see on the City Halls that assist get all of that real-time data that you simply talked about. As we transfer ahead, we need to proceed to offer the most recent data that we are able to round points impacting the occupation. Within the first a part of 2022, we count on there will be numerous legislative motion. We need to ensure that that City Corridor discussion board is there to maintain you recent in order that as you are making an attempt to do your individual tax planning or as you are working together with your shoppers, what is going on on from a legislative standpoint.
However we additionally need to take the chance to speak about what we’re seeing within the occupation on a broader scale. We’ll be speaking about observe administration methods, CPA Evolution, and likewise simply persevering with to provide you these financial updates that you’ve got come to count on, bringing in practitioners of all agency sizes to speak about what they’re listening to, what they’re seeing, and simply bringing a few of these finest practices to our City Corridor attendees.
Amato: We are going to hyperlink to the City Corridor sequence, each the video and their podcast. We admire you, Lisa, for approaching the podcast. Thanks very a lot.
Simpson: Thanks, Neil.
Amato: Once more, that was Lisa Simpson. Subsequent up is a dialog with a frontrunner I related with in Nashville on December tenth. It was a fast, key-takeaways dialog, after the Way forward for Finance Summit concluded.
Becoming a member of me for this phase of the Journal of Accountancy podcast is CPA Floyd Amuchie. Floyd is the company controller for Virgin Galactic. Now, I imagine if you happen to’ve heard the corporate title Virgin Galactic, who they’re. However Floyd, if you happen to may first inform us briefly what Virgin Galactic does.
Floyd Amuchie: Our mission actually is to broaden entry to area. We actually need to take as many individuals as doable, to benefit from the distinctive expertise of going to area and area tourism. Actually, that is what we’re making an attempt to do, get everyone up into the celebs primarily.
Amato: You have been part of this Way forward for Finance Summit. What made you need to come right here, and the way do you are feeling such as you perhaps received some takeaways, some issues that you would be able to apply and take again with you in your function?
Amuchie: Tom [Hood] reached out to me. He actually gave me an excellent overview of what folks needed to perform right here. I actually needed to come back and simply perceive what others’ views are on, what the long run holds for our occupation, folks sooner or later, how we are able to have a giant half to play. What I’ve taken to date, I believe the largest takeaway is unquestionably, how can we proceed so as to add worth as a finance operate?
There’s been numerous change over the previous few years. There’s numerous totally different industries which might be being “disruptive.” How does finance assist folks proceed to progress, proceed to develop with the adjustments which might be taking place? There have been few good concepts right here that I’ve taken and that I’ll make use of again at Virgin. I’ve positively gotten rather a lot from the summit to date.
Amato: Clearly, expertise in and of itself, you guys are a tech firm if there ever was one. It is at all times going to be a part of the roles that finance professionals do and actually everybody. However one factor I heard that caught out to me, I would such as you to answer is, “Expertise is just not going to take the place of creativity.” What do you consider that?
Amuchie: What which means to me is actually, the stuff that we are able to automate, we are going to and we must always. These are the extra repetitive processes that we now have, issues which might be simply simple to copy. However numerous the extra strategic, extra forward-thinking, extra inventive features to the job. These are issues that you would be able to’t actually automate. That is human intelligence that we’d like for that. I believe what which means is as we develop as a operate, we now have to transition away from these processes which might be good candidates for automation, to do extra of the value-add kind strategic considering, pushing the enterprise ahead.
Amato: Actually looking forward to 2022, Floyd, something you would like so as to add in closing?
Amuchie: I’d positively need, I believe everybody, to replicate on how resilient they have been over the previous two years and actually have fun that as a result of there’s been rather a lot. I believe one factor that actually was attained right here was, we have made it, by means of some fairly robust occasions, and we must always actually cease and take into consideration that and have fun that. Hopefully in the direction of the tip of the 12 months, we are able to replicate and have fun the progress we have made.
Amato: Once more, because of Floyd Amuchie for that message, and for his time in Nashville, on the conclusion of the Way forward for Finance Summit. You will hear extra voices from that group of finance leaders in 2022 episodes of the Journal of Accountancy podcast.
That is our final episode of 2021. We hope you possibly can spend the vacations with folks you care most about. Take time to replicate, and likewise time to recharge, and rejuvenate. We thanks, the listener, for persevering with to have interaction with the present. We stay up for extra conversations within the new 12 months.
