SBA PPP loan allocation between parish and school – GUIDANCE
SBA PPP loan allocation between parish and school
As earlier indicated, the SBA PPP loan should generally be allocated between parish and school in proportion to how payroll costs were used to support the loan application. E.g., if the loan request was for $200,000, and the documents provided in the loan application indicated $150,000 was from school payroll, that is generally how you should plan on allocating those funds. There might be some exceptions (e.g., the parish pays all the utilities, and the school none) that would cause some rejiggering of that formula, but generally the above guidance should be followed.
If not already done, on the balance sheet, the PPP loan amount should be broken out to show an amount for the parish and an amount for the school. Budgets and cash flows should reflect the PPP amounts as cash available.
Also, the expected amount that would be allocated to the school should be communicated to the school leadership. (Of course, this should have taken place as budgeting work was done in consultation between parish and school leadership; and of course the monthly sharing of financial statements such as balance sheet, income statement, and cash flows between the parish and school should reflect this information as well.)