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A nongovernmental entity may account for a Paycheck Protection Program (PPP) loan as a financial liability in accordance with FASB ASC Topic 470, Debt, or under other models, if certain conditions are met, according to new guidance for borrowers issued Wednesday by the AICPA.

The AICPA worked with many of its volunteer members, and also the FASB staff, to develop Technical Question and Answer (TQA) 3200.18, Borrower Accounting for a Forgivable Loan Received Under the Small Business Administration Paycheck Protection Program. Additionally, the SEC staff shared its views in indicating it would not object to an SEC registrant accounting for a PPP loan under Topic 470 or as a government grant by analogy to IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, provided certain conditions are met.