Legislative relief for COVID-19
Hot Topic | March 2021
Updated: Financial reporting considerations of the combined provisions of the American Rescue Plan Act and other relief.
On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security (CARES) Act was signed into law. Since then, three additional COVID-19 relief bills have been enacted into law, with the latest (the American Rescue Plan Act of 2021) in March 2021.
Relevant dates
- CARES Act was signed into law on March 27, 2020
- Paycheck Protection Program Flexibility Act was signed into law on June 5, 2020
- Consolidated Appropriations Act, 2021 was signed into law on December 27, 2020
- American Rescue Plan Act of 2021 was signed into law on March 11, 2021
Key Impacts:
- The CARES Act and subsequent COVID-19 related relief include many provisions that could significantly affect the financial reporting of companies applying US GAAP.
- The changes in law are, in general, recognized events for annual and interim reporting periods ending on or after their respective enactment dates, and a nonrecognized subsequent event for annual and interim reporting periods ending before that date.
- KPMG addresses the primary accounting and reporting impacts of the relief provisions.
Report contents
- Background
- Applicability
- Key impacts
- Income taxes
- Employee retention credit and payroll taxes
- Paycheck protection program
- Government grants and payments for goods and services
- Debt and equity instruments issued
- Deferral of credit impairment guidance, and suspension of troubled debt restructuring guidance
- Mortgage relief
- Lease eviction moratoriums
- Subsequent events and going concern
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