Remember PPP loans? The Small Business Administration defines PPP as “an SBA-backed loan that helps businesses keep their workforce employed during the COVID-19 crisis.” Remember all the layoffs and pay cuts at accounting firms we were meticulously tracking in early 2020? Transparency group OpenTheBooks.com crunched the numbers using Small Business Administration data and found $635 million in forgiven PPP loans by 237 accounting firms, some of which also appear on the layoff list. So who are they?
Topping the list, the metaverse’s own Prager Metis with $10.2 million. At the beginning of the pandemic, Prager Metis initiated a 20% pay cut across the board along with layoffs and furloughs. When we first reported this information in March 2020, CEO and Co-Managing Partner Glenn Friedman called our reporting negative and wanted to clarify “the cuts are 20% for three months or 5% annually.” Let’s be sure that’s clarified.
The full analysis from OpenTheBooks is in Scribd below, including details on revenue vs. loans and statements from a few firms that received these loans. But there’s this bit worth calling out:
We reviewed the top 300 accounting firms across America and found that 237 firms received $635 million in forgiven PPP loans. The average large firm received $2.6 million.The Guam office of Ernst and Young located in Tamuning received a $750,000 forgiven loan. Ernst and Young (E&Y) is a Big Three accounting firm with 365,000 employees and $45 billion in gross revenues. Really?
LMAO @ “Big Three”
Schneider Downs & Co. — which is ranked #54 on the IPA Top 500 Firms with $103.4 million in net revenue in 2021 had its $8.9 million loan forgiven in June 2021 — responded to OTB’s comment request with this:
“Our people are our greatest asset and necessary for us to support our clients and communities throughout any crisis. As a privately owned company with fewer than 500 employees, we were eligible to apply for a Paycheck Protection Program loan to allow us to operate with our workforce fully intact during a period of economic uncertainty in which all of our clients were impacted and reliant on our services. The loan allowed us to focus our energy and efforts on helping them manage through their rapidly changing needs. Our decision to accept a PPP loan included our acknowledgement of all requirements associated with the program. The specific use of the funds fell into those required guidelines and helped our company weather the early challenges of the pandemic so we could focus on meeting the needs of our clients.”
In total, OTB found that large law and accounting firms received $1.4 billion of the $800 billion in PPP loans. Nearly 90% of PPP loans were forgiven.
More info here: