David Fontes is a certified public accountant, certified financial planner and tax partner at blumshapiro with more than 14 years of public accounting experience. He has a bachelor’s degree in accounting from Plymouth State University and a master’s degree in business administration from Bryant University.
PBN: How has COVID-19 changed public accounting in terms of demand and specific types of services?
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FONTES: Whether they were applying for financial relief through the federally funded Paycheck Protection Program or planning to take advantage of various options related to tax relief or deferrals, business owners in Rhode Island and across the country had to make a great deal of important decisions in a very short period of time. Our job as their financial advisers has been to help them develop comprehensive plans to maximize their options and successfully navigate this unprecedented crisis.
In addition to supporting clients through the economic impact of the crisis, we are also working with them as they lay out plans to adjust to the “new normal” created by COVID-19. Business owners needed to quickly figure out how to maintain productivity without going into the physical office; they needed to implement new cybersecurity measures to ensure their employees could safely work from home; and they needed to revisit their 2020 financial projections and budget accordingly. The list goes on and on, and – as a full-service accounting, tax and business advisory firm – we’ve certainly been in the middle of a lot of it!
PBN: What has been the biggest challenge in your role assisting clients with navigating the complex and ever-changing rules surrounding the Paycheck Protection Program?
FONTES: The biggest challenge throughout the PPP process has been communication. As you mentioned, this is an extremely complex initiative that has gone through a long list of sweeping changes since it first launched in March. Businesses that applied for and secured funding through the PPP needed to develop very detail-oriented, specific plans to effectively use their funds while maximizing their potential for loan forgiveness. And, due to the fact that guidance pertaining to loan forgiveness has changed so many times, many borrowers’ plans have changed on a near-daily basis.
We’re now three months into the program, and lenders and borrowers alike are still waiting on additional clarifications from the Small Business Administration and the U.S. Treasury [Department]. Our best advice is to stay in close contact with your advisers, and to keep meticulously detailed records of how your funds are being used.
PBN: Why is it important for businesses to consult with an accounting firm or expert when making decisions about applying for federal relief programs or other financial decisions related to COVID-19?
FONTES: For many businesses across the country, access to funding through the PPP or other federal and state lending programs was the key to withstanding this crisis. Businesses needed access to capital in order to pay their bills and maintain operations. Now, as we enter what we hope is the recovery stage of the crisis, the focus is shifting away from obtaining loans and toward the process of loan forgiveness. This process couldn’t be more important. Obviously, the loans businesses secured during this pandemic won’t be as helpful if significant portions of the loans aren’t ultimately forgiven.
In order to successfully navigate the loan forgiveness process, business owners need to work alongside their accounting firms, attorneys and payroll departments/payroll services to formulate and execute a strategy to maximize their loan forgiveness.
PBN: You are also a certified fraud examiner. How has the pandemic impacted risk of (and potentially findings for) fraud?
FONTES: I wouldn’t say that instances of fraud have been widespread during this crisis, but they certainly exist. Any large-scale crisis [such as] COVID-19 has the potential for fraud. Employees and business owners may find themselves struggling financially and make bad decisions, or the day-to-day stress of the crisis may simply lead to a lack of focus and simple mistakes.
To avoid any potential risk of fraud, especially as so many industries are continuing to work remotely, it’s important for business owners to maintain proper controls (segregation of duties, proper checks and balances, reviews and approvals, etc.) regardless of where their employees are physically working.
PBN: Diversity has become a central topic as a result of protests and calls for racial equality in the wake of George Floyd’s death. How has this discussion impacted the work and focus by you and other members of blumshapiro’s Diversity and Inclusion Committee?
FONTES: As a firm, blumshapiro is strongly committed to fostering a diverse and inclusive work environment at all times. I’m proud of the fact that our team consistently showcases that value through our actions. Our Diversity and Inclusion Committee is focused on executing a comprehensive strategy to educate employees at every level of our firm on the importance of racial justice and equity, both in the workplace and from a broader, societal level. Ultimately, our goal is to create opportunities for people of color within our industry and bring more diverse voices into our growing workforce.
Are we perfect? Of course not. Our firm – and, to be frank, our industry as a whole – still has a lot of work to do when it comes to promoting diversity. But we’ve made progress over the last several years, and we’re committed to continuing these efforts.
Nancy Lavin is a staff writer for PBN. Contact her at Lavin@PBN.com.
