Need CPA to Certify My P/L for Real Estate Purchase

[Jason Chase]

I'm trying to finalize a purchase but underwriting is not accepting my profit/loss statement and says it has to be certified by a licenced CPA. I need a CPA who can get me a quick turnaround.  This would be for 2020 and 2021 until June.  I have all records to sustain P/L.  Just tell me what you need and I will deliver it to you in the desired format.

[Christian Stoecklein]

@Jason Chase CPAs don't "certify" they compete audits, reviews and compilations so you need to know which you need. Also it would be for your whole financial statement and not just the P&L. Try some local regional CPAs firms in your area. This will not be quick though. Be prepared to pay a big price for an audit on short notice to support the financing of your commercial real estate purchase. Good luck!

Christian

[Ashish Acharya]

Originally posted by @Jason Chase:

I'm trying to finalize a purchase but underwriting is not accepting my profit/loss statement and says it has to be certified by a licenced CPA. I need a CPA who can get me a quick turnaround.  This would be for 2020 and 2021 until June.  I have all records to sustain P/L.  Just tell me what you need and I will deliver it to you in the desired format.

Do they want the compilation of your financials, reviewed statement or audited statement? 

[Jason Chase]

@Christian Stoecklein Thanks, I had a feeling this would be a headache.  I've never had a lender not accept the P/L I provide.  It's pretty easy to see it lines up with my bank statements.  This is not for a commercial property.  It's actually for a primary residence but I have 10 rental properties.

[Jason Chase]

@Ashish Acharya I sent them a one page P/L with revenue, expenses and profile charted out for each month.  They said the CPA can submit the same thing but it has to come from a CPA and on their letterhead.

[Eamonn McElroy]

@jason chase

What your lender is asking for is what we commonly call a "comfort letter".

It is a checkbox on their list, and will be scrutinized with the attempt to shift liability to the accounting firm that wrote it should the loan go south and the lender cannot collect from the lendee.

The AICPA as well as errors & omissions insurers strongly discourage tax and accounting firms from writing these letters. The GNMA and FNMA also actively discourage the practice and have issued written guidance stating that lenders should not be requesting comfort letters from accounting firms.

Unfortunately some lenders continue to do it as they want the assurance of an audit but do not want to pay for it.  Furthermore, a tax CPA providing any level of assurance would be a violation of AICPA professional standards.  They are risking their license and risking sanction by their state board.

Most reputable CPA firms are not going to write any kind of letter for a non-client, which I believe is your situation.  The risk just isn't worth any fee.

For long-time, existing clients who need something for the lender, most firms have a boilerplate template that clearly states the scope of the services that they provide to the client, that they have not audited or examined the financials and provide no assurance, and that it is the lender's responsibility to perform due diligence, etc.

[Jonathan Pavkov]

Originally posted by @Jason Chase:

I'm trying to finalize a purchase but underwriting is not accepting my profit/loss statement and says it has to be certified by a licenced CPA. I need a CPA who can get me a quick turnaround.  This would be for 2020 and 2021 until June.  I have all records to sustain P/L.  Just tell me what you need and I will deliver it to you in the desired format.

Is the purchase price above market? How many units? I haven't found lenders looking for verified P/L statements if price was within market comps. Also - A CPA probably won't be able to quickly perform a compilation or audit unless you have all of your balance sheet items (assets / liabilities) documented, like bank accounts. Best of luck!