According to the Paws for Purple Hearts audit of December 31, 2020 (Note 2, Related Party Transactions):
"The founder, who is also a member of the board of directors of the Organization, is a member of the board of directors of Bergin University of Canine Studies (BUCS). The Organization has a contract with BUCS located in Penngrove, California, as discussed further in Note 8 [cited below]. As a result of the contract, the Organization paid $706,312 to BUCS during the year ended December 31, 2020..."
According to the Paws for Purple Hearts audit of December 31, 2020 (Note 8, Agreements):
"The Organization has an agreement with Bergin University of Canine Studies (BUCS) to provide dogs that are suitable for candidates for training by veterans suffering from psychological scars, curriculum and updates for teaching veterans about training services and assistance dogs and oversight of the program, consulting regarding dogs being trained by the Organization, and services and expenses. The Organization has agreed to identify veterans eligible for dogs, work with veterans under the Organization's supervision, obtain dogs exclusively from BUCS, provide for the health and maintenance of the dogs, to extent possible, and all instructors of the Organization shall be BUCS graduates. In addition, the Organization will return the dogs to BUCS when suitable for placement. The agreement requires the Organization to reimburse BUCS for the cost of services and expenses, and an annual licensing fee of 9.75% of the Organization's revenue from $250,000 to $499,000, 8.5% of revenue from $500,000 to $749,000, 7.25% of revenue from $750,000 to $1,000,000 and 6% of revenue in excess of $1,000,000. During the year ended December 31, 2020 the Organization recorded $555,828 for licensing and administrative fees... As of December 31, 2020, the Organization owes $184,847 to BUCS related to the above agreement..."
According to the Paws for Purple Hearts audit of December 31, 2020 (Note 10, CARES Act Paycheck Protection Program Loans, Paycheck Protection Program (PPP)):
"The Company received funds through the Small Business Administration (SBA) under the PPP loan established under the CARES Act. The PPP Loan is subject to forgiveness under the PPP upon the Company's request to the extent that the proceeds are used to pay expenses permitted by the PPP, including payroll costs, covered rent and mortgage obligations, and covered utility payments. Amounts outstanding under the loan bear a fixed interest rate of 1.0% per annum with a maturity in two years from the disbursement date.
"During May 2020, the Company received a PPP loan of $306,604 with the Freedom Bank of Virginia, requiring monthly payments beginning December 2020, including interest of 1.00%, expiring in May 2022. During November 2020, the Company was approved for forgiveness by the SBA on the full amount of the loan and is included as grant income on the accompanying [audited] statement of activities."
According to the Paws for Purple Hearts audit of December 31, 2020 (Note 7, Debt):
"During the year, the Organization entered into a note payable for a Small Business Administration Economic Injury Disaster Loan (SBA EIDL). The note payable requires monthly payments of $641, including interest rate of 2.75% and matures in February 2049." The reported balance of the loan is $149,900 at 12/31/2020.
According to the Paws for Purple Hearts audit of December 31, 2020 (Note 13, Subsequent Events):
"During April 2021, the Organization paid the EIDL Loan in full, as described in Note 7 [cited above].
"Subsequent events were evaluated through July 21, 2021, which is the date the [audited] financial statements were available to be issued."
According to the Paws for Purple Hearts audit of December 31, 2020 (Note 11, Commitments and Contingencies, COVID-19 Pandemic):
"In March 2020, the COVID-19 outbreak was declared a pandemic by the World Health Organization, which recommended containment and mitigation measures worldwide. The outbreak and the response of governmental and public health organizations in dealing with the pandemic included restricting general activity levels within communities, the economy, and activities with our employees. While the Organization has experienced an impact to its business, operations, and financial results as a result of the COVID-19 pandemic, it may have even more far-reaching impacts on many aspects of operations including the impact on business operations, employees, and the market in general. The extent to which the COVID-19 pandemic ultimately impacts the Organization's business, financial condition, results of operations, cash flows, and liquidity may differ from management's current estimates due to inherent uncertainties regarding the duration and further spread of the outbreak, actions taken to contain the virus, as well as, how quickly and to what extent normal economic and operating conditions can resume."