Since the Trump administration’s anti-DEI executive orders came out, companies and organizations have been on the retreat when it comes to their diversity, equity, and inclusion programs. The accounting industry has been no exception. Deloitte and KPMG, which are government contractors, both rescinded aspects of their DEI initiatives.

The DEI backlash is “causing a lot of firms to…think about [their] commitment to a diverse, equitable, inclusive workforce” and how to balance that with their hiring practices while making sure they adhere to the law, Geof Brown, president and CEO of the Illinois CPA Society (ICPAS), told CFO Brew.

The changes to DEI are very recent, so it’s hard to say what long-term effects they might have on the accounting profession. If they prove long-lived, though, they might risk making the profession less inclusive, could do reputational damage to firms, and weaken client relationships.

DEI can address the accounting shortage: Even putting equity aside, less diversity could prove a problem. Historically, accounting has not been a very diverse profession. As recently as 2010, 91% of CPAs working at public accounting firms were white, according to the 2011 AICPA Trends report. In 2020, 77% were.

In the face of a widespread accountant shortage, the profession needs to do more to recruit students from different communities, Brown said. “We know that the pathway to meeting the profession’s talent needs is going to go through expanding the pie,” he said, “and you can’t expand the pie without making inroads into some historically underrepresented populations.”

Click here for more on how backing away from DEI may impact accounting.—CV

It’s about to get more expensive for small businesses seeking government-backed loans.

The SBA said in a recent notice that it’s reinstating up-front fees on 7(a) loans for the remainder of the fiscal year ending Sept. 30, in what business lending platform Funder Intel described as a “significant policy shift.” The announcement reverses previous policy that waived up-front fees on any loans of $1 million or less.

Starting Thursday, the SBA will tack a guarantee fee onto long-term loans, or those with a maturity greater than 12 months. The scale starts at 2% on loans totaling $150,000 or less, and increases to 3% for loans between $150,001 and $700,000.

The fee on loans from $700,001 to $5 million will be 3.5% of the guaranteed portion up to the first $1 million, then 3.75% on the portion over $1 million. Short-term loans will have an up-front fee of 0.25%.

The 7(a) loan program is “SBA’s primary business loan program” and provides guaranties to lenders writing loans to small businesses, according to the agency’s website. These SBA-backed loans of up to $5 million are meant to help small businesses buy real estate, purchase machinery and equipment, and refinance debt, among other things.

For more on the SBA’s reinstated fees, click here.—AZ

Remember when we said M&A was gonna be hot this year? Well, so far it’s been “more lukewarm,” KPMG experts said of the first quarter of dealmaking, in a new report.

M&A activity through March 10 totaled $376 billion in value, putting the first quarter (well, most of it) at a 7% decline from Q4 2024 and making it the lowest quarter since Q3 2023, which came in at $349 billion, according to the Big Four accounting firm.

“The excitement and positive momentum observed in the M&A market at the start of the year has morphed into something more lukewarm,” as some firms held off on deals due to tariff uncertainty, Carole Streicher, head of deal advisory and strategy at KPMG US, said in the report. “However, there is still optimism that this year will be better than last, as there continues to be pent up demand for deals, with companies still looking to divest slow-growing assets and make acquisitions that will promote growth accretive to their bottom line.”

PE and IPOs, oh my. US private equity deals were down by an even greater rate. According to the report, Q1 PE acquisitions totaled $145 billion, a decrease of 19% from the last three months of 2024. It was also “the slowest quarter” for PE deals since Q1 last year, KPMG added.

Keep reading here.—AZ