8a Annual Certification Compliance Service
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Once your firm becomes 8(a) Certified it is required to submit an 8(a) renewal each year within 30 days of its anniversary date. This renewal is designed to determine if the firm has met its business objectives and to see if the firm and its owners are continuing to follow the guidelines created by the SBA. It is very important that the firm take the annual review that the SBA performs seriously. If the SBA discovers that any of its continuing eligibility criteria have been violated or that the firm has primarily met the business objectives of its 1010c business plan, the SBA can early graduate the firm. The most common eligibility issues are that the owner is no longer deemed to be economically disadvantaged, has exceeded the income limitations, or that the firm didn't meet its 8(a) client mix requirements.
8acertification.net will keep your business from making any one of the many mistakes that can get your firm early graduated. It is easy for an 8(a) firm to become overly confident in the review process especially if they have done it on their own in the past. The review process with the SBA becomes more stringent year after year. In many cases, we see that a compliance package that the SBA would allow in a prior year may result in early graduation in the following year. Our approach calls for a conservative and methodical approach to the annual review in order to protect the 8(a) Certified firm’s status for the full nine years of eligibility.
Areas we analyze as part of the 8(a) annual compliance package:
- Has the business “substantially achieved” the targets set forth in the business plan form 1010c?
- Is the owner by SBA definition deemed to be no longer economically disadvantaged?
- Has an owner made excessive withdrawals from the business?
- Did the owner receive an average compensation in excess of $350,000 by the SBA calculations?
- Does the business's revenue, net worth, or working capital no longer justify small business classification?
- Is the business no longer disadvantaged compared to other businesses in the same SIC code?
- Financial ratio analysis
- Ability to operate without 8(a) contracts.
- Percentage of non-8(a) business obtained
- Overall firm profitability benchmarks met or exceeded.
- Is the firm in compliance with the 8(a) sole source contract limitations?