Small Business Administration: Inadequate Documentation of Eligibility of Businesses Receiving SSBIC Financing
RCED-94-182
Published: Apr 26, 1994. Publicly Released: Apr 29, 1994.
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Highlights
Pursuant to a congressional request, GAO reviewed the Small Business Administration's (SBA) efforts to help small businesses obtain financing for starting, maintaining, and expanding operations, focusing on whether the specialized small business investment companies (SSBIC) have complied with SBA guidance and eligibility criteria for firms seeking SSBIC financing.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Small Business Administration | The Administrator, SBA, should resolve the inconsistency between its guidance to SSBIC and SBA examiners as to whether minority status alone is sufficient to establish eligibility. If SBA deems that minority status alone is sufficient to establish eligibility, its should modify Policy Release 2017 to instruct SSBIC to use a composite of factors in determining the eligibility of the businesses they finance, then SBA should instruct examiners to look for such a composite when assessing SSBIC compliance with SBA requirements for documenting and determining eligibility. |
Closed – Implemented
SBA's revision to its policy release number 2017 should clarify for SSBICs and SBA examiners the requirements for determining and documenting the eligibility of businesses receiving SSBIC financial status.
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Topics
Disadvantaged personsEligibility determinationsMinority businessesRecordsSmall business assistanceSmall business investment companiesSmall business loansSmall businessEconomically disadvantagedData errors