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The Latest FASB Accounting Standards: “How Do I Characterize Thee? Let Me Count the Ways: Fish or Fowl; Reciprocal or Nonreciprocal; Conditional or Unconditional?”

There have been a lot of changes in the accounting practices for nonprofits over the past couple of years. It’s not really surprising, because it has been 25 years since the Financial Accounting Standards Board (FASB) has made major updates to generally accepted accounting principles (GAAP) for nonprofits. The recent changes began with Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers (Topic 606), which modified the timing and methods nonprofits use to recognize revenues generated through contracts. ASU 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities, which goes into effect this year (“for annual financial statements issued for fiscal years beginning after December 15, 2017”), revises several accounting practices. It changes the classification of net assets from unrestricted, temporarily restricted, or permanently restricted to net assets without donor restrictions and net assets with donor restrictions; increases disclosure requirements, including those related to asset liquidity; and requires that expenses be presented by function.


What Are the New Significant Changes Required by FASB for Nonprofit Financial Statements?

Q & A with Rick Cole, Supervising Project Manager, FASB

Nonprofits need to be aware of changes to accounting standards issued by the Financial Accounting Standards Board (FASB) because those standards will play a significant role in how the nonprofit prepares its financial statements and how people view the nonprofit’s financial health through its financial statements.


Unrelated Business Income Tax: What Your Organization Should Know

Most organizations exempt from tax under Internal Revenue Code (“IRC”) Section 501(a), including charitable, religious, scientific, and other organizations described in IRC Section 501(c), may be subject to tax on unrelated business income (UBIT), depending on the nature of the activities producing that income. It is important for an organization to distinguish between its tax-exempt purpose and its business activities.


Nonprofit Finance Study Reveals Compliance, People, and Process Complexities

Nonprofit finance and accounting can be tricky business. First of all—serving as a responsible steward of money coming in from a multitude of sources with diverse demands is a huge challenge. Then, rules and regulations are in constant flux. Compliance is becoming increasingly complex and burdensome. Fraud is a potential risk lurking around every corner. And, oh yeah. There’s the seemingly never-ending stresses associated with audit planning and prep. 


FASB Modifies Not-for-Profit Accounting Rules

FASB [Financial Accounting Standards Board] issued a new accounting standard Thursday [August 18, 2016] that is designed to help not-for-profits tell their stories through their financial statements.

Not-for-profit financial statements have been prepared under FASB's current guidance since 1993. The new standard changes presentation and disclosure requirements with the intention of helping not-for-profits provide more relevant information about their resources—and the changes in those resources—to donors, grantors, creditors, and other financial statement users.


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