FASB Discusses Financial Statements of Not-for-Profit Entities Project
At its meeting on Wednesday, February 25th, the Financial Accounting Standards Board (“FASB”) discussed numerous matters associated with its proposed Accounting Standards Update (ASU) for the financial statements of nonprofits. Decisions made at the meeting included: The tentative definitions for operations in activities and cash flows statements will stay in place, but the FASB will seek additional feedback from the upcoming Exposure Draft regarding whether and how it could possibly further line up the definitions. Unrelated business income taxes or excise taxes made against investment return will not be required to be disclosed. Also, the standard setter eliminated the disclosure. Read More.
Gates Foundation Planning “Strategy Reboot”
Moving on to the next phase of its college completion agenda, the Bill & Melinda Gates Foundation will now shift attention to four major areas of higher education. Outlined in a document dubbed as a “strategy reboot”, the Foundation plans to focus its efforts on data and information, finance and financial aid, college readiness, and innovation and scale. For instance, as mentioned in the document, the Foundation hopes to establish a national data infrastructure that provides consistency in reporting top performance metrics that encompasses every student at all institutions. The new data reporting framework is expected to be released later. Read More.
FASB Proposes Changes to Nonprofit Accounting for Financial Statements
For the first time in two decades, the Financial Accounting Standards Board (“FASB”) is planning to make major changes to nonprofit accounting. Targeting a mid-April release, the FASB is expected to issue a proposal that overhauls how nonprofit organizations such as charities, universities and museums disclose financial information with donors and officials. The proposal would signify the most substantial nonprofit accounting updates since the 1993 publication of Statement of Financial Accounting Standards (SFAS) No. 116, Accounting for Contributions Received and Contributions Made, (FASB ASC 958), and SFAS No. 117, Financial Statements of Not-for-Profit Organizations. In the last few years, nonprofit. Read More.
What Causes Donor Defection?
After researching U.S. and U.K. nonprofits over a three-year period, Roger Craver shares his findings in the new eBook, Retention Fundraising: The New Art and Science of Keeping Your Donors for Life. Discovering why donors stop supporting organizations, he references a Bloomerang infographic that outlines the top eight reasons donors end their support: Donating was no longer affordable; Other organizations were more deserving of support; Poor service or communication; Death of donors; Some organizations never thanked donors for donating; Some donors have no memory of supporting an organization; No information available on how donations were used; and Some thought the. Read More.
AICPA’s Technical Q&A 6140.26 Published
Discussing the election of goodwill amortization as allowed by Accounting Standards Update (ASU) No. 2014-02, the American Institute of Certified Public Accountants’ (“AICPA”) Not-for-Profit Entities Expert Panel has issued Technical Question and Answer (Technical Q&A) Section 6140.26, Not-for-Profit Entity with For-Profit Subsidiary and Adoption of FASB ASU 2014-02 on Goodwill. A result of the work of the Private Company Council, ASU No. 2014-02 provides for-profit, private companies an accounting alternative to amortize goodwill in lieu of annual impairment testing. The TIS considered nonprofits that consolidate for profit entities. Since the accounting alternative is not permissible to nonprofit companies, Technical Q&A. Read More.
IRS Ordered to Release Form 990 in Digital Formats
A judge last week has ordered the Internal Revenue Service (“IRS”) to comply with Public.Resource.org founder Carl Malamud’s request of releasing Form 990 for nonprofits in digital and electronic formats. Filed under the Freedom of Information Act (FOIA), Malamud stated that the formats available on the IRS website were complex. Conversely, the IRS argued scanned versions of Form 990 were sufficient enough, and the agency was unable to fund a format change. The judge, however, sided with Malamud and stated, “The fact that an agency may be under significant financial distress because it is underfunded does not excuse an agency’s. Read More.