FASB Addresses General Expenditure Questions for Nonprofit Standard
With the 2018 effective date approaching for Accounting Standards Update (“ASU”) No. 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities, a project manager with the Financial Accounting Standards Board’s (“FASB”) research team has advised nonprofit groups not to overthink the concept of “general expenditure.” Addressing concerns over the disclosure of funds for general expenditure at last week’s FASB Not-for-Profit Advisory Committee meeting, Rick Cole said donor restrictions on certain funds would not be exempt from general expenditures. He remarked that many of the illustrations should be taken as they are, not as absolute law. FASB Assistant Director. Read More.
Topics: Accounting Standards Update "ASU", FASB, FASB Nonprofit Standard, FASB Not-for-Profit Advisory Committee, Financial Accounting Standards Board "FASB", Financial Statement Disclosures, Not-for-Profit Entities (Topic 958)
Nonprofits Concerned with Contribution Classifications for Revenue Standard
Several nonprofits are confused over whether to classify a contribution as having a restriction or a condition with respect to the Financial Accounting Standards Board’s (“FASB”) revenue recognition standard. The issue is significant to nonprofits because it impacts the timing of recording the revenue from the contribution, but FASB Assistant Director Jeffrey Mechanick recently cautioned that it will ultimately be in the hands of an organization’s financial report preparers to decide. At last week’s meeting between the FASB and its Not-for-Profit Advisory Committee, Mechanick said due to the amount of judgment in practice, the board is attempting to offer improved. Read More.
FASB Clarifies Donor-Imposed Conditions
During a discussion last Wednesday concerning its project on revenue recognition of grants and contracts by nonprofits, the Financial Accounting Standards Board (“FASB”) agreed to refine guidance under Subtopic 958-605, Not-for-Profit Entities—Revenue Recognition. Specifically, the FASB clarified the definition of a “donor-imposed condition” by including the following: A right of return, involving either a return of assets transferred or a release of a promisor from its responsibility to transfer assets. A barrier that must be overcome before the recipient receives transferred or promised assets. Indicators and illustrative examples would help describe a barrier.
Blackbaud Institute Issues Charitable Giving Report
Blackbaud Institute has released its fifth-annual Charitable Giving Report, which offers the most up-to-date insight and trends on nonprofit fundraising. The latest edition covers how nonprofit fundraising performed in 2016, and includes information on the overall and online fundraising trends, the impact of mobile giving, and how #GivingTuesday shapes year-end fundraising efforts. Download Blackbaud Institute’s Charitable Giving Report here. An email is required for downloading the report.
2016 AP Program Participation Results Released
More students are taking advantage of Advanced Placement courses. According to the 2016 AP Program results from College Board, participation in the program has almost doubled to 1.1 million students since 2006. In that same span, the number of U.S. public high school graduates that passed AP exams increased from 14.3 percent to 21.9 percent. College Board CEO David Coleman contributes the 2016 results to students’ expanded access to the AP Program. More on the 2016 AP Program results is available on Inside Higher Ed.
Modest Gains in Charitable Giving to Colleges
Colleges and universities experienced a modest rise in charitable donations last year. According to an annual report by the Council for Aid to Education, charitable giving to higher institutions in fiscal year 2016 increased from $40.3 billion to $41 billion (1.7 percent). Compared to the growth rate from 2014 to 2015 (7.6 percent), the increase was much less than expected. A significant drop in personal giving is being contributed to the flat growth rate. More on the Council for Aid to Education’s latest report is available at Inside Higher Ed.