COFAR Updates Frequently Asked Questions Document on Uniform Guidance
The Council on Financial Assistance Reform has issued a revised frequently asked questions (“FAQs”) document on the Office Management and Budget’s (“OMB”) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards at 2 CFR 200. Updated as of July 2017, the document features 24 new FAQs and four revised FAQs. Download the new FAQs document on OMB’s Uniform Guidance at 2 CFR 200 here.
FASB Grant Accounting Proposal Issued
The Financial Accounting Standards Board (“FASB”) is proposing new guidance for contributions made or received by organizations, especially nonprofits. The proposed Accounting Standards Update (“ASU”) will help decide whether an organization’s transactions are treated as either a contribution or an exchange. This would be achieved by clarifying guidance on assessing whether a resource provider receives value in exchange for the transferred resources. The proposal also provides an improved framework that helps organizations decide whether a contribution is conditional or unconditional. In addition, the proposed amendments help distinguish between a donor-imposed condition and a donor-imposed restriction. Transfers of assets from a. Read More.
AICPA Advises Nonprofits on Financial Reporting Model Changes
In the first of a two-part blog series on its website, the American Institute of Certified Public Accountants (“AICPA”) discusses the upcoming changes to the nonprofit financial reporting model. The changes are part of the Financial Accounting Standards Board’s Accounting Standards Update No. 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities, which affects certain line items on nonprofits’ financial statements. The blog series’ first installment features suggestions on an organization’s chart of account modifications in five areas: liquidity, net assets, investment return, statement of cash flows and expense reporting. To read part one of the blog series, visit AICPA.org.
Study Cautions Nonprofits on Barriers to Growth
If you’re a nonprofit seeking future growth, a new study has identified several issues that your organization must consider. According to the Abila Nonprofit Finance Study, nonprofits should factor in potential difficulties dealing with personnel and risk management, an increased burden on administrative duties, and compliance matters. Of course, nonprofits, such as Make A Stand, that did not prepare for these issues fell short in their organizational growth efforts. More on the Abila Nonprofit Finance Study is available on the Nonprofit Quarterly website.
Gift Acceptance Policy Tips for Nonprofits
In a recent blog on the American Institute of Certified Public Accountants’ (“AICPA”) website, Foundation of the Carolinas Vice President Alyssa Federico shares her insights on developing a gift acceptance policy for a nonprofit organization. According to Federico, a well-developed policy can protect a nonprofit from potential risks and educate staff members on when to decline gifts. Some of the guidance Federico outlines concerns handling non-cash gifts, the process for deciding whether or not to accept a gift, and determining what is required prior to acceptance. Federico’s blog can be read in its entirety on the AICPA website.
Forthcoming Revenue Standard Proposal to Help Nonprofits
New Financial Accounting Standards Board (“FASB”) guidance could make it easier for nonprofits to record revenue from grants and donations with restrictions. On June 7, the FASB unanimously agreed on a proposal to help nonprofits differentiate between a condition and a restriction in U.S. GAAP for received grants and donations. Accounting Standards Update No. 2014-09, Revenue From Contracts With Customers (Topic 606) removed guidance on “exchange” transactions. Furthermore, many nonprofit organizations have had trouble distinguishing between a condition and restrictions. To address the matter, the FASB will clarify that when a gift comes with a donor-imposed condition, the agreement must. Read More.
Topics: Accounting Standards Update "ASU", Charitable Giving, FASB, Financial Accounting Standards Board "FASB", Nonprofits, Revenue from Contracts with Customers (Topic 606), Revenue Recognition, U.S. GAAP