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FASB Nonprofit Consolidation Guidance Changes Proposed

Seeking to clarify consolidation guidance for nonprofits with respect to the effective date of Accounting Standards Update (“ASU”) No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis, the Financial Accounting Standards Board (“FASB”) has issued the proposed ASU, Not-for-Profit Entities – Consolidation (Subtopic 958-810): Clarifying When a Not-for-Profit Entity That Is a General Partner Should Consolidate a For-Profit Limited Partnership or Similar Entity. The proposed amendments would retain the consolidation guidance under Subtopic 810-20 by adding it to Subtopic 958-10. Per the proposal, nonprofits acting as general partners will continue to be assumed to oversee a for-profit limited partnership. Read More.

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FASB Discusses Nonprofit Partner Consolidation Guidance

During its meeting on March 30th, the Financial Accounting Standards Board (“FASB”) discussed its project on clarifying when a nonprofit general partner should consolidate a for-profit limited partnership or similar entity. Topics covered included outreach performed on potential alternatives, the transition method and whether the FASB should draft a proposed Accounting Standards Update (ASU). As a result of the discussions, the FASB reached the following decisions: The current practice for nonprofit general partners was preserved by reinstating the consolidation guidance that existed in Subtopic 810-20, Consolidation—Control of Partnerships and Similar Entities, and adding it to Subtopic 958-810, Not-for-Profit Entities—Consolidation. Because. Read More.

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