FASB Exposure Draft Impacts NFPs

March 12, 2020

The Financial Accounting Standards Board (“FASB”) has issued an exposure draft on the Presentation and Disclosures by Not-For-Profit (“NFP”) Entities for Contributed Non-financial Assets. This Board is issuing this proposed update to increase transparency about the types of non-financial assets contributed to NFPs and the ways in which NFPs are valuing and using those contributions.
The proposed amendments would require NFPs to present non-financial assets as a separate line item in the statement of activities. The amendments would require enhanced disclosures regarding the categories of contributed non-financial assets that the organization has received as well as qualitative information on whether the contributed assets were, or are, intended to be monetized or otherwise used by the organization. There will also be additional disclosures regarding the existence of any donor restrictions on the contributed assets and the valuation techniques, and inputs used to arrive at the fair value of the gift in accordance with Topic 820, Fair Value Measurements.
Comments on the proposed standard are due by April 10, 2020, and effective dates will be announced pending issuance of the proposed update. If you have any questions about the exposure draft and the impact on your organization, please reach out to a member of our Cherry Bekaert NFP industry group.