Slight Correction Proposed to New Nonprofit Accounting Guidance
Following its October 19 meeting on approved technical corrections to the U.S. GAAP, the Financial Accounting Standards Board (“FASB”) is proposing a slight change to Accounting Standards Update (“ASU”) No. 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities. In the proposed ASU, Technical Correction to Update No. 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities – Endowment Reporting, the FASB seeks to remove the phrase “that contain no purpose restrictions” from paragraph 958-205-50-1B(e)(3) of its August-issued accounting standard. The amendment would help clarify the requirements for nonprofits to disclose endowment funds, as well as restore the correct guidance that was changed by the amendments in ASU No. 2016-14.
Comments on the proposal are due Friday November 11.