Your Partner for Bookkeeping Services and Operational Support
Contact Us: 888-631-8922 

Learn More

What are you interested in learning more about?

×

Wilmington, DE


Understanding the New Accounting Standards for Nonprofits

April 25, 2019 / by Gianluca Santinelli posted in Nonprofits, Wilmington, DE

0 Comments

Change has become a constant in the nonprofit sector. Recently we saw new regulations under the 2017 Tax Cuts and Jobs Act that eliminated certain deductions. The Financial Accounting Standards Board (FASB) has also been hard at work instituting sweeping changes in procedures aimed at reducing complexities while making it easier to understand nonprofit financial information — notably, updates to the accounting standards in 2016 (impacting 2018 financial statements) and in 2018 (impacting 2019 financial statements).

Here's a summary of the most significant revisions.

New Revenue Recognition Standard Focus Clarifies Contributions
You might think that, when it comes to charitable giving, a dollar is a dollar. But in the nonprofit sector, it's important to determine the giver's expectations in providing that dollar. Are the expectations nonreciprocal and unconditional, meaning the nonprofit can spend that full dollar however (and whenever) it sees fit? Or does the giver expect something in return of equal (or "commensurate," in FASB parlance) value, thus an exchange transaction? That return could range from "membership" status to branded merchandise, like a pin or a mug, to funding clinical drug trials, performing public services or conducting scientific research under a grant.

Read More


Subscribe to Email Updates

Download our E-book "What You Need to Know About Cloud Accounting"

Recent Posts