FASB Decisions Regarding NFP Financial Statements Project from March 2 Meeting
The Financial Accounting Standards Board (FASB) continued its Phase 1 deliberations at its March 2nd, 2016 Board Meeting on the proposed FASB Accounting Standards Update (ASU), Not-for-Profit Entities (Topic 958) and Health Care Entities (Topic 954): Presentation of Financial Statements of Not-for-Profit Entities.
Significant Decisions Made at the Board’s March 2016 Meeting:
The proposed ASU would affect substantially all nonprofits as well as creditors, donors, grantors, and others that use their financial statements. AAFCPAs would like to make clients aware of the significant FASB decisions made on March 2:
- Nonprofits will be required to report internal transfers that are a result of board designations, appropriations and similar actions, either on the face of the financial statements or in the notes. Examples will be provided to illustrate different ways to report such information.
- Nonprofits will be required to provide quantitative and qualitative information about financial assets available at the balance sheet date to meet cash flow needs for general expenditures within one year of the balance sheet date. Examples will be provided in the final ASU to illustrate different ways to report such liquidity information.
As a reminder, all of the reported decisions are tentative and may be changed at future Board meetings. It is expected that Phase 1 of the proposed update will be completed and the final ASU, including effective dates, will be issued by mid-June 2016.
AAFCPAs will continue to follow the Board’s deliberations closely. As always, we will keep you informed and provide further updates as they become available.
If you have any additional questions about how the new ASU will impact you, please contact your AAFCPA partner, or Matt Hutt, Partner, CPA, CGMA at 774.512.4043, firstname.lastname@example.org.
Previous FASB Decisions: