c




O| Includes any nonprofit besides state and local governmental units

Common Traits for ALL not-for-profits

O| All 


their own fixed assets
O| All these NFP͛s M

M

M 
O| All of these carry their own debt
O| ¦easurement focus = 

  



O| All NFP͛s must 

  
O| To be restricted, must be by

  (you can only spend my $$ on such and such͙)


 
Ex: £
  
 

(record as revenue when collected or even pledged)

Cash 100K
Temp restricted revenue 100K

At Y/E, assuming temporarily restricted $ has not been spent

Temp restricted revenue 100K
Net assets- temp restricted 100K [B/S acct]

Upon purchase of intended purpose

Net assets- temp restricted 100K
Net assets- released from restriction 100K [I/S acct]

 
O| £ecord at  and record as revenue 


 


Pledges receivable 500K
Uncollectible allowance 50K
Unrestricted revenue 200K
£estricted revenue 250K


 
Criteria required to book donated services:
O| F¦ can be determined „

O| Skills donated the NFP would have had to pay for otherwise
O| Nonfinancial assets have either been created or enhanced

Salaries and Wage Expense xx

£evenue xx

£  £!M 

1.|
 

 
a.| Total assets ʹ total liabilities
i.| Investments are


 (no distinction between AFS, trading, HT¦)
ii.| Include fixed assets net of depreciation
b.| M"#


i.|  
 $M  
ii.|  
 $   
iii.|  
 $  
c




2.|
   
a.| All revenues (+) any net assets   
 


 (-)
expenses
b.| Focus: What was the  

  in net assets (unrestricted, temp, perm)
c.| Private hospitals divide revenue into 3 categories
i.| 
  M
1.| Patient billings
ii.| c

 M
1.| Educational programs, nursing classes, CP£ classes, cafeteria, parking, vending machines,
gift shop
2.| Includes M 
 
3.| Includes 
M
4.|  

 

iii.| 
   
1.| Unrestricted gifts/bequests/pledges
2.| Gains/losses from the sale of assets
3.| Unrestricted endowment income
4.| Unrestricted interest or dividend income
5.| Term endowments that have expired (can now use principal)

3.|
 %

 (FASB format- DI£ECT ¦ETHOD £EQUI£ED)
a.| Operating Activities
i.| Includes agency transactions
b.| Investing Activities
i.| Includes purchase/sale of works of art
c.| Financing Activity
i.| Includes any contributions that were restricted to the purchase of LT assets

   !M

Does c& have to be recorded if following criteria are met:
1.| Piece is part of a collection
2.| Collection is held for the public͛s benefit
3.| NFP intends to use proceeds, if sold, to purchase additional items for the collection

X
Ë 
  £M
O| Gross revenues @ established rates (do not account for estimated uncollectibles)
O| Less: 3rd party contractual adjustments
O| Less: Charity care provided
O| Equals: Net patient service revenues

'%((%c£c(&£
'
1.| Private NFP Hospitals or health-care entities
a.| Internal reporting ʹ can  MM (funds have ͞net asset positions͟,  ͞fund balances͟)
i.| Only M  M)
M 
 )M  
1.| Day-to-day operations of the hospital
2.| Carries fixed assets, net of AD, in the general fund (differs from governmental)
3.| Carries debt in general fund
4.| Also where hospital carries #
 

 
a.| ¦oney set aside by board for specific program
b.| All interest and dividends can be used for this specific purpose only
i.| ͞Internally restricted͟ ʹ Board can change their minds
ii.| Technically M   for external reporting requirements
c




5.| Agency activities
ii.|   M
1.| Specific Purpose Fund  
 )   
a.| Grants & gifts restricted for 

2.| Plant replacement and expansion fund  
 )   
a.| Gifts & grants restricted for capital additions
3.| Endowment Funds
a.| ͞pure endowment͟ Ë can  M

 


i.|  
 )  
b.| ͞term endowment͟ Ë after a period of time, can spend the principle
i.|  
 )   
2.| % X

a.| %  
 
M )operated as  M**
i.| Follows GASB format for statement of cash flows

%

 
Ëc&M
O| ¦ust back out from patient service revenue if included

£(&'%c

''  ('£ (&('

External reporting Ë Statements of 

 +%

+  

State CollegesË Enterprise fund (must follow GASB)

Statement o activities issues

O| &M 
: scholarships, fellowships, tuition remission (faculty͛s child can attend school for free)
O| £ule: c& 

MM  (washes out)

Scholarship expenditures 100K

£evenue 100K

O| £M" Direct M M

£evenue 50
Cash 50

Statement of Activities divides expenses into 3 categories

1.| 'M


a.| Faculty salaries, research, student services
2.| M
' 
a.| Caf, book store, dorms, athletic programs
3.| M '
a.| H£, management, admin, M


Internal reporting Ë Colleges may use funds


 M, 
1.| Unexpended plant fund
a.| Accumulates the money to acquire fixed assets
b.| î £
  for capital additions (grants, gifts, etc͙)
2.| Investment in plant fund
a.| %


 
b.| %


&$# M#

 
c.| r
  net asset
c




3.| £etirement of indebtedness plant fund
a.| Only purpose is to service debt
b.| Net assets = î £
 
4.| £enewal and replacements plant fund
a.| Accounts for major repairs, maintenance, and refurbishing
b.| Net assets = î £
 
͞Board designated assets͟ = ͞internally designated assets͟ Ë UN£EST£ICTED
O| Carried in the !M
$ fund

M
X


-
c

X-c
O| £ed Cross, United Way
O| Note: Besides governments, schools, hospital Ë This is the ͞default category͟ (churches, labor unions)
O| £equired to follow the FASB for external reporting
O| Can still use fund accounting for internal reporting
O| £EQUI£ED: 4th Statement- ͞The Statement of M 
'͟

HWO Statement of Activities

O| Draws a distinction between   
and


O| £M)Program revenue, membership dues, investment income, fees for services
O| M )Contributions, gifts, bequests, ͞casino night͟ and other special events

HWO Statement of Functional Expenses

O| Divide into 2 types of expenses
O|  
)Expenses to run the program/mission (education, health, etc͙)
O| M  = Fund raising (HUGE), administrative