by Blue and Co. CPAs
In 2018, the Financial Accounting Standards Board (FASB) released Accounting Standards Update (ASU) 2018-08, Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made. The effective date of this ASU corresponds to the implementation of ASU 2014-09, Revenue from Contracts with Customers (Topic 606), both of which are effective for fiscal years beginning after December 15, 2018, and interim periods within fiscal years beginning after December 15, 2019. The end of 2019 is quickly approaching, and while most not-for-profit (NFP) organizations have discussed the effects the implementation of these standards will have on the organization’s accounting, now is a good time to revisit both topics to ensure your NFP is properly prepared for implementation.
ASU 2018-08 was released to provide additional guidance for contributions received and contributions made. The two primary objectives of the ASU 2018-08 is to provide assistance to organizations in:
- determining if a donation should be provided as a contribution (nonreciprocal transaction) or as an exchange transaction, and
- determining whether it is a conditional or unconditional contribution.
In this article, we discuss the details of these two areas [READ MORE]
As NFPs will need to exercise reasonable judgement in applying the new requirements listed above, a thorough understanding of these standards will assist in interpreting how the standards apply to the revenue sources within your organization. If you have questions or would like to learn more, please contact Clay Deye or your local Blue & Co. advisor today.