Not-for-Profit Financial Reporting: Financial StatementsLast updated on June 10, 2013. Please refer to the Current Technical Plan for information about the expected release dates of exposure documents and final standards.
The staff has prepared this summary of Board decisions for information purposes only. Those Board decisions are tentative and do not change current accounting. Official positions of the FASB are determined only after extensive due process and deliberations.
The objective of this project is to reexamine existing standards for financial statement presentation by not-for-profit entities, focusing on improving:
- Net asset classification requirements
- Information provided in financial statements and notes about liquidity, financial performance, and cash flows.
*Decisions Reached at Last Meeting (MAY 29, 2013)
The Board tentatively decided to define an intermediate operating measure on the basis of two key dimensions:
- A mission dimension based on whether resources are from or directed at carrying out a NFP’s purpose for existence.
- An availability dimension based on whether resources are available for current period activities, and reflecting both external limitations and internal actions of a NFP’s governing board.
Before conducting further outreach, the Board directed the staff to explore whether the availability dimension should be limited to resources that are liquid.
The Board also considered three alternatives for presenting an intermediate measure in a NFP’s statement of activities. It tentatively decided to support an alternative that would present all legally available mission related revenues before reductions for amounts designated by the governing board for use in future periods, rather than only the net of those amounts. That presentation also would include amounts of previously unavailable resources that the governing board made available for use in the current period.
The Board also discussed certain implementation matters but concluded that they would be better addressed later in the project. The Board will consider at a future meeting whether the presentation of an intermediate operating measure would be required, permitted, or encouraged.
*Summary of Decisions Reached to Date (May 29, 2013)See “Decisions Reached at Last Meeting” above.
On May 29, 2013, following the Board Meeting on defining an operating measure, an Education Session was held on net asset classifications. Board members discussed rationale underlying the current net asset classes, stakeholder concerns, and plans for revisiting the net asset classes. The Board directed the staff to consider how net asset classes may be aligned with the tentatively decided definition of an operating measure as well as other alternatives. For the project timeline, refer to the technical plan.
*Board/Other Public Meeting Dates
The Board meeting minutes are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions become final only after a formal written ballot to issue a final standard.
|*May 29, 2013||Education Session—Net Asset Classes: Background, Stakeholder Concerns, Plans for Revisiting the Net Asset Classes|
|*May 29, 2013||Board Meeting—Operating Measure: Definition and Presentation|
|*May 15, 2013||Education Session—Operating Measure: Definition (cont.)|
|March 28, 2013||Education Session—Operating Measure: Definition (cont.)|
|January 31, 2013||Education Session—Operating Measure: Background, Objectives, Definition|
|June 6, 2012||Board Meeting—Project Plan|
|May 16, 2012||Education Session—Handout|
|November 9, 2011||Board Meeting—Agenda Announcement|
On November 9, 2011, the FASB chairman announced (press release) the addition of two agenda projects—this standards-setting project and a research project (Not-for-Profit Financial Reporting: Other Financial Communications)—intended to improve financial reporting of not-for-profit entities. The objectives of these projects encompass suggestions received by the Board from its Not-for-Profit Advisory Committee (NAC) at the Committee’s September 2011 meeting. The staff discussed the plans and approach for both projects with the NAC at its March 2012 and September 2012 meetings. The NAC page contains handouts and minutes from those meetings.
Contact InformationLee Klumpp
Ronald J. Bossio
Senior Project Manager
Postgraduate Technical Assistant