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December 31, 2018 will see significant changes to not-for profit (NFP) financial reporting.  ASU 2016-14, Presentation of Financial Statements of not-for-profit entities will become effective.  It is essential to understand the various aspects of the Accounting Standards Update (ASU).  

The previous reporting requirements for not-for-profit entities fell under the Financial Accounting Standards Board (FASB) Statement of Financial Accounting Standards (FAS) No. 116 and 117, issued in 1993.  In November 2011, the FASB announced two projects intended to improve the financial reporting of not-for-profit entities.   This was the first change to reporting in over 20 years.

In April 2015, an exposure draft was released with the comment period ending in August 2015.

In October 2015, the board split the proposed update into two phases:

  • Phase 1 Included issues that weren’t dependent on other FASB projects and were improvements the FASB believed could be finalized in the near term. 
    • The ASU that was issued in August 2016 includes the items that were included in Phase 1.
  • Phase 2 This phase includes matters that need further consideration as they may be impacted by decisions made in the Financial Performance Reporting project, which the FASB currently has on its agenda.

FASB views ASU 2016-14 as Phase 1—the beginning of guidance to result from its multiyear review of the not-for-profit financial reporting model. There are critical enhancements to the reporting process which all not-for-profit entities should be aware of including:

  • Changes in net asset classification
  • Changes in investment returns
  • Changes in reporting of expenditures
  • Changes in reporting and disclosing liquidity and cash flow
  • Changes to the physical financial statements of the not-for-profit entity.

This course reviews the new requirements and provides examples on how they will impact the not-for-profit financial statements. This particular segment focuses on the changes relevant to net assets and how that impacts financial reporting.  We also explore options available for implementing  requirements. Future segments will focus on the other aspects of ASU 2016-14.

Learning Objectives

  • Explore the history of not-for-profit financial reporting and the evolution to Accounting Standards Update (ASU) 2016-14 - Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities.
  • Explore variances in reporting for not-for-profit entities under Topic 958.
  • Explore changes in reporting of net assets
  • Explore the impact to the statement of financial position (SFP).
  • Explore example formats for the statement of financial position as well as relevant disclosure requirements related to net assets.
Last updated/reviewed: November 4, 2019

4 Reviews (13 ratings)Reviews

4
Anonymous Author
Good course overall with an important subject matter. Thanks for the reminders and tune-up.
4
Anonymous Author
Very helpful. There was quite a bit of information on various footnote disclosures.
5
Member's Profile
This was an excellent overall course for me to do. I love this author.
4
Anonymous Author
Delivery was a bit repetitive but the overall material was important

Prerequisites

Course Complexity: Intermediate

No advanced preparation or prerequisites are required for this course.

Education Provider Information

Company:
Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact:
For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Course Syllabus
INTRODUCTION AND OVERVIEW
  3:27Introduction to ASU-2016-14 Not-for-Profit Financial Statements Part One: Focus on Net assets
  9:28History & Variances in Reporting
  3:15Industry Specific Guidance
  6:14Overview ASU 2016-14 (Topic 958) & Net Assests
  10:53Net Asset Continued...
  12:19Statement of Financial Position (SEP)
  4:06Endowment
  14:01NA Note Disclosures
  2:13Summary
CONTINUOUS PLAY
  1:05:56ASU-2016-14 Not-for-Profit Financial Statements Part One: Focus on Net assets Full Video
SUPPORTING MATERIALS
  PDFSlides: ASU-2016-14 Not-for-Profit Financial Statements Part One: Focus on Net assets
  PDFASU-2016-14 Not-for-Profit Financial Statements Part One: Focus on Net assets Glossary/Index
REVIEW AND TEST
  quizREVIEW QUESTIONS
 examFINAL EXAM