FASB’s First Steps in Revising NPO Financial Reporting

FASB-logoAt its meeting on May 29, the FASB made a tentative decision to define intermediate operating measures in the financial statements of non-profits. It decided on two key dimensions – mission and availability. Expenditures related to mission and donated money currently available would be included in its operating measure. Donations subject to donor restrictions would not be counted. However, the Board also determined they would look more closely at the definition of “currently available” to determine whether the availability dimension should be limited to liquid resources.

The FASB is also considering whether to allow non-profits to write commentary in their financial statements, similar to the management discussion and analysis section in SEC filings.

FASB plans to release a proposal for public comment about the same time it releases its potential changes to the presentation of non-profit financial statements.

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