FASB Continues Deliberations On Not-for-Profit Financial Statements

May 14, 2014 FASB Board Meeting



Financial Statements of Not-for-Profit Entities. The Board continued its deliberations about the presentation and disclosure of investment expenses and an intermediate measure of operations in light of the results of staff outreach with stakeholders of foundations and health care entities. The Board decided that:

  1. All not-for-profit (NFP) entities would be required to disclose identifiable, direct external investment expenses and the amount of direct internal investment expenses incurred during the period.
  2. An NFP business-oriented health care entity would be required to present an intermediate measure of operations as previously defined by the Board in this project. Those entities would have the option of also presenting the performance indicator that is currently required by paragraph 954-225-45-4. As a result of this decision, all NFP entities including health care entities would be required to present the same intermediate measure of operations.

Health Care Reform Employer Mandate Extended

congressThe Department of Treasury announced late on July 2 that enforcement of the Affordable Care Act employer mandate, which requires employers with more than 50 full-time employees to provide affordable health insurance coverage or pay defined penalties, will be delayed from its original deadline of January 1, 2014, until January 1, 2015. Visit http://www.eidebailly.com for additional information.

Health Care Reform Strategy

HealthcareReformThe Patient Protection and Affordable Care Act (Health Care Reform) affects all businesses. However, employers with 50 or more full-time employees will be required to make some significant decisions regarding their options. These options include providing affordable health insurance to all employees, electing not to provide health insurance, or developing a hybrid plan.

Multiple factors should be considered before making a decision to retain or discontinue employer-sponsored health  insurance coverage. Some of those factors include the current and future costs of providing coverage, the impact the decision may have on employee acquisition and retention, comparisons to other organizations, and the alternative uses of potential cost savings.

New regulations and changes to Health Care Reform are likely to be issued as the process moves forward. However, organizations should be prepared for the January 1, 2014 implementation date. The decisions made by an organization could have a significant financial impact. While considering health insurance changes, organizations should identify someone to monitor the relevant issues and impact of Health Care Reform, follow what is happening with the creation and organization of federal and state health care exchanges, and review employee benefit plan design and options.