Government and Not For Profit Accounting: Concepts and Practices, 6th Edition

LEARNING OBJECTIVES

After studying this chapter you should understand:

• Which standard-setting authorities are responsible for not-for-profit organizations
• How and why the financial statements of not-for-profits divide all resources into three categories (unrestricted, temporarily restricted, and permanently restricted) based on donor stipulations
• How not-for-profits report cash flows
• How contributions are distinguished from exchange transactions
• The general rules governing the recognition of contributions
• How pledges, both unrestricted and restricted, are accounted for
• When contributions of services should be recognized as revenue
• When collection items should be recognized as revenue
• The special issues pertaining to conditional promises to give
• How pass-through contributions are accounted for
• How and when gains and losses on investments should be recognized
• How capital assets should be depreciated and reported
• The special problems of determining the cost of fund-raising activities
• What factors should be taken into account in assessing the financial condition of not-for-profits

Governments and not-for-profit organizations confront similar accounting and reporting issues. However, they do not necessarily resolve them alike. Differences in standards can be partly explained—and indeed, justified—by differences in the entities' characteristics and resultant differences in constituents' ...