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18 Cards in this Set
- Front
- Back
How are NFP's different from commercial orgs? |
1. Resources come from donations 2. Donors often impose restrictions |
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What authoritative body oversees not-for-profit hospitals and universities? Why?
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GASB If they are governmental-related (probably either they service a purpose in the public interest and/or they accept governmental grants ) |
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Why are private non-profit hospitals and colleges like governmental units? |
No owners of net assets (no equity) Definitely not owned or controlled by a govt |
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FASB Statement 116 |
Accounting for Contributions Rec'd/Made Unconditional promises: recognize revenue when promise is made Conditional promises recognized when conditions are met |
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FASB Statement 117 |
FS's of NFP's |
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Voluntary health and welfare org |
Promote public wellbeing Funded by voluntary contributions and some user charges
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Owner-benefit, commercial B-type NFP's (excluded from chapter) |
Employee benefit plans Mutual insurance companies Mutual banks/trusts Farm Co-ops |
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Three classes of NFP Net Assets |
Unrestricted Temporarily restricted Permanently restricted |
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Permanently restricted net assets |
Permanent endowments Certain assets that must be used in certain ways Land, art |
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Temporarily restricted net assets |
Come from contributions with donor-imposed restrictions Specific purpose Temporary ("Term") endowment Socked away to buy a fixed asset |
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Unrestricted net assets |
Unrestricted contributions Service revenues Unrestricted income from investments Donor-restricted cont's satisfied in same reporting period may also be classified as unrstct |
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Financial reporting for Private NFP's |
No fund accounting A/L, Rev/X's are recognized on accrual basis Excess of A>L called "Net Assets," not "Fund Balance" Encumbrances, expenditures, budgetary accounts are not used Depreciation recorded on fixed assets |
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Required Statements for Private NFP's |
(very similar to profit corporations) Statement of Financial Position Statement of Activities Statement of Cash Flows Welfare organizations: +Functional Expenses |
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Private NFP's: Statement of Financial Position |
A,L, Net Assets Assets and Lia's: In order of liquidity/Classified (not necessary to identify restrictions) Net assets: Un, temp, perm
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Private NFP's: Statement of Activities |
Rev/X G/L Reclassifications of net assets Need Org-wide totals Also need broken down by classification of net assets (ALL Expenses are reported as decrease in unrestricted net assets) |
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Private NFP's: Statement of Cash Flows |
Operating, Investing, Financing. Direct or indirect Cash from operating activities: includes contributions (restricted/long-term purpose are classified as financing activities) |
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Health and Welfare Orgs: Statement of Functional Expenses |
Expenses classified by 1. function (programs, fund-raising, etc) 2. nature (salaries, supplies, etc) |
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Private NFP's: Note Disclosures |
1. detail of reclassifications 2. detail of investments 3. breakdown of expenses by function and nature Also: groupings and schedules of conditional and unconditional promises, and allowance for uncollectible pledges receivable |