The latest view on not-for-profit accounting issues

Measuring investment values

Most investments held by nonprofit organizations are publicly traded and therefore easily valued at fair value or trading value. But sometimes nonprofit organizations also hold investments where it is not so easy to determine the fair value. One example is alternative investments which by definition do not have a readily determinable fair value (RDFV), meaning …

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What to remember about recording contributions

There are a lot of different aspects to remember about recording contributions. Here is a bullet pointed refresher for you to refer to: Don’t miss: Electronically filing your forms 1023 and 1023EZ Contributions can be restricted for a certain purpose (e.g. to purchase computers) or restricted to a specific time period (e.g., a multi-year promise …

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Electronically filing your forms 1023 and 1023EZ

Organizations that are organized and operated exclusively for charitable, religious, scientific and/or educational purposes must file either a Form 1023 or Form 1023-EZ to obtain recognition of exemption from federal income tax under section 501 (C)(3). The Form 1023 or 1023-EZ must be filed within 27 months of formation to avoid being taxed as a …

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Update on nonprofit accounting for a PPP loan

On May 29, I wrote an article on this topic, which was before official guidance had come out from the FASB. You may think the accounting for PPP funding would be straight forward, but unfortunately, it is not. Here are some questions a nonprofit organization should be asking. What options does a nonprofit organization have …

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When to recognize donated services and how much should you recognize

When most people think of in-kind donations their first thought might be to think of tangible goods. Tangible goods can be things such as vehicles, clothing, books and so on. With a physical transfer of assets, knowing when to recognize the contribution is simple. But what is not quite so simple is recording the other …

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Gifts-in-kind: Presentation and disclosure changes

FASB has issued a proposed Accounting Standards Update intended to increase transparency regarding such contributed nonfinancial assets like gifts-in-kind. As many nonprofit organizations rely on these contributions to carry out their programs and related activities – the following is a brief overview of the changes, and how they may apply to your organization. ASU – …

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How should a nonprofit record their PPP loan?

We need to start out with a disclaimer here. Currently, there is no authoritative guidance on how to account for PPP loans. If you google this topic, you’ll find that there is diversity in thought and approaches. However, there is some unofficial guidance from the Center for Plain English Accounting (CPEA), which is the AICPA’s …

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PPP loans – planning for forgiveness

So you got through the process of obtaining of the PPP loans, now is the time to plan for the amount of your loan forgiveness. There may be things you can do now to maximize that amount. Here are some examples that you may help. Don’t miss: Beware of PPP scams Example #1: The loan …

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COVID-19 – The Importance of maintaining segregation of duties

Work-from-home mandates intended to stop the spread of the COVID-19 virus have many of us in uncharted territories, which is causing us to react and change the way our organizations operate. The coronavirus has forced many organizations to change the way they operate, but there are certain factors that should not be overlooked, such as …

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