This disclosure is easy to overlook but it’s important for proper financial reporting. A related party footnote disclosure is needed when transactions are recorded in the financials between the preparer and related parties. Understanding whom and what is considered a related party will help alleviate missed opportunities in disclosing related party transactions. Per ASC 850 …
Non-profit GAAP accounting practices for auction and raffle donations.
Holding a raffle at a special event is common amongst non-profits. But did you know there are tax implications and responsibilities for the winner and nonprofit organization? Here are a few things to keep in mind as you are preparing to hold a raffle. Nonprofit organizations report raffle prizes to the recipient and IRS on …
The accounting for and the responsibilities relating to endowments can be confusing to nonprofit organizations. Accounting staff, management, and the Finance Committee members should all have the knowledge to be able to ensure endowments are tracked correctly and that the organization is complying with UPMIFA. Here are the top 10 things you should know about …
You have the passion to help and give back to others. You work so hard to get your passion into action and you know that the government offers the opportunity for organizations like yours to gain tax exemption. However, applying for tax-exempt status can be a long and complicated process and it may take months …
The statement of functional expense also referred to by some as a “SOFE”, provides the reader of the financial statement more detail of an entity’s expenses. The SOFE shows the expenses broken down by an expense’s purpose. This statement classifies expenses by its natural expense classification and also its functional expense classification. The natural expense …
What exactly is the fraud triangle and a better question is how does it apply to you? One thing to know about the fraud triangle is that it is designed to help explain why internal fraud occurs. Like most triangles, it has three points that make it what it is. These three components are Opportunity, …
Related party transactions are required to be disclosed in the footnotes of your financial statements. Once you identify who the related parties are, then you need to disclose any transactions between the Organization and those parties. A common example is when the attorney on the board provides services to the Organization for a fee. But …
Taxes relating to 457 plans can be confusing for tax exempt entities. Here are some key points to know: 457b and 457f plans are deferred compensation retirement plans that are offered to a select group of higher compensated or key management employees in a tax exempt entity. Both employees and employers can make contributions to …
Let’s be honest, data management in your organization is probably not the most important step in your nonprofit’s hierarchy of needs. And love it, or hate it, there’s a good chance your organization relies on Excel for many tasks, including data management. Here are three useful tips that may make life inside the spreadsheet a …