The Accounting Policy & Practice Report ® provides financial accounting policy makers, advisors, and practitioners with the latest news, expert insights, and guidance on emerging, evolving, and complex accounting issues. Expert News & Commentary.
By Denise Lugo
March 24 — All not-for-profit entities will be required to report all expenses—other than netted investment expenses—by both function and nature, together with an analysis of them, the Financial Accounting Standards Board said.
FASB March 23 said forthcoming rules for nonprofits' financial statements will require them to show all expenses by function and nature in one location, which means all functional expense categories would be broken down by nature of expense type.
Furthermore, the board decided all nonprofits should have flexibility in how they present the analysis of expenses. The analysis can be provided either on the face, in the notes or as a separate statement, FASB said.
The decisions are a change to a portion of what the board proposed about expenses in its April 2015 exposure draft, Not-for-Profit Entities (Topic 958) and Health Care Entities (Topic 954): Presentation of Financial Statements of Not-for-Profit Entities .
FASB's decisions also mean a change in accounting requirements for some nonprofits.
Under the proposal, FASB would have required all operating expenses to be arrayed by function and nature, but its March 23 decision means all expenses are to be arrayed that way.
Some nonprofits already do this today, but it's not a requirement for all. Currently it is only required in a statement format for voluntary health and welfare associations.
To contact the reporter on this story: Denise Lugo in Norwalk, Conn., at email@example.com
To contact the editor responsible for this story: Steven Marcy at firstname.lastname@example.org
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)