Financial Statement Presentation By Not-For-Profit Organizations

ASNPO 4400

Financial Statement Presentation By Not-For-Profit Organizations

Definition
  • Fund accounting
    • Fund accounting is when a NPO establishes a fund, whereby each fund has a collection of assets, liabilities, net assets, revenues, and expenses that self-balance
    • For example, a separate funds may be set up for different activities (i.e. fundraising, food bank, homeless shelter, etc.)
    • Fund accounting is optional
Financial Statements
  • A not-for-profit organization include the following financial statements
    • a statement of financial position
    • a statement of operations
    • a statement of changes in net assets; and
    • a statement of cash flows
Fund Accounting
  • An NPO that uses fund accounting should provide a brief description of the purpose of each fund
  • Financial statements that are reported using fund accounting may follow a multi-column format
  • Example
  •  Fund #1Fund #2Total
    Assets   
    Liabilities   
    Net Assets   
  • Interfund transfers should be presented in the statement of changes in net assets and disclose the amount and purpose of the Interfund transfers
  • Inter-fund loans outstanding are disclosed

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