2.0 Not for Profit Non-governmental organizations Flashcards
What is the formula for Contribution revenue
= Fair value of contributions received- Fair value of number of resources given up (given back)
Net Patient Service Revenue (formula)
Gross Patience services (excluding charity care from gross patient
revenue).
(-) Discounts
(-) Contractional adjustments
(-) implicit price concessions
= Net Patient service revenue (Provisions for credit loss reported separately under Operating expenses)
What is considered NET Assets of a Non-Governmentenal not for profit ?
aSSETS - Liabilities = Residual interest
How a donation is recorded - as revenue or liability…
Depends on the donor directives and whether the NPO has the power to redirect the funds to entities of its choosing ( Ie, variance power) .
Statement of financial position (NPO), reports what?
assets , liabilities and net assets
What is a Statement of financial position’s purpose?
It is a financial snapshot of the NPO that provides information about the NPO’s resources and obligations
Net assets are presented as ?
net assets without and with donor restrictions.
Financing activities of (NPO)
represents the cash flow effects of most long-term liability transactions. Inflows include proceeds from loans and outflow of principle payment on loans .
Investing activities of (NPO)
represents the cash flow effects of most long-term asset transactions. Inflows include proceeds from the sale of assets, and outflows include payments or assets purchases
How does GAAP apply to NPO’s
GAAP applies to both for profit entities and not or profit organizations. Under US GAAP, accrual basis accounting is required when preparing financial statements
Over one year of unconditional pledge (NPO), how should it be reported?
A : (by journal entry) pledges receivable valued at their present value.
Nongovernmental not for profit organizations use what type of accounting and flow of what?
use full accrual accounting and the flow of economic resources measurement focus
Term endowments allow what ?
Term endowments allow a portion of the principal to be spent each period.
Regular endowments allow what?
Regular endowment does not allow any of the principal to be spent.
What should be done when a pledge has been made but payment has yet to be received ?
it is a time restricted!
Pledges that have been made can have a receivable, but if not paid until a future date .
