FAR 1B3 SOCF

Question 1

💰 How is a restricted donation received in a prior year reported when used in the current year?

Answer 1

✅ Increase in net assets without donor restrictions
✅ Decrease when the donation is used

Question 2

🏗️ How are contributions restricted for long-term purposes (e.g., PP&E) classified in the SOCF?

Answer 2

✅ Financing activities

Question 3

💵 What are examples of financing activities in an NFP SOCF?

Answer 3

✅ Proceeds from long-term debt
✅ Raising cash through borrowings for long-term purposes

Question 4

🔄 What are examples of operating activities in an NFP SOCF?

Answer 4

✅ Unrestricted cash contributions
✅ Cash paid to employees/suppliers
✅ Cash received from service recipients

Question 5

🔓 How are restrictions met on previously restricted contributions reported in the SOCF?

Answer 5

✅ As “net assets released from restrictions” in the statement of activities
✅ Increase in net assets without donor restrictions

Question 6

🏗️ How is a contribution restricted for long-term purposes (e.g., construction) reported in the SOCF?

Answer 6

✅ As a financing activity

Question 7

💳 How should interest payments be disclosed in an NFP SOCF using the indirect method?

Answer 7

✅ As a supplemental disclosure of cash flow information

Question 8

🏢 How is the purchase of PP&E reported in the NFP SOCF?

Answer 8

✅ As an investing activity