General-Purpose Financial Reporting: Nongovernmental Not-for-Profit Entities Flashcards
Whats the difference between Conditional pledge vs unconditional.
Unconditional: No strings attached; recorded as revenue right away.
Conditional: Strings attached; not recorded until conditions are met.
Statement of activities is equivalent to
Income statement.
What is the statement of financial position for
a NPO similar to?
Balance Sheet
What’s the difference between Statement of Financial Position and Statement of Activities
Statement of Fin Pos has Net assets with/without donor restrictions as the equity section
Statement of Activities shows the changes in Net assets both with/without donor restrictions during a period.
Contribution revenue equation
Simplified rules for non profit hospital revenue
NFP Statements and their equivalents
What are the Bases and financial reporting frameworks
What are the NFP Functional expense catagories
Program services are NPOS mission, Supporting services are secondary expenses.
When do you recognize revenue for conditional pledges?
When the pledge is satisfied.
What are examples of Natural vs Functional Classificaions
Voluntary health and welfare NPOs are required to present both.
Whats in the NOP Statement of Cash flows operating section and briefly in the other sections
Net assets with donor restrictions equation
Ongoing central operations must be reported at their ________ amounts. Secondary or peripheral activities may be reported at their ____ amounts on the statement
Gross
Net of revenue and expenses
For NPO hospitals, ______charges related to ______ care must be deducted from gross revenue
For NPO hospitals, service charges related to charity care must be deducted from gross revenue
What is a split interest arrangement
A split-interest arrangement is when a gift is shared between the donor (or someone they choose) and a charity. The donor gets payments for a set time (lead interest), and the charity gets what’s left after (remainder interest).
Why are future pledges/contributions considered restricted even without specific donor restrictions, and how are they classified
Future pledges are restricted because of time restrictions. If the payment is due in more than a year, it’s classified as revenue with donor restrictions until the time restriction is met.
Donations of services are recognized on the statement of activities if either of the 2 conditions are met. What are the 2 conditions
1) Services create or enhance a nonfinancial asset
(e.g., building repairs).
2) Services require specialized skills. (e.g., services from accountants, doctors, or lawyers)
Income from an endowment goes into _________
Net assets without donor restriction. It is not added back to the endowment balance
Watch out for contributed collectibles like antiques or artifacts, these do not go on the financial statements but are __________
Disclosed in the footnotes.
Do quasi-endowments go into assets with donor restrictions?
No. Quasi-endowments are board-designated funds, not donor-restricted. The board controls their use, so they are classified as assets without donor restrictions.
On the Statement of financial position, where does Net assets go?
After Total Liabilities.
Net assets is in the equity position, showing net assets with/without donor restrictions.
What is the starting point for the cash flows from operating activities for a private, not-for-profit entity using the indirect method
