Government & Non-profit Flashcards
which is Fundraising expenses?
1) unsolicited merchandise sent to encourage contributions
2) The printing of the annual report
3) the cost of an audit
Fundraising expenses are incurred to induce contributions.
Of the expenses listed, only the unsolicited merchandise sent to encourage contributions qualifies as fundraising.
The printing of the annual report and the cost of an audit would be reported under supporting services—management and general expenses.
BAE - BAE ( beg and end)
Beg.
Dr. Estimated Revnue control
Dr. Budgetary control ( if negative/deficit)
Cr. Approrpiation control
Cr. Budgetary control ( positive/surplus)
End of the year
Dr. Appropriation control
Dr. Budgetary control(positive)
Cr. estimated revenue control
Cr. Budgetary control (negative)
Government cash flow
Operating activities:
generally result from providing services and producing or delivering goods and all other transactions not defined by other classifications.
Noncapital financing activities: include borrowing for non capital purposes as well as cash receipts from grants or subsidies (e.g. operating grants), property taxes, etc.
Capital and related financing activities:
include acquiring and disposing of capital assets, borrowing money for capital acquisitions and repaying amounts borrowed (including interest) as well as capital grants, special assessments levied for capital acquisitions, etc.
Investing activities:
include making and collecting loans and acquiring and disposing of debt or equity instruments.
Program services
Support services
(non-for-profit)
Program services are the activities for which the organization is chartered.
Support services include everything not classified as program services, including fund raising, administration and membership development
split-interest contribution ( main fund and income from the fund)
recognize contributions to the extent that the fair value of the contribution received exceeds the present value of estimated annuity payments.
contribution = FV of main fund - PV of the annual income
Contribution: major and others in the statement of activities
Generally, the difference between the fair value of dues or other purchases and the amount transferred is classified as a contribution.
When, however, the contributions relate to a major ongoing portion of the operation of the organization, the contribution revenues are displayed gross and the cost of the premium is displayed as a fund-raising expense.
When is donated service recorded as a contribution?
Donated services are recorded as contribution revenue “SOME” of the time:
when a Specialized skill is required,
when the donation is Otherwise needed and purchased and
when Measurable Easily.
Contributions of services are recognized as earnings if the services received either (1) create or enhance non-financial assets, or (2) require specialized skills, are provided by individuals possessing those skills, and would typically need to be purchased if not provided by donation. Both of these conditions are met so the following entry would be made to record the breakage and replacement of the windows:
Debit (Dr) Expense XXX
Credit (Cr) Contributions XXX
Special purpose gov (SELF rule)
A special purpose government is a government that stands by itself:
Separately
Elected
Legally separate
Financially independent
Component units that do not meet the criteria for blended reporting (governing boards of component and primary government are substantially the same or the component unit exclusively serves the primary government) are reported discretely.
Contribution and pledge to contribution
Cash contributions and UNCONDITIONAL pledges are recognized as:
contribution revenue in the year in which the cash or pledge is received.
Non-for-profit financial statements
Statement of financial positions
Statement of Activities
Non-for-profit financial statements
Statement of financial positions
Statement of Activities
Statement of Cashflow
NO statement of functional expense for non-profit
measurement focus of government fund
financial position and
current financial resources
Income focus is for proprietary and fiduciary funds
modified accrual basis” of accounting for a governmental unit, revenues should be recognized
when they become available and measurable.
Multiyear pledges
are recorded at their net present value at the date the pledge is made. Thus, multi-year pledges should be discounted. Multiyear pledges have an implied time restriction and are classified as with donor restrictions.
