All nonprofit entities are encouraged to assess the impact of proposed new accounting rules and submit comments on the pros and cons.
Nonprofits of all types are encouraged to assess the impact of Financial Accounting Standards Board (FASB) Topic 958, the proposed accounting standards update for nonprofits, and submit comments before the August 20, 2015, deadline.
As reported in late April, the proposed standards are considered by many to be the most significant overhaul of nonprofit financial accounting in decades. The update will profoundly impact the way many entities compile and present their financial statements. CliftonLarsonAllen is encouraging all nonprofit entities, including foundations, health care providers, private higher education institutions, associations, membership organizations, and others, to look closely at the impact the proposed standards could have on their processes and people.
See CliftonLarsonAllen's comments on the proposed FASB accounting standards. Download
The overarching question to answer is whether the added cost and effort required by the proposed changes will yield increased value for donors, creditors, board members, and other financial statement users.
FASB wants input on 22 questions
FASB has invited individuals and organizations to comment on all matters related to the proposed update, particularly on issues related to 22 questions covering the statement of financial position and liquidity, the statement of activities, and the statement of cash flows. Answers to these questions and any other commentary can be submitted using an online form, via email, or in a written letter (links and information below).
FASB says comments are most helpful if they identify and clearly explain the issue or question to which they relate. Those who disagree with the proposed guidance are asked to describe suggested alternatives (including ways to increase the expected benefits, minimize complexities, or reduce costs) supported by specific reasoning.
The American Institute of Certified Public Accountants (AICPA) is among those saying that this is a “once-in-a-generation” opportunity for CEOs, CFOs, board members, and others to share their opinions and shape the future of nonprofit finance. In a June 12 article, the AICPA attempts to demystify the comment letter process for individuals who may have never considered commenting on accounting standards.
| Submit Comments on FASB Topic 958 by August 20, 2015 | |
|---|---|
| Online | Use the form on the FASB website: Exposure Documents Open for Comment. |
| director@fasb.org File Reference No. 2015-230 |
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| Written | Technical Director, FASB File Reference No. 2015-230, 401 Merritt 7 PO Box 5116 Norwalk, CT 06856-5116 |
| Read Online Comment Letters | |
How we can help
As chairperson of the AICPA’s Not-for-Profit Expert Panel, Cathy Clarke was one of two signors of the AICPA’s comment letter. Read the comment letter.
CliftonLarsonAllen’s nonprofit professionals will continue to follow these developments, and the firm will submit a formal response before the deadline. We can help you understand what these reporting changes could mean for your organization. Additional information and guidance will be offered as it becomes available.