Blog Archives: 2016

Big Changes Coming for Financial Reporting of Not-for-Profit Organizations – Part 4: Accounting and Disclosures for Underwater Endowment Funds

Recap

On August 18, 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-14 “Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities.”  ASU 2016-14 requires a number of changes to the financial statements of NFPs.  These changes will be effective for fiscal years beginning on or after December 15, 2017.

This article is the fourth in a series discussing the changes required by ASU 2016-14.  In this article, we discuss new accounting and disclosure requirements for underwater endowment funds. 

Background

Endowments are established funds of cash, securities, or other assets to provide income for an NFP. 

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Washington B&O Tax Alert – Annual B&O Tax Apportionment Reconciliation Due October 31

Taxpayers earning revenue from performing services or from licensing intangibles, and doing business both inside and outside of the State of Washington are required to complete an “Annual Reconciliation of Apportionable Income.”

The form must be submitted to the Department of Revenue by October 31st of each year; failing to file the reconciliation may result in penalties.

The Department of Revenue allows businesses to use the prior year’s apportionment factor for reporting current year liabilities. This simplifies the businesses reporting method but then requires the business to do a true-up at the end of the year to determine the current year’s factor based on actual data.

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IRS Tax Scams Abound – Fake CP2000 Forms

IRS tax scams abound: the IRS and its Security Summit partners issued an alert on September 22 about the most recent scam, this one involving a fake email with a fraudulent CP2000 attachment.  The Treasury Inspector General for Tax Administration has been notified and the issue is under investigation.

The CP2000 notice is a common notice mailed to taxpayers via the U.S. postal service.  It is never sent out via email to taxpayers.  According to the notice, key indicators of a fraudulent CP2000 notice are:

  • These notices are being sent electronically, even though the IRS does not initiate contact with taxpayers by email or through social media platforms
  • The CP 2000 notices appear to be issued from an Austin,

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Big Changes Coming for Financial Reporting of Not-for-Profit Organizations – Part 3: Disclosing Board Designations of Net Assets

Recap

On August 18, 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-14 “Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities.”  ASU 2016-14 requires a number of changes to the financial statements of NFPs.  These changes will be effective for fiscal years beginning on or after December 15, 2017.

This article is the third in a series discussing the changes required by ASU 2016-14.  In this article, we discuss a new requirement to disclose board designations of net assets.

What is Changing?

The FASB noted that one of its goals with this ASU is to improve information about the various internal and external limitations and restrictions on the resources of NFPs. 

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Big Changes Coming for Financial Reporting of Not-for-Profit Organizations – Part 2: Net Asset Classification

Recap

On August 18, 2016, the FASB issued Accounting Standards Update (ASU) No. 2016-14 “Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities.”  ASU 2016-14 requires a number of changes to the financial statements of NFPs.  These changes will be effective for fiscal years beginning on or after December 15, 2017.

This article is the second in a series discussing the changes required by ASU 2016-14.  In this article, we discuss changes to net asset classification.

What is Changing?

For the past 20 years, U.S. GAAP has required NFPs to report net asset balances,

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