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Accounting for Nonprofits: Contributions and Exchange Transactions Under ASU 2018-08 and ASC 606

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Wednesday, June 3, 2020

Recorded event now available

This course will provide nonprofit advisers with a review of the material terms of accounting standards and guidance on accounting for contributions and exchange transactions. The panel will also provide insights and perspectives into facing practical challenges that are not addressed explicitly in the standards.

Description

Revenue recognition standard Accounting Standards Codification (ASC) 606 and clarifications in Accounting Standards Update (ASU) 2018-08, issued by the Financial Accounting Standards Board (FASB), offer guidance for accountants in recording contributions, and distinguishing between reciprocal (exchange) and nonreciprocal (contribution). A contribution must be further classified as unconditional or conditional and classified as unrestricted or restricted. For an exchange transaction, donor stipulated conditions can preclude the recognition of the contribution as revenue. These determinations are critical and not always simple.

With amendments effective in 2019 or 2020, depending on whether contributions are received or made, practitioners are trying to implement the new requirements effectively. Accountants need to understand the new standards to implement the changes effectively. Implementation will depend on how these transactions were classified in the past.

Listen as our panel discusses their approaches and best practices in this vital area of nonprofit accounting.

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Outline

  1. Scope and adoption
  2. Contributions vs. exchange transactions
  3. Contribution accounting under ASU 2018-08
    1. Donor imposed conditions
    2. Donor imposed restrictions
    3. Promise vs. intent
    4. Recognition and disclosure requirements
  4. Exchange transaction accounting under ASC 606
    1. Overview of the 5 step approach
    2. Recognition and disclosure requirements

Benefits

The panel will address issues such as:

  • Determining the differences between contributions and exchange transactions
  • Understanding donor imposed conditions: what are they and how they impact the accounting
  • Understanding the difference between donor imposed conditions and donor imposed restrictions
  • Exchange transaction accounting under ASC 606

Faculty

Duncan, Neely
Neely Duncan, CPA, CFE, FCPA
Partner
BKD

Ms. Duncan has more than 10 years of public accounting auditing experience on a variety of planning, risk assessment,...  |  Read More

Robins, Mark
Mark Robins
Partner
Aronson

Mr. Robins is a director in Aronson’s Nonprofit & Association Services Group. Prior to focusing his...  |  Read More