As not-for-profit organizations adopt the new financial statement presentation changes, they may want to take another look at their accounting for fundraising costs. Not-for-profits have some flexibility when it comes to allocating costs to fundraising efforts.
Topics: not-for-profit, financial statements, fundraising, NFP, Heather Hernandez, program costs, accounting for fundraising, joint cost allocation
As part of our commitment to keeping you informed with the latest regulatory developments, members of our Student Financial Aid Specialty Group recently attended the Department of Education’s Federal Student Aid (FSA) conference in Atlanta, GA. Among many topics discussed during the conference, the following are the key matters higher education institutions need to focus on in the near term.
Topics: not-for-profit, Department of Education, Federal Student Aid administration, single audit, FSA, Federal Student Aid, Perkins Loan, Pell Grant Funds
Several not-for-profit developments emerged during the first part of the year that should be on your organization’s radar: An industry merger could make financial reporting and presentation more important than ever; a not-for-profit employment survey provides a closer look at how the not-for-profit economy is faring; and we have the first indications of tax reform’s impact on charitable giving. The following three stories from the first of the year may affect your 2019 strategic planning.
Topics: not-for-profit, nonprofit, GuideStar, charitable giving, mergers and acquisition, nonprofit merger, employment survey
The Supreme Court made 2018 an incredibly exciting year for state and local taxes. For almost three decades, sales taxes from interstate commerce were controlled by one U.S. Supreme Court ruling: Quill v. North Dakota. In this case, the Court concluded that an out-of-state seller must have physical presence in a state before sales tax collection laws could be imposed. However, on June 21, 2018, that all changed. The U.S. Supreme Court overturned the Quill precedent when it ruled in South Dakota v. Wayfair that physical presence was no longer a requirement.
Topics: Tarra Curran, not-for-profit, nonprofit, Wayfair, South Dakota vs Wayfair
Even though the pace of new standard setting has appeared to have slowed, not-for-profit organizations will have no shortage of accounting considerations in the next year. Entities with fiscal year ends will be implementing the changes to their financial statement presentation for the first time, and all organizations will be tackling changes to contribution and revenue recognition accounting. On the horizon are the changes to the leasing standard, which will require analysis of all existing lease agreements. It’s never too early to start working on accounting changes. Getting a jump start on these and other updates may make year-end reporting significantly easier.
Topics: not-for-profit, Mark Winiarski, Financial Statement
Now is the time for not-for-profit organizations to begin implementing the new changes to their financial statements. Changes issued under the Financial Accounting Standards Board (FASB) Accounting Standards Update 2016-14, Presentation of Financial Statements of Not-for-Profit Entities is effective for calendar year-end entities in 2018, and fiscal year-end entities in 2019.
Topics: not-for-profit, Michelle Spriggs, NFP, nonprofit, Not-for-profit financial statement, Financial Statement
After the first full year under the new tax reform law, one thing is clear: Several tax reform provisions may make tax reporting more difficult for not-for-profit organizations.
The tax law commonly referred to as the Tax Cuts and Jobs Act (TCJA) passed into law quickly, leaving ambiguities about how some of its provisions would be implemented. Not-for-profits received some more clarity at the end of 2018 around how to apply some of the TCJA’s changes, but little in the way of relief. Most organizations should still expect to spend more time with certain segments of tax-related reporting, including quantifying and segmenting their sources of unrelated business income (UBI) and evaluating their qualified transportation fringe benefits.
Topics: Amy O’Loughlin, Not-for-Profits, unrelated business income (UBI), nonprofit, Tax Reform, Tax Cuts and Jobs Act, TCJA, Tax Reform Act, UBI
Low unemployment, strong stock market performances, and increases in corporate profits made 2018 a stellar year for grant-making foundations and charitable trusts. The sector is primarily fueled by private contributions from individuals and corporations, investment returns, and capital asset gains, so when economic conditions are favorable, grant-makers do well, too. And when grant-makers do well, it benefits the not-for-profit organizations that rely on donations, grants, and endowments to support their programming efforts.
Topics: Donations, Endowments, Grants, IBISWorld
Recently, the IRS made several changes to the rules related to hardship withdrawals for not-for-profit organizations. The changes may be adopted by plan sponsors as early as Jan. 1, 2019 or, if later, the first day of the plan year beginning after Dec. 31, 2018.
Topics: not-for-profit, IRS, 403(b), NFP, nonprofit, hardship withdrawals
Data can say a lot about which processes work and which don’t, but with the volume of information a not-for-profit organization is collecting on a daily basis, that message can easily get lost in the shuffle. Robust data analytics programs help to separate the story from all the numbers.
Analytics programs help to do the heavy lifting when it comes to information processing, distilling volumes of data into real time, and actionable insights. When a data analytics program is properly constructed, it can support risk management efforts, budget decisions, and strategic planning. Data analysis helps identify areas of key risk and fraudulent activity. It can be used to evaluate a program’s ability to meet its targets and highlight any inefficiencies. Data analytics can also play a role in donor management, picking up trends in contributions and charitable giving that may not be immediately obvious to a not-for-profit’s board or management team.
Topics: non-for-profit, Non-profits, nonprofit, data analytics, Scott Moody, analytics