Changes to Gifts-In-Kind Reporting for Not-for-Profits

On February 10, 2020, the Financial Accounting Standards Board (FASB) issued Proposed Accounting Standards Update (ASU), Not-for-Profit Entities (Topic 958), which is intended to improve transparency for how not-for-profit organizations present and disclose contributed nonfinancial assets. Contributed nonfinancial assets, or gifts-in-kind, include things like land, buildings, equipment, materials, supplies, intangible assets, and services. The proposed ASU is meant to address concerns about the lack of transparency regarding the value of gifts-in-kind received by not-for-profits, as well as the amount of those contributions used in their programs and activities.

The proposed ASU would require not-for-profits that receive gifts-in-kind to present them as a separate line on the statement of activities, distinct from other types of contributions. It would also require those organizations to disclose the following:

  1. Contributed nonfinancial assets received disaggregated by category that depicts the type of contributed nonfinancial assets
  2. For each category of contributed nonfinancial assets received (as identified above):
  3. Qualitative information about whether the contributed nonfinancial assets were or are intended to be either monetized or utilized during the reporting period and future periods. If utilized, a description of the programs or other activities in which those assets were or are intended to be used.
  4. A description of any donor restrictions associated with the contributed nonfinancial assets.
  5. The valuation techniques and inputs used to arrive at a fair value measure, including the principal market (or most advantageous market), if significant, in accordance with the requirements in Topic 820, Fair Value Measurement.

The amendments in this proposed ASU would be applied on a retrospective basis to the first set of financial statements following the effective date, which has not yet been determined. Comments on the proposed ASU are due to the FASB by April 10, 2020. To read the entire Proposed ASU, visit the link below:

You’ve heard our thoughts… We’d like to hear yours

The Schneider Downs Our Thoughts On blog exists to create a dialogue on issues that are important to organizations and individuals. While we enjoy sharing our ideas and insights, we’re especially interested in what you may have to say. If you have a question or a comment about this article – or any article from the Our Thoughts On blog – we hope you’ll share it with us. After all, a dialogue is an exchange of ideas, and we’d like to hear from you. Email us at [email protected].

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

© 2022 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

our thoughts on
IRS Revises Form 1024: Application for Exempt Organizations
457(b) Plans – What You Should Know
Donor Information Disclosure Requirements
ASC 842, Leases – ASU 2021-09 Provides Additional Guidance on Use of Risk-Free Rate and Required Disclosures for Non-Public Entities
IRS Joins Forces to Combat Fraud Against Charitable Organizations
Tax-Exempt Organizations Must Notify IRS of Responsible Party Changes
Register to receive our weekly newsletter with our most recent columns and insights.
Have a question? Ask us!

We’d love to hear from you. Drop us a note, and we’ll respond to you as quickly as possible.

Ask us
contact us

This site uses cookies to ensure that we give you the best user experience. Cookies assist in navigation, analyzing traffic and in our marketing efforts as described in our Privacy Policy.