I, along with Susan Kirsch, Staci Brogan, Jay Meglich and Kim James (as well as over 1,600 other accounting professionals), recently had the opportunity to attend the AICPA’s annual Not-for-Profit Industry Conference. The conference is a three-day intensive CPE course focusing on issues affecting the Not-for-Profit sector, with experts in the field presenting on a wide array of topics. However, one consistent theme that manifested itself throughout the conference was transparency in financial reporting.
The keynote speaker was Jacob Harold, President and CEO of Guidestar, the nonprofit organization that collects, organizes and presents information on nonprofits, most notably the Form 990 filed by all nonprofits. Jacob utilized the term “scaffolding”, with the emphasis that nonprofits need to build a strong set of scaffolding, through strong transparent information reporting, for donors to stand on when making decisions. His presentation really set the overall tone of the conference, particularly about where nonprofits need to focus their financial reporting efforts.
On the horizon, the Financial Accounting Standards Board is in the process of proposing significant changes to not-for-profit financial reporting, allowing for more consistent and transparent reporting among not-for-profits. These changes will represent a shift in financial reporting that aims to make financial statements more understandable to stakeholders and, overall, more comparable among peers in the industry.
Nonprofits also need to be current in the information age, because donors and other stakeholders will begin to demand more transparent and timely information. In conjunction with this, stakeholders are also seeking a connection between an organization’s mission and its financial reporting. Ultimately, nonprofits need to become more perceptive in the way that they report financial information to be successful in the long-term.
The conference was a great way to share ideas and thoughts on these trends in the nonprofit community, and how they will impact nonprofits in both the short and long term.
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