Phase 1 Complete on NFP Financial Statement Project
The Financial Accounting Standards Board is proceeding with a final standard on Phase 1 of the Financial Statements of Not-for-Profit (NFP) Entities project, which is expected to be released by the end of summer. This paper covers the last of the Phase 1 tentative decisions:
- Approval to enhance the operating measure disclosures for those entities volunteering to present such a measure
- Approval to modify the proposed disclosure of qualitative and quantitative information useful in assessing liquidity and availability
- Approval to maintain the current requirement for NFPs to report expenses by their functional classification
- Approval to require NFP entities to report all expenses by nature and function in one location, in the financial statements or footnotes
The amendments are expected to be effective for financial statements with fiscal years beginning after December 15, 2017, and interim statements thereafter. NFP entities will be permitted to early adopt the updates, subject to the retrospective application requirements for all years presented and certain transition guidance.