For the first time in 22 years FASB is making changes to the nonprofit accounting standards. These changes must be implemented with years beginning in 2018. This is only one year from now, so organizations should begin to strategize how these changes will impact the organization.
These are the four major changes:
- Net asset classification will now be "with donor restrictions" or "without donor restrictions". The previously used "unrestricted", "temporarily restricted", and "permanently restricted" classifications will no longer be allowed.
- All nonprofit organizations will be required to present expenses by function and nature. Previously this was only mandatory for health and welfare organizations.
- Qualitative and Quantitative disclosure regarding liquidity of assets, and the availability of assets to meet the cash needs for general expenses one year out.
- Investment expenses must be netted against investment revenues, instead of being show separately in expenses.
Here are a few articles with additional information