United States

Changes to revenue recognition for not-for-profit organizations


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In May 2014, the Financial Accounting Standards Board (FASB) issued new revenue recognition guidance that will, upon its effective date, replace most pre-existing revenue recognition guidance, including industry-specific guidance, in current U.S. generally accepted accounting principles (GAAP).The new guidance applies to contracts with customers. As such, it only affects the accounting for exchange transactions entered into by not-for-profit organizations that are otherwise within the scope of the new guidance. While only the exchange transactions of not-for-profit organizations will be affected by the new guidance, such organizations should not delay their implementation activities given that the effects of the new guidance could still be significant. In our white paper, Changes to revenue recognition for not-for-profit organizations, we discuss the following topics:

  • Scope
  • Subscriptions and membership dues
  • Tuition and housing fees
  • Assets and liabilities recognized under the new guidance
  • Disclosure requirements

For public entities, the effective date was the quarter and year beginning after December 15, 2017. Public entities include: (a) public business entities, (b) not-for-profit organizations that have issued, or are conduit bond obligors for, securities that are traded, listed or quoted on an exchange or an over-the-counter market and (c) certain employee benefit plans. For all other entities the amendments are effective for annual reporting periods beginning after December 15, 2018, and interim periods thereafter.

Also, for a comprehensive discussion and numerous examples of applying the new guidance, refer to our publication, A guide to revenue recognition.


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