F6

Question 1

Accounting rules for NFP

Answer 1

• come from FASB Accounting Standards Codification (ASC)

Question 2

Required FS for NFP

Answer 2

• statement of financial position
• statement of activities
• statement of cash flows
• info about - relationships between functional and natural expense classifications (either on the face of FS OR as a schedule in the notes to FS OR in a separate FS)

Question 3

Internal board designated funds are classified as

Answer 3

• net assets without donor restrictions

Question 4

Functional expense categories

Answer 4

• Program services - represent major activities of the organization performed in furtherance of the organizations mission
• Support services - represent admin type functions within the org (not directly related to business mission, ex: fundraising, admin, membership)

Question 5

Fundraising expenses are incurred to

Answer 5

• induce contributions

Question 6

FASB accounting standards codification for Financial Statements of Not-for-Profit Organizations, primarily focuses on

Answer 6

• basic information for the organization as a whole

Question 7

A not-for-profit organization needs to report its expenses

Answer 7

• in the statement of activities by their functional classification (program classification, supporting activities, fund-raising, etc.) and disclose the expenses in a natural classification by function in the notes to the financial statements

Question 8

Stmt of financial position

Answer 8

• Assets
• Liabilities
• Net assets (equity)

Question 9

Operating expenses are decreases in

Answer 9

• net assets without donor restrictions. Operating expenses are listed separately under “Expenses and Losses” in the Statement of Activities

Question 10

Statement of cash flows

Answer 10

• operating activities
• investing activities
• financing activities
• with direct or indirect presentation allowed for reporting operating activities

Question 11

Contributions of rev without donor restrictions that are board-designated for future construction or purchase of long-lived assets are

Answer 11

• classified as an operating activity on SCOF

Question 12

Sources and uses of cash classified as operating activities for a not-for-profit include items such as

Answer 12

• charitable contributions and disbursements. Grants paid are disbursements and reported within the operating activities section

Question 13

Investing activities in the statement of cash flows should include proceeds from the

Answer 13

• sale of long lived assets, art, or insurance proceeds associated with the loss of long lived assets