Module 22: Not-for-profit Accounting

Question 1

Unrestricted Resources

Answer 1

Unrestricted Resources include all other resources including unrestricted contributions, the net amount from providing services, unrestricted income from investments, etc. Resources are presumed to be unrestricted, unless evidence exists that donor-imposed restrictions exist.

Question 2

Permanently Restricted Resources

Answer 2

Include (1) certain assets, such as artwork, etc. that must be maintained or used in a certain way, and (2) endowments, which represent resources that must be invested permanently with income to be used for either restricted or unrestricted purposes, and land, when that land must be held in perpetuity.

Question 3

Temporary Restricted Resources

Answer 3

Include unexpended resources that are to be used for a particular purpose, at a time in the future, or are to be invested for a period of time (a term endowment).

Question 4

Cash Flow Statement - Non Profit Organizations - Financing Activities

Answer 4

Cash contributions that are donor restricted for long-term purposes are reported as financing activities on the statement of cash flows.

Question 5

Net (Patient) Revenue for a hospital

Answer 5

= Gross Revenue minus charity care and contractual adjustments

Question 6

AICPA Audit and Accounting Guide, Health Care Organizations: Unrealized Gains on Trading Securities

Answer 6

Should be included as part of the amount report for revenue, gains, and other support on the statement of operations. These unrealized gains are included in the performance indicator.