Preparing financial statements for not-for-profit entities under SFAS No. 117. (Statement of Financial Accounting Standards)

Ohio CPA Journal, The, April, 1996 by Clark, Stanley J.; Jordan, Charles E.

Until recently, not-for-profit organizations exhibited great inconsistencies in preparing and presenting financial statements. For example, hospitals reported on the entity as a whole while colleges reported primarily upon subcomponents of the entity (i.e., fund reporting). With SFAS No. 117, the FASB eliminated most of these reporting inconsistencies by requiring all not-for-profit entities to prepare financial statements similar to those of business enterprises. This article illustrates the new reporting requirements under SFAS No. 117. (Reprinted by permission of the publisher.)

The financial goals of not-for-profit organizations (NPOs) vary widely. As such, accounting standards developed to meet the needs of diverse groups have resulted in noncomparability of financial...

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