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FASB proposes standards for not-for-profit statements.

The Financial Accounting Standards Board issued a proposal that would establish standards for financial statements issued by not-forprofit organizations. The comment deadline on the exposure draft is February 19, 1993. Public hearings will be held February 25 and 26 at the board's headquarters in Norwalk, Connecticut.

According to the FASB, not-forprofit organizations' reporting practices differ widely in form and content. The proposal, if approved as a final statement, would enhance the relevance, understandability and comparability of their financial statements.

The proposal requires not-forprofit organizations to report the amounts of their total assets, liabilities and net assets in a statement of financial position; the changes in their net assets in a statement of activities; as well as the changes in their cash and cash equivalents in a statement of cash flows.

The proposal also requires classification of net assets and revenues, expenses, gains and losses based on the existence or absence of donor-imposed restrictions. The amounts for each of three classes of net assets--permanently restricted, temporarily restricted and unrestricted--must be displayed in the financial position statement and the amounts of change in each class must be shown in the activities statement.

If adopted, the proposal would be effective for financial statements issued for fiscal years beginning after December 15, 1994.

Copies of the proposal are available free of charge until February 19, 1993, by contacting the FASB Order Department, 410 Merritt 7, P.O. Box 5116, Norwalk, Connecticut 06856-5116.
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Author:Baliga, Wayne
Publication:Journal of Accountancy
Article Type:Brief Article
Date:Jan 1, 1993
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