Defining Issues | January 2017
FASB restores NFP general partners’ control presumption
KPMG reports on the FASB’s ASU 2017-02, which amends ASU 2015-02. The amendments clarify the consolidation guidance for NFPs (ASC 958-810).
Applicability
- A not-for-profit entity
Relevant dates
Mandatory effective dates and early adoption provisions:
Effective date:
Annual periods – fiscal years beginning after
Interim periods – fiscal years beginning after
Early adoption permitted?
Not-for-profit entities
Dec. 15, 2016
Dec. 15, 2017
Immediately
Key impacts
- The FASB has restored the pre-ASU 2015-02 consolidation guidance related to partnerships and similar entities that are not variable interest entities (VIEs)
- NFPs that are general partners are, once again, presumed to control a limited partnership (regardless of the extent of their ownership interest) unless the limited partners have substantive participating or kick-out rights
- The consolidation guidance under ASU 2015-02 does not apply to an NFP that invests in a for-profit limited partnership or similar legal entity if the partnership interest is reported at fair value under other US GAAP
Podcast
- Listen to KPMG’s podcast here
Report contents
- Implementation for NFPs (have adopted ASU 2015-02 vs. have not)
- Impact on NFP general partners of for-profit limited partnerships and similar entities
Receive timely updates on accounting and financial reporting topics from KPMG.
Receive timely updates on accounting and financial reporting topics from KPMG.
Sign up now