Defining Issues | September 2020

 

Insight

FASB issues new requirements for NFP gifts-in-kind

KPMG reports on enhanced presentation and disclosure for not-for-profits that receive contributed nonfinancial assets.

Lisa Hinkson

Lisa Hinkson

Partner, Dept. of Professional Practice, KPMG US

+1 212-954-6399

Kayla Futch

Kayla Futch

Managing Director, Dept. of Professional Practice, KPMG US

+1 212-954-6455

ASU 2020-07 addresses stakeholders’ concerns regarding lack of transparency about how certain gifts-in-kind are valued and used in an NFP’s programs and activities.

Applicability

ASU 2020-07

  • All not-for-profit entities that receive contributed nonfinancial assets

Relevant dates

Effective  

Annual periods – Fiscal years beginning after     

June 15, 2021

Interim periods – In fiscal years beginning after

June 15, 2022

Early adoption allowed?

Yes

 

Key impacts

  • Contributed nonfinancial assets are presented in a separate line item in the statement of activities – i.e. apart from contributions of cash and other financial assets.
  • The amount of these contributions is disaggregated by type in the notes.
  • For each type, the following is disclosed, if applicable:
    • Qualitative information about whether the contributions were either monetized or used during the reporting period.
    • Description of the programs or other activities in which the contributions were used.
    • Policy about monetizing contributed nonfinancial assets.
    • Donor-imposed restrictions.
    • Valuation techniques and inputs used in the fair value measurement at initial recognition.
    • The principal (or most advantageous) market used in the fair value measurement if it is a market in which the NFP is prohibited by a donor-imposed restriction from selling or using the contributed nonfinancial asset.
  • The amendments apply on a retrospective basis.

Report contents

  • Applicability
  • Key facts and impacts
  • Which gifts-in-kind are in scope?
  • Principal (or most advantageous) market
  • Format of disclosure
  • Effective dates and transition

Subscribe to our newsletter

Receive timely updates on accounting and financial reporting topics from KPMG.

Receive timely updates on accounting and financial reporting topics from KPMG.

ARO

Use our Accounting Research Online for financial reporting resources.

Use our Accounting Research Online for financial reporting resources.