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On September 17, the Financial Accounting Standards Board (FASB) released Accounting Standards Update 2020-07, Presentation and Disclosures by Not-for-Profit Entities for Contributed Nonfinancial Assets.

The ASU culminates a project undertaken because of stakeholder concern over the lack of transparency for in-kind gifts relied upon by many not-for-profit (NFP) entities. Consequently, the ASU requires an NFP to present contributed nonfinancial assets as a separate line item in the statement of activities (SOA), apart from contributions of cash or other financial assets and additional quantitative and qualitative disclosures.  

Concerning disclosures, the ASU requires an NFP to disaggregate the non-financial gift, presented in the SOA, by asset category and disclose—

  • Category type and corresponding asset value
  • Various qualitative factors that address—
    • Whether the asset was monetized or used, and if used:
      • a description of the programs or services that used the asset
      • the valuation techniques used to value the asset, including the principal market used to arrive at a fair value measure
    • If monetized, information about the reporting entity’s monetization policy
    • A description of any donor-imposed restrictions

The ASU guidance should be applied retroactively in the FY22 reporting period (years beginning after June 15, 2021) for most NFP colleges and universities. Early adoption is permitted. Because many NFP colleges and universities monetize gifts of nonfinancial assets, institutions may want to revisit their policies and be aware of retroactive reporting requirements that begin next fiscal year.


Sue Menditto

Senior Director, Accounting Policy


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