GASB issues standard on not-for-profit unit blending

The new statement clarifies display requirements.

A new standard issued by GASB is designed to clarify how certain component units incorporated as not-for-profit corporations should be presented in state or local government financial statements.

GASB Statement No. 80, Blending Requirements for Certain Component Units, requires these component units to be blended into the primary state or local government's financial statements, in a manner similar to a department or activity of the primary government.

The standard was created to clarify the display requirements in GASB Statement No. 14, The Financial Reporting Entity. The guidance is designed to eliminate diversity in practice that has existed in the presentation of not-for-profit corporations in which the primary government is the sole corporate member.

Statement No. 80 applies to a limited number of governmental units, such as public hospitals. It was designed to enhance the comparability of financial statements among those units and improve the value of information for users of state and local government financial statements.

The standard takes effect for reporting periods beginning after June 15, 2016, and GASB encourages earlier application.

SPONSORED REPORT

How the election may affect taxation of business income

This report summarizes recent proposals to reform the U.S. business income tax system and considers the path to enactment of any such legislation.

VIDEO

How to Excel pivot a general ledger

The general ledger is a vast historical data archive of your company's financial activities, including revenue, expenses, adjustments, and account balances. J. Carlton Collins, CPA, shows how to prepare data for, and mine data with, PivotTables.

QUIZ

Did you follow 2016’s biggest accounting news?

CPAs will remember 2016 as a year of new standards and new faces. How well did you follow the biggest accounting events? The 7 questions in this quiz will help you find out