1 Introduction .01-.27 Scope .01-.12 Entities .01-.06 Basis of Accounting .07-.
10 Level of Service .11-.12 GAAP for NFPs .13-.19 Fund Accounting and Net Asset Classes .20-.25 Other Resources for Financial Reporting by NFPs .26-.
27 2 General Auditing Considerations .01-.160 Overview .01-.02 Purpose of an Audit of Financial Statements .03-.08 Audit Risk .05-.
08 Terms of Engagement .09-.11 Audit Planning Considerations .12-.70 Group Audits .14-.18 Materiality .19-.
27 Related-Party Transactions .28-.31 Consideration of Errors and Fraud .32-.52 Compliance With Laws and Regulations .53-.67 Processing of Transactions by Service Organizations .68-.
70 Use of Assertions in Assessment of Risks of Material Misstatement .71-.75 Risk Assessment Procedures .76-.99 Risk Assessment Procedures and Related Activities .78-.80 Analytical Procedures .81-.
83 Discussion Among the Audit Team .84 Understanding of the Entity and Its Environment, Including the Entity''s Internal Control .85-.99 Using Risk Assessment to Design Further Audit Procedures .100-.122 Identifying and Assessing the Risks of Material Misstatement .101-.103 Risks That Require Special Audit Consideration .
104-.105 Designing and Performing Further Audit Procedures .106-.121 Evaluating the Sufficiency and Appropriateness of Audit Evidence .122 Evaluation of Misstatements Identified During the Audit .123-.125 Communication With Those Charged With Governance .126-.
132 Completing the Audit .133-.160 Going-Concern Considerations .133-.143 Written Representations .144-.152 Audit Documentation .153-.
160 3 Financial Statements, the Reporting Entity, and General Financial Reporting Matters .01-.202 Introduction .01-.05 Statement of Financial Position .06-.28 Effects of Restrictions, Designations, and Other Limitations on Liquidity .09-.
23 Classification of Net Assets .24-.28 Statement of Activities .29-.45 Reporting Expenses by Nature and Function .44-.45 Statement of Cash Flows .46-.
63 Liquidity and Availability Disclosure .60-.63 Comparative Financial Information .64-.66 Reporting of Related Entities, Including Consolidation .67-.130 Relationships With Another NFP .72-.
80 Relationships With a For-Profit Entity .81-.108 Consolidation of a Special-Purpose Leasing Entity .109-.110 Consolidated Financial Statements .111-.128 Parent-Only and Subsidiary-Only Financial Statements .129 Combined Financial Statements .
130 Mergers and Acquisitions .131-.144 Merger of Not-for-Profit Entities .133-.134 Acquisition by a Not-for-Profit Entity .135-.144 Collaborative Arrangements .145-.
146 The Use of Fair Value Measures .147-.180 Definition of Fair Value .150-.156 Valuation Approaches and Techniques .157-.163 The Fair Value Hierarchy .164-.
167 Additional Guidance for Fair Value Measurement in Special Circumstances .168-.176 Disclosures .177 Fair Value Option .178-.180 Financial Statement Disclosures Not Considered Elsewhere .181-.193 Noncompliance With Donor-Imposed Restrictions .
182-.184 Risks and Uncertainties .185 Subsequent Events .186-.189 Related Party Transactions .190-.193 Auditing .194-.
201 Financial Statement Close Process .195-.196 Operating and Nonoperating Classifications in the Statement of Activities .197 Consolidation .198 Liquidity .199 Mergers and Acquisitions .200 Noncompliance With Donor-Imposed Restrictions .201 Supplement A -- Flowcharts .
202 4 Cash, Cash Equivalents, and Investments .01-.112 Cash and Cash Equivalents .01-.04 Investments Discussed in This Chapter .05-.10 Initial Recognition and Measurement of Investments .11-.
12 Valuation of Investments Subsequent to Acquisition .13-.46 Equity Securities (Other Than Consolidated Subsidiaries and Equity Securities Reported Under the Equity Method) and Debt Securities .17-.19 Investments That Are Accounted for Under the Equity Method or a Fair Value Election .20-.30 Derivative Instruments .31-.
39 Other Investments .40 Decline in Fair Value After the Date of the Financial Statements .41 Fair Value Measurements .42-.46 Investment Income and Expenses .47-.51 Unrealized and Realized Gains and Losses .52-.
55 Investments Held as an Agent .56 Investment Pools .57-.63 Self-Managed Investment Pools .57 Investment Pools Managed by a Financially Interrelated Entity .58 Investment Pools Managed by Third Parties .59-.63 Endowment Funds .
64-.75 Financial Statement Presentation .76-.84 Cash and Cash Equivalents .76-.79 Investments .80-.84 Disclosures .
85-.96 Auditing .97-.111 Endowment Funds .102 Investment Pools .103-.108 Audit Objectives and Procedures .109-.
111 Appendix A -- Determining Fair Value of Alternative Investments .112 5 Contributions Received and Agency Transactions .01-.240 Introduction .01-.04 Distinguishing Contributions From Other Transactions .05-.60 Agency Transactions .
07-.22 Variance Power .23-.27 Financially Interrelated Entities .28-.32 Similar Transactions That Are Revocable, Repayable, or Reciprocal .33-.38 Exchange Transactions .
39-.60 5 Contributions Received and Agency Transactions -- continued Core Recognition and Measurement Principles for Contributions .61-.87 Recognition Principles .62-.73 Measurement Principles .74-.77 Recognition If a Donor Imposes a Condition .
78-.80 Recognition If a Donor Imposes a Restriction .81-.87 Additional Accounting Considerations for Certain Contributions .88-.177 Promises to Give .88-.109 Contributed Services .
110-.115 Special Events .116-.120 Gifts in Kind .121-.147 Contributed Items to Be Sold at Fundraising Events .148-.149 Contributed Fundraising Material, Informational Material, or Advertising, Including Media Time or Space .
150-.161 Contributed Utilities and Use of Long-Lived Assets .162-.164 Guarantees .165-.169 Below-Market Interest Rate Loans .170-.172 Contributed Collection Items .
173 Split-Interest Agreements .174 Administrative Costs of Restricted Contributions .175-.177 Measurement Principles for Contributions Receivable .178-.210 Present Value Techniques .181-.184 Organization of the Measurement Guidance .
185 Initial Measurement .186-.194 Subsequent Measurement .195-.210 Financial Statement Presentation .211-.213 Disclosures .214-.
220 Illustrative Disclosures .220 Auditing .221-.238 Contributions Receivable .235-.237 Agency Transactions .238-.238 Appendix A -- Excerpt From AICPA Financial Reporting White Paper Measurement of Fair Value for Certain Transactions of Not-for-Profit Entities .
239 Appendix B -- Technical Questions and Answers About Financially Interrelated Entities .240 6 Split-Interest Agreements and Beneficial Interests in Trusts .01-.95 Introduction .01 Types of Split-Interest Agreements .02-.03 Recognition and Measurement Principles .04-.
45 Use of Fair Value Measures .05-.06 6 Split-Interest Agreements and Beneficial Interests in Trusts -- continued Recognition of Revocable Agreements .07 Recognition of Irrevocable Agreements .08-.12 Initial Recognition and Measurement of Unconditional Irrevocable Agreements Other Than Pooled Income Funds or Net Income Unitrusts .13-.27 Initial Recognition and Measurement of Pooled Income Funds and Net Income Unitrusts .
28 Recognition and Measurement During the Agreement''s Term for Unconditional Irrevocable Agreements Other Than Pooled Income Funds or Net Income Unitrusts .29-.40 Recognition and Measurement During the Agreement''s Term for Pooled Income Funds and Net Income Unitrusts .41 Recognition Upon Termination of Agreement .42 Purchase of Annuity Contracts to Make Distributions to the Beneficiaries .43-.45 Financial Statement Presentation .46-.
53 Statement of Financial Position .46 Statement of Activities .47 Disclosures .48-.53 Examples of Split-Interest Agreements .54-.87 Charitable Lead Trust .55-.
60 Perpetual Trust Held by a Third Party .61-.65 Charitable Remainder Trust .66-.72 Charitable Gift Annuity .73-.77 Pooled (Life) Income Fund .78-.
82 Life Interest in Real Estate .83-.87 Auditing .88-.93 Appendix A -- Excerpt From AICPA White Paper Measurement of Fair Value for Certain Transactions of Not-for-Profit Entities .94 Appendix B -- Journal Entries .95 7 Other Assets .01-.
48 Introduction .01 Inventory .02-.11 Acting as an Agent in a Sale of Commodities .11 Prepaid Expenses, Deferred Costs, and Similar Items .12-.16 Collections and Works of Art, Historical Treasures, or Similar Assets .17-.
29 Financial Statement Presentation of Collections .26-.28 Illustrative Disclosures About Collections .29 Goodwill .30-.33 Intangible Assets Other Than Goodwill .34-.38 7 Other Assets -- continued Auditing .
39-.48 Inventory .40 Goodwill .41-.42 Collection Items .43-.48 8 Programmatic Investments .01-.
71 Introduction .01-.07 Core Considerations for A.