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Not-for-profit financial statements

FAR Chapter 5 · Area I · Blueprint I.B

A charity has no owners and no profit to share, so its statements answer a different question: what resources does it have, and what strings did donors attach? The Blueprint asks you to prepare the statement of financial position, the statement of activities and the statement of cash flows for a nongovernmental not-for-profit, and to correct its notes. Most questions come down to one skill: sorting amounts between net assets with donor restrictions and net assets without them.

In this chapter

1. The statements and the two classes of net assets
2. Statement of financial position
3. Statement of activities
4. Releases from restriction
5. Expenses by nature and function
6. Statement of cash flows
7. The notes

This chapter has 7 lessons, 50 practice MCQs with explanations and 10 simulations, plus flashcards and a recall sheet.

What this chapter covers

• Statement of financial position
• statement of activities
• donor restrictions and releases
• expenses by nature and function
• cash flows
• notes

Chapter 4: Consolidated financial statements · Chapter 6: State and local government concepts