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Our firm specializes in providing the
not-for-profit community with audit, accounting and tax services. We have more than 20 years of experience
servicing the needs of 501(c)(3) organizations, including consulting and management review.
FASB 116 and
117
Perhaps the two most important accounting
treatises ever issued by the Financial Accounting Standards Board for
not-for-profit entities are Statements 116 and 117, which deal with Contributions
Received and Contributions Made and Financial Statements of
Not-for-Profit Organizations, respectively. Our firm has assisted numerous nonprofit
institutions in implementing these two important FASB statements. We understand the many subtle nuances
contained in the documents. We meet
with our clients and answer questions pertaining to the issues contained in
these accounting pronouncements and how they affect ongoing operations
not-for-profit enterprises. During the
course of our audits, we perform audit procedures to ensure proper compliance
with FASB Statements 116 and 117.
FASB 124
 In 1995,
the Financial Accounting Standards Board (FASB) signed into law another
accounting pronouncement affecting nonprofit organizations. Statement of Financial Accounting Standards
Number 124 requires not-for-profit enterprises to report investments in
equity securities with readily determinable fair values and all investments
in debt securities in the statement of financial position at fair value and
report realized and unrealized gains and losses in the statement of
activities and changes in net assets.
Our staff is well versed in the
requirements of Generally Accepted Governmental Auditing Standards, including
the various Single Audit provisions.
GAGAS and OMB Circular A-133
 In
response to the increase in the number and dollar amount of governmental
programs and services, governmental auditing standards - as from time to time
established by the U.S. General Accounting Office (GAO) - were revised in
1981 and 1988. Many changes continue
to occur to the governmental environment, leading to a demand for increased
accountability by those entrusted with public funds. To ensure that standards remain current and
meet the needs of the audit community and the public, the GAO revised the
auditing standards again in June 1994.
In June 1999, the Governmental Accounting Standards Board lifted the
curtain on its long-awaited new framework for state and local government
financial statements. In October 2000, GASB issued Statement 34 summarizing
new reporting standards.
The current GASB standard came into
effect for larger governments ($100 million plus in revenues) in fiscal years
beginning after June 15, 2001. Medium-sized governments (between $10 and $100
million in revenue) were impacted beginning after June 15, 2002 and smaller
governments (under $10 million in revenue) were impacted beginning after June
15, 2003.
The official title of the latest revision
is Government Auditing Standards, and, in keeping with the tradition that has
led to its informal name, it is also dressed in a yellow cover. The updated
revision represents a significant reversal of what the GAO wanted to do with
the document. The GAO (as can be seen in the public statements of Comptroller
General Charles Bowsher and Chief Accountant Donald Chapin) believes strongly
in the importance of effective internal control systems - especially those
related to safeguarding of assets and compliance with laws and regulations -
where U.S.
government funds are involved. The GAO initially sought to expand generally
accepted governmental auditing standards (GAGAS), to include more emphasis on
internal control testing and reporting than is now required by AICPA GAAS.
For example the exposure draft would have required auditors to perform
procedures separately for the control environment and the control procedures
for safeguarding assets considered vulnerable to loss or misappropriation.
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