- June 8, 2018
- Posted by: Jelena Subasic
- Category: Intacct, Nonprofit
Nonprofits need to be ready now for the new FASB-ASU 2016-14 deadlines fast approaching. These guidelines, years in the making, are designed to provide greater clarity, consistency, and transparency to stakeholders about your financials. Are your teams prepared for the change?
Beginning with the fiscal year 2018, nonprofits will see improvements to direct and indirect reconciliation hurdles, period expense inconsistencies, lack of transparency, and net asset classifications.
Preparation for these guidelines, rolling out in 2 phases, will mean adjustments in how your nonprofit sets up your financial statements going forward. Net asset classes will go from 3 classes – unrestricted, temporarily restricted, and permanently restricted, to two, being: “with donor restrictions” and “without donor restrictions.”
Also, you will need to provide greater transparency with regard to assets – both net assets, and total net assets. You will need to show how the assets changed, and current net presentation on the face of the balance sheet reflecting expenses, both internal and external.
While the change will offer better insight into the way you handle assets, it will require that you modify how you keep track of, and disclose your financial data.
This will likely result in a big draw against your time and resources if you’re currently working a from static, on-premises financial management system.
Sage Intacct, a best-in-class financial management solution is designed to accommodate the new FASB-ASU 2016-14 guidelines to speed and simplify compliance for nonprofits in these areas:
- Reporting flexibility means you can alter your reports to reflect the new changes by adding in or taking out columns and showing new criteria in subtotals without having to reinvent the wheel.
- The Dimensions feature in Sage Intacct helps you summarize your reporting data with tracking by dimension groups and restriction types, changing your classifications from 3 to 2, for “with” or “without” donor restrictions.
- Get real-time visibility into your dashboard to quickly view Operating metrics, Statement of Activities, and Cash Flow, through a strong cloud-based system with highly customizable options to showcase only the key metrics you need the most.
The new FASB ASU 2016-14 guidelines are right around the corner, and while modifying your accounting processes to reflect these changes may seem overwhelming, it isn’t an impossible feat.
Save your nonprofit’s time and resources by adopting a strong financial management system that can scale with your business as quickly as you grow, whether that’s right now, or in the years ahead.
Make sure your teams are ready. Contact us– we can take the pain and confusion out of compliance to help you get set up with a system that’s right for you.