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Point of view: The financial reporting framework - Could changes to the not-for-profit (NFP) standard impact for-profit entities?

Burgess COMMENTARY
LinkedIn Comment Tamara Hubbard, Liliana Lopez like this 1 comment

Peter Burgess Founder/CEO at TrueValueMetrics developing Multi Dimension Impact Accounting

My hope would be that the Financial Reporting framework for for-profits will be changed just as I hope that Performance Reporting for not-for-profits will be changed. The current state of play is that we do reporting on top of a double entry accounting construct that goes back to Venice over 400 years ago. I argue that this conventional accounting basis for reporting needs to be revisited so that metrics other than money are brought into account. FASB and others obviously recognize that change is happening, and whether or not the old established order is going to stay relevant in the world that will exist by mid-century is going to depend on how well the conventional wisdoms are debunked and then reformulated.

Exciting times

PeterB
Peter Burgess

Point of view: The financial reporting framework - Could changes to the not-for-profit (NFP) standard impact for-profit entities? Point of view 04/27/2015 by Assurance services

Point of view: The financial reporting framework - Could changes to the not-for-profit standard impact for-profit entities? At a glance

Could proposed reporting changes for not-for-profits impact business entities? Read our Point of view for highlights on the NFP proposal.

Download: Point of view: The financial reporting framework - Could changes to the not-for-profit (NFP) standard impact for-profit entities?

The FASB has proposed sweeping changes to the not-for-profit (NFP) financial reporting model and has a research project on its agenda on the financial performance statement of for-profit business entities. Some of the proposed not-for-profit changes reflect areas of reporting that are unique to not-for-profit organizations. Other areas deal with changing fundamental aspects of the underlying U.S. reporting model. As such, for-profit business entities may want to view the broader areas of the not-for-profit proposal as a potential bellwether for the business entities financial reporting project, and consider commenting on those areas as part of the not-for-profit proposal. Obtaining feedback from the broader group of constituents–including business entities—will provide the FASB with the opportunity to thoughtfully consider the needs of all stakeholders, and assess changes in the areas of intersection, with a focus on improvements to overall financial reporting for all constituents. Such a process will help maintain consistency and comparability, where appropriate.

Beth Paul U.S. Strategic Thought Leader, National Accounting Services Group Phone: 973-236-7270 Email: elizabeth.paul@us.pwc.com

Martha Garner Not-for-Profit and GASB Leader, National Accounting Services Group Phone: 973-236-7294 Email: martha.garner@us.pwc.com

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