Financial Reporting Standards for Charities

Introduction of speakers - Lisa Gibson, Senior Advisor, Sport NZ  

“Setting the scene” - Who has to prepare financial statements & what they have to comply with (new framework).

Tiers for Registered Charities – how do you determine which tier you are? Do you need to comply with GAAP?

Expense thresholds for tiers and transitions

Audits (types of audits) & registered charity size criteria

Questions & discussions on audits/agreed upon procedures and NZCT “Will an agreed upon procedure be sufficient for a funder in regards to a small charity?

“Any requirements around the quality of the auditor?"

Special Purpose framework – what is it?

Conversion framework

Impact assessment

Our experiences – take people on the journey with you (Board, Funders, Audit & Risk Committee)

Changes to organisations in the WHO world

Revenue (Tier 1 & 2) – Exchange and non-exchange – what’s the difference? (including government revenue)

Stipulations – Conditions & Restrictions & impact on balance sheet

Consolidation & Control

Financial Instruments

Asset Impairment

Disclosures

Tier Three transition

Statement of Service Performance – outcomes & outputs, compulsory and optional elements

Question: “This isn’t applicable for Tier two – why is that?”

Question: “In regards to the statement of service performance will we have to go through our non-financial systems and get those audited as well?”

Cash flows

Statement of Service Performance – observations

Question: on financial instruments – “how do you deal with derivative contracts?“

Question: “what about hedge accounting?”

Revisit transition – how does the actual adjustment practically work – what do I do once I’ve calculated all of my adjustments? What does it look like?

Income – Tier 3 (Simple Format)

Question: “If given product or gear how do you account for that?”

Question and comment from audience regarding sponsors who want to see that the GST has tracked through the GST return on gear

“What is the likelihood of change in the incorporation society legislation?”

Question: “How do you apply this restriction / condition, where in the standard does it say “may” is a restriction in regards to return of funds?”

Question: “So if I get some funding on the last day in my financial year but will spend in the next financial year do I have to record it as income if no return condition and do I just put it in the notes?”

Question: “Could you educate the funder of this issue and get the timings of the funding deposits adjusted”? - click here

Comments on moving away from the matching concept and impact this has on the organisations P&L

Question: “How does this compare to the International Accounting Standards?”

Question: “If we put the stipulation around the funding contract can we put it on our balance sheet (and deal with it the old way)?”

Question: “They have put the stipulation on income but they haven’t done it with expenses so we can still accrue the costs?”