Review of not-for-profit sector accounting standards

Supporting not-for-profit organisations is one of the ways that Saward Dawson makes a difference. Our expertise and support services ensure that we attract many of these important organisations as clients. We will be working with the Institute of Chartered Accountants (Institute) to provide input into a review of Australian accounting standards for the not-for-profit sector.

The Australian Financial Reporting Council (FRC), responsible for overseeing the setting of Australia’s accounting standards, is reviewing the financial reporting standards for the not-for-profit sector. Australia currently has a single set of accounting standards that apply to both the profit and not-for-profit sectors. The FRC is considering:

	Implementing two or more different sets of standards
	Options for a specific not-for-profit sector standards
	Other options to enhance the current approach.

At a recent meeting of not-for-profit industry leaders and interested accounting bodies including the Institute, the FRC and the Australian Accounting Standards Board, the bodies agreed to work together on several issues, including:

	Reviewing the current 'reporting entity concept' and considering appropriate differential disclosure and reporting
	Providing a clear definition of a 'not-for-profit' organisation and the requirements of the typical audience of their financial report
	Prescribing a common format for the preparation of reports
	Considering changing the presentation of financial reports to reflect the specific needs, activities and funding of the not-for-profit sector
	Providing additional guidance on accounting for contributions (e.g. donations and grants).

We will keep our not-for-profit clients up to date with developments. If you would like to subscribe to our not-for-profit email bulletins, visit our Newsletter Subscription page.

Published : 27 October 2006