Question

In: Accounting

How does a recipient not-for-profit entity record the receipt of a gift that will be transferred...

  • How does a recipient not-for-profit entity record the receipt of a gift that will be transferred without restriction to another charitable entity? What if the donor retains the right to revoke or redirect the gift?

Solutions

Expert Solution

Yes it can be possible if they are donating the same money or gift to another charitable entity only if:

1. NO VIOLATION OF DONOR RESTRICTION It is that some donors do not approved to send their charity to another charitable entity so this must be take in consideration before redonating.

2. NO MISUSE OF THE RESOURCES It is important to check wheather the fund or gift will not misuse by the charity. It will then cause a serious trouble.

3. NO CONFLICT OF INTEREST A person who is donating the gift must not be personally benefit in any way.

And if the donor retains the right to revoke or redirect the gift then it will be his/her choice of action because under the donation of gift criteria a charitable entity cannot redonate that gift to another entity without the consent of donor or it the dono is not agreed to do this. It happens because sometimes donor donates for some specific purposes which can only be complete in that charitable entity and not in any other which is why he/she revokes.


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