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In: Accounting

Are there circumstances when financial statements can quantify volunteers' services?​

Are there circumstances when financial statements can quantify volunteers' services?​

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Expert Solution

As per the recent changes made in FASB STANDARDS, volunteer services shall be recognised in financial statemets unlike earlier they were not recognised because there was not any measurement tool for recording their services value in money.

But we are left with one question. Which is:

Are volunteer services always be recorded or are there any criteria for recognising them!? And how such amount shall be ascertained!?

Well here are the conditions which when fulfilled, then volunteer services shall be recorded.

  1. The services provided by such volunteers either creates or enhance any nonfinancial assets. Where nonfinancial assets also includes buildings and equipments
  2. Such services shall require some specialised skills, and thus service are provided by the individuals with those skills. Example doctors, Lawyers, Accountants, Architects, Interior designers etc.

   (FASB STANDARD 116 & 117)

If any of the conditions is not met, then volunteer servies shall not be recognised.

They shall be recorder at Fair value of such services provided in the market.

ekkarill92 answered 1 year ago
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