Question

There is no information missing. There are no financial reports to put. Just need some information on the bold one.

Create a slide presentation of 10 to 12 slides.

Address the following:

Examine FASB financial reporting requirements for a private college.

*****Apply basics of GAAP pertaining to categorizing restrictions on net assets.******

Evaluate whether the entity is subject to the requirements of the Single Audit Act and the provisions of Office of Management and Budget.

Answer 1

The FASB requires private colleges and universities to report on the changes in unrestricted, temporarily restricted, and permanently restricted net assets of the entity as a whole,

•The recording and reporting of capital assets by colleges and universities is similar under FASB and GASB standards.

•For example, both recognize assets at historical cost when purchased and both recognize depreciation.

•Accounting and reporting guidelines differ when considering intangible assets and infrastructure assets.

Collections:

Both FASB and GASB provide for note disclosure of collections rather than reporting them on the balance sheet; both FASB and GASB permit nonrecognition only if the donated items are added to collections that meet the conditions outlined in Chapter 13.

Liabilities:

•A short-term liability that may appear on college and university statements is Deposits Held in Custody for Others.

•This account is used to record events such as students making cash deposits for housing, equipment, or services.

•Accounting for these transactions is the same under either GASB or FASB.

•If the college or university is obligated to return some or all of the deposit at a future date, it should be accounted for as a liability.

•When the deposits are returned, the liability would be debited and cash would be credited.

•When an outstanding charge exists, the university would credit outstanding receivable for the amount owed and any cash remaining from the deposit, minus any adjustments for charges such as rent or damages.

Tuition and Fees:

•Both FASB and GASB require that gross tuition and fees be recorded as revenue even though some of the revenue will be offset by tuition waivers, scholarships, and fellowships.

•Discount and allowance accounts are used to recognize offsets to tuition and fees.

•Tuition refunds are charged directly against the Tuition and Fees revenue account.

Tuition waivers received as part of compensation should be recorded as compensation expense

Uncollectible Tuition and Fees:

FASB:

Private colleges and universities should show tuition and fees net of any estimated uncollectible amounts, directly adjusting the revenue account for the estimate

GASB:

Public colleges and universities use a contra-revenue account, such as Provision for Bad Debts

Contributions:

•Both FASB and GASB define nonexchange transactions, such as contributions, as transactions where the donor does not expect anything of value in return.

Because contributions are so important to colleges and universities, the information provided in earlier chapters concerning recording and reporting of contributions is briefly summarized in this section

FASB:

•Recognize contributions and promises to give as income in the period in which the contributions are made

•Report increases as either unrestricted, temporarily restricted, or permanently restricted net assets, depending on the stipulation of the donor

•Estimates for uncollectible pledges must be made

GASB:

•Recognize contributions as revenue when all eligibility requirements and time restrictions have been met

•Eligibility requirements relate to

–Characteristics of recipients

–Reimbursable costs incurred

–Ability to meet stated contingency

•Uncollectible promises must be estimated