P & L for Non-Profits?

Discussion in 'Technical Queries' started by OC Del Guy, Apr 14, 2011.

  1. OC Del Guy

    OC Del Guy

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    Since a Non-Profit Organization doesn't make a profit. What report does the accountant generate instead of the profit and loss statement?
     
    OC Del Guy, Apr 14, 2011
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  2. OC Del Guy

    jonathan.a.clark

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    Income Statement Alternative

    A viable alternative would be a cash flow statement. But in any case, it would be recommended that an accountant produce an income statement. The decision makers would want to know how they're doing on a month-to-month basis.
     
    jonathan.a.clark, May 12, 2011
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  3. OC Del Guy

    gralynjacques

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    Statement of Activities

    Look at last year's audit and pattern your financials to accordingly. Because of FASB 116, Revenues can be inflated and give a non-profit a false sense of security. I recommend a good Cash Flow Statement as well. Black ink on the P&L does not always reflect the real picture in operations.
     
    gralynjacques, May 13, 2011
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  4. OC Del Guy

    LoveEventing

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    The income statement for a non-profit organization is called the Statement of Activities. It shows the change in net assets for the year instead of "net income/loss" as in a for-profit entity. However, the format is essentially the same, taking Revenues less Expenses.

    Generally, the Statement of Activities is broken out between temporarily restricted, permanently restricted, and unrestricted activities.
     
    LoveEventing, May 16, 2011
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  5. OC Del Guy

    cpetraining

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    CPE Accountant

    I recommend a good Cash Flow Statement as well.
     
    cpetraining, May 17, 2011
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  6. OC Del Guy

    gsoClarke

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    Nonprofit is a tax status, not a balance sheet description!

    Glad LoveEventing pointed out the nonprofit name for the P&L as the Statement of Activities and its need for Restricted, Temporarily Restricted, and Unrestricted Income. There is a parallel need for those categories on the Statement of Position (Balance Sheet), too. Gotta keep up with how much is available for what when, eh? ;)
     
    gsoClarke, Jun 14, 2012
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  7. OC Del Guy

    timpgoetz

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    LoveEventing and gsoClarke nailed this and are the only correct answers in this thread.

    -Tim Goetz, CPA
     
    timpgoetz, Jul 12, 2013
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  8. OC Del Guy

    BrianT

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    QuickBooks Non-profit edition could be a better way to manage the show for Non profit organizations. I worked with several accountants working with that and quite comfortable with its features.
     
    BrianT, Oct 8, 2013
    #8
  9. OC Del Guy

    Rizwan

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    Surplus income over expenditure
     
    Rizwan, Oct 30, 2013
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