Discrepancies Between ASU No. 2016-14 and Form 990
Ultimately, the largest issue that early adopters of ASU No. 2016-14 and 2018 (and beyond) Form 990 filers will have to navigate relates to Form 990, Part X, Lines 27–29. Currently, those lines read as follows:
ASU No. 2016-14 replaces three classes of net assets with two:
- Net assets without donor restrictions
- Net assets with donor restrictions
In addition, Form 990, Part IV, Line 10 is a “trigger” question that currently asks, “Did the organization, directly or through a related organization, hold assets in temporarily restricted endowments, permanent endowments, or quasi-endowments? If ‘Yes,’ complete Schedule D, Part V.”
Following that line of reporting, Schedule D (Form 990), Part V, Endowment Funds, requires detailed information reporting of endowment funds for the most recent five-year period. Part of that reporting includes reporting on Part V, Lines 2a–2c the percentage of the total endowment funds at the end of the current year broken out among:
On May 10, 2017, the AICPA’s Exempt Organizations Taxation Technical Resource Panel sent a letter to Margaret Von Lienen (Acting Director, Exempt Organizations, Internal Revenue Service) respectfully requesting updates to Form 990 to align with the tenets of ASU No. 2016-14.
The updates requested in the letter concern the following parts of Form 990 and its associated schedules (along with the corresponding instructions):
The letter recommended specific updates to the form as well as methods for those who have adopted ASU No. 2016-14 early to complete the form if it is not updated by their filing deadline.
This document originally appeared in the AICPA’s Not-for- Profit Entities Industry Developments—2018 ©2018 AICPA. All rights reserved. Used by permission.
Dave serves as Partner and is dedicated to meeting client needs in the exempt organization tax arena through review of client returns, consulting engagements, training, and the compilation of the annual CapinCrouse Higher Education Tax Reporting Trends Project. He has 30 years of accounting experience and serves several industry committees, including the AICPA Not-for-Profit Advisory Council. Dave has also served on the IRS Advisory Committee on Tax Exempt and Government Entities (ACT).