CMA M3A3
MODULE 3, ASSIGNMENT 3
December 19, 2013
Topic: Financial Reporting for Not-for-Profit
Organizations
Overview
Not-for-profit organizations have their own set of unique issues that are not prevalent in the for-profit organizations. For example, many not-for-profits do not offer a product or service for which forecasted revenues can be made (e.g. charities, environmental organizers, humanitarian aid, health care, religion, the arts, animal protection, etc.). The extent to which it can generate income may be constrained or restricted. It may be dependent on government funding, sponsorship or simply the generosity of donors, thus making the task of covering expenses arduous.
The reliance on volunteers is another unique characteristic of not-for-profits. Often, there is little in the way of record-keeping data on hours of work or duties performed, making it difficult to determine actual resources required. The volunteers may not be qualified to perform the functions they volunteered for. In addition, training may be erratic and inconsistent, and volunteer motives may be self-serving.
This assignment is based on a short case entitled Middletown Community Centre
(MCC), a not-for-profit organization (Appendix 1). In this assignment, candidates have an opportunity to discuss the critical issues faced by the MCC. This case presents several financial reporting issues, and it is difficult to decide how to meet the needs of the various financial statement users. The implications of alternative accounting treatments of the issues will be discussed at the Interactive Session.
Learning Outcome
By the end of the assignment, candidates will have demonstrated good judgment in the identification and ranking of issues based on a critical analysis of the various stakeholder concerns.
© 2013 The Society of Management Accountants of Canada. All rights reserved.
®/™ Registered Trade-Marks/Trade-Marks are owned by The Society of Management Accountants of
December 19, 2013
Topic: Financial Reporting for Not-for-Profit
Organizations
Overview
Not-for-profit organizations have their own set of unique issues that are not prevalent in the for-profit organizations. For example, many not-for-profits do not offer a product or service for which forecasted revenues can be made (e.g. charities, environmental organizers, humanitarian aid, health care, religion, the arts, animal protection, etc.). The extent to which it can generate income may be constrained or restricted. It may be dependent on government funding, sponsorship or simply the generosity of donors, thus making the task of covering expenses arduous.
The reliance on volunteers is another unique characteristic of not-for-profits. Often, there is little in the way of record-keeping data on hours of work or duties performed, making it difficult to determine actual resources required. The volunteers may not be qualified to perform the functions they volunteered for. In addition, training may be erratic and inconsistent, and volunteer motives may be self-serving.
This assignment is based on a short case entitled Middletown Community Centre
(MCC), a not-for-profit organization (Appendix 1). In this assignment, candidates have an opportunity to discuss the critical issues faced by the MCC. This case presents several financial reporting issues, and it is difficult to decide how to meet the needs of the various financial statement users. The implications of alternative accounting treatments of the issues will be discussed at the Interactive Session.
Learning Outcome
By the end of the assignment, candidates will have demonstrated good judgment in the identification and ranking of issues based on a critical analysis of the various stakeholder concerns.
© 2013 The Society of Management Accountants of Canada. All rights reserved.
®/™ Registered Trade-Marks/Trade-Marks are owned by The Society of Management Accountants of