Category

Nonprofit

Dec 05
0

New FASB Rules Go into Effect for Enhanced Clarity in Nonprofit Financial Reports

By | Accounting, Nonprofit | No Comments

FASB announced changes to Accounting Standards Update No. 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities. This landmark set of guidelines is the first update since 1993 and will change how many nonprofits report their numbers.

Summary of the New Guidelines

The new guidelines call for the following changes:

* Reducing the net asset classifications from three to two, net assets with donor restrictions and net assets without donor restrictions;

* Underwater amounts of donor-restricted endowment funds in net assets with donor restrictions are now required to be reported;

* Enhanced disclosures about underwater endowments are also required;

* Preparers can now choose between the direct method and indirect method for presenting operating cash flows;

* The requirement to reconcile the direct method with the indirect method is now waived;

* Requires a not-for-profit to provide in the notes qualitative information on how it manages its liquid available resources and liquidity risks;

* Requires reporting of expenses by function and nature, as well as an analysis of expenses by both function and nature.

The new standards take effect for fiscal years beginning December 15, 2017 and for interim fiscal years after December 15, 2018.

Enhanced Clarity for Donors, Members, and the Public

The impetus behind the changes is twofold. First, FASB sought to update the rules after a long period of consistency. The last update occurred in 1993, and an update was thought long overdue. With the changing nature of nonprofit organizations, donations, and information access by the public, new guidelines were thought necessary for enhanced clarity and confidence in the financial management of nonprofit finances.

The rules also seek to simplify financial reporting for nonprofits. FASB has no wish to complicate reporting for anyone, and the new guidelines, once understood and implemented, will likely make financial reporting easier for nonprofits.

Making the Switch Easier on Your Organization

How the changes may or may not impact your organization depends greatly on how your accounts are currently kept. For those who need to adjust their accounting methods, now is the time to begin planning to meet the compliance deadline of December 2017.

Reducing net asset classifications should not be too difficult for most nonprofits. Many already used two net asset classifications, and the former classifications can be rolled into three without too much difficult by most.

If you need assistance making these changes, Welter Consulting can help. We bridge people and technology together for effective solutions for nonprofit organizations. Your accounting software is an important component of the changeover from the older 1993 regulations to the new rollout. We can help you with the change and more.

Please contact Welter Consulting at 206-605-3113.

Dec 01
0

Helpful Volunteer Resources from Open Educators

By | Nonprofit, Volunteer, Youth | No Comments

The Youth Activist’s Toolkit

A Kid’s Guide to Hunger & Homelessness: How to Take Action!

The Activist’s Guide to Fostering LGBTQ Pride in Your Community

How to Volunteer for Veterans

 How to Volunteer Abroad as a Couple

 Parent Enabler Intervention: When, How, and Why to Speak Up When Parents Enable Their Addicts

 Ideas for Educating the Community About Cyberbullying

 Legal Guide for Activists

For more info visit http://openeducators.org/

Dec 01
0

Could You Be At Risk Of An FLSA Lawsuit?

By | Accounting, FLSA, Nonprofit, Overtime | No Comments

A record number of FLSA lawsuits were filed against U.S. employers last year and with new overtime regulations due on December 1, this is a very good time to ask if you could be at risk.

 

As we reported earlier, another four million employees will be eligible for overtime pay under the new regulations and attorneys have warned this could lead to a spike in the number of disputes.

 

“We now have a new salary threshold that puts 4.2 million workers back into play,” said Daniel Abrahams of Brown Rudnick LLP in an interview with TSheets earlier this year. “You can bet the plaintiffs’ bar is busy monitoring this and looking for new cases.”

 

You may wonder what impact the Trump presidency will have on the new regulations and that remains to be seen, but experts warn it would be unwise to ignore the December 1 deadline. The Fair Labor Standards Act has been around for a long time — and it’s not going away anytime soon — so it’s a very good idea to get familiar with the regulations.

 

There are some great free resources out there to get you started and this one, recently published by TSheets, highlights seven of the most common risk areas:

 

1. Misclassification

8.6 million employees are currently misclassified and the consequences can be costly. It pays to know the difference between an independent contractor and an employee, and to know who is exempt from the FLSA and who is not.

 

2. Off-the-clock work

Mobile technology means more and more employees now work outside of normal hours and if they are nonexempt, this time has to be tracked and paid. This is already a common cause of disputes and more are expected after December 1.

 

3. Unauthorized overtime

When nonexempt employees work overtime they have to be paid for it, even if it was unauthorized. The rate is usually 1.5 times their normal pay but in some states, like California, the regulations demand more than this.

 

4. Breaks

 

Research shows that 4 out of 5 office workers now regularly work through their lunch breaks — but if they are nonexempt and the time is being deducted from their paychecks, their employers could end up in court.

 

5. Record-keeping

 

“To the degree that you don’t have this in place, start creating a really good paper trail,” says attorney Maria Hart from Parson, Behle & Latimer. “That’s an attorney’s best friend—to have documents that show what you were doing, not doing, and so forth. Document, document, document.”

 

6. Interns and volunteers

 

In 2015, just 39% of graduate interns were paid. But as attorney Mark S. Goldstein warns, a recent ruling could mean that more of them could be in future. “An employment relationship is created when the benefits to the intern are greater than their contribution to the business,” he says.

 

7. Regulatory changes

 

Should you be complying with state or federal laws? Or both? Are you following the latest labor department regulations? The shifting sands of labor laws makes it a challenge to get it right all of the time.

 

Disclaimer: Please refer to a professional tax or legal advisor regarding specific requirements of FLSA and how they impact your business. We do not recommend particular employee classifications or practices and leave those decisions to the discretion of your organization.

Nov 28
0

6 Disaster Recovery Tips to Keep Your Nonprofit Afloat

By | Nonprofit | No Comments

Disasters come in many shapes and sizes. Sometimes they’re small and inconsequential and others are big and completely devastating. Regardless of the size and severity, if you don’t have a plan in place, your business may be forever altered. Both big and small disasters happen at unexpected times, so we often are not fully prepared for them.

There are many examples of accidents that happen every day. Here are a few we have seen that are not as uncommon as you might think:

1. Fire breaks out in the office damaging the equipment leaving management without a location to conduct business.

2. Water pipes in the ceiling burst leaving the office flooded and all servers and vital technology beyond repair. Management’s ability to retrieve and process information stops abruptly.

3. Prolonged power outages due to a damaged electrical transformer. The agency is unable to resume critical business functions utilizing electricity.

4. A server blows up and the back-up system did not work properly. The organization is at a complete standstill.

Post-Disaster Course of Action

After an unexpected event, the most timely and efficient response requires pre-disaster planning. Rather than responding in a crisis mode, with a post-disaster course of action, you will be able to follow a well thought-out plan you put in place for just such emergencies.

Planning for the unknown may seem like a daunting task. However, if you break down the key elements of disaster recovery, it can make planning easier and business continuity a success.

Here are six key steps you’ll likely need to take in a disaster recovery scenario:

1. Designate a place to go to restore operations, whether that’s another location or a mobile office brought to your site.

2. Plan how to communicate with staff. The team is the most important part of your organization. Set up a communication system and reroute telephone calls or establish a special number that the team can call for updates.

3. Consider geography. Locating a disaster recovery site 10 miles away may seem convenient, but in a natural disaster, 10 miles may not be far enough. Assemble an emergency kit filled with batteries, flashlights, water and other sustainability items. It could contain petty cash, important documents, passwords, keys, etc.

4. Validate backup data. Is the data on your backup tapes sufficient? Don’t underestimate this step!

5. Test your plan. Testing often lands on the back burner, yet it is the only way to confirm your recovery plan will work.

Don’t compromise your organization’s health by trying to recover when you are the most vulnerable, as in a disaster. Welter Consulting is available to help with disaster planning, preparedness, business continuity, data storage, and faster recovery. At Welter Consulting we are committed to finding you the most affordable technology, the most powerful solution, and providing expert support. By leveraging technology and superior reporting, more efficiency is achieved, freeing up more of your time to devote to the important work of your mission. We are passionate professionals who choose to work in the nonprofit sector for the same reason you do – helping others.