Not-for-profit Update #4

  • Not-for-profit
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Aimed at registered charities and other
not-for-profits, our Not-for-profit Update provides you an overview of recent External Reporting Board activities — with a focus on the financial reporting and assurance implications of COVID-19.

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In this issue we cover:

  • XRB Alert 2020-3— Spotlight on Going Concern Disclosures for Tier 1 and Tier 2 Not-for-Profit Entities
  • FAQs for Tier 3 Not-for-Profit Entities — Assessing and reporting on an entity’s ability to continue operating
  • Resources on the impacts of COVID-19 on financial reporting and auditing available on the XRB website.

XRB Alert—Spotlight on Going Concern Disclosures

 XRB Alert 2020-3 Cover

Applies to: 


Not-for-profitAuditing


  

 

XRB Alert 2020-3 provides you an overview of the responsibility of those charged with governance for the adequacy of going concern related disclosures provided in a not-for-profit entity’s financial statements.

It includes commentary on the requirements in the accounting standards and auditor expectations of compliance with going concern requirements.What is the impact on going-concern disclosures in response to COVID-19 for Tier 1 and Tier 2 not-for-profit entities?

Going concern uncertainty is a reality for many not-for-profit entities, so good disclosure is an opportunity to communicate that reality in a clear and transparent way.

Download PDF 


FAQs for Tier 3 Not-for-Profit Entities

Going Concern Disclosures in the Performance Report

 Tier 3 FAQs - Ability to keep operating cover

Applies to: 


Not-for-profit


  

 

 

 

This FAQ document will help the governing bodies of smaller Tier 3 not‑for‑profits understand their responsibility to assess and report on their entity’s ability to continue operating. How do I make an assessment on my entity’s ability to continue as a going concern?

What disclosures am I required to make in my entity’s Performance Report?

Uncertainty about the future is just as relevant for smaller entities as it is for larger entities. Clearly reflecting these uncertainties in your performance report is an important part of helping your donors, funders, and the wider public understand how your entity has been affected.  

If you are a Tier 4 not-for-profit entity, this Tier 3 FAQ document does not apply to you.  There is no requirement for Tier 4 entities to report information about your ability to continue operating, also called going concern.

Download PDF 


XRB website features Financial Reporting and Auditing Resources on COVID-19

 XRB website Information in Response to COVID-19 screenshot

Applies to:


Not-for-profit


 
 

 

COVID-19 and the subsequent economic impact is having an unprecedented impact on the resources available for not-for-profit entities, the nature of their activities and services, and their ability to continue operating.

Preparers, auditors and those charged with governance will need to consider the current impact and ongoing risks arising from the COVID-19 pandemic in the financial statements of the organisations they are involved with.

Our website provides a range of useful financial reporting and auditing resources to assist preparers and auditors during this period of significant disruption and increased uncertainty resulting from the impact of COVID-19. 

We update these pages as useful new information comes to hand. 

Have a look


Have your say…

Have your say icon

Before issuing a finalised accounting standard the NZASB and the international standard-setting boards, including the IPSASB, issue consultation documents. These documents seek your feedback on proposals that could potentially affect you.

We are currently consulting on the matters set out in the table below. Tell us how these changes could affect your entity or the entities you work with.

We welcome your comments and feedback, either formal or informal, by the due dates below.

You can submit your comments directly from the Exposure Draft page on our website following the links below.


IPSASB Consultation Documents


Not-for-profitPublic Sector



This Not-for-profit Update is intended to provide you with a summary of the recent activities of the External Reporting Board (XRB). Links to websites are correct at the time of publication. You should not rely on this newsletter as a definitive publication of updates. The External Reporting Board does not guarantee, and accepts no legal liability whatsoever arising from or connected to the accuracy, reliability, currency, timeliness or completeness of this newsletter. The information contained in this newsletter does not constitute advice and should not be relied upon as such.