What is Liquidity and availability disclosure?
In short
Not-for-profits disclose qualitative information about how they manage liquid resources to meet cash needs for general expenditures within one year, and quantitative information about financial assets available for those needs.
Key takeaways
- Assets limited by donor restrictions or board designations are shown as reducing what is available.
- It helps readers judge whether the organization can meet its near-term obligations.
- It is presented in the notes or on the face of the statement of financial position.
Where it's tested
FAR: Not-for-Profit Accounting — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
A not-for-profit organization classifies net assets into how many categories?