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This Subtopic provides guidance on the following:
  1. a
    Reporting relationships between a not-for-profit entity (NFP) and another NFP that potentially result in consolidation
  2. b
    Reporting relationships with special-purpose entity lessors (either for-profit entities or NFPs)
  3. c
    Reporting a noncontrolling interest in an acquiree
  4. d
    Reporting relationships between an NFP and a for-profit entity that is other than a limited partnership or similar legal entity (incremental guidance only).
  5. e
    Reporting relationships between an NFP that is a general partner or a limited partner and a for-profit limited partnership or similar legal entity.
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An NFP may be related to one or more other NFPs in numerous ways, including any of the following:
  1. a
    Ownership
  2. b
    Control
  3. c
    Economic interest.
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Because NFPs may exist in various legal forms, ownership of NFPs may be evidenced in various ways. Examples include:
  1. a
    Corporations issuing stock
  2. b
    Corporations issuing ownership certificates
  3. c
    Membership corporations issuing membership certificates
  4. d
    Joint ventures
  5. e
    Partnerships.
A parent corporation typically owns stock in a for-profit entity, whereas a sole corporate member holds (all) membership rights in an NFP.
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The nature of the relationship between the entities determines the following:
  1. a
    Whether the financial statements of an NFP and those of another NFP should be consolidated
  2. b
    Whether the other NFP should be reported using a method similar to the equity method (see Subtopic 958-20)
  3. c
    The extent of the disclosure that should be required, if any.
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