# ASC 810-958-05: Consolidation — Not-for-Profit Entities — 05 Overview and Background Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/810/958/#05-overview-and-background) Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective. Tables and mathematical or amendment markup are retained as HTML where Markdown would lose structure. Source downloaded (UTC): 2026-09-10T01:33:05.595Z to 2026-09-10T01:33:05.595Z Record version: sha256:09e2f15995ba7bfab91c1acbe50743064533603a62db69ce3a024d4f52537ac9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 810-958-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/810/958/#05-overview-and-background) SEC content: no ##### [810-958-05-1](https://asc.understandingaccounting.org/asc/810/958/#810-958-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:05.595Z to 2026-09-10T01:33:05.595Z Record version: sha256:79c2025d2362bd75cdbf4a6f9f983189ba187c99c1ddf8d324d1ca1cbce33c24 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance on the following: 1. a Reporting relationships between a [not-for-profit entity](https://asc.understandingaccounting.org/glossary/n/#not-for-profit-entity "An entity that possesses the following characteristics, in varying degrees, that distinguish it from a business entity: Contributions of significant amounts of resources from resource providers who do not expect commensurate or proportionate pecuniary return Operating purposes other than to provide goods or services at a profit Absence of ownership interests like those of business entities. Entities that clearly fall outside this definition include the following: All investor-owned entities Entities that provide dividends, lower costs, or other economic benefits directly and proportionately to their owners, members, or participants, such as mutual insurance entities, credit unions, farm and rural electric cooperatives, and employee benefit plans.") (NFP) and another NFP that potentially result in [consolidation](https://asc.understandingaccounting.org/glossary/c/#consolidation "The presentation of a single set of amounts for an entire reporting entity. Consolidation requires elimination of intra-entity transactions and balances.") 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](https://asc.understandingaccounting.org/glossary/l/#limited-partnership "An association in which one or more general partners have unlimited liability and one or more partners have limited liability. A limited partnership is usually managed by the general partner or partners, subject to limitations, if any, imposed by the partnership agreement.") or similar [legal entity](https://asc.understandingaccounting.org/glossary/l/#legal-entity "Any legal structure used to conduct activities or to hold assets. Some examples of such structures are corporations, partnerships, limited liability companies, grantor trusts, and other trusts.") (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. ##### [810-958-05-2](https://asc.understandingaccounting.org/asc/810/958/#810-958-05-2) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:05.595Z to 2026-09-10T01:33:05.595Z Record version: sha256:84d82b098c07606153a332fad30b437db21872d67acf0b737a469f61a8c0974d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. 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](https://asc.understandingaccounting.org/glossary/c/#control "The direct or indirect ability to determine the direction of management and policies through ownership, contract, or otherwise.") 3. c [Economic interest](https://asc.understandingaccounting.org/glossary/e/#economic-interest "A not-for-profit entity's (NFP's) interest in another entity that exists if any of the following criteria are met: The other entity holds or utilizes significant resources that must be used for the purposes of the NFP, either directly or indirectly by producing income or providing services. The NFP is responsible for the liabilities of the other entity. See paragraph 958-810-55-6 for examples of economic interests."). ##### [810-958-05-3](https://asc.understandingaccounting.org/asc/810/958/#810-958-05-3) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:05.595Z to 2026-09-10T01:33:05.595Z Record version: sha256:d409400ea134d61e442f0fdf6bdc6bc2da274cea419a3b4c30b7f079f17684dc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. 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. ##### [810-958-05-4](https://asc.understandingaccounting.org/asc/810/958/#810-958-05-4) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:05.595Z to 2026-09-10T01:33:05.595Z Record version: sha256:c82eec18a3b15b6c40444ab54130d061909656e8b14eb88c153f77868ecc5470 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. 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. ##### [810-958-05-5](https://asc.understandingaccounting.org/asc/810/958/#810-958-05-5) Pending content: no Source downloaded (UTC): 2026-09-10T01:33:05.595Z to 2026-09-10T01:33:05.595Z Record version: sha256:e7267341e963b911c2d8feec98c1981e612d78345101fd17b8700c7e81979b07 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph not used](https://asc.understandingaccounting.org/updates/page-1833002/).