{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/810/958/#15-scope-and-scope-exceptions","source":"FASB Accounting Standards Codification, Basic View","usage":"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.","topic":"810","topic_title":"Consolidation","subtopic":"810-958","subtopic_title":"Not-for-Profit Entities","section":{"number":"15","label":"15 Scope and Scope Exceptions","anchor":"15-scope-and-scope-exceptions","is_sec":false,"groups":[{"block":null,"heading":"Overall Guidance","paragraphs":[{"citation":"810-958-15-1","para":"15-1","html":"
This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 958-10-15, with specific exceptions noted below.
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This Subtopic does not provide guidance on the following subjects:
  1. a
    How to prepare consolidated financial statements, other than to provide guidance on the presentation of noncontrolling interests
  2. b
    Commonly controlled not-for-profit entities (NFPs) or combined financial statements of commonly controlled NFPs, which may be presented, in certain circumstances, in conformity with the guidance in paragraph 810-10-55-1B
  3. c
    Parent-entity-only or subsidiary-entity-only financial statements (see paragraph 810-10-45-11 if parent-entity financial statements are needed)
  4. d
    All the conceptual issues underlying the reporting of relationships not evidenced by ownership.
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Additional guidance for reporting relationships between NFPs and for-profit entities resides in the following locations in the Codification:
  1. a
    An NFP with a controlling financial interest through direct or indirect ownership of a majority voting interest in a for-profit entity that is other than a limited partnership or similar legal entityshall apply the guidance in the General Subsections of Subtopic 810-10. However, in accordance with paragraph 810-10-15-17, NFPs are not subject to the Variable Interest Entities Subsections of that Subtopic.
  2. b
    An NFP that is a general partner or a limited partner of a for-profit limited partnership or a similar legal entity (such as a limited liability company that has governing provisions that are the functional equivalent of a limited partnership) shall apply the guidance in paragraphs
    958-810-25-11 through 25-29
    and
    958-810-55-16A through 55-16I
    . However, the guidance in those paragraphs does not apply to the following:
    1. 1
      A general partner or a limited partner that reports its partnership interest at fair value in accordance with (e)
    2. 2
      Entities in industries, such as the construction or extractive industries, in which it is appropriate for a general partner to use the pro rata method of consolidation for its investment in a limited partnership (see paragraph 810-10-45-14).
  3. c
    An NFP that owns 50 percent or less of the voting stock in a for-profit entity shall apply the guidance in Subtopic 323-10 unless the investment is measured at fair value in accordance with applicable GAAP, including the guidance described in (e). If the NFP is unable to exercise significant influence, the NFP shall apply the guidance for equity securities in Topic 321.
  4. d
    An NFP with a more than minor noncontrolling interest in a for-profit real estate partnership, limited liability company, or similar legal entity shall report its noncontrolling interests in such entities using the equity method in accordance with the guidance in Subtopic 970-323 unless that interest is reported at fair value in accordance with applicable GAAP, including the guidance described in (e). An NFP shall apply the guidance in paragraph 970-810-25-1 to determine whether its interests in a general partnership are controlling financial interests or noncontrolling interests. An NFP shall apply the guidance in paragraphs
    958-810-25-11 through 25-29
    and
    958-810-55-16A through 55-16I
    to determine whether its interests in a for-profit limited partnership, limited liability company, or similar legal entity are controlling financial interests or noncontrolling interests. An NFP shall apply the guidance in paragraph 323-30-35-3 to determine whether a limited liability company should be viewed as similar to a partnership, as opposed to a corporation, for purposes of determining whether noncontrolling interests in a limited liability company or a similar legal entity should be accounted for in accordance with Subtopic 970-323 or Subtopic 323-10.
  5. e
    An NFP that is not within the scope of Topic 954 on health care entities may elect to report the investments described in (b) through (d) and paragraph 958-325-15-2 at fair value, with changes in fair value reported in the statement of activities, provided that all such investments are measured at fair value.
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