# ASC Topic 958: Not-for-Profit Entities Source: FASB Accounting Standards Codification, Basic View [Read online](https://asc.understandingaccounting.org/asc/958/) 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): 2026-09-10T02:21:08.558Z to 2026-09-10T02:22:23.587Z Record version: sha256:ed73c2f0133a34dfde653b3b367486b1934af348e259d51b5f5dc6df0f3e44b2 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## Machine-generated topic summary ASC 958 is the industry Topic for not-for-profit entities (NFPs), providing only incremental guidance layered on top of the rest of the Codification. Its scope subtopic (958-10) defines which nongovernmental entities are NFPs (excluding investor-owned entities and those distributing economic benefits proportionately to owners or members) and directs NFPs to apply other Topics in an analogous manner suited to the NFP reporting model. The specialized subtopics then address distinctive NFP transactions: transfers among financially interrelated entities (958-20), where the recipient records contribution revenue and the beneficiary records an equity-method-like interest in the recipient's net assets, and equity transactions when the provider names itself or an affiliate; and split-interest agreements (958-30), where irrevocable agreements are recognized at execution at fair value with contribution revenue equal to assets received less the fair value of amounts owed to other beneficiaries. The unifying idea is that the substance of a donor-imposed arrangement — who controls the assets, whether the arrangement is revocable or conditional, and whether the parties are financially interrelated — drives whether the NFP recognizes contribution revenue, a liability or refundable advance, or an interest in another entity's net assets. Source downloaded (UTC): 2026-09-10T02:21:08.558Z to 2026-09-10T02:21:26.859Z Record version: sha256:1a3425f46008c578ea5b7a5cad3cddd6c0893e1df7bce419eef86cce5f49d975 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-10: Not-for-Profit Entities — Overall ### Machine-generated study aids ```json { "summary": "ASC 958-10 sets the scope of the Not-for-Profit Entities Topic and its relationship to the rest of the Codification. It applies to nongovernmental entities meeting the definition of an NFP and provides only incremental industry-specific guidance—NFPs must otherwise follow all other Topics unless a Scope Section exempts them or the subject matter is inapplicable (e.g., payment of dividends). It also lists the Subtopics comprising Topic 958 and directs NFPs to apply other guidance in an analogous manner suited to their reporting model.", "key_points": [ "Topic 958 provides only incremental industry-specific guidance; entities in scope must also comply with applicable guidance not included in the Topic (958-10-15-1), and other Topics apply to NFPs unless their Scope Sections exempt NFPs or the subject matter precludes applicability, such as payment of dividends (958-10-05-1).", "The Topic applies to all nongovernmental NFPs, including a nonexclusive list of organization types from cemetery organizations through zoological and botanical societies, plus any other entity meeting the NFP definition (958-10-15-2 through 15-3).", "An entity can meet the NFP definition without satisfying every criterion (a), (b), or (c); for example, trade associations, country clubs, and unions that meet only criterion (b) are within scope (958-10-15-4).", "Clearly outside the definition are all investor-owned entities and entities that provide dividends, lower costs, or other economic benefits directly and proportionately to owners, members, or participants—such as mutual insurance entities, credit unions, farm and rural electric cooperatives, and employee benefit plans (958-10-15-5).", "Tax-exempt status is determined by the IRS and is distinct from NFP status; an entity may meet the definition of an NFP yet not be tax-exempt under the Internal Revenue Code (958-10-15-6).", "When applying other Topics, NFPs follow that guidance in an analogous manner appropriate to their reporting model, considering the reporting objectives when judging how to display elements, such as in which net asset class (958-10-45-1).", "Certain Subtopics within 958-605 on revenue recognition also apply to business entities as identified in their Scope Sections (958-10-15-1), and not-for-profit, business-oriented health care entities also apply Topic 954 (958-10-60-1)." ], "categories": [ "Not-for-profit", "Industry-specific", "Financial statement presentation" ], "audience_level": "introductory", "student_note": "Scope is the trap here: students often assume NFPs have a self-contained rulebook, when Topic 958 is only incremental—an NFP still applies ASC 606, 842, 820, and others unless specifically exempted. Also remember that GAAP's NFP definition is independent of IRS tax exemption, and member-benefit entities like credit unions and cooperatives fall outside it.", "related_topics": [ "954", "958-205", "958-605", "958-810", "958-30", "958-20" ], "key_concepts": [ "not-for-profit entity definition", "nongovernmental entity", "incremental industry-specific guidance", "scope exemption", "net asset class", "reporting model", "investor-owned entity" ] } ``` Source downloaded (UTC): 2026-09-10T02:21:08.558Z to 2026-09-10T02:21:08.558Z Record version: sha256:3536e74799dc06f904632aa73b0bf39d3e216f6e7da7e65b73eebd0bb000bbc3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-10-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/958/10/#00-status) SEC content: no ##### [958-10-00-1](https://asc.understandingaccounting.org/asc/958/10/#958-10-00-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:08.558Z to 2026-09-10T02:21:08.558Z Record version: sha256:5e935016bbb89d2575b47a2316d23e078ad2d1946c72e594960ec9b3be3b4dda Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Nongovernmental EntityAddedAccounting Standards Update No. 2012-0410/01/2012
Public Business EntityAddedAccounting Standards Update No. 2018-0806/21/2018
958-10-05-1AmendedAccounting Standards Update No. 2015-1006/12/2015
958-10-05-1AmendedAccounting Standards Update No. 2012-0410/01/2012
958-10-05-2AmendedMaintenance Update 2021-02 (PDF)01/19/2021
958-10-05-2AmendedAccounting Standards Update No. 2016-0101/05/2016
958-10-05-2AmendedAccounting Standards Update No. 2014-0905/28/2014
958-10-05-2AmendedAccounting Standards Update No. 2010-0701/28/2010
958-10-15-1AmendedAccounting Standards Update No. 2018-0806/21/2018
958-10-65-1AddedAccounting Standards Update No. 2016-1408/18/2016
958-10-65-2AddedAccounting Standards Update No. 2018-0806/21/2018
958-10-65-3AddedAccounting Standards Update No. 2019-0303/21/2019
958-10-65-4AddedAccounting Standards Update No. 2020-0709/17/2020
Source downloaded (UTC): 2026-09-10T02:21:11.923Z to 2026-09-10T02:21:11.923Z Record version: sha256:c81d1814b5e82888d4521cd75a5ea664b0396fe9e710bbceb97f3167b5d952f5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-10-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/958/10/#05-overview-and-background) SEC content: no ##### [958-10-05-1](https://asc.understandingaccounting.org/asc/958/10/#958-10-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:11.923Z to 2026-09-10T02:21:11.923Z Record version: sha256:56b673355d5af67effc78c689a18885e9ac12f0ab3a87d1534f1aabeb7a0c19b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Not-for-Profit Entities Topic provides guidance for [not-for-profit entities](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.") (NFPs) as defined in Section 958-10-15 that are [nongovernmental entities](https://asc.understandingaccounting.org/glossary/n/#nongovernmental-entity "An entity that is not required to issue financial reports in accordance with guidance promulgated by the Governmental Accounting Standards Board or the Federal Accounting Standards Advisory Board."), or as further defined in the Scope Sections of the individual Subtopics. Guidance in other Topics and Subtopics applies to NFPs unless the specific Scope Sections exempt NFPs or the subject matter precludes applicability (for example, payment of dividends). ##### [958-10-05-2](https://asc.understandingaccounting.org/asc/958/10/#958-10-05-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:11.923Z to 2026-09-10T02:21:11.923Z Record version: sha256:b86b3c3a7cc94421a6031e694c32ce0ca0f9f7b171d7171dc9649ca4f78eafda Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Topic includes the following Subtopics: 1. a Overall 2. b Financially Interrelated Entities 3. c Split-Interest Agreements 4. d Presentation of Financial Statements 5. e Balance Sheet 6. f Income Statement 7. g Statement of Cash Flows 8. h Receivables 9. i Investments—Debt Securities 10. ii Investments—Equity Securities 11. j Investments—Other 12. k Property, Plant, and Equipment 13. l Liabilities 14. m Contingencies 15. n Revenue Recognition—Contributions 16. o Compensation—Retirement Benefits 17. p Other Expenses 18. pp Business Combinations (Mergers and Acquisitions) 19. q Consolidation. ##### [958-10-05-3](https://asc.understandingaccounting.org/asc/958/10/#958-10-05-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:11.923Z to 2026-09-10T02:21:11.923Z Record version: sha256:d64a083e8f24f1f68d4dfa6a8de11475d56b4e1ab2e27ff4ed69569a31ca3a2b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Overall Subtopic provides guidance on the scope of this Topic as well as relationships to other Topics in the Codification. Source downloaded (UTC): 2026-09-10T02:21:13.926Z to 2026-09-10T02:21:13.926Z Record version: sha256:765cc8f0cde761e0ad41f6ce1013bdafcc81930bfd898f2f517a0a60ef80b203 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-10-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/958/10/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [958-10-15-1](https://asc.understandingaccounting.org/asc/958/10/#958-10-15-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:13.926Z to 2026-09-10T02:21:13.926Z Record version: sha256:444fd04ad37628cbdb76ce98d888c342a6d919605ac8124254c7fe45c0efbedb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Subtopics within the Not-for-Profit Entities Topic only provide incremental industry-specific guidance for the entities defined in this Scope Section, or as further defined in the Scope Sections of the individual Not-for-Profit Entities Subtopics. Entities within the scope of this Topic shall also comply with the applicable guidance not included in this Topic. Certain Subtopics within Subtopic 958-605 on revenue recognition also apply to business entities. Those Subtopics will be specifically identified in their Scope Sections. #### Entities ##### [958-10-15-2](https://asc.understandingaccounting.org/asc/958/10/#958-10-15-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:13.926Z to 2026-09-10T02:21:13.926Z Record version: sha256:3884b1a09319cbbdde73e6f1a3627af02bcf535fcb2e08210b144561eacb787a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Topic applies to all [not-for-profit entities](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.") (NFPs). ##### [958-10-15-3](https://asc.understandingaccounting.org/asc/958/10/#958-10-15-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:13.926Z to 2026-09-10T02:21:13.926Z Record version: sha256:8e6de2fb9223228ef6605618e368377d0cdfa8e31101363138dbd4bd9eb21d28 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Topic applies to the following nongovernmental NFPs: 1. a Cemetery organizations 2. b Civic and community organizations 3. c Colleges and universities 4. d Elementary and secondary schools 5. e Federated fundraising organizations 6. f Fraternal organizations 7. g Health care entities (see also Topic 954) 8. h Labor unions 9. i Libraries 10. j Museums 11. k Other cultural organizations 12. l Performing arts organizations 13. m Political parties 14. n Political action committees 15. o Private and community foundations 16. p Professional associations 17. q Public broadcasting stations 18. r Religious organizations 19. s Research and scientific organizations 20. t Social and country clubs 21. u Trade associations 22. v Voluntary health and welfare entities 23. w Zoological and botanical societies. Additionally, the guidance in this Topic applies to all entities that meet the definition of an NFP, regardless of whether they are included in this list. ##### [958-10-15-4](https://asc.understandingaccounting.org/asc/958/10/#958-10-15-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:13.926Z to 2026-09-10T02:21:13.926Z Record version: sha256:73519bdad9e8b91ba25d387447a73cd6d7f2f3439907f9e5f95e6fab4632401f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. NFPs have the characteristics in criteria (a), (b), and (c) of the definition of [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.") in varying degrees. An entity could meet the definition of an NFP without meeting criterion (a), (b), or (c). For example, although trade associations, country clubs, unions, and other similar entities often meet criterion (b) in the definition of an NFP (that is, they have operating purposes other than to provide goods or services at a profit) but may not meet the other criteria, those entities are within the scope of this Topic. ##### [958-10-15-5](https://asc.understandingaccounting.org/asc/958/10/#958-10-15-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:13.926Z to 2026-09-10T02:21:13.926Z Record version: sha256:44d8d1ac85e5e2664d2cb0aa889b2b7c03e8a430ab67ee8556718b86e993e9d4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Entities that clearly fall outside this definition include the following: 1. a All investor-owned entities 2. b 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. ##### [958-10-15-6](https://asc.understandingaccounting.org/asc/958/10/#958-10-15-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:13.926Z to 2026-09-10T02:21:13.926Z Record version: sha256:f0a0e71967c9af5e0fbee6d641babf7696a22cc76bf6345f4b956439d080fcec Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The Internal Revenue Service determines whether an entity qualifies for exemption from federal income tax. For example, an entity may meet the definition of an NFP, but may nevertheless not be tax-exempt under the Internal Revenue Code because it has violated the rules applicable to tax-exempt organizations. Source downloaded (UTC): 2026-09-10T02:21:19.605Z to 2026-09-10T02:21:19.605Z Record version: sha256:aee920a2b262d9d75d1ef403d0b58c8af0c8e1a3cee4fc2ae04452e5c028a2c7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-10-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/958/10/#45-other-presentation-matters) SEC content: no ##### [958-10-45-1](https://asc.understandingaccounting.org/asc/958/10/#958-10-45-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:19.605Z to 2026-09-10T02:21:19.605Z Record version: sha256:f455f98eaa5dd01f6cf5aa9f97de7d8fc75d3b3d3263da52c07588a154680eaf Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. When applying the guidance in other Topics and Subtopics, NFPs shall follow that guidance in an analogous manner that is appropriate for their method of reporting financial performance and financial position (the reporting model defined in this Topic). NFPs shall consider the reporting objectives of the guidance when exercising judgment about how best to display elements, such as in which net asset class. Source downloaded (UTC): 2026-09-10T02:21:22.158Z to 2026-09-10T02:21:22.158Z Record version: sha256:a65cc8ad50dbe46ced2a37722a5aae89b1c336510680d4440434f42535c2d06f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-10-60: 60 Relationships [Read section](https://asc.understandingaccounting.org/asc/958/10/#60-relationships) SEC content: no #### Health Care Entities ##### [958-10-60-1](https://asc.understandingaccounting.org/asc/958/10/#958-10-60-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:22.158Z to 2026-09-10T02:21:22.158Z Record version: sha256:9e87a6b221f89262c315ccc3d26f0c58394ae87466316db99b8081ea338aefe0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For additional standards that apply to [not-for-profit entities](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.") (NFPs) that are not-for-profit, business-oriented health care entities, see Topic 954. Source downloaded (UTC): 2026-09-10T02:21:24.673Z to 2026-09-10T02:21:24.673Z Record version: sha256:28883557732fa09d2234911a154c9b912292c9627c382b9b3a95ff6244e001c8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-10-65: 65 Transition and Open Effective Date Information [Read section](https://asc.understandingaccounting.org/asc/958/10/#65-transition-and-open-effective-date-information) SEC content: no ##### [958-10-65-1](https://asc.understandingaccounting.org/asc/958/10/#958-10-65-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:24.673Z to 2026-09-10T02:21:24.673Z Record version: sha256:f3cf4b47467e1565e84772e194ebdb142e07121e25a21688e140717bb00810f8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph superseded on 1/31/2020 after the end of the transition period stated in _Accounting Standards Update No. 2016-14, Not-for-Profit Entities (Topic 958): Presentation of Financial Statements of Not-for-Profit Entities._ ##### [958-10-65-2](https://asc.understandingaccounting.org/asc/958/10/#958-10-65-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:24.673Z to 2026-09-10T02:21:24.673Z Record version: sha256:871699c3d4f6958ef4eea973cd5596fef8448347990837f07314e32e4683356f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph superseded on 08/19/2021 after the end of the transition period stated in Accounting Standards Update No. 2018-08, _Not-for-Profit Entities (Topic 958): Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made_. ##### [958-10-65-3](https://asc.understandingaccounting.org/asc/958/10/#958-10-65-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:24.673Z to 2026-09-10T02:21:24.673Z Record version: sha256:0bf433b343d6e4f6270cbed499a6961776861fb305f233bf296ddc0778699041 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph superseded on 08/19/2021 after the end of the transition period stated in Accounting Standards Update No. 2019-03, _Not-for-Profit Entities (Topic 958): Updating the Definition of_ Collections. ##### [958-10-65-4](https://asc.understandingaccounting.org/asc/958/10/#958-10-65-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:24.673Z to 2026-09-10T02:21:24.673Z Record version: sha256:a6fd7764502d7e2df65a1d566f59ca3a6cfdeb996ab0286a539582f7b080798a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph superseded on 09/24/2024 after the end of the transition period stated in Accounting Standards Update No. 2020-07, _Not-for-Profit Entities (Topic 958): Presentation and Disclosures by Not-for-Profit Entities for Contributed Nonfinancial Assets_. Source downloaded (UTC): 2026-09-10T02:21:31.090Z to 2026-09-10T02:21:57.175Z Record version: sha256:63bb11c7fa374224fe266247910246216f11dd01e1726934cc7bde8d83c61ebc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20: Not-for-Profit Entities — Financially Interrelated Entities ### Machine-generated study aids ```json { "summary": "ASC 958-20 governs accounting by two NFPs that are \"financially interrelated\" — one entity can influence the other's operating and financial decisions AND one has an ongoing, residual economic interest in the other's net assets (958-20-15-2). When a donor transfers assets to a recipient entity (e.g., a fundraising foundation) for a financially interrelated specified beneficiary and the recipient is not a trustee, the recipient recognizes contribution revenue on receipt (958-20-25-1) and the beneficiary recognizes an interest in the recipient's net assets, adjusted for its share of changes in those net assets in a manner similar to the equity method (958-20-25-2; 35-1). Transfers in which the resource provider names itself or an affiliate as beneficiary and expects no repayment are \"equity transactions\" reported as a separate line in the statement of activities (958-20-25-4; 45-1).", "key_points": [ "Two entities are financially interrelated only if BOTH criteria in 958-20-15-2 are met: ability to influence the other's operating and financial decisions (e.g., affiliates, considerable board representation, limiting bylaws, policymaking agreement) and an ongoing economic interest in the other's net assets that is residual in nature (958-20-55-2A).", "If the recipient entity and specified beneficiary are financially interrelated and the recipient is not a trustee, the recipient recognizes a contribution received when it receives the donor's assets (958-20-25-1, per 958-605-25-27).", "The beneficiary recognizes its interest in the recipient entity's net assets (958-20-25-2) and adjusts that interest for its share of the change in the recipient's net assets (958-20-35-1) — a method similar to the equity method in Subtopic 323-10 (958-20-60-1).", "A transfer is an equity transaction only if the resource provider specifies itself or an affiliate as beneficiary, the provider and recipient are financially interrelated, and no repayment of the transferred assets is expected (958-20-25-4); the recipient reports it as a separate line item in its statement of activities (958-20-45-1).", "If the provider names itself, it reports the equity transaction as an interest in the recipient's net assets (958-20-25-5); if it names an affiliate, the provider reports a separate line in its statement of activities and the affiliate reports the interest (958-20-25-6, 45-2).", "If the provider names itself or an affiliate but the financially-interrelated or no-repayment conditions of 958-20-25-4(b)-(c) fail, the transfer is an asset to the provider and a liability to the recipient (958-20-25-7, per 958-605-25-33).", "The beneficiary's interest in the recipient's net assets is eliminated when both are included in consolidated financial statements (958-20-45-3; 810-10-45-1), and transferors in equity transactions must give the 958-605-50-6 disclosures (958-20-50-1)." ], "categories": [ "Not-for-profit", "Recognition", "Presentation", "Consolidation" ], "audience_level": "intermediate", "student_note": "This is the classic \"university/hospital foundation\" fact pattern: the foundation books contribution revenue while the supported NFP books an equity-method-like interest in the foundation's net assets — so the gift appears in two sets of financial statements unless consolidated. Students often forget that BOTH the influence and the ongoing *residual* economic interest tests must be met (an economic interest under 958-810 is not automatically enough), and confuse an \"equity transaction\" (reciprocal, financially interrelated) with an \"equity transfer.\"", "related_topics": [ "958-605", "958-810", "323-10", "810-10", "954-220", "850" ], "key_concepts": [ "financially interrelated entities", "recipient entity", "specified beneficiary", "ongoing economic interest in net assets", "residual rights", "equity transaction", "interest in net assets (equity-method-like)", "implied time restriction" ] } ``` Source downloaded (UTC): 2026-09-10T02:21:31.090Z to 2026-09-10T02:21:31.090Z Record version: sha256:31ebad11476816f3fdfa245a3192fb52ba2c6419045f98572ac213960d031c53 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/958/20/#00-status) SEC content: no ##### [958-20-00-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-00-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:31.090Z to 2026-09-10T02:21:31.090Z Record version: sha256:2abbf28166d4ddac5d97160fd8eb80e97a2f0e4fc8992cdfb3c7969bf0e4750b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
AffiliateAmendedMaintenance Update 2018-12 (PDF)09/10/2018
Conditional ContributionAddedAccounting Standards Update No. 2018-0806/21/2018
ContributionAmendedAccounting Standards Update No. 2018-0806/21/2018
ContributionAmendedAccounting Standards Update No. 2010-0701/28/2010
Donor-Imposed ConditionAddedAccounting Standards Update No. 2018-0806/21/2018
Donor-Imposed RestrictionAddedAccounting Standards Update No. 2016-1408/18/2016
Economic InterestAmendedAccounting Standards Update No. 2016-1408/18/2016
Equity TransferAddedAccounting Standards Update No. 2016-1408/18/2016
Financial Asset (2nd def.)AmendedAccounting Standards Update No. 2016-1912/14/2016
Net Assets with Donor RestrictionsAddedAccounting Standards Update No. 2016-1408/18/2016
Net Assets without Donor RestrictionsAddedAccounting Standards Update No. 2016-1408/18/2016
Performance IndicatorAddedAccounting Standards Update No. 2016-1408/18/2016
Temporarily Restricted Net AssetsSupersededAccounting Standards Update No. 2016-1408/18/2016
Unrestricted Net AssetsSupersededAccounting Standards Update No. 2016-1408/18/2016
958-20-45-1AmendedAccounting Standards Update No. 2016-1408/18/2016
958-20-55-2BAddedAccounting Standards Update No. 2016-1408/18/2016
958-20-55-5AmendedAccounting Standards Update No. 2016-1408/18/2016
958-20-55-6AmendedAccounting Standards Update No. 2016-1408/18/2016
958-20-55-10 through 55-13
AmendedAccounting Standards Update No. 2016-1408/18/2016
958-20-55-16AmendedAccounting Standards Update No. 2016-1408/18/2016
958-20-55-17AmendedAccounting Standards Update No. 2016-1408/18/2016
Source downloaded (UTC): 2026-09-10T02:21:33.238Z to 2026-09-10T02:21:33.238Z Record version: sha256:bb87f9b546da88424eb434bca4983577c7493de58156c4bc1539f28b133a160f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/958/20/#05-overview-and-background) SEC content: no ##### [958-20-05-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:33.238Z to 2026-09-10T02:21:33.238Z Record version: sha256:dbe33eb2831061838cf5c427e59c2678a25e6f0078af5d3ef02152890adbb077 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance for certain transactions between two [not-for-profit entities](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.") (NFPs) if the relationship between them has both of the following characteristics: 1. a One of the entities has the ability to influence the operating and financial decisions of the other. 2. b One of the entities has an [ongoing economic interest in the net assets of the other](https://asc.understandingaccounting.org/glossary/o/#ongoing-economic-interest-in-the-net-assets-of-another "A residual right to another not-for-profit entity's (NFP's) net assets that results from an ongoing relationship. The value of those rights increases or decreases as a result of the investment, fundraising, operating, and other activities of the other entity."). ##### [958-20-05-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-05-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:33.238Z to 2026-09-10T02:21:33.238Z Record version: sha256:3e98bcedd5431c633e829b2a32574ef1b47371976e33b2f4663efedf4f95ccd8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In some cases, the relationship between the [financially interrelated entities](https://asc.understandingaccounting.org/glossary/f/#financially-interrelated-entities "A recipient entity and a specified beneficiary are financially interrelated entities if the relationship between them has both of the following characteristics: One of the entities has the ability to influence the operating and financial decisions of the other. One of the entities has an ongoing economic interest in the net assets of the other.") requires consolidation, as discussed in Subtopic 958-810. Source downloaded (UTC): 2026-09-10T02:21:36.095Z to 2026-09-10T02:21:36.095Z Record version: sha256:a41ec3b278c8b4197e85dffd3aabb793ca014d9a5f4d00f8e5dbe7f097e5c5d4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/958/20/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [958-20-15-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:36.095Z to 2026-09-10T02:21:36.095Z Record version: sha256:46955f5dc727d07c521856ad536a4f8078ce02c5c8feca515ea72ed80b9c5e7b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 958-10-15, with specific qualifications noted below. #### Entities ##### [958-20-15-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:36.095Z to 2026-09-10T02:21:36.095Z Record version: sha256:f947174ebed592cf8b24cc62aed01da354cc7c42fa39e74cd22a9dee6bce39b3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic applies to entities that are financially interrelated. A [recipient entity](https://asc.understandingaccounting.org/glossary/r/#recipient-entity "A not-for-profit entity (NFP) or charitable trust that accepts assets from a donor or other resource provider and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a beneficiary that is specified by the donor or resource provider.") and a specified beneficiary are [financially interrelated entities](https://asc.understandingaccounting.org/glossary/f/#financially-interrelated-entities "A recipient entity and a specified beneficiary are financially interrelated entities if the relationship between them has both of the following characteristics: One of the entities has the ability to influence the operating and financial decisions of the other. One of the entities has an ongoing economic interest in the net assets of the other.") if the relationship between them has both of the following characteristics: 1. a One entity has the ability to influence the operating and financial decisions of the other. The ability to exercise that influence may be demonstrated in several ways, including the following: 1. 1 The entities are [affiliates](https://asc.understandingaccounting.org/glossary/a/#affiliate "A party that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with an entity. See Control."). 2. 2 One entity has considerable representation on the governing board of the other entity. 3. 3 The charter or bylaws of one entity limit its activities to those that are beneficial to the other entity. 4. 4 An agreement between the entities allows one entity to actively participate in policymaking processes of the other, such as setting organizational priorities, budgets, and management compensation. 2. b One entity has an [ongoing economic interest in the net assets of the other](https://asc.understandingaccounting.org/glossary/o/#ongoing-economic-interest-in-the-net-assets-of-another "A residual right to another not-for-profit entity's (NFP's) net assets that results from an ongoing relationship. The value of those rights increases or decreases as a result of the investment, fundraising, operating, and other activities of the other entity."). If the specified beneficiary has an ongoing economic interest in the net assets of the recipient entity, the beneficiary's rights to the assets held by the recipient entity are residual rights; that is, the value of those rights increases or decreases as a result of the investment, fundraising, operating, and other activities of the recipient entity. Alternatively, but less common, a recipient entity may have an ongoing economic interest in the net assets of the specified beneficiary. If so, the recipient entity's rights are residual rights, and their value changes as a result of the operations of the beneficiary. #### Transactions ##### [958-20-15-3](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:36.095Z to 2026-09-10T02:21:36.095Z Record version: sha256:2f3674749a222d525bbbe9493d83bf3d1ec9748c721b776037b31cce72f15ea5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic applies to the following types of transactions: 1. a Transactions in which an entity—the donor—makes a [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") by transferring assets to 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) or charitable trust—the recipient entity—that accepts the assets from the donor and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a financially interrelated entity—the beneficiary—that is specified by the donor 2. b Transfers that take place in a similar manner to (a) but are not contributions for either of the following reasons: 1. 1 The entity that transfers the assets to the recipient entity—the resource provider—is related to the beneficiary in a way that causes the transfer to be reciprocal. 2. 2 Conditions imposed by the resource provider or the relationships between the parties make the transfer of assets to the recipient entity revocable or repayable. ##### [958-20-15-4](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:36.095Z to 2026-09-10T02:21:36.095Z Record version: sha256:557d0c185df69d9692edd0a859a0432125788d92cfbb5c1e8af4ab4f6e7cf293 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The guidance in this Subtopic applies to transfers addressed by the preceding paragraph of cash and other assets, including securities, land, buildings, use of facilities or utilities, materials and supplies, intangible assets, services, and [unconditional promises to give](https://asc.understandingaccounting.org/glossary/u/#unconditional-promise-to-give "A promise to give that depends only on passage of time or demand by the promisee for performance.") those items in the future. Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:3df955b72a262fa0968741d1a7984ad312a0e6250549d1e5424889adce7ffa85 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/958/20/#25-recognition) SEC content: no #### Contributions Received for a Financially Interrelated Beneficiary ##### [958-20-25-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:bc1da91e24aed0d6d1008bc3c9f45aab26305808b2831a7a7da58724a72c08b8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Pursuant to paragraph [958-605-25-27](https://asc.understandingaccounting.org/asc/605/958/#605-958-25-27), if a [recipient entity](https://asc.understandingaccounting.org/glossary/r/#recipient-entity "A not-for-profit entity (NFP) or charitable trust that accepts assets from a donor or other resource provider and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a beneficiary that is specified by the donor or resource provider.") and a specified beneficiary are [financially interrelated entities](https://asc.understandingaccounting.org/glossary/f/#financially-interrelated-entities "A recipient entity and a specified beneficiary are financially interrelated entities if the relationship between them has both of the following characteristics: One of the entities has the ability to influence the operating and financial decisions of the other. One of the entities has an ongoing economic interest in the net assets of the other.") and the recipient entity is not a [trustee](https://asc.understandingaccounting.org/glossary/t/#trustee "An entity that has a duty to hold and manage assets for the benefit of a specified beneficiary in accordance with a charitable trust agreement. In some states, not-for-profit entities (NFPs) are organized under trust law rather than as corporations. Those NFPs are not trustees as defined because, under those statutes, they hold assets in trust for the community or some other broadly described group, rather than for a specific beneficiary."), the recipient entity shall recognize a [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") received when it receives assets ([financial](https://asc.understandingaccounting.org/glossary/f/#financial-asset "Cash, evidence of an ownership interest in an entity, or a contract that conveys to one entity a right to do either of the following: Receive cash or another financial instrument from a second entity Exchange other financial instruments on potentially favorable terms with the second entity.") or [nonfinancial](https://asc.understandingaccounting.org/glossary/n/#nonfinancial-asset "An asset that is not a financial asset. Nonfinancial assets include land, buildings, use of facilities or utilities, materials and supplies, intangible assets, or services.")) from the donor that are specified for the beneficiary. For example, a foundation that exists to raise, hold, and invest assets for the specified beneficiary or for a group of affiliates of which the specified beneficiary is a member generally is financially interrelated with the [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.") or entities (NFPs) it supports and recognizes contribution revenue when it receives assets from the donor. See Examples 1 through 3 (paragraphs [958-20-55-3 through 55-17](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-3) ) for illustrations of this guidance. #### Beneficiary's Recognition of Interest in a Financially Interrelated Recipient Entity ##### [958-20-25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:d3aed13d7073b8e684d2e5d3d472ef0c8e3b062f21633a26cfd7735c21718744 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a beneficiary and a recipient entity are financially interrelated entities, the beneficiary shall recognize its interest in the net assets of the recipient entity. See Examples 1 through 3 (paragraphs [958-20-55-3 through 55-17](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-3) ) for illustrations of this guidance. Recognizing an interest in the net assets of the recipient entity and adjusting that interest for a share of the change in net assets of the recipient entity is similar to the equity method, which is described in Subtopic 323-10. ##### [958-20-25-3](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:2b54d2a2bbbaccd4f55604dba2c91dce983f78147ba4c4c1f0762a19e2a81472 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph not used](https://asc.understandingaccounting.org/updates/page-1833002/). #### Equity Transactions ##### [958-20-25-4](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:a2c65e382fb06bea7d842e14d0e0dc6742c7d8f5ad6f45f1f3516493b5ece3bc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A transfer of assets to a recipient entity is an equity transaction if all of the following conditions are present: 1. a The resource provider specifies itself or its [affiliate](https://asc.understandingaccounting.org/glossary/a/#affiliate "A party that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with an entity. See Control.") as the beneficiary. 2. b The resource provider and the recipient entity are financially interrelated entities. 3. c Neither the resource provider nor its affiliate expects payment of the transferred assets, although payment of investment return on the transferred assets may be expected. ##### [958-20-25-5](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:aeebaea9b17faf104e23093e6d84fba2e9cef224d5475dfe70d8fbfe22dd01b8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a resource provider specifies itself as beneficiary, it shall report an equity transaction as an interest in the net assets of the recipient entity (or as an increase in a previously recognized interest) (see paragraph [958-20-25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-2)). ##### [958-20-25-6](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:d65db1e9a4d90ec007965d925f0fe116fed5d19378dd4b884cde265bd36e00b8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If a resource provider specifies an affiliate as beneficiary of an equity transaction, the resource provider shall report an equity transaction as a separate line in its statement of activities, and the affiliate named as beneficiary shall report an interest in the net assets of the recipient entity (see paragraph [958-20-25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-2)). ##### [958-20-25-7](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:40.938Z to 2026-09-10T02:21:40.938Z Record version: sha256:fc273a11b16a689178f493ce986bcf4845f19c416d2e0694ea491f75e49e25dc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the resource provider specifies itself or its affiliate as the beneficiary and any of the conditions in paragraph [958-20-25-4(b)](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-4) and [958-20-25-4(c)](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-4) are not met, the transfer shall be accounted for as an asset by the resource provider and as a liability by the recipient entity, in accordance with paragraph [958-605-25-33](https://asc.understandingaccounting.org/asc/605/958/#605-958-25-33). Source downloaded (UTC): 2026-09-10T02:21:43.724Z to 2026-09-10T02:21:43.724Z Record version: sha256:b1f894738f053e3f20c516f74fe6512363b95c987f676edc6edf4777bbb08144 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/958/20/#35-subsequent-measurement) SEC content: no ##### [958-20-35-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-35-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:43.724Z to 2026-09-10T02:21:43.724Z Record version: sha256:c1867001dad740d5acaac59b52d6783a3c82015a20eb6263e3174446cdc6fde6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the beneficiary has recognized an interest in the net assets of the [recipient entity](https://asc.understandingaccounting.org/glossary/r/#recipient-entity "A not-for-profit entity (NFP) or charitable trust that accepts assets from a donor or other resource provider and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a beneficiary that is specified by the donor or resource provider.") pursuant to paragraph [958-20-25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-2), it shall adjust that interest for its share of the change in net assets of the recipient entity. Source downloaded (UTC): 2026-09-10T02:21:46.276Z to 2026-09-10T02:21:46.276Z Record version: sha256:ad06e5967f9228342543a44d4667ebc748d74502a502586d7694a352bfdd86bc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/958/20/#45-other-presentation-matters) SEC content: no #### Equity Transactions ##### [958-20-45-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-45-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:46.276Z to 2026-09-10T02:21:46.276Z Record version: sha256:f5898422bdd69261c09bdd5b7efcd78053d1da43dfdd8cc9ed53b056ef185192 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A [recipient entity](https://asc.understandingaccounting.org/glossary/r/#recipient-entity "A not-for-profit entity (NFP) or charitable trust that accepts assets from a donor or other resource provider and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a beneficiary that is specified by the donor or resource provider.") shall report an equity transaction as a separate line item in its statement of activities. Paragraph [958-20-55-2B](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-2B) describes the difference between an equity transfer and an equity transaction. See paragraph [954-220-45-2](https://asc.understandingaccounting.org/asc/220/954/#220-954-45-2) for guidance on how to present equity transfers for not-for-profit, business-oriented health care entities that present a [performance indicator](https://asc.understandingaccounting.org/glossary/p/#performance-indicator "A performance indicator reports results of operations. A performance indicator and the income from continuing operations reported by for-profit health care entities generally are consistent, except for transactions that clearly are not applicable to one kind of entity (for example, for-profit health care entities typically would not receive contributions, and not-for-profit health care entities would not award stock compensation). That is, a performance indicator is analogous to income from continuing operations of a for-profit entity."). ##### [958-20-45-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-45-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:46.276Z to 2026-09-10T02:21:46.276Z Record version: sha256:1c34dddeeadfd3ccaf85457c07fab7f2a3690629326c0b54a974b927ab545756 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A resource provider shall report an equity transaction as a separate line in its statement of activities if it specifies an [affiliate](https://asc.understandingaccounting.org/glossary/a/#affiliate "A party that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with an entity. See Control.") as beneficiary. See paragraph [958-20-25-4](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-4) for the conditions that determine if a transfer is an equity transaction. #### Beneficiary's Interest in the Net Assets of a Recipient Entity ##### [958-20-45-3](https://asc.understandingaccounting.org/asc/958/20/#958-20-45-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:46.276Z to 2026-09-10T02:21:46.276Z Record version: sha256:b48f4b74f43d4f09fe3fdd07424105d730acb447568f9bff7f6aa325c79ef8af Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the beneficiary and the recipient entity are included in consolidated financial statements, the beneficiary's interest in the net assets of the recipient entity shall be eliminated in accordance with paragraph [810-10-45-1](https://asc.understandingaccounting.org/asc/810/10/#810-10-45-1). Source downloaded (UTC): 2026-09-10T02:21:49.971Z to 2026-09-10T02:21:49.971Z Record version: sha256:3e9b95fece245e5849ad9607875150631931a6dc4ced79f71b5a685ede971875 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/958/20/#50-disclosure) SEC content: no ##### [958-20-50-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-50-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:49.971Z to 2026-09-10T02:21:49.971Z Record version: sha256:7341e048b2e01948d8f11a547670e6b41aed9432d88a00a1d14d72b3456cb055 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If 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) transfers assets to a [recipient entity](https://asc.understandingaccounting.org/glossary/r/#recipient-entity "A not-for-profit entity (NFP) or charitable trust that accepts assets from a donor or other resource provider and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a beneficiary that is specified by the donor or resource provider.") in an equity transaction (see paragraph [958-20-25-4](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-4)), it shall disclose the information required by paragraph [958-605-50-6](https://asc.understandingaccounting.org/asc/605/958/#605-958-50-6) for each period for which a statement of financial position is presented. Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:9b480d09583cf7acb81568c062cbc16e3a0ffa8a71b3619ddf4d9971be29120d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-55: 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/958/20/#55-implementation-guidance-and-illustrations) SEC content: no ##### [958-20-55-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:b4d45a99daf7291f18bead1522c922ad4d1900e32312557b1ca8cf4901fe0eb9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Section, which is an integral part of the requirements of this Subtopic, provides general guidance to be used by 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) in reporting relationships with [financially interrelated entities](https://asc.understandingaccounting.org/glossary/f/#financially-interrelated-entities "A recipient entity and a specified beneficiary are financially interrelated entities if the relationship between them has both of the following characteristics: One of the entities has the ability to influence the operating and financial decisions of the other. One of the entities has an ongoing economic interest in the net assets of the other."). #### Implementation Guidance ##### [958-20-55-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:3b40de02c6116c1aa635dba35ebdad37b35cb68469bb35929ca8b3fd7a33156b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The flowchart in paragraph [958-605-55-74](https://asc.understandingaccounting.org/asc/605/958/#605-958-55-74) depicts the process of applying the requirements of Sections 958-20-15 and 958-20-25. ##### [958-20-55-2A](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-2A) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:79762a32134e127199cc605b2422c54a54e3806b4fffce4c11c9133cea56483a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Although most of the relationships described in the definition of [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.") used in Subtopic 958-810 are potentially [ongoing economic interests in the net assets of another](https://asc.understandingaccounting.org/glossary/o/#ongoing-economic-interest-in-the-net-assets-of-another "A residual right to another not-for-profit entity's (NFP's) net assets that results from an ongoing relationship. The value of those rights increases or decreases as a result of the investment, fundraising, operating, and other activities of the other entity."), some do not meet the criterion in paragraph [958-20-15-2(b)](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2). Only economic interests that are both ongoing and residual interests in the net assets are ongoing economic interests in the net assets of another. ##### [958-20-55-2B](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-2B) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:92f95334855df6b5287aac844d1a1c4c854be0fee39f5ee4078bd294575212a5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An equity transaction differs from an [equity transfer](https://asc.understandingaccounting.org/glossary/e/#equity-transfer "An equity transfer is nonreciprocal. An equity transfer is a transaction directly between a transferor and a transferee. Equity transfers are similar to ownership transactions between a for-profit parent and its owned subsidiary (for example, additional paid-in capital or dividends). However, equity transfers can occur only between related not-for-profit entities (NFPs) if one controls the other or both are under common control. An equity transfer embodies no expectation of repayment, nor does the transferor receive anything of immediate economic value (such as a financial interest or ownership).") in that an equity transaction, as described in paragraph [958-20-25-4](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-4), involves a financially interrelated party either as a third party in a transfer from an entity to one of its affiliates or as a counterparty in a transfer from an entity to itself. In addition, an equity transaction, unlike an equity transfer, is reciprocal; the NFP or its affiliate named as the beneficiary receives an ongoing economic interest in the assets held by the recipient entity. See paragraph [954-220-45-2](https://asc.understandingaccounting.org/asc/220/954/#220-954-45-2) for guidance on how to present equity transfers for not-for-profit, business-oriented health care entities that present a [performance indicator](https://asc.understandingaccounting.org/glossary/p/#performance-indicator "A performance indicator reports results of operations. A performance indicator and the income from continuing operations reported by for-profit health care entities generally are consistent, except for transactions that clearly are not applicable to one kind of entity (for example, for-profit health care entities typically would not receive contributions, and not-for-profit health care entities would not award stock compensation). That is, a performance indicator is analogous to income from continuing operations of a for-profit entity."). #### Illustrations ##### [958-20-55-3](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:b26ddd759b4da23967a1dbf107f8d2590b66b2fe14307ed26a37a63a711587ef Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Example illustrates the guidance in paragraphs [958-20-15-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2) and [958-20-25-1 through 25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-1) . ##### [958-20-55-4](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:23310d1c165e65bc8a5a22ac8ac086b1b2ce5176339ade6aa93b71fe63f8c3fc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Corporation sends dental supplies to University Foundation to be used by students in University's dental clinic. University Foundation's bylaws state that it is organized for the purpose of stimulating voluntary financial support from alumni and other donors for the benefit of University, especially for addressing the long-term academic priorities of University. As with most gifts it receives, University Foundation can choose the timing of the distribution to University and can place additional limitations on the distribution if those limitations are consistent with Corporation's restrictions. University does not control University Foundation. ##### [958-20-55-5](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:79a4b984d453dc2afd97a56a951e68e2bf52385062be7d0ef4830a6a540fbb5a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. University Foundation recognizes the [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") of the dental supplies ([nonfinancial assets](https://asc.understandingaccounting.org/glossary/n/#nonfinancial-asset "An asset that is not a financial asset. Nonfinancial assets include land, buildings, use of facilities or utilities, materials and supplies, intangible assets, or services.")) as an increase in assets and as [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenue that increases [net assets with donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-with-donor-restrictions "The part of net assets of a not-for-profit entity that is subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).") because there are [donor-imposed restrictions](https://asc.understandingaccounting.org/glossary/d/#donor-imposed-restriction "A donor stipulation (donors include other types of contributors, including makers of certain grants) that specifies a use for a contributed asset that is more specific than broad limits resulting from the following: The nature of the not-for-profit entity (NFP) The environment in which it operates The purposes specified in its articles of incorporation or bylaws or comparable documents for an unincorporated association. Some donors impose restrictions that are temporary in nature, for example, stipulating that resources be used after a specified date, for particular programs or services, or to acquire buildings or equipment. Other donors impose restrictions that are perpetual in nature, for example, stipulating that resources be maintained in perpetuity. Laws may extend those limits to investment returns from those resources and to other enhancements (diminishments) of those resources. Thus, those laws extend donor-imposed restrictions.") and because University and University Foundation are financially interrelated entities (see paragraph [958-20-25-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-1)). University can influence the financial and operating decisions of University Foundation because the bylaws of University Foundation limit its activities to those that benefit University (see paragraph [958-20-15-2(a)](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2)). University has an ongoing economic interest in the net assets of University Foundation because the results of University Foundation's activities accrue to the benefit of University (see paragraph [958-20-15-2(b)](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2)). When University Foundation distributes the dental supplies to University, it reduces its assets and recognizes an expense and the expiration of the restriction. ##### [958-20-55-6](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:388d4769823778f7bd2ec5f3ac9c4f130894189728c47f11f63144e0557afdda Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Periodically, in conjunction with preparing its financial statements, University recognizes the change in its interest in the net assets of University Foundation, which would include the gift of nonfinancial assets received by the foundation (see paragraph [958-20-25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-2)). Because payments from University Foundation are due in future periods, the increase (or decrease) in University's interest would be classified as a change in net assets with donor restrictions to reflect the time restriction. When the dental supplies and other assets are distributed to it, University would recognize the assets received and decrease its interest in the net assets of University Foundation. ##### [958-20-55-7](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:237a0eadfd58aad26bf8686ccc8e06eca425643805c6c476779181cf789ee696 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If, instead, University controlled University Foundation, University would be able to access at will any assets held by University Foundation. Implying a time restriction on the gifts held by University Foundation would be inappropriate. When recognizing the change in its interest in University Foundation, University would report the resulting net assets in the same net asset classifications as University Foundation. ##### [958-20-55-8](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:de5de5839645ede52401410a67403ad62c640e61002ee3811cda018045ee37a0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Example illustrates the guidance in paragraphs [958-20-15-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2) and [958-20-25-1 through 25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-1) . ##### [958-20-55-9](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-9) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:fdbd3c667acbf2fa33e9cf7e3ef4a7b12cf65ce90dc599245af9da8502144b7a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Corporation transfers cash to Healthcare Foundation and requests that Healthcare Foundation use the gift to provide healthcare benefits to the community. Healthcare Foundation's bylaws state that it is organized for the purpose of stimulating voluntary financial support from donors for the benefit of Hospital, Nursing Home, and Walk-in Clinic, all of which are located in the community. Hospital, Nursing Home, Walk-in Clinic, and Healthcare Foundation are affiliates that are controlled by Healthcare System. ##### [958-20-55-10](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-10) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:af93f8c71062eca907fc05e36879beeb492c85aa3b260b631bc72c472743d229 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Healthcare Foundation would recognize cash and [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenue that increases [net assets without donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-without-donor-restrictions "The part of net assets of a not-for-profit entity that is not subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).") because Corporation did not specify a beneficiary for its gift. Healthcare Foundation can choose how to distribute the gift among the three affiliates (see paragraphs [958-605-55-76 through 55-77](https://asc.understandingaccounting.org/asc/605/958/#605-958-55-76) ). ##### [958-20-55-11](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-11) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:59660cbb3b9e6b1e2241478355e455b910b97ccb7fd117d99ef3ba33907c47ff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Periodically, in conjunction with preparing their financial statements, Hospital, Nursing Home, and Walk-in Clinic recognize the changes in their interests in the net assets of Healthcare Foundation (see paragraph [958-20-25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-2)). When measuring its interest in Healthcare Foundation, each [affiliate](https://asc.understandingaccounting.org/glossary/a/#affiliate "A party that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with an entity. See Control.") would include only the net assets of Healthcare Foundation that are restricted to that affiliate's use. None of them would include in their individual interest the net assets resulting from the gift received from Corporation because Healthcare Foundation can choose how to distribute the gift among the three affiliates. Healthcare System's financial statements would include the net assets resulting from the gift received from Corporation, as well as other changes in the net assets of Healthcare Foundation, in its interest in the net assets of the foundation. (An interest in the net assets of an affiliate would be eliminated if that affiliate were included in the consolidated financial statements of the interest holder.) ##### [958-20-55-12](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-12) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:1b886abcc94e5b8902c5e87f5afa5455b8b605153e519dc969e9b48eccc2452a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If Healthcare Foundation, Hospital, Nursing Home, and Walk-in Clinic entered into an agreement that specified how gifts without donor restrictions to Healthcare Foundation should be divided, each affiliate would also include its share of Healthcare Foundation's net assets without donor restrictions, computed in accordance with that agreement, when it measured its interest in Healthcare Foundation. Similarly, if Healthcare System directed that gifts without donor restrictions to Healthcare Foundation be distributed to the three affiliates in accordance with a specified formula, each affiliate would include its share of net assets without donor restrictions, computed in accordance with that formula, when it measured its interest in Healthcare Foundation. ##### [958-20-55-13](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-13) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:2206455e7758c82688039aeb547380be864f13d1e721ab99789a54f3fa315769 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If Corporation had specified that its gift be used for the benefit of Walk-in Clinic rather than giving without restriction, Healthcare Foundation would recognize contribution revenue that increases [net assets with donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-with-donor-restrictions "The part of net assets of a not-for-profit entity that is subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).") because Hospital, Nursing Home, Walk-in Clinic, and Healthcare Foundation are financially interrelated entities (see paragraph [958-20-15-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2)). Their relationship meets both requirements of paragraph [958-20-25-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-1). Hospital, Nursing Home, and Walk-in Clinic can influence the financial and operating decisions of Healthcare Foundation because all four NFPs are under common control and the bylaws of Healthcare Foundation limit its activities to support of its three affiliates (see paragraph [958-20-15-2(a)](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2)). Hospital, Nursing Home, and Walk-in Clinic each have an ongoing economic interest in the net assets of Healthcare Foundation because their rights to the assets held by Healthcare Foundation are residual rights in an ongoing relationship (see paragraph [958-20-15-2(b)](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2)). Walk-in Clinic would include the net assets resulting from the gift received from Corporation in its interest in the net assets of Healthcare Foundation. ##### [958-20-55-14](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-14) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:72e1f17a632b8bcbf8c31fe6327ef4f406ee921f2f4957bc7e85672b93f5dfd7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Example illustrates the guidance in paragraphs [958-20-15-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2) and [958-20-25-1 through 25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-1) . ##### [958-20-55-15](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-15) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:d874e361c28524b2ba30d4a7e2cb6a66e2bbb01e8114d67a61a396bbb1a9ef7c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Individual transfers cash to Arts Foundation and specifies that the money be used to support the expenses of the ballet. Arts Foundation's bylaws state that it is organized for the purpose of stimulating voluntary financial support from donors for the benefit of Community Ballet and Community Theater. At the time Arts Foundation was created, the three NFPs entered into an agreement that specifies that if a donor does not specify the NFP to which the gift should be transferred, the gift will be split equally between Community Ballet and Community Theater. The agreement also specifies that representatives from the three NFPs will meet annually and determine campaign priorities for the next year and the costs of operating Arts Foundation will be equally split between Community Ballet and Community Theater. Arts Foundation is not controlled by Community Ballet, Community Theater, or Individual. ##### [958-20-55-16](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-16) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:59bac0429016c57e3555a9486eda4571a86c6cc445df53e569490f7ba6acbab7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Arts Foundation would report assets and contribution revenue that increases net assets with donor restrictions because there are donor-imposed restrictions and because Community Ballet and Arts Foundation are financially interrelated entities (see paragraph [958-20-25-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-1)). Community Ballet has the ability to influence the operating and financial decisions of Arts Foundation because the agreement allows Community Ballet to participate in the policymaking processes of Arts Foundation (see paragraph [958-20-15-2(a)](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2)). The agreement also establishes Community Ballet's rights as residual rights because it specifies how the revenues and expenses of Arts Foundation will be shared (see paragraph [958-20-15-2(b)](https://asc.understandingaccounting.org/asc/958/20/#958-20-15-2)). When Arts Foundation distributes assets to Community Ballet, it reduces its assets and recognizes an expense. ##### [958-20-55-17](https://asc.understandingaccounting.org/asc/958/20/#958-20-55-17) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:53.308Z to 2026-09-10T02:21:53.308Z Record version: sha256:0bdc4f08be545831bea21b465c14b72e0f9255f28c6bae30c10a0ef2079d69e7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Periodically, in conjunction with preparing their financial statements, Community Ballet and Community Theater recognize the changes in their interests in the net assets of Arts Foundation (see paragraph [958-20-25-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-25-2)). Community Ballet would include the net assets resulting from the gift received from Individual in its interest in the net assets of Arts Foundation because Individual specified that the gift be used to support the ballet and Arts Foundation's bylaws limit it to supporting Community Ballet. Community Ballet would also include in its interest all other gifts restricted to its benefit and its share of net assets without donor restrictions because of the agreement among the three organizations that gifts to Arts Foundation that are not donor-restricted should be split equally between Community Ballet and Community Theater. Because payments from Arts Foundation are due in future periods, the increase (or decrease) in Community Ballet's interest would be classified as a change in net assets with donor restrictions to reflect the time restriction. When assets are distributed to Community Ballet, it recognizes the assets received and decreases its interest in the net assets of Arts Foundation. Source downloaded (UTC): 2026-09-10T02:21:57.175Z to 2026-09-10T02:21:57.175Z Record version: sha256:7e3e2a651cc911d55e87469ae976cc7d810ae307fc4b3ad4c883b1ceed756b80 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-20-60: 60 Relationships [Read section](https://asc.understandingaccounting.org/asc/958/20/#60-relationships) SEC content: no #### Investments—Equity Method and Joint Ventures ##### [958-20-60-1](https://asc.understandingaccounting.org/asc/958/20/#958-20-60-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:57.175Z to 2026-09-10T02:21:57.175Z Record version: sha256:8d486e30526f35523873e6b4b4f064280976f1432e0986a98a61aefd5ecea564 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For the procedures required to report an interest in the net assets of a [recipient entity](https://asc.understandingaccounting.org/glossary/r/#recipient-entity "A not-for-profit entity (NFP) or charitable trust that accepts assets from a donor or other resource provider and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a beneficiary that is specified by the donor or resource provider.") using a method similar to the equity method, see Subtopic 323-10. #### Related Party Disclosures ##### [958-20-60-2](https://asc.understandingaccounting.org/asc/958/20/#958-20-60-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:57.175Z to 2026-09-10T02:21:57.175Z Record version: sha256:6c209684083ace90266fdf58e40949baf7d654a42151f5ef0ffca7f7e9890fe3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. For a definition of a related party and the required disclosures of material related party transactions, see Topic 850. Source downloaded (UTC): 2026-09-10T02:21:59.891Z to 2026-09-10T02:22:23.587Z Record version: sha256:4919c0e0fb68bffa1ec259502cb4b0e779889c9e4715bf1dc421b40291a23c60 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30: Not-for-Profit Entities — Split-Interest Agreements ### Machine-generated study aids ```json { "summary": "ASC 958-30 governs how a not-for-profit entity accounts for split-interest agreements—trusts or similar arrangements (charitable lead/remainder annuity trusts and unitrusts, charitable gift annuities, pooled income funds) in which the NFP shares the benefits of donated assets with other, usually non-charitable, beneficiaries. Revocable agreements are treated as intentions to give (assets recorded as a refundable advance); irrevocable agreements are recognized on execution at fair value, with contribution revenue equal to the assets received less the fair value of the obligation to other beneficiaries. When a third party holds the assets, the NFP instead recognizes a beneficial interest at fair value, and the liability side of period-certain, variable-payment agreements may contain a bifurcable embedded derivative under Topic 815.", "key_points": [ "Revocable split-interest agreements are accounted for as intentions to give: assets received as trustee are recognized at fair value with an offsetting refundable advance, and contribution revenue is recognized only when the agreement becomes irrevocable or the assets are distributed for the NFP's unconditional use (958-30-25-2; 958-30-30-3).", "For an irrevocable agreement naming the NFP trustee or fiscal agent and absent donor-imposed conditions, the NFP recognizes assets at fair value, a liability for future payments to other beneficiaries at fair value (often the present value of future payments), and contribution revenue for the difference, all at execution (958-30-25-4; 958-30-25-6; 958-30-30-4 through 30-8).", "A liability that is solely life-contingent qualifies for the exception in 815-10-15-52 through 15-57 and is outside Topic 815, but a liability with variable payments over a period-certain generally contains an embedded derivative that must be bifurcated under 815-15-25-1 unless a fair value election is made (958-30-25-8 through 25-14; 958-30-55-8 through 55-29).", "For pooled income funds and net income unitrusts, assets are recognized at fair value when received, the remainder interest is recognized as contribution revenue, and the difference is deferred revenue for the discount for future interest, amortized as a change in the value of split-interest agreements (958-30-25-15; 958-30-30-10; 958-30-35-9).", "When a third party controls the assets, the NFP recognizes a beneficial interest asset and contribution revenue at fair value when notified—unless the trustee has variance power or the NFP's rights are conditional—remeasures it at fair value through the statement of activities, and records no liability (958-30-25-16 through 25-19; 958-30-30-11; 958-30-35-10).", "If the fair value option is not elected, the liability is remeasured only for amortization of the discount and revaluations based on changes in life expectancy and other actuarial assumptions, and the discount rate is not revised after initial recognition (958-30-35-6; 958-30-35-7); on termination the accounts are closed and residual amounts recognized as changes in the value of split-interest agreements (958-30-40-1).", "Contribution revenue is classified as an increase in net assets with donor restrictions unless the NFP has the immediate unrestricted right to use the assets; a charitable gift annuity contribution is unrestricted only if the donor imposes no restriction and no law or agreement requires the assets to be invested until the income beneficiary's death (958-30-45-1; 958-30-45-2)." ], "categories": [ "Not-for-profit", "Recognition", "Fair value", "Derivatives and hedging" ], "audience_level": "advanced", "student_note": "Exam questions usually turn on two switches: who controls the assets (NFP as trustee vs. third-party trustee, which decides liability vs. beneficial-interest accounting) and whether the payments are fixed/life-contingent or variable/period-certain (which decides embedded derivative bifurcation). The common misunderstanding is treating the full amount of assets received as contribution revenue—revenue is only the net contribution portion after deducting the fair value of the obligation to the other beneficiaries.", "related_topics": [ "958-605", "815-15", "820-10", "825-10", "958-320", "958-220" ], "key_concepts": [ "split-interest agreement", "lead interest", "remainder interest", "charitable gift annuity", "pooled income fund", "beneficial interest in trust", "embedded derivative bifurcation", "net assets with donor restrictions" ] } ``` Source downloaded (UTC): 2026-09-10T02:21:59.891Z to 2026-09-10T02:21:59.891Z Record version: sha256:9ce2795813034c859b28f618a7eab605b5dd8f93c7d575489b7fb21511f3ab50 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-00: 00 Status [Read section](https://asc.understandingaccounting.org/asc/958/30/#00-status) SEC content: no ##### [958-30-00-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-00-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:21:59.891Z to 2026-09-10T02:21:59.891Z Record version: sha256:bdd4ce78645c887ac5f3d56e849f105db32327544d9a28f59e876a8ad53cf86e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following table identifies the changes made to this Subtopic.
ParagraphActionAccounting Standards UpdateDate
Board-Designated Endowment FundAmendedAccounting Standards Update No. 2016-1408/18/2016
Board-Designated Net AssetsAddedAccounting Standards Update No. 2016-1408/18/2016
Conditional ContributionAddedAccounting Standards Update No. 2018-0806/21/2018
ContributionAmendedAccounting Standards Update No. 2018-0806/21/2018
ContributionAmendedAccounting Standards Update No. 2010-0701/28/2010
Donor-Imposed ConditionAmendedAccounting Standards Update No. 2018-0806/21/2018
Donor-Imposed RestrictionAddedAccounting Standards Update No. 2016-1408/18/2016
Donor-Restricted Endowment FundAddedAccounting Standards Update No. 2016-1408/18/2016
Donor-Restricted SupportAddedAccounting Standards Update No. 2016-1408/18/2016
Endowment FundAmendedAccounting Standards Update No. 2016-1408/18/2016
Funds Functioning as EndowmentAddedAccounting Standards Update No. 2016-1408/18/2016
Net AssetsAddedAccounting Standards Update No. 2016-1408/18/2016
Net Assets with Donor RestrictionsAddedAccounting Standards Update No. 2016-1408/18/2016
Net Assets without Donor RestrictionsAddedAccounting Standards Update No. 2016-1408/18/2016
Permanent EndowmentSupersededAccounting Standards Update No. 2016-1408/18/2016
Permanently Restricted Net AssetsSupersededAccounting Standards Update No. 2016-1408/18/2016
Promise to GiveAddedAccounting Standards Update No. 2018-0806/21/2018
Reclassification of Net AssetsAddedAccounting Standards Update No. 2016-1408/18/2016
Restricted SupportSupersededAccounting Standards Update No. 2016-1408/18/2016
Temporarily Restricted Net AssetsSupersededAccounting Standards Update No. 2016-1408/18/2016
Temporary RestrictionSupersededAccounting Standards Update No. 2016-1408/18/2016
Unrestricted Net AssetsSupersededAccounting Standards Update No. 2016-1408/18/2016
Unrestricted SupportSupersededAccounting Standards Update No. 2016-1408/18/2016
958-30-25-2AmendedAccounting Standards Update No. 2016-0101/05/2016
958-30-25-4AmendedAccounting Standards Update No. 2016-0101/05/2016
958-30-25-17AmendedAccounting Standards Update No. 2012-0410/01/2012
958-30-35-4AmendedAccounting Standards Update No. 2016-0101/05/2016
958-30-35-11AmendedAccounting Standards Update No. 2016-0101/05/2016
958-30-45-1 through 45-5
AmendedAccounting Standards Update No. 2016-1408/18/2016
958-30-45-6AmendedMaintenance Update 2020-18 (PDF)11/25/2020
958-30-45-7AmendedMaintenance Update 2020-18 (PDF)11/25/2020
958-30-45-7AmendedAccounting Standards Update No. 2016-1408/18/2016
958-30-50-1AmendedAccounting Standards Update No. 2018-1308/28/2018
958-30-50-1AmendedAccounting Standards Update No. 2012-0410/01/2012
958-30-50-1AmendedAccounting Standards Update No. 2011-0405/12/2011
958-30-50-2AmendedAccounting Standards Update No. 2016-1408/18/2016
958-30-50-3AmendedAccounting Standards Update No. 2016-1408/18/2016
958-30-55-4AmendedAccounting Standards Update No. 2016-1408/18/2016
958-30-55-5SupersededAccounting Standards Update No. 2016-1408/18/2016
958-30-55-30AmendedAccounting Standards Update No. 2016-1408/18/2016
Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:db1f4163f9eec882cec4714ed01e76faad4b98c21e1f83ad243c1ea6c421df41 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-05: 05 Overview and Background [Read section](https://asc.understandingaccounting.org/asc/958/30/#05-overview-and-background) SEC content: no ##### [958-30-05-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:036d9377a3e2b5c1873bee56e3534338790f004bbf41f5b990d08313cf9b4059 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic provides guidance for reporting arrangements under which 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) shares the benefits of assets with other beneficiaries (a [split-interest agreement](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest.")). Those other beneficiaries generally are not NFPs. For example, a donor may give an NFP the right to receive all or a portion of the specified cash flows from a charitable trust or other identifiable pool of assets that is held either by the NFP or by an unrelated third party (such as a bank, trust company, foundation, or private individual). ##### [958-30-05-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:0379c27cefe5b0c337eb6b4f2456a111116a6c49484a7e93733b6e4327f56711 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the NFP shares the cash flows with another beneficiary, that agreement is subject to the guidance in this Subtopic. ##### [958-30-05-3](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:17c692c3babf53b3d2100bac9f63b7e486571914932e46075071c05aeaa374dc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the NFP controls the rights to all of the specified cash flows from the trust or other identifiable pool of assets, the agreement is subject to the guidance in paragraphs [958-605-25-28 through 25-30](https://asc.understandingaccounting.org/asc/605/958/#605-958-25-28) . #### General Structure ##### [958-30-05-4](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:9cd6ce395a073dc14d38be0c2937ab03b7b24ca0f74e59afb45ac411cee4beb3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Split-interest agreements are agreements in which donors enter into trusts or other arrangements under which an NFP receives benefits that are shared with other beneficiaries that generally are not NFPs. A typical split-interest agreement has the following two components: 1. a A [lead interest](https://asc.understandingaccounting.org/glossary/l/#lead-interest "The right to the benefits (cash flows or use) of assets during the term of a split-interest agreement, which generally starts upon the signing of the agreement and terminates at either of the following times: After a specified number of years (period-certain) Upon the occurrence of a certain event, commonly either the death of the donor or the death of the lead interest beneficiary (life-contingent).") 2. b A [remainder interest](https://asc.understandingaccounting.org/glossary/r/#remainder-interest "The right to receive all or a portion of the assets of a split-interest agreement remaining at the end of the agreement's term."). ##### [958-30-05-5](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:3b4f3eb6ef46cf34643f7be0c00bbb9cd3ff6d14f6b20334643e3eddd1e8fd72 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The lead interest is the right to the benefits (cash flows or use) of assets during the term of the split-interest agreement, which generally starts upon the signing of the agreement and terminates at either of the following times: 1. a After a specified number of years (period-certain) 2. b Upon the occurrence of a certain event, commonly either the death of the donor or the death of the lead interest beneficiary (life-contingent). The remainder interest is the right to receive all or a portion of the assets of a split-interest agreement remaining at the end of the agreement's term. ##### [958-30-05-6](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:02016f3e3b0cd8f8e1fa5a87a4959826522d2b29e2cf15b753dfa689695a3f74 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Split-interest agreements can take any one of the following forms: 1. a [Charitable lead annuity trust](https://asc.understandingaccounting.org/glossary/c/#charitable-lead-annuity-trust "A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions of a fixed amount during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor.") 2. b [Charitable lead unitrust](https://asc.understandingaccounting.org/glossary/c/#charitable-lead-unitrust "A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions of a fixed percentage of the fair value of the trust's assets during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor.") 3. c [Charitable remainder annuity trust](https://asc.understandingaccounting.org/glossary/c/#charitable-remainder-annuity-trust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions of a fixed amount during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.") 4. d [Charitable remainder unitrust](https://asc.understandingaccounting.org/glossary/c/#charitable-remainder-unitrust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions of a fixed percentage of the fair value of the trust's assets during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.") 5. e [Charitable gift annuities](https://asc.understandingaccounting.org/glossary/c/#charitable-gift-annuity "A transfer of assets to a not-for-profit entity (NFP) in connection with a split-interest agreement that is in part a contribution and in part an exchange transaction. The NFP accepts the contribution and is obligated to make periodic stipulated payments to the donor or a third-party beneficiary for a specified period of time, usually either a specified number of years or until the death of the donor or third-party beneficiary.") 6. f [Pooled income funds](https://asc.understandingaccounting.org/glossary/p/#pooled-income-fund "A trust in which donors are assigned a specific number of units based on the proportion of the fair value of their contributions to the total fair value of the pooled income fund on the date of the donor's entry to the pooled fund. Until a donor's death, the donor (or the donor's designated beneficiary or beneficiaries) is paid the actual income (as defined under the arrangement) earned on the donor's assigned units. Upon the donor's death, the value of these assigned units reverts to the NFP."). ##### [958-30-05-7](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:6af735fb2a6ee36a1995dffdac76ec91584968564e1375e83bd871e674434a26 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The terms of some agreements do not allow donors to revoke their gifts; other agreements may be revocable by donors in certain situations. This Subtopic addresses the accounting for both revocable and irrevocable split-interest agreements. ##### [958-30-05-8](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:8b66a0de542b755b5aa2bcfb217a06d07af2aaab677a09d968f478ac414d90fa Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The donor may transfer the assets to an unrelated third party (such as a bank, trust company, foundation, or private individual) or may give the NFP the right to control the contributed assets by either of the following: 1. a Naming the NFP as [trustee](https://asc.understandingaccounting.org/glossary/t/#trustee "An entity that has a duty to hold and manage assets for the benefit of a specified beneficiary in accordance with a charitable trust agreement. In some states, not-for-profit entities (NFPs) are organized under trust law rather than as corporations. Those NFPs are not trustees as defined because, under those statutes, they hold assets in trust for the community or some other broadly described group, rather than for a specific beneficiary.") of the trust holding the assets 2. b Granting the NFP the right to hold the assets as general assets of the entity. This Subtopic addresses the accounting for all of those situations. #### Charitable Lead Annuity Trusts and Lead Unitrusts ##### [958-30-05-9](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-9) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:6533249fb0bb47e47548a0990a9974b4d69d88eb9172d86099fb27e9b56f6530 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Assets such as cash or shares of stock are contributed by the donor either to the control of the NFP through its role as trustee of a trust holding the assets or to a third-party trustee. The NFP receives periodic cash payments (the lead interest) that are either a fixed dollar amount (an [annuity trust](https://asc.understandingaccounting.org/glossary/a/#annuity-trust "See Charitable Remainder Trust.")) or a specified percentage of the [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") of the assets as of the beginning of each period (a unitrust). Some of the assets may need to be liquidated to make the required payments. At the termination of the agreement, the remaining assets revert to the donor or the donor's beneficiary (the remainder interest). #### Charitable Remainder Annuity Trusts and Remainder Unitrusts ##### [958-30-05-10](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-10) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:ca1b1a15a750a635e4c7d4b99f037497651358170f2ac1aaaa9cb52f9241dd6e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Assets such as cash or shares of stock are contributed by the donor either to the control of the NFP through its role as trustee of a trust holding the assets or to a third-party trustee. The NFP (or the trust) makes periodic payments to the donor or the donor's beneficiary that are either a fixed dollar amount (an annuity trust) or a specified percentage of the fair value of the assets during the term of the agreement (a unitrust). Some of the assets may need to be liquidated to make the payments. At the termination of the agreement, the remaining assets revert to the NFP. #### Charitable Gift Annuities ##### [958-30-05-11](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-11) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:dd60c8cc5b7b55b2b530d82652563adcc09bee2dbc001049fe32eb00d73e1f96 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. A charitable gift annuity is an arrangement between a donor and an NFP in which the donor contributes assets to the NFP in exchange for a promise by the NFP to pay a fixed amount for a specified period of time to the donor or to individuals or entities designated by the donor. The agreements are similar to charitable remainder annuity trusts except that no trust exists, the assets received are held as general assets of the NFP, and the annuity liability is a general obligation of the NFP. #### Pooled Income Fund ##### [958-30-05-12](https://asc.understandingaccounting.org/asc/958/30/#958-30-05-12) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:01.739Z to 2026-09-10T02:22:01.739Z Record version: sha256:398e4728a84dbb5e6ea8c9904c81745d902bb8644393707792de5d76867f5519 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Some NFPs form, invest, and manage pooled income funds. These funds are divided into units, and [contributions](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") of many donors' life income gifts are pooled and invested as a group. Source downloaded (UTC): 2026-09-10T02:22:04.567Z to 2026-09-10T02:22:04.567Z Record version: sha256:542f3cfd51c601a378eb24b5a82e5dc003fed4b4f471f006a378e868f7f47cf4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-15: 15 Scope and Scope Exceptions [Read section](https://asc.understandingaccounting.org/asc/958/30/#15-scope-and-scope-exceptions) SEC content: no #### Overall Guidance ##### [958-30-15-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-15-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:04.567Z to 2026-09-10T02:22:04.567Z Record version: sha256:9afc7b2096b21b05f364a68c7afd579cd314b8ee777899ffb9e4d26adc9f6522 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Subtopic follows the same Scope and Scope Exceptions as outlined in the Overall Subtopic, see Section 958-10-15. Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:c40c3102a970d201b3e161160377cc6426f56ce86a5304fe04d734510631561a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-25: 25 Recognition [Read section](https://asc.understandingaccounting.org/asc/958/30/#25-recognition) SEC content: no ##### [958-30-25-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:6fa72a3d20da40259d18d9dd9d6907d1f5616961ff03a2f77b7504b0fe9db72d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Section provides recognition guidance for two types of split-interest agreements: 1. a Revocable agreements 2. b Irrevocable agreements. #### Revocable Agreements ##### [958-30-25-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:ed6aa4a0b938656798d69a917c094334927e069988d5c7a33a4aa4edccaa5fdb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Revocable split-interest agreements shall be accounted for as intentions to give. Assets received by 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) acting as a [trustee](https://asc.understandingaccounting.org/glossary/t/#trustee "An entity that has a duty to hold and manage assets for the benefit of a specified beneficiary in accordance with a charitable trust agreement. In some states, not-for-profit entities (NFPs) are organized under trust law rather than as corporations. Those NFPs are not trustees as defined because, under those statutes, they hold assets in trust for the community or some other broadly described group, rather than for a specific beneficiary.") under a revocable [split-interest agreement](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest.") shall be recognized when received as assets and as a refundable advance. If those assets are investments, they shall be recognized in conformity with Section 958-320-25, 958-321-25, or 958-325-25, as appropriate. [Contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenue for the assets received shall be recognized when the agreement becomes irrevocable or when the assets are distributed to the NFP for its unconditional use, whichever occurs first. #### Irrevocable Agreements ##### [958-30-25-3](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:53f5d8f45f885645748743feca6ef01db8994b7f1220513b16d9aceca3c20033 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Under irrevocable split-interest agreements the assets contributed by the donor may be either: 1. a Held by an NFP 2. b Held by a third party. ##### [958-30-25-4](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:c7ed425072d64654063731d76f53b5b476ff4b3df9247b6a6a650156a9a326ce Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In the absence of [donor-imposed conditions](https://asc.understandingaccounting.org/glossary/d/#donor-imposed-condition "A donor stipulation (donors include other types of contributors, including makers of certain grants) that represents a barrier that must be overcome before the recipient is entitled to the assets transferred or promised. Failure to overcome the barrier gives the contributor a right of return of the assets it has transferred or gives the promisor a right of release from its obligation to transfer its assets."), an NFP shall recognize contribution revenue and related assets and liabilities when an irrevocable split-interest agreement naming it trustee or fiscal [agent](https://asc.understandingaccounting.org/glossary/a/#agent "An entity that acts for and on behalf of another. Although the term agency has a legal definition, the term is used broadly to encompass not only legal agency, but also the relationships described in Topic 958. A recipient entity acts as an agent for and on behalf of a donor if it receives assets from the donor and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a specified beneficiary. A recipient entity acts as an agent for and on behalf of a beneficiary if it agrees to solicit assets from potential donors specifically for the beneficiary's use and to distribute those assets to the beneficiary. A recipient entity also acts as an agent if a beneficiary can compel the recipient entity to make distributions to it or on its behalf.") is executed. Assets received under those agreements shall be recorded when received. If those assets are investments, they shall be recognized in conformity with Section 958-320-25, 958-321-25, or 958-325-25, as appropriate. The contribution portion of the agreement (that is, the part that represents the unconditional transfer of assets in a voluntary nonreciprocal transaction) shall be recognized as revenue or gain (see paragraph [958-30-45-7](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-7)). ##### [958-30-25-5](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:f93c0835c733b17b8afb79ea7fa20039108760171bd201378dc2038605b408f6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraphs [958-30-25-6 through 25-15](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-6) provide guidance on the following types of donor agreements: 1. a Split-interest agreements other than pooled income funds or net income unitrusts 2. b Pooled income funds or net income unitrusts. ##### [958-30-25-6](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:a5c1895ef2000e376af9d987c657eb5017c9e1807eacf789824dec0cc1c31d84 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the split-interest agreement is other than a pooled income fund or net income unitrust (for example, a [charitable gift annuity](https://asc.understandingaccounting.org/glossary/c/#charitable-gift-annuity "A transfer of assets to a not-for-profit entity (NFP) in connection with a split-interest agreement that is in part a contribution and in part an exchange transaction. The NFP accepts the contribution and is obligated to make periodic stipulated payments to the donor or a third-party beneficiary for a specified period of time, usually either a specified number of years or until the death of the donor or third-party beneficiary."), a [charitable lead trust](https://asc.understandingaccounting.org/glossary/c/#charitable-lead-trust "A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor."), or a [charitable remainder trust](https://asc.understandingaccounting.org/glossary/c/#charitable-remainder-trust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives specified distributions during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.")), the transferred assets, or a portion of those assets, are being held for the benefit of others, such as the donor or third parties designated by the donor. A liability for the future payments to be made to those other beneficiaries shall also be recognized at the date of initial recognition. See paragraphs [958-30-25-7 through 25-14](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-7) to determine whether the agreement contains an embedded derivative. ##### [958-30-25-7](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:49ec7e1c86e5935fd55a9465988c1b7cf2ee19d2bf476182dd307b9946027103 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following two aspects of a split-interest agreement's payment terms affect the accounting treatment for an NFP's liability for the payment or payments to the donor or the donor's beneficiary: 1. a Whether the payments are a fixed or variable cash amount 2. b Whether the agreement is period-certain or life-contingent. ##### [958-30-25-8](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:14f071d75e96642fb2801950ddedba5807a5077aa4ed07428ba9801e121e8d0e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An NFP's liability for its obligation to the donor or the donor's beneficiary under an irrevocable split-interest agreement shall be analyzed to determine whether it qualifies for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) , in which case that liability would not be subject to the requirements of Topic 815. For example, if the obligation is solely life-contingent (that is, contingent upon the survival of an identified individual, in which case the payments are made only if the individual is alive when the payments are due), that obligation would qualify for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) . ##### [958-30-25-9](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-9) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:e734dc06edd95b4d007a1b29d5c089db0c44a99952d2f42fdc8a649a6859cec8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an NFP's liability for its obligation under the split-interest agreement does not qualify for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) because the agreement is not solely life-contingent, the NFP shall determine whether that liability meets the definition of a derivative instrument in its entirety under paragraph [815-10-15-83](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83) or whether it contains an embedded derivative that could warrant separate accounting under paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1) unless a fair value election is made pursuant to Section 815-15-25. ##### [958-30-25-10](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-10) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:0daf4c319935a06be32b8d1d156154c6762272d6d44ad0d594fa2f89f55a3cf3 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The NFP's liability for its obligation under a split-interest agreement would typically not meet the definition of a derivative instrument in its entirety because it would not meet the criterion in paragraph [815-10-15-83(b)](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83) that requires the contract to have no initial net investment or an initial net investment that is smaller than would be required for other types of contracts that would be expected to have a similar response to changes in market factors. In contrast, the initial net investment for the liability recognized for typical split-interest agreements is its [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date."). ##### [958-30-25-11](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-11) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:5b017d3bd85ef02e2ec6b74b5524d232992e3db03558f3d8279a264443089278 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an NFP's liability for its obligation under the split-interest agreement does not in its entirety meet the definition of a derivative instrument in paragraph [815-10-15-83](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83), that liability shall be analyzed to determine whether it contains provisions that constitute an embedded derivative that warrants separate accounting under paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1). ##### [958-30-25-12](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-12) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:75f5de4d3488b1bf30920cf042793f1f62e1b45e8f207698414ea74b73508cff Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Generally, the liability representing an obligation under a split-interest agreement contains an embedded derivative if the payments are variable and the agreement is period-certain (rather than life-contingent). The embedded derivative shall be bifurcated and accounted for as a derivative instrument pursuant to the requirements of paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1) unless a fair value election is made pursuant to Section 815-15-25 or the Fair Value Option Subsections of Subtopic 825-10. ##### [958-30-25-13](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-13) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:4277dca4475aad1515d2c77abd1f796d2d89e9e50b23747ea519f1ea875ef563 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Example 2, Cases A through H (see paragraphs [958-30-55-6 through 55-29](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-6) ) illustrate the applicability of paragraphs [958-30-25-7 through 25-12](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-7) to various split-interest agreements that are invested in shares of common stock. ##### [958-30-25-14](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-14) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:12df925db1feaa2007c23c4268f1c92129e0afd761dd8fb4e8789f36ff6bff49 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Other split-interest agreements may involve the gift of corporate or U.S. government debt securities, or other securities that are not equity. In determining whether or not those split-interest agreements contain an embedded derivative, the same analysis outlined in paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1) shall be applied. The notion of clearly and closely related, as defined in paragraph [815-15-25-1(a)](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1), shall involve an assessment of the economic characteristics and risks associated with the nonequity securities in relation to the economic characteristics and risks of the NFP's debt host contract. Generally, because of the differences in credit risk, the change in the fair value of corporate bonds (based on that corporation's credit and interest rate risk) will not be clearly and closely related to the change in the economic characteristics and risks of the NFP's debt host contract. Thus, an embedded derivative requiring bifurcation and separate accounting for the embedded derivative would exist unless a fair value election is made pursuant to Section 815-15-25 or the Fair Value Option Subsections of Subtopic 825-10. ##### [958-30-25-15](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-15) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:b43a6420b4d8a12e98e81dd84d35a9b348ba1eec4a7eaf93968476c78eb0fccd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The assets received from the donor under a pooled income fund agreement or a [net income unitrust](https://asc.understandingaccounting.org/glossary/n/#net-income-unitrust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions during the agreement's term of the lesser of the net income earned by the trust or a fixed percentage of the fair value of the trust's assets, with or without recovery and distribution of the shortfall in a subsequent year. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.") shall be recognized when received. An NFP also shall recognize its [remainder interest](https://asc.understandingaccounting.org/glossary/r/#remainder-interest "The right to receive all or a portion of the assets of a split-interest agreement remaining at the end of the agreement's term.") in the assets received as contribution revenue in the period in which the assets are received from the donor. The difference between the assets recognized and the revenue recognized shall be recorded as deferred revenue, representing the amount of the discount for future interest. ##### [958-30-25-16](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-16) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:d1084de856731d3267a1d2ab848a2588c03d10a77ed877e3f17ecd21187d4b4a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Some NFPs are parties to split-interest agreements that involve a third party who maintains control of the donor's contributed assets. In a split-interest agreement in which cash or other assets contributed by a donor are held by an independent trustee (such as a charitable trust for which a bank, trust company, foundation, or private individual is the trustee) or by another fiscal agent of the donor or the cash or other assets are otherwise not controlled by the NFP, the NFP shall recognize its beneficial interest in those assets. ##### [958-30-25-17](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-17) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:40b8df408efb5799999b3632eb4e3efa56dcb4b0dc6f6ef47aa313927ff80c57 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Pursuant to paragraphs [958-605-25-28 through 25-30](https://asc.understandingaccounting.org/asc/605/958/#605-958-25-28) , if an NFP is the beneficiary of a split-interest agreement held by a third party and has an unconditional right to receive all or a portion of the specified cash flows from the assets held pursuant to that agreement, the NFP shall recognize that beneficial interest as an asset and contribution revenue. That asset and contribution revenue represents its entitlement to the [lead interest](https://asc.understandingaccounting.org/glossary/l/#lead-interest "The right to the benefits (cash flows or use) of assets during the term of a split-interest agreement, which generally starts upon the signing of the agreement and terminates at either of the following times: After a specified number of years (period-certain) Upon the occurrence of a certain event, commonly either the death of the donor or the death of the lead interest beneficiary (life-contingent).") payments or the remainder interest, as stipulated in the agreement. The contribution shall be recognized when the NFP is notified of the split-interest agreement's existence. ##### [958-30-25-18](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-18) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:63efdea3747619366987ef6cb8a82b505e9fb7db9ce08714ef64d015035b3c36 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. However, if the trustee or fiscal agent has [variance power](https://asc.understandingaccounting.org/glossary/v/#variance-power "The unilateral power to redirect the use of the transferred assets to another beneficiary. A donor explicitly grants variance power if the recipient entity's unilateral power to redirect the use of the assets is explicitly referred to in the instrument transferring the assets. Unilateral power means that the recipient entity can override the donor's instructions without approval from the donor, specified beneficiary, or any other interested party.") to redirect the benefits to another entity or if the NFP's rights to the benefits are conditional, the NFP shall not recognize its potential for future distributions from the split-interest agreement until the NFP has an unconditional right to receive benefits under the agreement. ##### [958-30-25-19](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-19) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:08.355Z to 2026-09-10T02:22:08.355Z Record version: sha256:2e028e76e23a2f832faa0d6781c871831ea714174babf3dec127c8f2de34b310 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The NFP does not have an obligation to pay either the remainder or lead interest to the designated beneficiary, as that responsibility remains with the third party who maintains control of the assets (thus, the NFP does not recognize a liability). Further, under paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1), the embedded derivative would not be bifurcated, as the criterion in paragraph [815-15-25-1(b)](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1) is not met. Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:5fcc72c8c42b3e81db26a71aadd179dddb5c335c53cebcd7de636290269a9e0e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-30: 30 Initial Measurement [Read section](https://asc.understandingaccounting.org/asc/958/30/#30-initial-measurement) SEC content: no #### Fair Value Measurement ##### [958-30-30-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:11691d47ff914dab8ca5c64274106b019f813ff67d0a78dcbb4370c11ad63314 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Topic 820 establishes a framework for measuring [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date."). This Subtopic uses present value techniques as one possible technique to measure the [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenue and obligation to other beneficiaries of a [split-interest agreement](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest."). See paragraphs [820-10-55-4 through 55-20](https://asc.understandingaccounting.org/asc/820/10/#820-10-55-4) for implementation guidance for using present value techniques if the measurement objective is fair value. Other valuation techniques are also available, as discussed in Section 820-10-35. ##### [958-30-30-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:6ff959d7206be8a1e9da6087600df00f88e7e0de63de6d1c689a623133319778 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Section provides initial measurement guidance for the two types of split-interest agreements: 1. a Revocable agreements 2. b Irrevocable agreements. #### Revocable Agreements ##### [958-30-30-3](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:4d17a45184be12412090fec45fa05dba1eee9aa215c1ab1f152aa7ec5430bab8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Assets received by 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) acting as a [trustee](https://asc.understandingaccounting.org/glossary/t/#trustee "An entity that has a duty to hold and manage assets for the benefit of a specified beneficiary in accordance with a charitable trust agreement. In some states, not-for-profit entities (NFPs) are organized under trust law rather than as corporations. Those NFPs are not trustees as defined because, under those statutes, they hold assets in trust for the community or some other broadly described group, rather than for a specific beneficiary.") under a revocable split-interest agreement shall be recognized at fair value. #### Irrevocable Agreements ##### [958-30-30-4](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:72b10e0fb01cb5791183aa775e7c7a1aa3e9b78ac62a0ac514f990b31fdfda07 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the NFP serves as trustee or if the assets contributed by the donor are otherwise under the control of the NFP, cash and other assets received under split-interest agreements shall be recognized at fair value at the date of initial recognition. Further, in accordance with paragraph [958-605-30-2](https://asc.understandingaccounting.org/asc/605/958/#605-958-30-2), contributions shall be measured at fair value at the date of initial recognition of a split-interest agreement. ##### [958-30-30-5](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:9cb5e42b7a2e01de970836fcc9d7f917cd0fa9e9a7e72dc07b9935ec24e3ba46 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If the split-interest agreement is other than a [pooled income fund](https://asc.understandingaccounting.org/glossary/p/#pooled-income-fund "A trust in which donors are assigned a specific number of units based on the proportion of the fair value of their contributions to the total fair value of the pooled income fund on the date of the donor's entry to the pooled fund. Until a donor's death, the donor (or the donor's designated beneficiary or beneficiaries) is paid the actual income (as defined under the arrangement) earned on the donor's assigned units. Upon the donor's death, the value of these assigned units reverts to the NFP.") or net income unitrust (for example, a [charitable gift annuity](https://asc.understandingaccounting.org/glossary/c/#charitable-gift-annuity "A transfer of assets to a not-for-profit entity (NFP) in connection with a split-interest agreement that is in part a contribution and in part an exchange transaction. The NFP accepts the contribution and is obligated to make periodic stipulated payments to the donor or a third-party beneficiary for a specified period of time, usually either a specified number of years or until the death of the donor or third-party beneficiary."), a [charitable lead trust](https://asc.understandingaccounting.org/glossary/c/#charitable-lead-trust "A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor."), or a [charitable remainder trust](https://asc.understandingaccounting.org/glossary/c/#charitable-remainder-trust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives specified distributions during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.")), the transferred assets, or a portion of those assets, are being held for the benefit of others, such as the donor or third parties designated by the donor. That liability shall be measured at fair value at the date of initial recognition. If present value techniques are used to measure fair value, the liability is measured at the present value of the future payments to be made to the other beneficiaries. ##### [958-30-30-6](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:3f87c04cf749c2f06b35bd6b52b5ff1b7f7f5f284613fbdcf2f660eab41b6af0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Any present value technique for measuring the fair value of the contribution or payments to be made to other beneficiaries shall consider the elements described in paragraph [820-10-55-5](https://asc.understandingaccounting.org/asc/820/10/#820-10-55-5), including the following: 1. a The estimated return on the invested assets during the expected term of the agreement 2. b The contractual payment obligations under the agreement 3. c A discount rate commensurate with the risks involved. ##### [958-30-30-7](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:5a23443ac0316659c71e1d66f1cba6ebf37cebb8d3454ddea0fdcb9224959407 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Under a [lead interest](https://asc.understandingaccounting.org/glossary/l/#lead-interest "The right to the benefits (cash flows or use) of assets during the term of a split-interest agreement, which generally starts upon the signing of the agreement and terminates at either of the following times: After a specified number of years (period-certain) Upon the occurrence of a certain event, commonly either the death of the donor or the death of the lead interest beneficiary (life-contingent).") agreement, the fair value of the contribution can be estimated directly based on the present value of the future distributions to be received by the NFP as a beneficiary. Under lead interest agreements, the future payments to be made to other beneficiaries will be made by the NFP only after the NFP receives its benefits. In those situations, the present value of the future payments to be made to other beneficiaries may be estimated by the fair value of the assets contributed by the donor under the agreement less the fair value of the benefits to be received by the NFP. If present value techniques are used, the fair value of the benefits to be received by the NFP shall be measured at the present value of the benefits to be received over the expected term of the agreement. ##### [958-30-30-8](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:13f31624b62833a3eab9bf035927ee7918282523a927037aa2fe13530c019d8a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Under [remainder interest](https://asc.understandingaccounting.org/glossary/r/#remainder-interest "The right to receive all or a portion of the assets of a split-interest agreement remaining at the end of the agreement's term.") agreements, the present value of the future payments to be made to other beneficiaries can be estimated directly based on the terms of the agreement. Future distributions will be received by the NFP only after obligations to other beneficiaries are satisfied. In those cases, the fair value of the contribution may be estimated based on the fair value of the assets contributed by the donor less the fair value of the payments to be made to other beneficiaries. ##### [958-30-30-9](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-9) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:7133019a1387e42e7b772b59e220b37329a255baf0d0c0c98879e964d3165595 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Pursuant to Section 815-15-30, an embedded derivative in an obligation for future payments to be made to other beneficiaries shall be measured at fair value. Alternatively, an NFP that serves as a trustee or fiscal [agent](https://asc.understandingaccounting.org/glossary/a/#agent "An entity that acts for and on behalf of another. Although the term agency has a legal definition, the term is used broadly to encompass not only legal agency, but also the relationships described in Topic 958. A recipient entity acts as an agent for and on behalf of a donor if it receives assets from the donor and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a specified beneficiary. A recipient entity acts as an agent for and on behalf of a beneficiary if it agrees to solicit assets from potential donors specifically for the beneficiary's use and to distribute those assets to the beneficiary. A recipient entity also acts as an agent if a beneficiary can compel the recipient entity to make distributions to it or on its behalf.") can irrevocably elect to measure the entire obligation at fair value pursuant to Section 815-15-25 or the Fair Value Option Subsections of Subtopic 825-10. ##### [958-30-30-10](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-10) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:838de5fec053ed6fb5fe87867df2eb64877dba3df067f7f44d3b05b401043ca5 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The contributed assets received from the donor under a pooled income fund agreement or a [net income unitrust](https://asc.understandingaccounting.org/glossary/n/#net-income-unitrust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions during the agreement's term of the lesser of the net income earned by the trust or a fixed percentage of the fair value of the trust's assets, with or without recovery and distribution of the shortfall in a subsequent year. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.") shall be recognized at fair value. The contribution shall be measured at fair value. Present value techniques are one valuation technique for measuring the fair value of the contribution; other valuation techniques are also available, as described in Topic 820. If present value techniques are used, the contribution may be measured at the fair value of the assets to be received, discounted for the estimated time period until the donor's death. ##### [958-30-30-11](https://asc.understandingaccounting.org/asc/958/30/#958-30-30-11) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:11.482Z to 2026-09-10T02:22:11.482Z Record version: sha256:72dafb0ca5ef642afadce816edefbb90360bccdd5fe43b11dab9411bdea7879d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Pursuant to paragraph [958-605-30-14](https://asc.understandingaccounting.org/asc/605/958/#605-958-30-14), if an NFP is the beneficiary of a split-interest agreement held by a third party and has an unconditional right to receive all or a portion of the specified cash flows from the assets held pursuant to that agreement, the NFP shall measure its beneficial interest at fair value. Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:1cdffee8e2316299620e06a77982934be3410aeef8df36a3ae8a7333670561e0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-35: 35 Subsequent Measurement [Read section](https://asc.understandingaccounting.org/asc/958/30/#35-subsequent-measurement) SEC content: no #### Fair Value Measurement ##### [958-30-35-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:496cd0fb6ef79a81fb52583c34fd8b49bb04ddd98a513e2ce1c392b28e691065 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Topic 820 establishes a framework for measuring [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date."). This Subtopic uses present value techniques as one possible technique to measure the obligation to other beneficiaries of a [split-interest agreement](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest."). See paragraphs [820-10-55-4 through 55-20](https://asc.understandingaccounting.org/asc/820/10/#820-10-55-4) for implementation guidance for using present value techniques if the measurement objective is fair value. ##### [958-30-35-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:6cd064f3d1b33a9af0923f329e839af83fccc26434fcb3bd98e8f2e0b7b21d14 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The measurement objective is fair value for the following split-interest obligations: 1. a Embedded derivatives subject to the measurement provisions of Topic 815 2. b Obligations for which the [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) elects the fair value option pursuant to the Fair Value Option Subsections of Subtopic 825-10 3. c Obligations containing embedded derivatives that the NFP has irrevocably elected to measure in their entirety at fair value in conformity with Section 815-15-25. Additionally, in circumstances in which cash or other assets contributed by donors under split-interest agreements are held by independent trustees, such as a charitable trust for which a bank is a [trustee](https://asc.understandingaccounting.org/glossary/t/#trustee "An entity that has a duty to hold and manage assets for the benefit of a specified beneficiary in accordance with a charitable trust agreement. In some states, not-for-profit entities (NFPs) are organized under trust law rather than as corporations. Those NFPs are not trustees as defined because, under those statutes, they hold assets in trust for the community or some other broadly described group, rather than for a specific beneficiary."), or by other fiscal agents of the donors or otherwise not controlled by the NFP, the measurement objective for the beneficial interest in periods after the period of initial recognition is fair value. ##### [958-30-35-3](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:631a81f50ece52ac09ced45f964c94abf06d3c66435fc1e668ef59d38b46b8a9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In circumstances in which the fair value is measured at the present value of the future cash flows, all elements discussed in paragraph [820-10-55-5](https://asc.understandingaccounting.org/asc/820/10/#820-10-55-5), including discount rate assumptions, shall be revised at each measurement date to reflect current market conditions. #### Irrevocable Agreements ##### [958-30-35-4](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:de39dc80676206812a5a7ec8de0c8c4049db91e809e34db374f7914ed8c66cdf Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Assets held by the NFP under irrevocable split-interest agreements as investments shall be subsequently measured in conformity with Section 958-320-35, 958-321-35, or 958-325-35. ##### [958-30-35-5](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:e074beca858526166f2344c1c1c74eee582a5b16c9224bafd86180596ee22acd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In addition, if assets and related liabilities are recognized under a split-interest agreement other than a [pooled income fund](https://asc.understandingaccounting.org/glossary/p/#pooled-income-fund "A trust in which donors are assigned a specific number of units based on the proportion of the fair value of their contributions to the total fair value of the pooled income fund on the date of the donor's entry to the pooled fund. Until a donor's death, the donor (or the donor's designated beneficiary or beneficiaries) is paid the actual income (as defined under the arrangement) earned on the donor's assigned units. Upon the donor's death, the value of these assigned units reverts to the NFP.") or net income unitrust (for example, a [charitable gift annuity](https://asc.understandingaccounting.org/glossary/c/#charitable-gift-annuity "A transfer of assets to a not-for-profit entity (NFP) in connection with a split-interest agreement that is in part a contribution and in part an exchange transaction. The NFP accepts the contribution and is obligated to make periodic stipulated payments to the donor or a third-party beneficiary for a specified period of time, usually either a specified number of years or until the death of the donor or third-party beneficiary."), [charitable lead trust](https://asc.understandingaccounting.org/glossary/c/#charitable-lead-trust "A trust established in connection with a split-interest agreement, in which a not-for-profit entity (NFP) receives distributions during the agreement's term. Upon termination of the trust, the remainder of the trust assets is paid to the donor or to third-party beneficiaries designated by the donor."), or [charitable remainder trust](https://asc.understandingaccounting.org/glossary/c/#charitable-remainder-trust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives specified distributions during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.") agreement) for which an NFP serves as a trustee or fiscal [agent](https://asc.understandingaccounting.org/glossary/a/#agent "An entity that acts for and on behalf of another. Although the term agency has a legal definition, the term is used broadly to encompass not only legal agency, but also the relationships described in Topic 958. A recipient entity acts as an agent for and on behalf of a donor if it receives assets from the donor and agrees to use those assets on behalf of or transfer those assets, the return on investment of those assets, or both to a specified beneficiary. A recipient entity acts as an agent for and on behalf of a beneficiary if it agrees to solicit assets from potential donors specifically for the beneficiary's use and to distribute those assets to the beneficiary. A recipient entity also acts as an agent if a beneficiary can compel the recipient entity to make distributions to it or on its behalf."), the following shall be reported in the NFP's statements of financial position, activities, and cash flows: 1. a Income earned on those assets 2. b Gains and losses 3. c Distributions made to other beneficiaries under the agreements. Those transactions generally are recognized as either an increase or a reduction in the liability to the other beneficiaries. For example, in subsequent periods, payments to an annuity beneficiary reduce the annuity liability. ##### [958-30-35-6](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:7c80300eb3d8f6a8a6acd8dfb86759ae1a843a82a4843c39d930a8a251aba3af Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, the following adjustments to the liability shall be recognized as changes in the value of split-interest agreements in a statement of activities. In circumstances in which assets held in trust and related liabilities are recognized under lead and [remainder interest](https://asc.understandingaccounting.org/glossary/r/#remainder-interest "The right to receive all or a portion of the assets of a split-interest agreement remaining at the end of the agreement's term.") agreements for which an NFP serves as a trustee or fiscal agent, the liability for future payments to be made to other beneficiaries is measured at fair value if the NFP elects the fair value option as described in paragraph [958-30-35-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-2). If the NFP does not elect the fair value option, the following transactions and events shall be included in the remeasurement of the liability: 1. a Amortization of the discount associated with the [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") 2. b Revaluations of future payments to beneficiaries, based on changes in life expectancy, and other actuarial assumptions. In conformity with paragraph [310-10-30-6](https://asc.understandingaccounting.org/asc/310/10/#310-10-30-6), unless the measurement objective for periods after the period of initial recognition is fair value, the discount rate shall not be revised after initial recognition. ##### [958-30-35-7](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:fe86a615ca8113afd58e217b0dd5d0fa871cc706c8c921be55c8b932a1d22bbe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If an NFP does not elect to report a split-interest obligation at fair value as described in paragraph [958-30-35-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-2), a split-interest obligation with an embedded derivative is bifurcated into its debt host contract and embedded derivative. The debt host contract is the liability for the payment to the beneficiary that would be required if the fair value of the trust assets does not change over the specified period. The embedded derivative represents the liability (or contraliability) for the increase (or decrease) in the payments to the beneficiary due to changes in the fair value of the trust assets over the specified period. In circumstances in which the liability is measured using present value techniques, the discount rate assumptions on the debt host contract shall not be revised after initial recognition, consistent with the preceding paragraph. In accordance with paragraph [815-10-35-1](https://asc.understandingaccounting.org/asc/815/10/#815-10-35-1), the embedded derivative is subsequently measured at fair value. If the fair value of the embedded derivative is measured using present value techniques, all elements discussed in paragraph [820-10-55-5](https://asc.understandingaccounting.org/asc/820/10/#820-10-55-5), including the discount rate assumptions on the embedded derivative, shall be revised at each measurement date to reflect current market conditions. ##### [958-30-35-8](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:e6e146ec16bb576a238e484eb543cd677800e88603626ba08149dcedb2947de6 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In conformity with paragraph [815-15-25-53](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-53), if an NFP cannot reliably identify and measure the embedded derivative, the entire split-interest liability shall be measured at fair value (that is, all elements discussed in paragraph [820-10-55-5](https://asc.understandingaccounting.org/asc/820/10/#820-10-55-5), including discount rate assumptions, shall be revised to reflect current market conditions). ##### [958-30-35-9](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-9) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:fb2c4915562452950b0f6d67ff590d0be8b89ad34c35eae0298756c2e5295be4 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Periodic income on a [pooled income fund](https://asc.understandingaccounting.org/glossary/p/#pooled-income-fund "A trust in which donors are assigned a specific number of units based on the proportion of the fair value of their contributions to the total fair value of the pooled income fund on the date of the donor's entry to the pooled fund. Until a donor's death, the donor (or the donor's designated beneficiary or beneficiaries) is paid the actual income (as defined under the arrangement) earned on the donor's assigned units. Upon the donor's death, the value of these assigned units reverts to the NFP.") or net-income unitrust and payments to the beneficiary shall be reflected as increases and decreases in a liability to the beneficiary. Amortization of the discount for future interest shall be recognized as a reduction in the deferred revenue account and as a change in the value of split-interest agreements. ##### [958-30-35-10](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-10) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:13e3bd12e8c5be8525fa8033f841d775a9c1e51ef0841175629ed9ea46b4b589 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Pursuant to paragraph [958-605-35-3](https://asc.understandingaccounting.org/asc/605/958/#605-958-35-3), if an NFP is the beneficiary of a split-interest agreement held by a third party and has an unconditional right to receive all or a portion of the specified cash flows from the assets held pursuant to that agreement, the NFP shall subsequently remeasure that beneficial interest at fair value. Changes in the fair value of the beneficial interest shall be recognized in the statement of activities. The change in the value of split-interest agreements is the change in the fair value of the NFP's beneficial interest, which shall be determined using the same valuation technique that was used to measure the asset initially. Distributions from the trust shall be reflected as a reduction in the beneficial interest. #### Revocable Agreements ##### [958-30-35-11](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-11) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:3808ab1e7eb19d125ad35e1bd77a571bcf82bf297afad03991b72af913319abc Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Assets held by the NFP under revocable split-interest agreements as investments shall be subsequently measured in conformity with Section 958-320-35, 958-321-35, or 958-325-35. ##### [958-30-35-12](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-12) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:13.243Z to 2026-09-10T02:22:13.243Z Record version: sha256:41abb8a6c817498f6f45491fb6807c4e252929c8a13188ed388906e13bc276cb Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Income earned on assets held under such agreements that is not available for the NFP's unconditional use, and any subsequent adjustments to the carrying value of those assets, shall be recognized as adjustments to the assets and as refundable advances. Source downloaded (UTC): 2026-09-10T02:22:15.799Z to 2026-09-10T02:22:15.799Z Record version: sha256:d83ceb92b7d1bcf159430575f2d2e4c66f704179fceba622baa4e39eeef9d2ca Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-40: 40 Derecognition [Read section](https://asc.understandingaccounting.org/asc/958/30/#40-derecognition) SEC content: no ##### [958-30-40-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-40-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:15.799Z to 2026-09-10T02:22:15.799Z Record version: sha256:fa5d3f03917de85c08b5a3c7042bc2f8b3f48aa04010b4eb2276bc024a22cb10 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Upon termination of a [split-interest agreement](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest."), asset and liability accounts related to the agreement shall be closed. Any remaining amounts in the asset or liability accounts shall be recognized as changes in the value of split-interest agreements. Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:50f569b7471f5a7c59b9992f5b661fb53d8468cd28f00880e1e7b07968c78161 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-45: 45 Other Presentation Matters [Read section](https://asc.understandingaccounting.org/asc/958/30/#45-other-presentation-matters) SEC content: no #### Classification of Net Assets ##### [958-30-45-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:8dace40fc4b36588e4e77761bd1b4195151ce9c09e51c971b8d34b05fd071bb8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenues recognized under [split-interest agreements](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest.") shall be classified as increases in [net assets with donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-with-donor-restrictions "The part of net assets of a not-for-profit entity that is subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).") unlessthe donor gives the [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) the immediate right to use, without restrictions, the assets it receives, in which case the contribution shall be classified as an increase in [net assets without donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-without-donor-restrictions "The part of net assets of a not-for-profit entity that is not subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants)."). 1. a [Subparagraph superseded by Accounting Standards Update No. 2016-14](https://asc.understandingaccounting.org/updates/asu-2016-14/). 2. b [Subparagraph superseded by Accounting Standards Update No. 2016-14](https://asc.understandingaccounting.org/updates/asu-2016-14/). ##### [958-30-45-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:367af4bc8c5c49fd5cc1ab5aefb74e95f5b672faeb4cd699d5bc7d87b53a452d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Under many [charitable gift annuity](https://asc.understandingaccounting.org/glossary/c/#charitable-gift-annuity "A transfer of assets to a not-for-profit entity (NFP) in connection with a split-interest agreement that is in part a contribution and in part an exchange transaction. The NFP accepts the contribution and is obligated to make periodic stipulated payments to the donor or a third-party beneficiary for a specified period of time, usually either a specified number of years or until the death of the donor or third-party beneficiary.") agreements, the assets received from the donor are held by the NFP as part of its general assets and are available for its general use. The contribution portion of a charitable gift annuity agreement shall be recognized as revenue without donor restrictions if both of the following criteria are met: 1. a The donor does not restrict the use of the assets contributed to the NFP. 2. b Neither the agreement nor laws and regulations require the assets received by the NFP to be invested until the income beneficiary's death. Additional annuity reserves required by state laws, as described in paragraph [958-30-50-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-50-2), do not create donor restrictions. If either of those criteria is not met, the contribution shall be classified as [donor-restricted support](https://asc.understandingaccounting.org/glossary/d/#donor-restricted-support "Donor-restricted revenues or gains from contributions that increase net assets with donor restrictions (donors include other types of contributors, including makers of certain grants).") that increases net assets with donor restrictions and shall be reclassified as net assets without donor restrictions when [donor-imposed restrictions](https://asc.understandingaccounting.org/glossary/d/#donor-imposed-restriction "A donor stipulation (donors include other types of contributors, including makers of certain grants) that specifies a use for a contributed asset that is more specific than broad limits resulting from the following: The nature of the not-for-profit entity (NFP) The environment in which it operates The purposes specified in its articles of incorporation or bylaws or comparable documents for an unincorporated association. Some donors impose restrictions that are temporary in nature, for example, stipulating that resources be used after a specified date, for particular programs or services, or to acquire buildings or equipment. Other donors impose restrictions that are perpetual in nature, for example, stipulating that resources be maintained in perpetuity. Laws may extend those limits to investment returns from those resources and to other enhancements (diminishments) of those resources. Thus, those laws extend donor-imposed restrictions.") or legal requirements are satisfied. ##### [958-30-45-3](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:f9c3aa0cde3283d1059e6909e26928622d75a4e2e24cbf53753cc7623a2b9f5f Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, transactions and events that are recognized as changes in the value of split-interest agreements in a statement of activities shall be classified as [net assets with donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-with-donor-restrictions "The part of net assets of a not-for-profit entity that is subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).") or [net assets without donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-without-donor-restrictions "The part of net assets of a not-for-profit entity that is not subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants)."), depending on the classification used when the [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenue was recognized initially. ##### [958-30-45-4](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:c685df5d0b2ffe39e5d770766ce1ed72df9bd8cd1224ccf4a65cf95d5f38b718 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Amounts shall be reclassified from net assets with donor restrictions to net assets without donor restrictions as distributions are received by the NFP under the terms of the [split-interest agreement](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest.") unless those assets are otherwise further restricted by the donor. In that case, they shall be reclassified to net assets without donor restrictions when the restrictions expire. ##### [958-30-45-5](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:bd88c0296b9a12ed1dfe6c9e771fd1f3e564d92a4b8d4711ac44d27320dbb16e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If assets previously distributed to the NFP become available for its general use upon termination of the split-interest agreement, a [reclassification of net assets](https://asc.understandingaccounting.org/glossary/r/#reclassification-of-net-assets "Simultaneous increase of one class of net assets and decrease of another. A reclassification of net assets usually results from a donor-imposed restriction (donors include other types of contributors, including makers of certain grants) being satisfied or otherwise lapsing.") shall be made from net assets with donor restrictions to net assets without donor restrictions. #### Presentation in the Statement of Financial Position ##### [958-30-45-6](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:fd835c82e9d7d8310e639337a12cd06762a846a7bfcebdd58b79af9dcaa8cc6b Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Assets and liabilities recognized under split-interest agreements shall be reported separately from other assets and liabilities in a statement of financial position if not disclosed in the related notes (see paragraph [958-30-50-1(b)](https://asc.understandingaccounting.org/asc/958/30/#958-30-50-1)). #### Presentation in the Statement of Activities ##### [958-30-45-7](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:18.202Z to 2026-09-10T02:22:18.202Z Record version: sha256:407225acb699aca89258710265644a601cdb8801ccd3cd66bfe05af666d9282a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenue and changes in the value of split-interest agreements recognized under such agreements shall be reported as separate line items in a statement of activities if not disclosed in the related notes (see paragraph [958-30-50-1(e)](https://asc.understandingaccounting.org/asc/958/30/#958-30-50-1)). Paragraph [958-220-45-6](https://asc.understandingaccounting.org/asc/220/958/#220-958-45-6) states that the classification of contributions received as revenues or gains depends on whether the transactions are part of the NFP's ongoing major or central activities (revenues) or are peripheral or incidental to the NFP (gains). Source downloaded (UTC): 2026-09-10T02:22:19.926Z to 2026-09-10T02:22:19.926Z Record version: sha256:6bd3db3c0765135c43f61c75a8c081670d36ec39905b8d936a0cdc5f7f667fe7 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-50: 50 Disclosure [Read section](https://asc.understandingaccounting.org/asc/958/30/#50-disclosure) SEC content: no ##### [958-30-50-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-50-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:19.926Z to 2026-09-10T02:22:19.926Z Record version: sha256:a075421588d7cb57dc871e540c1370d3f57c8687b0a2b2f40a5222edc3a8d29e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The notes to financial statements shall include all of the following disclosures related to [split-interest agreements](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest."): 1. a A description of the general terms of existing split-interest agreements 2. b Assets and liabilities recognized under split-interest agreements, if not reported separately from other assets and liabilities in a statement of financial position 3. c The basis used (for example, cost, lower of cost or fair value, [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.")) for recognized assets 4. d The discount rates and actuarial assumptions used, if present value techniques are used in reporting the assets and liabilities related to split-interest agreements 5. e [Contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") revenue recognized under such agreements, if not reported as a separate line item in a statement of activities 6. f Changes in the value of split-interest agreements recognized, if not reported as a separate line item in a statement of activities 7. g The disclosures required by the Fair Value Option Subsections of Subtopic 825-10, if 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) elects the fair value option pursuant to paragraph [958-30-35-2(b)](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-2) or [958-30-35-2(c)](https://asc.understandingaccounting.org/asc/958/30/#958-30-35-2) 8. h The disclosures required by paragraphs [820-10-50-1C through 50-2](https://asc.understandingaccounting.org/asc/820/10/#820-10-50-1C) and [820-10-50-2B through 50-2E](https://asc.understandingaccounting.org/asc/820/10/#820-10-50-2B) in the format described in paragraph [820-10-50-8](https://asc.understandingaccounting.org/asc/820/10/#820-10-50-8), if the assets and liabilities of split-interest agreements are measured at fair value on a recurring basis in periods after initial recognition. ##### [958-30-50-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-50-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:19.926Z to 2026-09-10T02:22:19.926Z Record version: sha256:45a03c5ba0cdfe51ecf22eeb8aee1b1d7e9a659d05631d18dc195bb3cb73d5d8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Additional annuity reserves may be required by the laws of the state where the NFP is located or by the state where the donor resides. Legally mandated reserves shall be disclosed in the notes to financial statements. If state law imposes other limitations on the NFP, such as limitations on the manner in which some net assets are invested, those limitations also shall be disclosed in the notes to financial statements. ##### [958-30-50-3](https://asc.understandingaccounting.org/asc/958/30/#958-30-50-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:19.926Z to 2026-09-10T02:22:19.926Z Record version: sha256:1b94ac4c3f2780a56c9d13f896342a111923ac5068fb22010621d3d0071720fa Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. In addition, some NFPs voluntarily set aside additional reserves for unexpected actuarial losses. Voluntary reserves shall be included as part of [net assets without donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-without-donor-restrictions "The part of net assets of a not-for-profit entity that is not subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants)."), but may be presented as a separate component of [board-designated net assets](https://asc.understandingaccounting.org/glossary/b/#board-designated-net-assets "Net assets without donor restrictions subject to self-imposed limits by action of the governing board. Board-designated net assets may be earmarked for future programs, investment, contingencies, purchase or construction of fixed assets, or other uses. Some governing boards may delegate designation decisions to internal management. Such designations are considered to be included in board-designated net assets.") on the face of the statement of financial position (see paragraph [958-210-55-3](https://asc.understandingaccounting.org/asc/210/958/#210-958-55-3)). If not provided on the face of that statement, the reserves set aside by the NFP's governing board shall be disclosed in the notes in accordance with paragraph [958-210-50-3](https://asc.understandingaccounting.org/asc/210/958/#210-958-50-3) to disclose information about the amounts and purposes of board designations of net assets without donor restrictions. Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:97692661524658b98391d4aa89caf953b1bd380bd43720c24ba161ff4ba10a22 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. ## ASC 958-30-55: 55 Implementation Guidance and Illustrations [Read section](https://asc.understandingaccounting.org/asc/958/30/#55-implementation-guidance-and-illustrations) SEC content: no ##### [958-30-55-1](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-1) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:d6ff71d70f824e60a7379f330f60bc94aa5112c8983aa6ff611a389d7e04fb3e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Section, which is an integral part of the requirements of this Subtopic, provides general guidance to be used in the recognition of [split-interest agreements](https://asc.understandingaccounting.org/glossary/s/#split-interest-agreement "An agreement in which a donor enters into a trust or other arrangement under which a not-for-profit entity (NFP) receives benefits that are shared with other beneficiaries. A typical split-interest agreement has the following two components: A lead interest A remainder interest."), particularly those with embedded derivatives. #### Illustrations ##### [958-30-55-2](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-2) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:8d44795c2fc69f27b616c98b72531f2a9b4d36dd1faf46f8fc7649e7e482534a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Example illustrates the guidance in Sections 958-30-25 and 958-30-30 for initial recognition and measurement of a [charitable remainder annuity trust](https://asc.understandingaccounting.org/glossary/c/#charitable-remainder-annuity-trust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions of a fixed amount during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust."). ##### [958-30-55-3](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-3) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:fbe703a166627547119de5fccafcab445641dcc3ee4618107612a058e2c39b17 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Not-for-Profit Entity A (NFP A) receives $100,000 in cash from a donor under a charitable remainder annuity trust agreement designating NFP A as the [trustee](https://asc.understandingaccounting.org/glossary/t/#trustee "An entity that has a duty to hold and manage assets for the benefit of a specified beneficiary in accordance with a charitable trust agreement. In some states, not-for-profit entities (NFPs) are organized under trust law rather than as corporations. Those NFPs are not trustees as defined because, under those statutes, they hold assets in trust for the community or some other broadly described group, rather than for a specific beneficiary.") and charitable remainder beneficiary—a donee. The terms of the trust agreement require that NFP A, as trustee, invest the trust assets and pay $5,000 each year to an annuitant (an income beneficiary specified by the donor) for the remainder of the annuitant's life. Upon death of the annuitant, NFP A may use its [remainder interest](https://asc.understandingaccounting.org/glossary/r/#remainder-interest "The right to receive all or a portion of the assets of a split-interest agreement remaining at the end of the agreement's term.") for any purpose consistent with its mission. ##### [958-30-55-4](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-4) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:1793d4104dfb807a04560731f9767078bd613cf70c257e766e04317603820900 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. NFP A, as a donee, would recognize the [contribution](https://asc.understandingaccounting.org/glossary/c/#contribution "An unconditional transfer of cash or other assets, as well as unconditional promises to give, to an entity or a reduction, settlement, or cancellation of its liabilities in a voluntary nonreciprocal transfer by another entity acting other than as an owner. Those characteristics distinguish contributions from:Exchange transactions, which are reciprocal transfers in which each party receives and sacrifices approximately commensurate valueInvestments by owners and distributions to owners, which are nonreciprocal transfers between an entity and its ownersOther nonreciprocal transfers, such as impositions of taxes or legal judgments, fines, and thefts, which are not voluntary transfers. In a contribution transaction, the resource provider often receives value indirectly by providing a societal benefit although that benefit is not considered to be of commensurate value. In an exchange transaction, the potential public benefits are secondary to the potential direct benefits to the resource provider. The term contribution revenue is used to apply to transactions that are part of the entity's ongoing major or central activities (revenues), or are peripheral or incidental to the entity (gains). See also Inherent Contribution and Conditional Contribution.") received as revenue in the period the trust is established. The transfer is partially an exchange transaction—an agreement for annuity payments to a beneficiary over time—and partially a contribution. The contribution received by NFP A is the unconditional right to receive the remainder interest of the [annuity trust](https://asc.understandingaccounting.org/glossary/a/#annuity-trust "See Charitable Remainder Trust."). The amount of the contribution received by NFP A is the [fair value](https://asc.understandingaccounting.org/glossary/f/#fair-value "The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.") of the trust assets ($100,000 cash transferred) less the fair value of the estimated annuity payments (which is the present value of $5,000 to be paid annually over the expected life of the annuitant if present value techniques are used to measure fair value). Because NFP A must invest the underlying donated assets until the annuitant's death, the revenue recognized for this type of contribution—[donor-restricted support](https://asc.understandingaccounting.org/glossary/d/#donor-restricted-support "Donor-restricted revenues or gains from contributions that increase net assets with donor restrictions (donors include other types of contributors, including makers of certain grants).")—should be distinguished from revenues from gifts that are reported in the [net assets without donor restrictions](https://asc.understandingaccounting.org/glossary/n/#net-assets-without-donor-restrictions "The part of net assets of a not-for-profit entity that is not subject to donor-imposed restrictions (donors include other types of contributors, including makers of certain grants).") category (see paragraph [958-605-45-3](https://asc.understandingaccounting.org/asc/605/958/#605-958-45-3)). The death of the annuitant determines when the required annuity payments cease and when the trust expires and effectively removes all restrictions on the net assets of NFP A (see paragraph [958-30-45-5](https://asc.understandingaccounting.org/asc/958/30/#958-30-45-5)). ##### [958-30-55-5](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-5) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:38d1d0d5055b06bdd8993443f021b5342d5c59d7cb0469d282f95d1261b3b8ac Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. [Paragraph superseded by Accounting Standards Update No. 2016-14](https://asc.understandingaccounting.org/updates/asu-2016-14/). ##### [958-30-55-6](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-6) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:dee2e44597539eb1c2ede9abc6f08e729431213d19fc3bbcc5e4c5f8c96fad35 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The following Cases provide an understanding of the applicability of paragraphs [958-30-25-7 through 25-14](https://asc.understandingaccounting.org/asc/958/30/#958-30-25-7) to various split-interest agreements: 1. a Remainder interest—period-certain, fixed payments (Case A) 2. b Remainder interest—period-certain, variable payments (Case B) 3. c Remainder interest—life-contingent, variable or fixed payments (Case C) 4. d Remainder interest—period-certain-plus-life-contingent, fixed payments (Case D) 5. e Remainder interest—period-certain-plus-life-contingent, variable payments (Case E) 6. f Lead trust—period-certain, fixed or variable payments (Case F) 7. g Lead trust—life-contingent, fixed or variable payments (Case G) 8. h Lead trust—period-certain-plus-life-contingent, variable or fixed payments (Case H). ##### [958-30-55-7](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-7) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:b63d500ae879e194e75a294b2a87365a6ee468dece46eaef66cbb91ea3eae63d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Shares of common stock are contributed to the control of an NFP which is required to pay the donor or the donor's beneficiary an annual fixed cash payment for 20 years, after which time the remaining shares revert to the NFP. ##### [958-30-55-8](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-8) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:edbeaee63de3b737c08156bb77d22a825b5f17d7bb46cb5fc66f4c91c9a42484 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement (20 years), the NFP has a liability that does not require bifurcation of an embedded derivative. Because the periodic cash payment is a fixed dollar amount, the liability has no underlying and, thus, does not meet the criterion in paragraph [815-10-15-83(a)](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83) of the definition of a derivative instrument. Because there is no underlying, there is also no embedded derivative that warrants separate accounting under paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1). ##### [958-30-55-9](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-9) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:81c31a03d269ff6cd38624afa9f23faa5ae330253ad1583ac32aec6424f3ca51 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Shares of common stock are contributed to the control of NFP, which is required to make 20 annual cash payments to the donor or the donor's beneficiary that are equal to a specified percentage of the fair value of the assets as of the beginning of each annual period (that is, a [charitable remainder unitrust](https://asc.understandingaccounting.org/glossary/c/#charitable-remainder-unitrust "A trust established in connection with a split-interest agreement, in which the donor or a third-party beneficiary receives distributions of a fixed percentage of the fair value of the trust's assets during the agreement's term. Upon termination of the trust, a not-for-profit entity (NFP) receives the assets remaining in the trust.")). After the 20 payments have been made, the remaining shares will revert to the NFP. ##### [958-30-55-10](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-10) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:cdc425f6393813c6c37cddaaa9d9fc348b624ebe67a9b8def690abd30b66a938 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement (20 years), the NFP has a liability that must be bifurcated because it contains an embedded derivative that warrants separate accounting unless a fair value election is made pursuant to Section 815-15-25 or Fair Value Option Subsections 825-10. Under paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1), the liability represents a hybrid instrument that is composed of a debt host contract and an embedded equity-based derivative that is not clearly and closely related to the debt host contract and that would meet the definition of a derivative instrument if it were freestanding. That is, it meets all of the following criteria of paragraph [815-10-15-83](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83): 1. a It has an underlying (price of shares). 2. b It has a notional amount (number of shares in the trust at the beginning of each annual period). 3. c It satisfies the no-or-smaller initial net investment characteristic in paragraph [815-10-15-83(b)](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83). 4. d It would meet the net settlement characteristic in paragraph [815-10-15-83(c)](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83) (because each annual payment is adjusted for the effect of the embedded equity-based derivative). ##### [958-30-55-11](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-11) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:097a46a88fadfa7a590555faec98779a490a11e7d7182d5fa043caead0f5bda8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The debt host contract represents the liability for the series of 20 annual payments that would be required based on the assumption that the fair value of the common stock does not change over the 20-year period. The embedded equity-based derivative relates to the increase or decrease in each of the 20 annual payments due to changes in the fair value of the common stock. ##### [958-30-55-12](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-12) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:800ada98759d7baf94783d1fe33d6f25b3d72772994f3af4160631814004b787 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Shares of common stock are contributed to the control of an NFP, which is required to make annual cash payments to the donor or the donor's beneficiary that are either a fixed dollar amount or a specified percentage of the fair value of the assets at the beginning of each annual period until the death of the donor or the donor's beneficiary, upon which time the remaining shares will revert to the NFP. ##### [958-30-55-13](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-13) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:6eb2f18d1c3cff40a7942fef5104c611fa0168b5ccff121b43e29809db46b753 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, the NFP has a liability that is not bifurcated because it is solely life-contingent and thus qualifies for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) . ##### [958-30-55-14](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-14) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:c6b124e4168e8f5bf4e7b88b2c95f26538a6899f0d8fc5f8fea1cf6dc09cd438 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Shares of common stock are contributed to the control of an NFP, which is required to pay the donor or the donor's beneficiary an annual fixed cash payment for the longer of the beneficiary's remaining life or a specified period. The remaining shares then revert to the NFP. ##### [958-30-55-15](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-15) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:1bf4bc1458ac42b2ed529c06dd79bcbb1e5a81ec7b36664a03c69924612cca8d Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, the NFP has a liability that, for purposes of applying Topic 815, must be analyzed as consisting of the following two separate liabilities: 1. a A liability relating to the period-certain cash payments 2. b A liability relating to the possible additional cash payments that are contingent upon the beneficiary living beyond the end of the period-certain payments. ##### [958-30-55-16](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-16) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:a17e5f2e7be813d29d4dcf9a0f71b30c82df5a6f1c384ba60f309a91c3f1a3fe Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The NFP's liability does not require the bifurcation of any embedded derivative because: 1. a The portion of the liability related to the fixed period-certain payments has no underlying. 2. b The portion of the liability related to the possible life-contingent payments qualifies for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) . ##### [958-30-55-17](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-17) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:5c15be2783cdb03a1b3298661ec2db534b132159e699f671c6e4e3c9c0816753 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Shares of common stock are contributed to the control of an NFP, which is required to pay the donor or the donor's beneficiary an annual cash payment equal to a specified percentage of the fair value of the assets at the beginning of each annual period for the greater of the beneficiary's remaining life or a specified period. The remaining assets revert to the NFP. ##### [958-30-55-18](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-18) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:f5ec8185439af8aefd7d27c73a0ac80aaf186221709f96f6da92c3b3c52818e0 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, the NFP has a liability that, for purposes of applying Topic 815, must be analyzed as consisting of the following two separate liabilities: 1. a A liability relating to the period-certain cash payments 2. b A liability relating to the possible additional cash payments that are contingent upon the beneficiary living beyond the end of the period-certain payments. ##### [958-30-55-19](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-19) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:190c4d81a5293eb38a9eddda9931a5e8581a86acc23cff2de2cb1f0e7c93ba5a Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1) requires that the equity-based derivative instrument embedded in the portion of the liability related to the period-certain variable cash payments be bifurcated from a debt host contract (consistent with the analysis in Case B). ##### [958-30-55-20](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-20) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:d0ac5e6ec5d4bc03877fb6ed81d58234b5790a8cd526340e9e9b9f5630fc496e Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. The equity-based derivative instrument embedded in the portion of the liability related to the possible life-contingent cash payments that can occur after the end of the specified period is not subject to Topic 815 because it qualifies for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) . ##### [958-30-55-21](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-21) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:2eec6ee48b6d9f0538a86b903db8bd57199cd49b1fdc4b910de34e8cd2fb4046 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An NFP receives cash from a donor, which is invested by the NFP in common equity securities. The donor designates the NFP as lead beneficiary. The NFP receives an annual cash payment of either a fixed amount or a specified percentage of the fair value of the investment amount at the beginning of each annual period for a specified period of time. After that time, the remaining assets revert to the donor or the donor's beneficiary. ##### [958-30-55-22](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-22) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:c859509f8c70bf470ef23a76033a76d60a9d7f45d987132af7da030ab67158c8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, the NFP has a liability that must be bifurcated. Under paragraph [815-15-25-1](https://asc.understandingaccounting.org/asc/815/15/#815-15-25-1), the liability represents a hybrid instrument that is composed of a debt host contract and an embedded equity-based derivative that is not clearly and closely related to the debt host contract and that would meet the definition of a derivative instrument if it were freestanding. That is, it meets all of the following criteria of paragraph [815-10-15-83](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83): 1. a It has an underlying (price of shares). 2. b It has a notional amount (number of shares at the beginning of each annual period). 3. c It satisfies the no-or-smaller initial net investment characteristic in paragraph [815-10-15-83(b)](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83). 4. d It would meet the net settlement characteristic in paragraph [815-10-15-83(c)](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-83). ##### [958-30-55-23](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-23) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:d78b03578174988f7f334eca931f722f4fcc8a5efc1a2f05f112ce91491a34d8 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. Regardless of whether the [lead interest](https://asc.understandingaccounting.org/glossary/l/#lead-interest "The right to the benefits (cash flows or use) of assets during the term of a split-interest agreement, which generally starts upon the signing of the agreement and terminates at either of the following times: After a specified number of years (period-certain) Upon the occurrence of a certain event, commonly either the death of the donor or the death of the lead interest beneficiary (life-contingent).") payments are fixed or variable, the value of the liability representing the remainder interest—the assets remaining at the end of the agreement that will be paid to the donor or the donor's beneficiary—is affected by changes in the equity value, thus requiring the embedded equity-based derivative to be bifurcated from the host contract unless a fair value election is made pursuant to Section 815-15-25 or the Fair Value Option Subsections of Subtopic 825-10. ##### [958-30-55-24](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-24) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:f5178c56bbcb0deea038564590fbdabdc53ecb738e06a023199ab09bddd86a92 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An NFP receives cash from a donor, which is invested by the NFP in common equity securities. The donor designates the NFP as lead beneficiary. The NFP receives an annual cash payment of either a fixed dollar amount or a specified percentage of the fair value of the investment amount at the beginning of each annual period until the death of the donor or the donor's beneficiary, at which time the remaining assets revert to the donor or the donor's beneficiary. ##### [958-30-55-25](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-25) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:15f7aabc6446dee526506f8900626235495cb63179e79ce44fbccb4a4c737d98 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, the NFP has a liability that is not subject to Topic 815 because the remainder interest liability relates to a single payment whose amount and timing is life-contingent and thus qualifies for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) . ##### [958-30-55-26](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-26) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:a75962b43f7932c38bbaf903fa907943f28c0e76e8af366153a7ef900ccca8cd Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. An NFP receives cash from a donor, which is invested by the NFP in common equity securities. The donor designates the NFP as lead beneficiary. The NFP receives an annual cash payment for either a specified percentage of the fair value of the assets at the beginning of each annual period or a fixed dollar amount. That cash payment is made for the greater of the beneficiary's (or the donor's) remaining life or a specified period. After that time, the remaining assets revert to the donor or the donor's beneficiary. ##### [958-30-55-27](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-27) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:a4be24fa66be0e6c90641d839bd6dea5fca4f1f21cae2f679b5344a887c6656c Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. During the term of the agreement, the NFP has a liability that is not subject to Topic 815 because, unlike the liability in Case E the period-certain aspect of the liability cannot be separated from the life-contingent aspect of the liability (because there is only one payment whose timing and value are affected by mortality risk). Thus, the remainder interest liability relates to a single payment whose amount and timing is life-contingent and thus qualifies for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) . ##### [958-30-55-28](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-28) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:78432af3b209dc42ab68ed790d9c5bb89c6a5ea8f83a1d4b0d617b91815aedf9 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If payment occurs only when the beneficiary (or donor) is alive, such as in an agreement in which the period is for the lesser of the beneficiary's (donor's) remaining life or a specified period, then every payment is life-contingent and qualifies for the exception in paragraphs [815-10-15-52 through 15-57](https://asc.understandingaccounting.org/asc/815/10/#815-10-15-52) . ##### [958-30-55-29](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-29) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:f6a9b9f884b94f30c69478cbe1a43bd2bc3cc4066da7633622cae68b419710de Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. If during the terms of a greater-of-period-certain-or-life-contingent agreement, the beneficiary dies before the end of the period-certain terms in the agreement, that change in circumstance eliminates the life-contingent aspect of the contract. Thus, the agreement is now only a period-certain agreement and mirrors the agreement outlined in Case F requiring bifurcation of the embedded derivative. ##### [958-30-55-30](https://asc.understandingaccounting.org/asc/958/30/#958-30-55-30) Pending content: no Source downloaded (UTC): 2026-09-10T02:22:23.587Z to 2026-09-10T02:22:23.587Z Record version: sha256:0bf7ea2c5abb2ce6dd066ebffa000005c589f5703b52328ff22152fe54529d80 Snapshot version: sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f Effective as of: not established by retrieval timestamps. This Example provides the following journal entries related to the guidance in Sections 958-30-25, 958-30-35, and 958-30-40. - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-250BC60E-AA41-4464-B3D8-B7FA757CCAEC-low.gif) Creation of the Agreement Debit Credit Credit Assets Held by a Third Party Charitable lead trust Beneficial interest in lead trust Contribution revenue (a) Charitable remainder trust Beneficial interest in remainder trust Contribution revenue (a) Assets Held by the NFP Contribution revenue (a) Charitable lead trust Assets held in charitable lead trust Liability for amounts held for others Contribution revenue (a) Charitable remainder trust Assets held in charitable remainder trust Liability under trust agreement Contribution revenue (a) Charitable gift annuity Assets Annuity payment liability Contribution revenue (a) Pooled income fund Assets of pooled income fund Discount for future interest (Deferred revenue) Contribution revenue (a) - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-FE701418-8CC7-4FAC-8553-FBE505B3498D-low.gif) Investment Income and Changes in the Fair Value of Assets Held Under the Agreement (b) Debit Credit Assets Held by a Third Party Charitable lead trust No entry No entry Charitable remainder trust No entry No entry Assets Held by the NFP Charitable lead trust Assets held in charitable lead trust Liability for amounts held for others Charitable remainder trust Assets held in charitable remainder trust Liability under trust agreement Charitable gift annuity Assets Investment return (c) Pooled income fund Assets of pooled income fund Liability to life beneficiary - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-DD7A6FCD-7FC2-4BCD-885B-8A9397F03382-low.gif) Distribution to Holder of Lead Interest Debit Credit Assets Held by a Third Party Charitable lead trust Cash Beneficial interest in lead trust Charitable remainder trust No entry No entry Assets Held by the NFP Charitable lead trust Cash Assets held in charitable lead trust Charitable remainder trust Liability under trust agreement Assets held in charitable remainder trust Charitable gift annuity Annuity payment liability Cash Pooled income fund Liability to life beneficiary Assets of pooled income fund Reclassification of Amounts Distributed to Holder of Lead Interest When All Restrictions Are Met Debit Credit Assets Held by a Third Party Charitable lead trust Net assets with donor restrictions— Reclassifications out "Net assets without donor restrictions— Reclassifications in" Charitable remainder trust Not applicable Not applicable Assets Held by the NFP Charitable lead trust Net assets with donor restrictions— Reclassifications out "Net assets without donor restrictions— Reclassifications in" Charitable remainder trust Not applicable Not applicable Charitable gift annuity Not applicable Not applicable Pooled income fund Not applicable Not applicable - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-F690A09D-9F73-4495-A19A-82344ED927EE-low.gif) Revaluation of Obligation to Other Beneficiaries Debit Credit Assets Held by a Third Party Charitable lead trust Not applicable Not applicable Charitable remainder trust Not applicable Not applicable Assets Held by the NFP Charitable lead trust Liability for amounts held for others (d) "Change in value of split-interest agreements (a) (d)" Charitable remainder trust Liability under trust agreement (d) "Change in value of split-interest agreements (a) (d)" Charitable gift annuity Annuity payment liability (d) "Change in value of split-interest agreements (a) (d)" Adjustment of Deferred Revenue—including Amortization of Discount and Changes in Life Expectancy Debit Credit Pooled income fund Discount for future interest (deferred revenue) Change in value of split-interest agreements Change in Fair Value of Beneficial Interest Debit Credit Assets Held by a Third Party Charitable lead trust Beneficial interest in lead trust "Change in value of split-interest agreements (a) (d)" Charitable remainder trust Beneficial interest in remainder trust "Change in value of split-interest agreements (a) (d)" Assets Held by the NFP Charitable lead trust Not applicable Not applicable Charitable remainder trust Not applicable Not applicable Charitable gift annuity Not applicable Not applicable Pooled income fund Not applicable Not applicable - ![ ](https://asc.understandingaccounting.org/asc-img/GUID-9B3DBAAB-25AA-4B0A-8D7F-D1224894007C-low.gif) Termination of the Trust Debit Credit Credit Assets Held by a Third Party Charitable lead trust Change in value of split-interest agreements (a) Beneficial interest in lead trust Charitable remainder trust "Assets (for example, endowment or other investments)" Beneficial interest in remainder trust Change in value of split-interest agreements (a) (d) Assets Held by the NFP Change in value of split-interest agreements (a) (d) Charitable lead trust Liability for amounts held for others Assets held in charitable lead trust Change in value of split-interest agreements (a) (d) Charitable remainder trust Liability under trust agreement Change in value of split-interest agreements (a) Charitable remainder trust "Assets (for example, endowment or other investments)" Assets held in charitable remainder trust Charitable gift annuity Annuity payment liability Change in value of split-interest agreements (a) Pooled income fund Discount for future interest (deferred revenue) Change in value of split-interest agreements (a) Pooled income fund "Assets (for example, endowment or other investments)" Assets of pooled income fund All Agreements "Additionally, a reclassification may be necessary if net assets are no longer subject to time or purpose restrictions." (a) See Section 958-30-45 for classification of contribution revenue and change in the value of split-interest agreements. (b) Debit and credit could be reversed depending on whether the change in fair value of the assets held under the agreement is a gain or a loss. (c) "Alternatively, the annuity payment liability could be credited, resulting in the netting of investment return with other changes in the value of split-interest agreements." (d) Debit or credit could be reversed depending upon the whether the adjustment increases or decreases the liability.