barrier and right of return

Revenue1

1. 605-958Not-for-Profit Entities605 Revenue Recognition

   ASC 958-605 governs revenue recognition by not-for-profit entities, principally contributions received. Its core rules are (1) distinguishing contributions (no commensurate value to the resource provider) from exchange transactions accounted for under Topic 606, (2) recognizing unconditional contributions as revenue or gains at fair value when received while conditional contributions (a barrier plus a right of return/release) are deferred as refundable advances until the barrier is substantially met, and (3) classifying contributions as with or without donor restrictions. It also covers agency-type transfers where an NFP recipient acts as intermediary, agent, or trustee for a donor and a specified third-party beneficiary.