FASB provides outline for new disclosures on GIK

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On November 6, 2019, FASB discussed the GIK valuation project.

Back on August 21, 2019, FASB set the scope for the project to include only nonfinancial GIK with measurement (that means valuation) off the table. Staff was directed to work toward an exposure draft (ED) that would address only presentation and disclosure. That means an ED will only describe how GIK is presented on the statement of activity and what information is explained in the notes.

According to minutes of the 11/6/19 meeting, available here, FASB ratified that previous scope.

The board decided that nonfinancial GIK should be presented as a separate line on the statement of activity.

The financial statement notes also must disclose GIK by category. The notes don’t provide definition of a ‘category.’ That will be explained in the ED.

Footnotes must also include disclosure of:

  • Quantified information on how much of the GIK was monetized (meaning sold) or utilized (meaning used in the charity or distributed to other parties). For the portion utilized in the organization, the notes need to describe which programs or activities used the GIK.
  • Donor restrictions on the GIK.
  • Principal market for valuing the GIK.


FASB directed staff to prepare an exposure draft. There will be a 60 day comment period. The implied target for release of the ED is about 12/31/19, based on the comment period ending on the later of 2/28/20 or 60 days after issuing the ED.


Notice the project does not address valuation, which seems to be the primary concern of the regulatory community.

Notice also that the amount of GIK, breakout of medicine & supplies, program categories where GIK was used, along with donor restrictions imposed & released are currently available on either the statement of activity, statement of functional expenses, or schedule M of the 990.

I’ve taken a glance at a large number of financial statements for charities with substantial GIK and have noticed that statements of activities routinely show the amount of GIK revenue on a separate line with indication of the amount that is restricted by donors. The amount of GIK released, by program, is routinely presented in the separate statement of functional expenses.

Seems to me in terms of the basic financial statements, the exposure draft will require what is already normative in the sector.

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