issues with in-kind services

Windows Mac Tablet

• Attendees are in listen-only mode• This webinar is being recorded for future on-demand playback• Your participation represents acknowledgement that we are

recording• Tweet questions & comments to: #WelchNPO

Christa CaseyCPA, CAPartner + Director of the Not-for-Profit Sectorccasey@welchllp.com

Garth Steele CPA, CAAudit + Indirect Tax Partnergsteele@welchllp.com

Virginia Lackey CPA, CA, CIASenior Managervlackey@welchllp.com

• What Do We Mean by “In-Kind”?• Recent Trends• Valuation Issues• Accounting Recognition + Disclosure• Audit Implications• HST and Barter Transactions• Charitable Receipting

Donated Goods

Contributed Services

Volunteer Time (Including Board)

Sponsorships

• Funder contribution matching

• Meaningful reflection of operations

• Recognized value vs perceived value

• Volunteer Time (Including Board)• # of hours• Rate

• Donated Goods + Services• Fair Market Value

• Sponsorships• Given up vs. Received

Measured at Fair Value

Disclose- Accounting policy- Nature + amount recognized

Recognition is Optional if Criteria are Met- Fair value reasonably estimated- Used in the normal course of operations- Would have been purchased

Recognized as Contribution Revenue + Expense

Appropriate Audit Evidence

Occurrence

Fair Value

• A straight donation of goods or services for no consideration is not an issue• An exchange of goods or services for other goods or services can cause problems• Example: Supplier provides advertising services in exchange for tickets to an event• You must “break apart” the transaction and charge tax according to regular rules

• Donated goods• Auction items• Donated services

Windows Mac Tablet

Christa CaseyCPA, CAPartner + Director of the Not-for-Profit Sectorccasey@welchllp.com

Garth Steele CPA, CAAudit + Indirect Tax Partnergsteele@welchllp.com

Virginia Lackey CPA, CA, CIASenior Managervlackey@welchllp.com