The American Institute of CPAs has released guidance to help CPAs deal with accounting issues related to two separate issues: going concern, and not-for-profit entities with for-profit subsidiaries.
The AICPA’s Auditing Standards Board issued
In response, the AICPA’s Auditing Standards Board has issued
The issuance of these interpretations represents a short-term initiative by the ASB to address some consequences of the new accounting standards. In the long term, the ASB plans to undertake a more comprehensive project to align AU-C section 570 with the various accounting and auditing standards.
Not-for-Profits with For-Profit Subsidiaries
Separately, to help accountants deal with not-for-profits with for-profit subsidiaries, the AICPA’s Not-for-Profit Entities Expert Panel has also developed
Because the reporting entity is the consolidated not-for-profit entity, which is not permitted to adopt the accounting alternative in ASU No. 2014-02, Intangibles—Goodwill and Other (Topic 350): Accounting for Goodwill (a consensus of the Private Company Council), the for-profit subsidiary that is part of that consolidated reporting entity is not permitted to use the amortization accounting alternative in the consolidated financial statements. The for-profit subsidiary could adopt the accounting alternative in ASU No. 2014-02 in its standalone financial statements, however, the AICPA noted.