Multi-Year event support for reporting purposes

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Cindy Shanks
Cindy Shanks
Tenth Anniversary 10 Comments Photogenic Name Dropper
in Blackbaud Raiser's Edge NXT®: General Discussion
I'm curious on how other organizations record multi-year support for an event. What's your best practice for gifts to support future events that don't meet GAAP criteria for recording until a later period? Our finance team would like for these future gifts to be suppressed from Fund Development's reports until they are recordable. Fund Development prefer to count them at the time it was received/committed regardless.
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  • Cindy Shanks
    Cindy Shanks
    Tenth Anniversary 10 Comments Photogenic Name Dropper

    Cindy Shanks:

    I'm curious on how other organizations record multi-year support for an event. What's your best practice for gifts to support future events that don't meet GAAP criteria for recording until a later period? Our finance team would like for these future gifts to be suppressed from Fund Development's reports until they are recordable. Fund Development prefer to count them at the time it was received/committed regardless.

    How do you handle future gifts for an event if the accounting can't accept financial support for future events on their end, same goes for multi-year supports? Here's an example, let's say a corporation gave $10,000 to support an event - $5,000 for this fiscal year and $5,000 for next fiscal year. Finance only wants to recognize $5,000 for this current year. Fund Development wants to recognize the full the amount of $10,000. The Primary Relation Manager wants to count the full amount toward her job performance/portfolio this fiscal year. I'm looking for best practices for gifts that don't meet GAAP criteria for recording until a later period.

  • John Heizer
    John Heizer
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    I'm curious as to why you feel it doesn't meet GAAP for recording the entire amount now as a time restricted gift with appropriate amounts to be released in future fiscal years. We book all pledges as income when the pledge is made (a documented commitment in-hand). Do you not have firm documentation of the commitment? When we have had situations like that we mark the Proposal as Funded but don't enter a pledge in RE and then use Proposal reports to show how much has been "raised".
  • Cindy Shanks
    Cindy Shanks
    Tenth Anniversary 10 Comments Photogenic Name Dropper
    John,

    Thank you for your response. Per GAAP rules, accounting is not allowed to count future event support if the current event hasn't taken place yet. For example, if a company gave $10,000 to support an event - $5,000 for FY20 and $5,000 for FY21. I would enter them as two donations not one. Fund Development want to count them both as we received them, but Finance is not allowed to count both before the current event takes place. Does that make sense?
  • Christine Cooke 2
    Christine Cooke 2
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    SOP would be to record them like you do a pledge no?  Finance should want that also.  And whatever funds are meant for future events are either held and carried over or collected in the year intended.


    Things can get lost when they are not recorded in the system, but kept in some side document.  Just my POV.
  • John Heizer
    John Heizer
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    I'm finding that interpretation of GAAP to be questionable. What if it is a monthly event? You can't count next month's pledge until this month's event is over? What if it's a one-time special event planned for 2 years from now? Does is only apply for "the same (annual) event" or you can't book ANY future event until all other events are completed?

     
  • Elaine Tucker
    Elaine Tucker Community All-Star
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    We have some donors who pre-pledge years in advance of our annual luncheon.  To help code this properly, we have funds in RE for each luncheon (easier to compare years and track exactly what event they are funding)  When we get an advance pledge we apply it to either "YYYY Luncheon Deferred" or "YYYY Luncheon Non-Deferred" funds in RE.  If something is added to the deferred fund, it indicates that accounting can't include the pledge in their "current" year numbers; the idea being that if the event doesn't happen then the donor may NOT fulfill the pledge.  If the pledge is applied to the "Non Deferred" fund - this is an indication that the donor will full fill the pledge even if the event does not take place.


    This way development gets the information that they need in RE and Finance can apply the pledge to the applicable area as they need.


    This is my very non-accountant brain trying to explain what our accounting department does, so I hope I've made sense.  It took me a while to wrap my head around the coding when mapping the GL from RE to FE.

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