Grants receivable means grant funding that has been committed to the organization but not received. Grants receivable will be cash in the future, but it is not cash now. The way this was set up is with individual “classes” instead of accounts and I need to provide https://www.bookstime.com/ each class it’s own Transaction Detail by Account. This is for a high school with different clubs and advisors who need to see their transactions in detail. Since technology is not going anywhere and does more good than harm, adapting is the best course of action.
There have been and continues to be many different names for the same calculated number. This was later changed (in 2013) to be “Restricted Net Position” to comply with GASB 63 account naming. The FDS used to report it as “Restricted Net Assets” and followed suit to “Restricted Net Position”. However, on the details links for calculating this value, it is also called “HAP Equity”. For those newer to the industry, it can be very confusing to discern if these are different balances as all five names are frequently used interchangeably. Recently, HUD has allowed certain variances to be deemed immaterial when it comes to reconciling variances between HUD systems.
Ratios, too, have different meanings in different situations. For example, a new organization may find it spent 90 unrestricted net assets percent of its dollars on fundraising. In an established organization, such a ratio would certainly be a red flag.
Now that you know the concept, look at your organization’s balance sheet again with fresh eyes. Keep in mind that, unfortunately, net assets is often not broken out properly in internally generated balance sheets. Even if it is, you may still need to ask questions to understand the nature of any restricted assets.
Assigned fund balance is also the “default” fund balance classification for all governmental funds except the general fund after nonspendable, restricted, and committed fund balance amounts have been identified. The definitions of the special revenue, capital projects, debt service, and permanent funds dictate that the resources within those funds represent, at a minimum, assigned portions of fund balance. After the nonspendable, restricted, and committed amounts of fund balance have been identified for these funds, if the remaining amount of fund balance represents a deficit, that amount must be reported as unassigned fund balance. The unassigned fund balance classification, as defined below, is used for special revenue, debt service, capital projects, or permanent funds only if the residual amount of fund balance is negative. Note the official wording for unrestricted net assets in the balance sheet above is “net assets without donor restrictions.” We commonly use the term “unrestricted net assets” since it’s easier to say.
Now cash is $60,000 and liabilities, specifically accounts payable, is $20,000. Accounts payable means the organization owes money to vendors in the near future. Net assets with donor restrictions is due to the $40,000 in cash, all of which is from a restricted grant, and the $10,000 grant receivable. A legitimate and well-run nonprofit organization will provide Form 990s, annual reports, and auditor’s reports to prospective donors for their review.
They are “restricted” because the donations are only usable for specific outlined purposes established by the donor. The NPOs cannot use these donations for whatever operational purpose they deem fit as they are earmarked for certain programs. Deficit net worth is a situation in which net liabilities are higher than net assets. Also known as negative net worth, deficit net worth can occur for a variety of reasons, but typically it arises when current or future asset values erode unexpectedly. One thing that is clear and certain amidst all this murkiness, is that the number that is used to determine PHA funding comes from the VMS.