FASB Staff Issues Q&As on the Application of the Limited Discretion Indicator and Cost-Sharing Provisions for Not-for-Profit Entities

The FASB staff has issued a Q&A document, Subtopic 958-605: Application of the Limited Discretion Indicator and Accounting for Cost-Sharing Provisions in a Grant Agreement.”

The Q&As discuss how the limited discretion indicator should be “applied when determining whether a budget and related stipulations within a grant agreement are deemed to be a barrier to entitlement”; how an entity should “determine whether a cost-sharing provision in an agreement is a barrier to entitlement”; and whether “cost-sharing provisions in an agreement [should] be analogized to matching provisions when determining how to account for the timing and pattern of revenue recognition.”

For more information, see the staff Q&A on the FASB’s Web site.