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Not-for-profit entities (NFPs) evaluate relationships with other entities for consolidation using a voting interest model, rather than the variable interest model prescribed in ASC 810-10-15; however, the specific accounting model applied depends on whether the relationship is with an NFP or a for-profit entity. The Master Glossary of the ASC defines an NFP as follows.

Definition from ASC Master Glossary

Not for profit entity: An entity that possesses the following characteristics, in varying degrees, that distinguish it from a business entity:
a. Contributions of significant amounts of resources from resource providers who do not expect commensurate or proportionate pecuniary return
b. Operating purposes other than to provide goods or services at a profit
c. Absences of ownership interests like those of business entities.
Entities that clearly fall outside this definition include the following:
a. All investor-owned entities
b. Entities that provide dividends, lower costs, or other economic benefits directly and proportionately to their owners, members, or other participants, such as mutual insurance entities, credit unions, farm and rural electric cooperatives, and employee benefit plans.

For further information on consolidation considerations related to NFPs, please refer to NP 5.1 and NP 9.2.

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