NP 6 covers the basic principles of accounting for contributions received and made. As defined in the Master Glossary, a contribution is a transfer of cash or other assets from a donor to a donee. This chapter expands on considerations related to contributions of “other assets,” such as securities, land, buildings, use of facilities or utilities, materials and supplies, intangible assets, services, and unconditional promises to give those items in the future.

For the most part, accounting for these gift transactions uses the basic principles discussed in NP 6 for cash contributions. That is, the gifts generally are recognized when the transfer of benefit occurs and are measured at fair value by donor and donee. However, their noncash nature gives rise to some special accounting considerations.

The chapter is divided into the following topics:

This chapter generally does not apply to transactions that appear similar to contributions but which do not meet the definition of a contribution because they occur between entities that are affiliates (and thus, generally are members of the same financial reporting entity). However, this chapter does discuss donated personnel services received from an affiliate in NP 7.5.2. Transactions between affiliates (including donated personnel services) are considered equity transfers, the presentation of which is discussed in NP 3.4.8.