International Accounting Standards for the Not for Profit Sector

There are currently no international standards for not-for-profit organisations which is why the International Financial Reporting for Non-Profit Organizations project was launched in 2019. This five-year project aims to develop the first-ever international financial reporting guidance for not-for-profit organisations, which can command support from the accounting community, not-for-profit organisations, funders, and regulators alike.

The project is run by the Chartered Institute of Public Finance and Accountancy and Humentum, a global not-for-profit organisation working with humanitarian and development organisations.

The project has reached the second of three consultations on proposed international accounting standards for the sector. The first exposure draft ran from November 2022 to March 2023, covered general financial reporting issues as well as sector-specific accounting issues. The second exposure draft for the project remains open for public comment until March 15, 2024, and covers four sector-specific accounting issues:

1. income from grants and donations,
2. grant expenditure,
3. stock, and
4. foreign currency translation.

This is a fantastic opportunity for the sector to contribute their views and shape the future of financial reporting for the not-for-profit sector.

The third exposure draft is expected to cover presentation issues. The final guidance is planned for publication in mid-2025.