(13) All expirations occurring based on donor-imposed restrictions will be recognized in the same accounting period when such expiration elapsed. However, expenses accrued but paid after the date of expiration will still be borne by the donor, based on the principle that the purpose for which the fund was provided has not yet been fulfilled.
(14) Donated services will apply only to the skills and expertise of professionals specified by the FASB’s Financial Accounting Standards 116, which are based on the principles that such services are usually paid for and cannot be acquired for free unless specifically rendered as a donation.
(15) Disbursements are recognized during the inclusive period they were incurred, and not on the date they were paid; hence, accrual method is a must.
(16) Matching of costs against contributions entails defining the expenses related to the project by adding descriptive labels pertaining to the program they are related to.
(17) Operating costs are proportionately allocated to match such costs against contributions received, when presented as separate reports to donors.
Readers who may be interested in knowing how these underlying principles are provided as Fund Accounting Guidelines in accordance with the Financial Accounting Standard’s Board (FASB), may refer to a separate article bearing the same title.