Accounting Finance Alliances
Accounting
and Finance
for Alliances
PRESENTED BY:
JANET MALASIG
IEEE-ISTO and member
Programs
Program Financial
Statements
Membership Dues
Accounting
IEEE Industry
Standards and
Technology
Organization
(IEEE-ISTO) was established
in January 1999 as a
global, not for profit
corporation 501(c)(6)
Internal Revenue Service Subsection Codes for Tax-Exempt Organizations
Section of Code Description of Categories Annual Return Required to Be Filed
501(c)(1) Corporations Organized under Act of Congress (including Federal Credit Unions) None
501(c)(2) Title Holding Corporation for Exempt Organization Form 9901 or 990-EZ8
501(c)(3)
Religious, Educational, Charitable, Scientific, Literary, Testing for Public Safety, to Foster National or International Amateur Sports Competition, or Prevention of Cruelty to Children or
Animals Organizations Form 990
1, 990-EZ8, or 990-PF
501(c)(4) Civic Leagues, Social Welfare Organizations, and Local Associations of Employees Form 9901 or 990-EZ8
501(c)(5) Labor, Agricultural, and Horticultural Organizations Form 9901 or 990-EZ8
501(c)(6) Business Leagues, Chambers of Commerce, Real Estate Boards, Etc. Form 990 or 990-EZ
501(c)(7) Social and Recreational Clubs Form 9901 or 990-EZ8
501(c)(8) Fraternal Beneficiary Societies and Associations Form 9901 or 990-EZ8
501(c)(9) Voluntary Employees Beneficiary Associations Form 9901 or 990-EZ8
501(c)(10) Domestic Fraternal Societies and Associations Form 9901 or 990-EZ8
501(c)(11) Teacher's Retirement Fund Associations Form 9901 or 990-EZ8
501(c)(12) Benevolent Life Insurance Associations, Mutual Ditch or Irrigation Companies, Mutual or Cooperative Telephone Companies, Etc. Form 9901 or 990-EZ8
501(c)(13) Cemetery Companies Form 9901 or 990-EZ8
501(c)(14) State Chartered Credit Unions, Mutual Reserve Funds Form 9901 or 990-EZ8
501(c)(15) Mutual Insurance Companies or Associations Form 9901 or 990-EZ8
501(c)(17) Supplemental Unemployment Benefit Trusts Form 9901 or 990-EZ8
501(c)(18) Employee Funded Pension Trust (created before June 25, 1959) Form 9901 or 990-EZ8
501(c)(19) Post or Organization of Past or Present Members of the Armed Forces Form 9901 or 990-EZ8
501(c)(21) Black Lung Benefit Trusts Form 990-BL
501(c)(22) Withdrawal Liability Payment Fund Form 990 or 990-EZ8
501(c)(23) Veterans Organizations (created before 1880) Form 990 or 990-EZ8
501(c)(25) Title Holding Corporations or Trusts with Multiple Parents Form 990 or 990-EZ
501(c)(26) State-Sponsored Organization Providing Health Coverage for High-Risk Individuals Form 9901 or 990-EZ8
501(c)(27)11 State-Sponsored Workers' Compensation Reinsurance Organization Form 9901 or 990-EZ8
501(c)(28)12 National Railroad Retirement Investment Trust Not yet determined
501(d) Religious and Apostolic Associations Form 10659
501(e) Cooperative Hospital Service Organizations Form 9901 or 990-EZ8
501(f) Cooperative Service Organizations of Operating Educational Organizations Form 9901 or 990-EZ8
501(k) Child Care Organizations Form 990 or 990-EZ8
501(n) Charitable Risk Pools Form 9901 or 990-EZ8
521(a) Farmers' Cooperative Associations Form 990-C
4947(a)(1) Non-Exempt Charitable Trusts Form 990-PF
4947(a)(2) Split-Interest Trust Form 5227
170(c)(1) Government Entity None
♦ Ref: IRS Publication 557
IEEE-ISTO
Federation
of
Programs
(Business League) Programs (Alliances) Programs (Alliances) Programs (Alliances) Programs (Alliances) IEEE-ISTO collaborates with a wide range of groups to bringIndustry standards to fruition and ensure their success in the market
Ø
Purpose: To communicate relevant
informa4on that sa4sfies the interest of
members, creditors, and recipients.
o
Useful in decision making regarding
resource allocation
o
How much can we spend, can we afford it?
o
Useful in evaluating the effectivity of the
Program’s Governing bodies (Board of
Directors, Officers) in performing their
duties and responsibilities
Program
Financial
Statements
Statement of Financial Position = Balance Sheet Statement of Cash flows Other schedules: Accounts Receivable Accounts Payable Budget vs. Actual Statement of Activities = Profit and LossAssets
Cash - membership fees collection Prepaid expenses - Insurance- Deposits for events etc. Other assets
Liabilities
Accounts payable - vendor invoices Deferred membership fees - unamortized portion of annual membership Other liabilitiesNet
Assets
(Net worth)
Assets
Assets are economic resources owned by a business that are expected to benefit future operations.
♦ Cash in bank - consist of bank deposits
- collections of accounts receivable
♦ Accounts Receivable - these are assets that arise from unpaid
invoices issued to members.
• Membership fee(majority of receivable)
• Sponsorship invoices (for events, member meetings, etc.)
♦ Prepaid expenses – prepayments for goods and services to
be received/used in the near future.
• Insurance, airfare for future events, booth and hotel
deposits.
♦ Other Assets
Liabilities
Liabilities are legal obligations that result from past transactions (to be paid in the future) or the future performance of services.
v Accounts payable – short term obligations to suppliers/
vendors for goods and services received.
v Deferred Membership fees
♦ Deferred revenues are funds that are received for goods
and services that have not yet been provided. When revenues are received in advance, the Company has an obligation to deliver goods or perform services. Therefore, deferred membership fees are shown in a liability account.
♦ Deferred revenue is not yet revenue. It is an amount that
was received by a company in advance of earning it. The amount unearned (and therefore deferred) as of the date of the financial statements should be reported as a liability.
♦ When the goods or services are performed or delivered,
Assets
Liabilities
Assets
Net
Program
revenues
Membership Revenues - By membership level Event sponsorship
Meeting registration fee
Program
expenses
Trade shows and conferences Legal fees
Travel
Marketing Etc.
Statement of Cash Flows
The purpose of the statement of cash flows is to
provide information about a company’s cash
receipts and cash payments during an
accounting period.
v
This statement adjust the net income(accrual
basis) to reflect the actual cash flow that
affected cash during the period.
Example:
Program name: XYZ Alliance Date of Invoice: November 2014 Member: ABC Tech. Co.
Renewal invoice: $12,000 for Annual dues Membership period Jan. – Dec. 2015.
November 2014: The full amount will be recorded as a receivable in XYZ Alliance and set up as Deferred membership fees.
January 2015: $1k of the $12k membership will be recognized as membership income and deducted from the balance of the Deferred membership fees.
February 2015: $1k of the $12k membership will be recognized as membership income and deducted from the balance of the Deferred membership fees.
v 1/12 of $12,000 or $1,000 for each subsequent months is recognized as income
until December 2015 covering the entire membership year (Jan. – Dec.)until the $12k has been fully recognized for the entire membership period.
v Collection of the invoice will be recorded as a cash receipt and a reduction in
Accounts receivable balance.
Jan, $1K Feb, $1K Mar, $1K April, $1K May, $1k June, $1K Jul, $1K Aug, $1K Sept., $1K Oct., $1K Nov, $1K Dec., $1K Revenue recognition:
$12K divided by 12 months (no. of membership months)
Annual fees, $12K
