Attestation Update – A&A for CPAs

Technical stuff for CPAs providing attestation services

California bill AB 1181 would address valuation of GIK when donor restricts distribution to outside U.S.

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What is the fair value of donated medicine restricted for use outside the U.S.? Image courtesy of Adobe Stock.

The California Assembly has passed and sent to the Senate a bill which would require specific accounting for charities who receive gifts-in-kind which are restricted by the donor for distribution outside the U.S.

For that very specific type of GIK, the bill would require the donation to be recorded at the fair value in the country where the items will be used.

This will particularly affect donated pharmaceuticals, which often have a severely different value in the U.S. compared to values internationally.

My perception is the bill would apply to a very small number of charities, perhaps something in the range of three dozen (wild guess) across the country. Affected charities would primarily be those involved in the relief and development sector.

My other blog, Nonprofit Update, has lots of discussion on GIK in general and this bill in particular.

If you are interested, you can check out the following posts about AB 1181:

Written by Jim Ulvog

June 13, 2019, 8:41 am at 8:41 am

Posted in Accounting

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