Not-for-profit grants and contracts FAQs

FASB Accounting Standards Update (ASU) No. 2018-08, Clarifying the Scope and the Accounting Guidance for Contributions Received and Contributions Made, addresses many questions stemming from the implementation of FASB ASC 606, Revenue from Contracts with Customers, including whether not-for-profit grants and contracts fit the definition of a contract with a customer, such that ASC 606 would apply, or whether they are more appropriately classified as contributions, which fall under the scope of ASC 958-605, Not-for-Profit Entities: Revenue Recognition.