Psak 45 Npo Ver171299

STATEMENT OF SFAS No.FINANCIAL ACCOUNTING STANDARDS

45INDONESIAN INSTITUTE OF ACCOUNTANTS

FINANCIAL REPORTING FOR NON-PROFIT ORGANIZATIONS

FINANCIAL REPORTING FOR NON-PROFIT ORGANIZATIONS SFAS No. 45 FINANCIAL REPORTING FOR NON-PROFIT ORGANIZATIONS SFAS No. 45

Financial Accounting Standard (PSAK) 45, FINANCIAL STATEMENTS FOR NON-PROFIT ORGANIZATIONS, was approved by the Financial Accounting Standards Committee on 20 December 1997 and legalised by the National Council of the Indonesian Institute of Accountants on 23 December 1997.

This Standard is not applicable for immaterial items.

Jakarta, 23 December 1997

National Council Indonesian Institute of Accountants

Financial Accounting Standards Committee

Jusuf Halim ChairmanIstini T. Sidharta Vice ChairmanMirza Mochtar SecretaryHein G. Surjaatmadja MemberKatjep K. Abdoelkadir MemberWahjudi Prakarsa MemberJan Hoesada MemberNur Indriantoro MemberRusdy Daryono MemberSiti Ch. Fadjriah MemberSobo Sitorus MemberTimoty E. Marnandus MemberMirawati Soedjono MemberOsman Sitorus MemberJusuf Wibisana MemberYosefa Sayekti MemberHeri Wahyu Setiyarso Member

CONTENTS

INTRODUCTION 01-05

Objective

Scope 01-04

Definitions 05

EXPLANATION 06-34

Objective of Financial Statements 05-08Financial Reporting for Non-Profit Organizations 09-34Balance Sheets 10-18

Objective of Balance Sheets 10-11Classification of Assets and Liabilities 12-13Classification of Restricted or Non-Restricted Net Assets 14-18

Operating Statements 19-32Objective and Focus of Operating Statements 19-20Changes in Net Assets Group 21-22Classification of Revenue, Expenses, Gain and Loss 23-26Information of Revenue and Expenses 27-28Information of Rendering Services 29-32

Cash Flows Statements 33-34Objective of Cash Flows Statements 33Classification of Cash Receipts and Cash Disbursements 34

STATEMENT OF FINANCIAL ACCOUNTING STANDARD No. 45 FINANCIAL REPORTING FOR NON-PROFIT ORGANIZATIONCONCLUSION………………………………………35-48

Effective Date 48


INTRODUCTION

The characteristics of non-profit organisations are different to profit-oriented organizations. The essential distinction is the source of the organisation’s resources to finance its activities. Non-profit organizations’ resources are donations from members and other contributors who do not expect to receive any benefits from the non-profit organisation.

As a result of such characteristics, there are specific transactions undertaken by non-profit organisations which rarely occur in profit-oriented organisations such as donations and grant receipts. However, there are many non-profit organisations which are difficult to distinguish from a profit-oriented organisation. Notwithstanding their lack of ownership, some non-profit organisations finance capital from loans, and finance operations from income received by rendering services to the public. Accordingly, the measurement of the amount of cash flows, their timing and their certainty become important performance measurements for the users of the non-profit organisation’s financial statements which may include creditors and lenders. Such non-profit organisations have characteristics which are similar to profit-oriented organisations.

The users of a non-profit organisation’s financial statements evaluate:

a) the services rendered by the non-profit organisation and its ability to continue rendering such services; and

b) how management have satisfied their responsibilities and to judge management’s performance.

The ability of a non-profit organisation to continue rendering services is communicated via the balance sheet which provides information on assets, liabilities, net assets and the relationship between those elements. The balance sheet should also separately disclose restricted and unrestricted net assets. Management’s ability to operate the non-profit organisation’s resources, including those received from contributors, are presented in the statement of activity and statement of cash flow.

Objective

The objective of this standard is to prescribe financial statement reporting for non-profit organisations to make such statements more understandable, relevant and comparable.

Scope

01.This standard is applied for financial statements presented by non-profit organisations that fulfil the following characteristics:

a) resources are from contributors who do not expect to receive any re-payment or benefits from the non-profit organisation in proportion to the resources contributed;

b) produce goods and/or services without intention to profit and, if the entity generates profit, it is never distributed to the members / contributors.

c) there is no ownership that is saleable, replaceable or refundable, and there is no claim on resources in the event of liquidation.

02. This standard is not applicable for government institutions, departments or other similar organisations.

03. Financial statements of non-profit organizations consist of balance sheets, statement of activities, statement of cash flows and notes thereto. The financial statements are generally different from financial statements of profit-oriented organizations.

04. This standard establishes basic information that should be disclosed in the financial statements of non-profit organisations. Matters not specifically addressed in this standard should be referred to generally accepted accounting standards.

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Definitions

05. The following are definitions of terms used in this standard:

Permanent restriction is limitation on the use of resources determined by the contributors to maintain the resources permanently, however the non-profit organisation is permitted to use part or all income or other economic benefits generated from using those resources.

Temporary restriction is limitation on the use of resources determined by the contributors to maintain the resources until a particular date or until such a particular condition is achieved.

Restricted donations are resources for which the use of which is limited by the contributors for a specific reason. Such limitations could be permanent or temporary.

Unrestricted donations are resources for which the use of which is unlimited.

EXPLANATION

Objective of Financial Statements

06. The primary objective of financial statements for non-profit organisations is to provide relevant information for use by contributors, members, creditors and other financial statement users who provide resources.

07. The users of a non-profit organisation’s financial statements evaluate:

a) the services rendered by the non-profit organisation and its ability to continue rendering such services; and

b) how management have satisfied their responsibilities and to judge management’s performance.

08. The objective of a non-profit organisation’s financial statements, including the notes thereto, is to provide information concerning:

a. the amount and nature of assets, liabilities and net assets;b. the effect of transactions, events and other situations that impact on the

amount and nature of net assets;c. the type and amount of resource inflows and outflows in a period, and the

relationship between them;d. how cash is obtained and spent, finance received and other factors that have

an impact on liquidity; ande. the services performed.

Each element of the financial statements provides different information, and information in financial terms usually compliments other non-financial information.

Financial Statements for Non-Profit Organizations

09. Financial statements of non-profit organisations are to consist of balance sheets as of the reporting date, statements of activity and of cash flows for the reporting period, and notes thereto.

Balance Sheet

Objectives of the balance sheet

10. The objectives of the balance sheets are to provide information on assets, liabilities, net assets and information on the relationship between those elements as of a reporting date. Information presented in the balance sheet together with information in other financial statements can assist contributors, members, creditors and other interested financial statement users to evaluate a non-profit organisation’s:

a. ability to continue rendering services; andb. liquidity, financial flexibility, solvency and external funding requirements.

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11. A non-profit organisation’s balance sheet must present total assets, total liabilities and net assets.

Classification of assets and liabilities

12. Balance sheet, including nNotes to the balance sheet, are also included in the financial statements to presents relevant information about liquidity, financial flexibility and relationship between assets and liabilities. This information is usually presented in groups of assets and liabilities that have similar characteristics in a relatively homogeneous group. For example, a non-profit organisation usually reports each element of assets in a homogeneous account, such as:

a. cash and cash equivalents;b. amounts due from patients, students, members and others service recipients;c. inventory;d. rent, insurance and other amounts paid in advance;e. marketable securities and long term investments;f. land, buildings, equipment and other fixed assets that are used to produce

goods and services.

Cash and other assets which have restricted uses as determined by the contributors must be separated from unrestricted cash and other assets.

13. Information on liquidity is presented as follows:

a. Presentation of assets based on liquidity, and liabilities based on maturity dates;

b. Classification of assets as current and non-current, and classification of liabilities as short term and long term; and

c. Information disclosed in the notes to the financial statements regarding liquidity of assets, maturity dates of liabilities and restrictions on the use of assets.

14. Classification of restricted or unrestricted net assets

14. The balance sheet presents each group of assets and liabilities included in net assets regardless of whether limitations on the use of resources have been determined by the contributors, and therefore includes permanently restricted, temporarily restricted or unrestricted resources.

15. Information about the nature and amount of permanent and/or temporary restrictions is disclosed by presenting that amount in the financial statements and notes thereto.

16. Permanent restriction’s on assets such as (1i) assets, such as land or art, donated for a specific purpose,; for use and not for sale, or (2ii) assets donated for investment purposes that will generate permanent income can be reported as separate items in permanently restricted net assets or in the notes to the financial statements.

17. Temporary restriction of (1i) donations designated for a certain operation, (2ii) investments for a designated period, (3iii) the usage of assets for a certain future period, or (4iv) the acquisition of non-current assets can be reported as separate items in temporarily restricted net assets or reported in the notes to the financial statements. Temporary restriction by a contributor can be represented by time or usage restrictions, or both.

18. Unrestricted net assets commonly consist of income from services and sales of goods, donations and dividends or proceeds from investments, less expenses incurred to obtain net income. Restriction of the use of unrestricted net assets may be imposed by the nature of the non-profit organisation, the operating environment, the objectives of the non-profit organisation as documented in the deed of establishment and/or from contractual agreements with suppliers, creditors and other financial statement users associated with the non-profit organisation. Information regarding those restrictions are commonly reported in the notes to the financial statements.

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Statement of activity

The objective of the statement of activity

19. The primary objective of the statement of activity is to provide information about (ai) the effect of transactions and other events that change the amount and nature of net assets, (bii) the relationship among transactions and other events, and (ciii) how resources are utilised in conducting the program or services. Information in the statement of activity that is read together with other information in the financial statements can help the non-profit organisation contributors, members, creditors and other interested financial statement users to (ai) evaluate performance in a period, (bii) evaluate efforts, capabilities and ability to continue rendering services, and (ciii) evaluate how management satisfy their responsibilities and to judge management’s performance.

20. The statement of activity is focused on the non-profit organisation as a whole, and presents the changes in net assets for a period. The changes in net assets presented in a statement of activity is that reflected in net assets or equity in the balance sheet.

The changes of net assets

21. The statement of activity presents the changes in permanently restricted, temporarily restricted, and unrestricted net assets during a period.

22. Income and profits that increase net assets and expense and losses that decrease net assets are grouped together as regulated in paragraphs 24-25.

Classification of revenue, expense, gain and loss

23. The statement of activity presents income items as additions to unrestricted net assets unless utilisation is restricted by contributors, and presents expense items as deductions from unrestricted net assets.

24. Depending on restrictions imposed, donations are presented as additions to unrestricted, permanently restricted or temporarily restricted net assets. If limitations on restricted donations expire during a reporting period, restricted donations can be presented as unrestricted donations provided that presentation is consistent and that the accounting policy is disclosed.

25. The statement of activity presents gains and losses recognised from investment and other assets (or liabilities) as additions to and deductions from unrestricted net assets, unless restrictions exist.

26. Classification of income, expenses, gains and losses in net assets doesn’t preclude additional classification in the statement of activity. For example, a non-profit organisation can classify categories effecting net assets as operating or non-operating, disposable or non-disposable, realised or not realised, normal or abnormal etc.

Information on revenues and expenses

27. The statement of activity presents gross revenue and expenses although investment income can be presented net of expenses provided that expenses, such as depository and investment advisory expenses, are separately disclosed in the notes to the financial statements.

28. The statement of activityassets presents net gains or losses that are generated from incidental transactions or other events beyond the non-profit organisation’s management control. For example, gains or losses on the sale of unused land and buildings.

Information of providing services

29. The statement of activity orand notes to the financial statements must present information about expenses based on functional categories classified as primary and supporting services.

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30. Functional classification can help contributors, creditors and other financial statement users to evaluate the non-profit organisation’s provision of services and the utilisation of resources. In addition to presenting expenses by functional classification, it is recommended that non-profit organisations present additional information about expenses according to their nature, for example, salaries, rent, electricity, interest, depreciation etc.

31. The provision of goods and services to a recipient, customer or member is performed to achieve a non-profit organisation’s goals or mission. The provision of goods and services is the non-profit organisation’s primary objective, and are undertaken through various primary programs.

32. Supporting activities include all activities in addition to the primary activity and usually comprise of management and general activities, fund raising and memberstaff development. Management and general activities include supervision, business management, bookkeeping, budgeting, financing and other administrative activities, and all management and other administrative activities exceptin addition to the program for the provision of goods and services or fund raising. Fund raising activities include fund raising campaigns and publications, preparation of mailing lists, special fund raising, preparation and distribution of information, guidance, and other materials; and another activities related to fund raising from individuals, foundations, governments and others. MemberStaff development activities consist of locating new members, collection of membership fees, public relations and similar activities.

Cash flow statement

Objective of the statement of cash flow

33. The primary objective of the statement of cash flow is to provide information about cash receipts and disbursements for a period.

Classification of cash receipts and disbursements

34. The statement of cash flow is presented according to PSAK 2, Cash Flow Statement and with additional information as follows:

(a) financing activity:(b) cash receipts from contributors that have long term restrictions.;(c) cash receipts from donation and investment income, the use of which is

restricted for acquisition, development and maintenance of non-current assets, or increases in endowments.; and

(d) interest and dividends that have long term restrictions.

(e) disclosure about investment and non-cash financing activities such as building and investments received as donations.

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Statement of Financial Accounting Standard No.45Financial reporting for non-profit organisations.

Statement of financial accounting standard is consist of paragraph 35-48. This statement should be read in a context with paragraph 01-34.

Financial statement for non-profit organisations.

35. Financial statements of non-profit organisations are to consist of balance sheets as of the reporting date, statements of activity and of cash flows for the reporting period, and notes thereto.

Balance Sheet

Classification of assets and liabilities

36. Information on liquidity is presented as follows:

a. Presentation of assets based on liquidity, and liabilities based on maturity dates;

b. Classification of assets as current and non-current, and classification of liabilities as short term and long term; and

c. Information disclosed in the notes to the financial statements regarding liquidity of assets, maturity dates of liabilities and restrictions on the use of assets.

Classification of restricted or unrestricted net assets

37. The balance sheet presents each group of assets and liabilities included in net assets regardless of whether limitations on the use of resources have been determined by the contributors, and therefore includes permanently restricted, temporarily restricted or unrestricted resources.

38. Information about the nature and amount of permanent and/or temporary restrictions is disclosed by presenting that amount in the financial statements and notes thereto.

Statement of activity

Objective and focus of statement of activity

39. The statement of activity is focused on the non-profit organisation as a whole, and presents the changes in net assets for a period. The changes in net assets presented in a statement of activity is that reflected in net assets or equity in the balance sheet.

The changes of net assets

40. The statement of activity presents the changes in permanently restricted, temporarily restricted, and unrestricted net assets during a period.

Classification of revenue, expense, gain and loss

41. The statement of activity presents income items as additions to unrestricted net assets unless utilisation is restricted by contributors, and presents expense items as deductions from unrestricted net assets.

42. Depending on restrictions imposed, donations are presented as additions to unrestricted, permanently restricted or temporarily restricted net assets. If limitations on restricted donations expire during a reporting period, restricted donations can be presented as unrestricted donations provided that presentation is consistent and that the accounting policy is disclosed.

43. The statement of activity presents gains and losses recognised from investment and other assets (or liabilities) as additions to and deductions from unrestricted net assets, unless restrictions exist.

Information of revenues and expenses

44. The statement of activity presents gross revenue and expenses although investment income can be presented net of expenses provided that expenses, such as depository and investment advisory expenses, are separately disclosed in the notes to the financial statements.

Information of providing services

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45. The statement of activity and notes to the financial statements must present information about expenses based on functional categories classified as primary and supporting services.

Cash flow statement

Objective of the statement of cash flow

46. The primary objective of the statement of cash flow is to provide information about cash receipts and disbursements for a period.

Classification of cash receipt and disbursements

47. The statement of cash flow is presented according to PSAK2, Cash Flow Statement and with additional information as follows:

(a) financing activity(b) cash receipts from contributors that have long term restrictions;(c) cash receipts from donation and investment income, the use of which is

restricted for acquisition, development and maintenance of non-current assets, or increases in endowments; and

(d) interest and dividends that have long term restrictions.

(e) disclosure about investment and non-cash financing activities such as building and investments received as donations.

Effective date

48. This statement is effective for preparing and presenting financial statement which cover report period since at or after at January 1, 2000. Implementation earlier is suggested.

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APPENDIX

The example of financial statement form

Herein is presented an example of financial statement for non-profit organisations which is presented to provide some consistency in format and descriptions. This example may be different from those conditions existing in certain non-profit organisations and therefore it is advised that a non-profit organisation should provide the most relevant information that is understandable by the contributors, creditors and other financial statement users outside of the non-profit organisation. The preparation of comparative financial statements is also advisable, however to simplify the following example in this appendix the statement of cash flows is presented for one period only.

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Example of Balance Sheet

Non-profit OrganisationBalance Sheet

December 31, 19X0 and 19X1(in millions of Rupiahs)

19X119X0

Assets:Cash and cash equivalents Rp 188 Rp 1,150Interest receivable 5,325 4,175Inventory and prepayments 1,525 2,500Other receivables 7,562 6,750Current investment 3,500 2,500Restricted asset for investment

in land buildings and equipment 13,025 11,400Land, buildings and equipment 154,250 158,975Long term investments 545,175 508,750

___________ ___________Total assets Rp 730,550 Rp 696,200

Liabilities and net asset:Trade payables Rp 6,425 Rp 2,625Returnable unearned revenue 1,625Other payables 2,187 3,250Notes payable 2,850Annual liabilities 4,213 4,250Long term payable 13,750 16,250

___________ ___________Total liabilities Rp 26,575 Rp 30,850

Net assets:

Unrestricted Rp 288,070 Rp 259,175Temporary restricted (Note B) 60,855 63,675Permanently restricted (Note C) 355,050 342,500

___________ __________Total net asset 703,975 665,350

Total liabilities and net asset Rp 730,550 Rp 696,200___________ _________

Example of statement of activity

There are three formats for the statement of activity presented in this appendix, each with its own advantages.

1. Format A presents information in a single column and permits easy preparation of a comparative statement of activity.

2. Format B presents information classified into columns and presents the effect of the end of restrictions on certain assets. Format B presents the impact of the changes in restricted asset to the net asset reclasification. Format B enables the aggregation of information about donation and investment income.

3. Format C presents information in two reports; a total summary of the income statement and expenses, and a statement of the changes in unrestricted net assets. Format C focuses attention on the change in unrestricted net assets, and is appropriate for non-profit organisations who consider operating activities as a separate activity from revenue generated from restricted assets and from donations and investment income.

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Format ANon-profit Organisation

Statement of ActivityFor the year ended December 31, 19X1

(in millions of Rupiahs)

Changes in unrestricted net assets:Revenue and earnings:

Donations Rp 21,600

Service revenue 13,500

Income from long term investments (note E) 14,000

Income from other investments (note E) 2,125Net income from unrealised long term investments 20,570Miscellaneous 375

__________Total unrestricted revenue and earnings 72,170

Net assets becoming unrestricted (note D) :Fulfilment of restriction program 29,975Fulfilment of restriction for equipment acquisition 3,750Completion of time restriction 3,125

__________Total assets becoming unrestricted 36,850

_______________Total revenue, earnings and others donations 109,020

Expenses and losses:Program A 32,750Program B 21,350Program C 14,400

Management and general 6,050Fund raising 5,375

__________Total expenses (note F) 79,925

Loss due to fire 200__________

Total expenses and losses 80,125____________

Increase in total unrestricted net assets Rp 28,895===========

Changes in temporarily restricted net assets:Donations 20,275

Income from long term investments (Note E) 6,450 Realised and unrealised income from long term investments (Note E) 7,380 Actuarial loss for annual liabilities (75) Net assets from restricted asset (Note D) (36,850) ------------ Decrease in temporarily restricted net assets (2,820)

Changes in permanently restricted net assets: Donations 700

Income from long term investments (Note E) 300Realised and unrealised income from long term investments

(Note E) 11,550____________

Increase in permanently restricted net assets 12,550____________

Increase in net assets 38,625Net assets at the beginning of the year 665,350

____________Net asset at the end of the year 703,975

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FINANCIAL REPORTING FOR NON-PROFIT ORGANIZATIONS SFAS No. 45

Format BNon-profit OrganisationStatement of Activity

For the year ended December 31, 19X1(in millions of Rupiahs)

Non restrictedTemporary Restricted Permanent Restricted Total

Income, earnings and other donations Rp 21,600 Rp 20,275 Rp 700 Rp 42,575Delivery services 13,500 13,500Income from long term investments (note E) 14,500 6,450 300 20,750Income from other investments (note E) 2,125 2,125Realised and unrealised income

from long term investments (note E) 20,570 7,380 11,550 39,500Other 375

Net asset becoming unrestrictedRestriction (note D):Fulfilment of restriction program 29,975 (29,975)Fulfilment of restriction for equipment acquisition 3,750 (3,750)Completion of time restriction 3,125 (3,125)

Total revenue, earnings and donations 109,020 (2,74475) 12,550 118,450

Expense and losses:Program A 32,750 32,750Program B 21,350 21,350Program C 14,400 14,400Management and general 6,050 6,050Fund raising 5,375 5,375

Total expenses (note F) 79,925 79,925Loss due to fire 200 200Actuarial loss on annual liability 75 75

Total expenses and losses 80,125 75 80,200


Change in net asset 28,895 (2,820) 12,550 38,625Net assets at the beginning of the year 259,175 63,675 342,500 665,350

Net assets at the end of the year Rp 288,070 Rp 60,855 Rp355,050 Rp 703,975


Format C(Part 1 from 2 part)

Non-profit OrganisationStatement of Income, Expense, Changes in unrestricted net asset

For year ended December 31, 19X1(in millions of Rupiah)

Unrestricted Revenue and Income:Donations Rp 21,600Rendering of services 13,500Income from long term investments (Note E) 14,000Income from other investments (Note E) 2,125Net income from realised and unrealised long term

investments (Note E) 20,570Other 375

___________Total unrestricted revenue and income 72,170

Unrestricted net assets (Note D)Fulfilment of restriction program 29,975Fulfilment of restriction for equipment acquisition 3,750Ending of time restriction 3,125

___________Total unrestricted net assets 36,850

___________Total revenue, income and other unrestricted

donations 109,020

____________Expenses and Losses:

Program A 32,750Program B 21,350Program C 14,400Management and general 6,050Fund rising 5,375

___________Total expenses (Note F) 79,925

Loss due to fire 200 -------------------Total unrestricted expenses and losses 80.125

___________Increase in unrestricted net assets Rp 28,895


Format C(Part 2 from 2 parts)

Non-profit OrganisationStatement Changes in Net asset

For year ended December 31, 19X1(in millions of Rupiah)

Unrestricted Net assets:

Total unrestricted revenue and income Rp 72,170Unrestricted net assets (Note D) 36,850Total unrestricted expenses and losses (80,125)

___________Increase in unrestricted net assets 28,895

___________Temporary restricted net assets:

Donations 20,275Income from long term investments 6,450Net income from realised and unrealised long term

investments 7,380Actuarial loss from annual liabilities (75)Unrestricted net assets (Note D) (36,850)

___________Decrease in Temporarily restricted net assets (2,820)

___________

Temporary restricted net assets:

Donations 700Income from long term investments (Note E) 300Net Income from realised and unrealised long term

investments (Note E) 11,550___________

Increase in permanently restricted net assets 12,550___________

Increase in net assets 38,625

Net asset at the beginning of the year 665,350___________

Net asset at the end of the year Rp 703,975


Format C(Part 2 of 2: Alternative)

Non-profit OrganisationStatement of Changes in Net asset

For the year ended December 31, 19X1(in millions of Rupiah)

Unrestricted Temporary Restricted Permanent Restricted Total

Revenue, income and other donations:

Restricted revenue, income and other donations Rp 72,170 Rp 72,170Revenue, income and unrestricted donations 20,275 700 20,975Income from long term investments (Note E) 6,450 300 6,750Realised and unrealised net income from long term

investments (Note E) 7,380 11,550 18,930Unrealised net assets (Note D) 36,850 (36,850)

Total revenue, income and donations 109,020 (2,74475) 12,550 118,825450

Expenses and losses:Unrestricted expenses and losses 80,125 80,125Actuarial losses from annual liabilities 75 75

Total expenses and losses 80,125 75 80,200

Change in net assets 28,895 (2,820) 12,550 38,625Net assets at the beginning of the year 259,175 63,675 342,500 665,350

Net assets at the end of the year Rp 288,070 Rp 60,855 Rp 355,050 Rp 703,975


Cash Flow StatementDirect Method

Non-profit OrganisationCash Flow Statement

For the year ended at December 31, 19X1(in million of Rupiahs)

Cash flows from operating activities:Cash from service income Rp 13,050.0Cash from contributors 20,075.0Cash from other receivables 6,537.5Interest and dividend received 21,425.0Others receipts 375.0Interest paid (955.0)Cash paid to employees and suppliers (59,520.0)Other (1,063.5)

___________Net cash received (paid) from operating

activities (75.0)___________

Cash flows from investing activities:Compensation from fire insurance 625,0Equipment purchases (3,750.0)Receipts from the sale of investments 190,250.0Purchase of investments (187,250.0)

___________Net cash received (paid) for investing activities (125.0)

Cash flows from financing activities:Received from restricted contributions:

Investment endowments 500.0Investment in time endowments 175.0Investment in buildings 3,025.0Annual agreement investment 500.0

___________

4,200.0

Other financing activities :Interest and restricted dividends for reinvestment 750.0Payment for annual liabilities (363.0)Payment for notes payable (2,850.0)Payment for long term liability (2,500.0)

___________(4,962.5)

___________Net cash received (paid) from financing activities Rp (762.5)

___________Net increase (decrease) in cash and cash equivalents Rp (962.5)Cash and cash equivalents at the beginning of the year 1,150.0

___________Cash and cash equivalents at the end of the year 187.5


Reconciliation of the change in net assets to net cash used for operating activities:

Changes in net assets 38,625.0Adjustment for the reconciliation of the change innet assets to net asset used in operating activities:

Depreciation 8,000.0Loss due to fire 200.0Actuarial loss on annual liability 75.0Increase in interest receivable (1,150.0)Decrease in inventory and prepaid expenses 975.0Increase in others receivables (812.5)Increase in accounts payable 3,800.0Decrease in returnable unearned revenue (1,625.0)Decrease in other payables (1,062.5)Restricted donations for long term investment (6,850.0)

Interest and dividend restricted for long term investment (750)

Realised and unrealised net revenue from long term investments (39,500.0)

___________Net cash received (paid) for operatingactivities Rp (75.0)

Additional data for investing activity and non-cash financing:Equipment received as a donation Rp 350.0Exemption from death insurance premium 200.0


Statement of cash flowIndirect method

Non-Profit OrganisationStatement of Cash flow

For year ended December 31, 19X1(expressed in millions of Rupiah)

Cash flow from operating activities:Reconciliation of the changes in net assets to net cash used

for operating activities:Changes in net assets Rp 38,625Adjustments to reconcile changes in net assets that areused for operating activities:

Depreciation 8,000Loss due to fire 200Actuarial loss on annual liabilities 75Increase in interest receivable (1,150)Decrease in inventory and prepaid expenses 975Increase in other receivables (813)Increase in trade payables 3,800Decrease in refundable unearned revenue (1,625)Decrease in other payables (1,063)Restricted donations for long term investments (6,850)Restricted interest and dividend for long terminvestments (750)Realised and unrealised net income from long tern investments (39,500)

___________Net cash received (used) for operating activities (75)

___________

Cash flows from investment activities:Payment from fire insurance 825Acquisition of equipment (3,750)Proceeds from the sale of investments 190,250Purchase of investments (187,250)

___________

Net cash received (used) for investment activities Rp (125)___________

Cash flows from financing activities:Receipts from restricted donations:

Investments in endowments Rp 500Investments in time endowments 175Investment in buildings 3,025Annual agreement investment 500

___________4,200

___________

Other financing activities:Interest and restricted dividends for reinvestment 750Payment of annual liabilities (363)Payment of notes payable (2,850)Payment of long term liability (2,500)

___________(4,963)

___________Net cash receipts (disbursements) for financing activities (763)

___________

Net decrease in cash and cash equivalents (963)Cash and cash equivalents at the beginning of the year 1,050

___________Cash and cash equivalents at the end of the year 185

___________Additional data:Investment activities and non-cash financing:

Equipment received as a donation 350Exemption from death insurance premium 200Interest paid Rp 955


Notes to the financial statements

Note A illustrates the disclosure policy required which incorporates notes B and C. Notes D, E and F suggest additional information to be disclosed by non-profit organisations. All amounts are in millions of rupiah.

Note A

Non-profit organisations present grant or donations in cash or other assets as restricted donations if the use of those grants or donations is restricted. If the restriction which originated from the contributor has expired, or the objective of the restriction has been fulfilled, temporary restricted net assets are reclassified as unrestricted net assets and are presented in the statement of activity as unrestricted net assets.

Non-profit organisations present grants or donations of land, buildings and equipment as unrestricted donations unless there exist explicit restrictions from the contributor regarding the objective of the utilisation of those assets. Donations of fixed assets which have explicit restrictions that state the objective of the utilisation of those assets, and donations in cash or other assets that are to be used to obtain fixed assets, are to be presented as restricted donations. If there are no explicit restrictions from contributors about the utilisation of fixed assets, they are classified as unrestricted assets.

Note B

Temporarily restricted net assets for a financial period are as follows:Program activity A:

Purchase of equipment Rp 7,650Research 10,640Seminars and publications 3,800

Program activity B:Repair of broken equipment 5,600Seminars and publications 5,395

Program activity C:General 7,420Building and equipment 5,375Annual trustee agreement 7,125For the period after December 31, 19X1 7,850

___________Rp 60,855___________

Note C

Permanently restricted net assetsAnnual investment revenue is spent to support:

Program activity A Rp 68,810Program activity B 34,155Program activity C 34,155Other activities 204,930

___________342,050

Fund for which income must be added to the original donation 5,300Exemption from death insurance premium 200Land for use as a recreation area 7,500

___________Rp 355,050

Note D


Net assets that are unrestricted by contributors due to the occurrence of certain expenses or conditions required by contributor.Removal of restriction achieved:

Program expense A Rp 14,500Program expense B 11,500Program expense C 3,975

___________Rp 29,975___________

Equipment for program A purchased and used 3,750___________

Time restriction that have been fulfilled:Period has been fulfilled Rp 2,125Death of annual contributor 1,000

___________Rp 3,125___________Rp 36,850

Note E

Investments are recorded at market or appraisal value and income (or loss) that has been recognised but not yet realised can be recorded in the statement of activity. Non-profit organisations invest the excess of cash required for daily needs in current investments. In Dec 31, 19X1, Rp. 1,400 is invested in the non-profit organisation’s current account which generates a profit of Rp. 850 per annum. Most long term investments are divided into two categories; group A consists of permanent funds and are not required to increase net assets, and group B are amounts designated by the non-profit organisation’s management which are intended for long term investment; an example is shown in the following table:

Group A Group B Others Total

Investments at the beginning of the year 410,000 82,000 16,750 508,750

Donations available for investment:Permanent fund 500 200 700Temporary fund 175 175Year trustee fund 500 500

Amount drawn for annual past contributors (1,000) (1,000)Investment return (net, after deducting

expenses Rp.375)Dividend, interest and rent 15,000 5,000 750 20,750Realised and unrealised income 30,000 9,500 39,500

Total investment return 45,000 14,500 750 60,250Amount available for current operation (18,750) (5,000) (23,750)Trustee fund income for current year

and future (450) (450)_________________________

______Investments at the end of the year 436,750 90,000 16,925 545,175

Component in each investment category and other investment ownership at December 31, 19X1 is presented in the following table:

Group A Group B Others Total

Permanently restricted net assets Rp. 342,050 5,500 347,550Temporarily restricted net assets 26,880 11,425 38,305Unrestricted net assets 67,820 91,500 159,320

_________________________________

Rp 436,000 90,000 16,925 545,175


The board of trustees non-profit organisation’s management implement regulations that require the permanent endowment fund to be valued at its real value unless contributors explicitly state another basis. To meet this objective, management state that net appreciation is maintained permanently as the amount required to the adjust the historic value of the donation with the consumer price index. All excesses above the permanent endowment fund can be used for other appropriate objectives.

In 19X1, the total investment return of group A is Rp. 18,000 (10.6 %), and from that amount, Rp. 4,620 is retained permanently to maintain the real value of that donation. The remainder, amounting Rp. 13,380, is available to provide other objectives as determined by the non-profit organisation’s management.

Note F

Expense incurred consisted of:

Program Management Fund

Total A B C & General

Raising

Salaries and wages Rp. 37,787.5 18,500 9,750.0 4,312.5 2,825.0 2,400.0

Others expenses 11,875.0 5,187.5 1,875.0 4,312.5

Supplies and travel 7,887.5 2,162.5 2,500.0 1,225.0 600.0 1,400.0

Service and professional 7,100.0 400.0 3,725.0 1500.0 500.0 975.0

Office 6,320.0 2,900.0 1,500.0 1,125.0 545.0 250.0

Depreciation 8,000.0 3,600.0 2,000.0 1,425.0 625.0 350.0

Interest 955.0 955.0

____________________________________________________________________Total expenses Rp 79,925.0 32,750.0 21,350.0 14,400.0 6,050.0 5,375.0

Psak 45 Npo Ver171299

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