Consolidation Guidance for Not-for-profit
On June 11, 2026, the FASB declined to add a not-for-profit reporting project to its technical agenda.
On June 11, 2026, the FASB declined to add a not-for-profit reporting project to its technical agenda.
That decision deserves more scrutiny than it may receive.
The Board considered several NFP issues, including consolidation under Subtopic 958-810, and concluded that none justified a standard-setting project at this time.
I think that was the wrong call.
Nonprofit consolidation guidance is unclear. It allows sophisticated organizations to easily structure around consolidation, leaving users with financial statements that do not reflect the full picture of the business.
Not every point deserves a place on the board agenda, but nonprofit consolidation should not be dismissed as a niche technical matter. It is a structural reporting issue that affects many public issuers: Salesforce, Monday.com, Circle, Upwork, Akamai Technologies, and the list goes on.
I would like to reiterate that the current guidance on the consolidation of nonprofit entities is the biggest loophole that allows any business to easily abuse accounting rules. It is notable that on June 12, 2026, Accounting Today reported that US non-profit foundations are showing strong growth, with more than $2 billion in assets now held by these organizations. Yet the issue remains not pervasive.
Estimating Minimum Allowance for Current Expected Credit Losses
Even with zero historical losses, the expected credit loss is not zero. The Rule of Three can be used to estimate the likelihood of a loss, as explained in the handout page.
SAFT Recalibration
Recurring valuation of SAFTs is an operational challenge we often see in practice.
Recurring valuation is an operational challenge we often see in practice. SAFTs were often held at cost because teams lacked a practical framework to true them up between signing and token launch.
In our work, we used agentic AI tools to help build an SAFT valuation template that analyzes legal terms, identifies economic assumptions, assesses scenario outcomes, and incorporates calibration logic. The result is a structured operating model that web3 finance teams can use to update SAFT valuations in response to changes in the economic environment and the entity’s facts and circumstances.
A calibrated scenario model can help management estimate changes in fair value after acquisition. The process starts with the deal terms at inception, calibrates to the transaction price, then updates probabilities and outcomes at each reporting date. This produces a more defensible fair value estimate for SAFTs, even when token delivery remains contingent.
SAFT Recalibration Model
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This file shows an illustrative calculation of SAFT contract value recalibration in accounting periods subsequent to the investment.
By anchoring the model to the original transaction and updating assumptions at each measurement date, companies can build a more consistent and auditable fair value process. The approach gives finance teams a repeatable process where they previously had a valuation gap. It also applies calibration discipline to instruments that were often left at cost until a major event forced a reset.
Used properly, with appropriate governance, expert review, and quality control, agentic AI tools can help create structured data that captures contractual terms, improve documentation, and support more accurate financial reporting.