Under FAS 116, an implied time restriction on contributed capital assets is assumed to exist in the absence of donor-imposed restrictions.

Question

Quizplus · Accepted Answer

FAS 116 (now part of ASC 958 due to the FASB Accounting Standards Codification) does not assume an implied time restriction on contributed capital assets in the absence of donor-imposed restrictions. Instead, it requires recognition of contributions when received, and any donor-imposed restrictions dictate how and when the assets can be used.

Under FAS 116, an Implied Time Restriction on Contributed capital