Statement of Financial Accounting Standards No. 157 - Paper Audit ...

qualified to estimate the fair value of the contributed painting and evidence of
its fair value exists. If Museum H does not capitalize its collections,
Museum H is precluded from recognizing the contribution (paragraph 13) and
would provide the information required by paragraphs 26 and 27.
e. Paragraph 208:
The 19X0 communication between Individual R and Church S specified an
intention to give. The ability to modify a will at any time prior to death is well
established; thus in 19X0 Church S did not receive a promise to give and did
not recognize a contribution received. When the probate court declares the
will valid, Church S would recognize a receivable and revenue for an
unconditional promise to give at the fair value of its interest in the estate
(paragraphs 8, 20, and 19−21). If the promise to give contained in the valid
will was instead conditioned on a future and uncertain event, Church S would
recognize the contribution when the condition was substantially met. A
conditional promise in a valid will would be disclosed in notes to financial
statements (paragraph 25).
E17. FASB Statement No. 124, Accounting for Certain Investments Held by Not-for-
Profit Organizations, is amended as follows:
a. Paragraph 3(a) and its related footnote 3:
Sales prices or bid-and-asked quotations for the security are currently
available on a securities exchange registered with the Securities and Exchange
Commission (SEC) or in the over-the-counter market, provided that
those prices or quotations for the over-the-counter market are publicly
reported by the National Association of Securities Dealers Automated
Quotations systems or by Pink Sheets LLCthe National Quotation Bureau.
Restricted stock 3 does not meet that definition meets that definition if the
restriction terminates within one year.
3 The fair value of restricted stock shall be measured based on the quoted price of an otherwise
identical unrestricted security of the same issuer, adjusted for the effect of the restriction, in
accordance with the provisions of FASB Statement No. 157, Fair Value Measurements.For the
purpose of this Statement, restricted stock means equity securities for which sale is restricted
at acquisition by governmental or contractual requirement (other than in connection with being
pledged as collateral) except if that requirement terminates within one year or if the holder has
the power by contract or otherwise to cause the requirement to be met within one year. Any
portion of the security that can be reasonably expected to qualify for sale within one year, such
as may be the case under Rule 144 or similar rules of the SEC, is not considered restricted.
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