CHAPTER 29 A-FN-105-001/AG-001 29-1 ACCOUNTING FOR ...

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CHAPTER 29 A-FN-105-001/AG-001 Deferred (Unearned) Revenue 7. Deferred revenue is revenue received in advance of being earned (unearned) and revenue recognition must be deferred until the future period or periods in which the revenue is to be recognized/earned. Donation 8. A donation is the provision by contributions, gifts or bequest by a person, group, or organization external to DGPFSS, DND and the CF of funds, goods, facilities or services without cost to DGPFSS, DND or the CF and without expectation of any benefit in return (other than public acknowledgement, if agreed to by both parties) which may or may not support a particular event or activity. Product in Kind (PIK) 9. Goods, facilities or services received/performed that DGPFSS uses in the normal course of operations and would have otherwise been purchased and goods facilities or services received/performed that the organization does not use in the normal course of operations and would not have normally purchased but is considered to have some value. Restricted Contributions 10. Restrictions are stipulations imposed that specify how resources must be used. External restrictions are imposed outside DGPFSS, usually by the contributor of the resources. Internal restrictions are imposed in a formal manner by DGPFSS, usually by resolution of the senior authority. Restricted sponsorship contributions are a rare occurrence whereby funds can be used solely for a specific purpose. Sponsorship 11. A sponsorship is a collaborative arrangement between DGPFSS and persons, groups, or organizations external to DGPFSS, DND and the CF. In such an arrangement, funds goods, facilities or services are provided to support a particular DGPFSS event or activity, in exchange for some appropriate non-monetary benefit of approximately equal value. Unrestricted Contributions 12. Contributions are neither restricted externally nor internally. Unrestricted contributions are normally recognized as revenue in the current period. 29-2
CHAPTER 29 A-FN-105-001/AG-001 OVERVIEW General 13. Collaborative arrangements between federal government departments and agencies and the private sector have become common. In this culture, instances arise where DGPFSS, DND or the CF are approached with sponsorship proposals or donations, or act to secure sponsorships or donations. Purpose 14. The purpose of the NPP sponsorship and donation accounting policy is to ensure that ethical, financial, legal and public affairs matters are respected in the financial records of NPP. FINANCIAL ADMINISTRATION 15. Approval of a senior authority is required prior to responding to any sponsorship proposal or donation, or pursuing any sponsorship or donation initiative. Approval authorities for sponsorship and donations are detailed in the Chief of The Defence Staff Delegation of Authorities for Financial Administration of Non-Public Property. 16. The following items received by NPP do not qualify as a sponsorship or donation and shall be treated as NPP operating revenue: a. registration and entry fees; b. licensing fees and royalties; c. concession fees and revenues; d. fees for booth or exhibit space; e. advertising revenues; f. any fee where the payee receives goods or services of approximate equal value, with the exception of sponsorship as defined in para 11; and g. anything received that does not qualify as a gift to the crown NPP Accounting Procedures 17. The accounting procedures pertain to the receipt and disbursement of funds received through sponsorship and donations, and the custody and administration of sponsorship or donated material that becomes NPP. 29-3
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CHAPTER 29 A-FN-105-001/AG-001 29-1 ACCOUNTING FOR ...

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