Beginning in 2018, this is one of two classifications of net assets reported on the financial statements of a not-for-profit organization's financial statements. This classification is to be used instead of the following two classifications: temporarily restricted net assets and permanently restricted net assets. Beginning in 2018, the other classification of net assets reported on the financial statements of a not-for-profit organization is net assets without donor restrictions. To learn more see our Explanation of Nonprofit Accounting.
Harold Averkamp (CPA, MBA) has worked as a university accounting instructor, accountant, and consultant for more than 25 years. He is the sole author of all the materials on AccountingCoach.com. Read more about the author.