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DownloadUpdated: August 2020
Effective Date: Fiscal years beginning on or after January 1, 20123
This Section applies to accounting for inventories of a NPO.
Except as stated in this Section, an NPO applies the guidance in Section 3031, Inventories1 and in Section 3041, Agriculture2, in Part II of the Handbook in accounting for inventories and agricultural inventories respectively
- When inventories have been contributed and a NPO recognizes contributions of materials and services, the amounts recorded as contributions in accordance with paragraph .19 of Section 4410, Contributions – Revenue Recognition, must be included in the cost of inventories.
- Note: paragraph 4410.19 requires that contributions be measured at fair value at the date of contribution if fair value can be reasonably estimated.
- When an NPO does not recognize contributions of materials and services this Section does not apply to those materials and services.
- When an NPO holds inventories for distribution at no charge / a nominal charge, or for consumption in the production of goods to be distributed at no charge / a nominal charge, these inventories must be measured at the lower of cost and current replacement cost.
1 See also our publication ASPE At a Glance: Section 3031 – Inventories.
2 See also our publication ASPE At a Glance: Section 3041 – Agriculture.
3 Except as specified in paragraph 3032.07.
This publication has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only.
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