— Examples illustrating different ways entities might report such information are included in the ASU


With limited exceptions for certain disclosures, the amendments are required to be applied on a retrospective basis for all years reported. Amendments will be effective for annual financial statements for fiscal years beginning after December 15, 2017, and for interim periods within fiscal years beginning after December 15, 2018. Early adoption is permitted.


Concurrent with the issuance of the standard, FASB issued an In Focus summary, a FASB: Understanding Costs and Benefits document, and a video: Why a New Not-for- Profit Financial Reporting Standard?*


Phase 2 of FASB’s NFP Entity Financial Statement project is expected to address intermediate operating measures based on mission and availability, presentation of internal transfers on the statement of activities, and alignment


Before the Bench


The Ministerial Exception: A Tool to Wield Cautiously Practical Tips in Defining Ministers


Nicholas R. Morgan, Esq. Reprinted with permission from Telios Law PLLC. http://telioslaw.com/member-care-info/1325-the- ministerial-exception-a-tool-to-wield-cautiously.


What Is the Ministerial Exception and Where Does It Come From?


“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof . . . .” 1


two-part amendment applies to the federal government directly and the states through the Due Process Clause of the 14th Amendment. The two parts, establishment and free exercise, are the Constitutional teeth for the separation of church and state, a historic principle dating back to the first clause of the Magna Carta. That principle applied to church conflicts (particularly property disputes) through Watson v. Jones 2 following 3


and , which circumscribed the State’s ability to adjudicate religious doctrinal disputes.


The concept that courts shouldn’t adjudicate doctrinal disputes, called the “ecclesiastical exemption,” or “ecclesiastical abstention,” was applied to employment law beginning in 1929 through a series of cases holding that courts do not have the authority to determine who is qualified to be a minister 4


, and thus created the


“ministerial exception.” Accordingly, even before the landmark opinion in Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC 5


states had a version of the ministerial exception, which described the government’s inability to interfere with the employment decisions of a church in regards to its ministerial employees, and specifically refused to apply antidiscrimination laws such as the Americans With


© 2016 by the Association of Christian Schools International , all federal circuits and many This


Disabilities Act and Title VII of the Civil Rights Act of 1964 to these situations.


When the Hosanna-Tabor case was heard in 2012, therefore, it represented the U.S. Supreme Court’s first opportunity to legitimate the already ubiquitous concept of the ministerial exception to antidiscrimination legislation in regard to employment decisions between a religious organization and its ministers. The Court did indeed legitimize the concept. More importantly, however, the Court offered instruction on the unsettled concept of how to determine whether an individual employee is indeed a minister. Despite the Court’s reluctance to provide a rigid formula for this determination, the Court provided useful information instructive both for future court analysis, and for religious orgs to utilize in ensuring that those in their employ, which they may consider ministers, are conveyed and constructed as such.


How Do We Show Which Employees Are Ministers?


Again, according to the Court’s totality-of-the-circumstances analysis, there is no rigid test nor ability for religious orgs to be absolutely confident of their determination of their employees’ statuses. However, in consultation with an experienced religious nonprofit attorney, religious orgs may bolster their confidence of a court’s concurrence with the org’s determination that an employee is a minister by structuring employment relationships in accordance with some or all of the following:


27.2 | 43


of the statement of cash flows with the statement of activities. In addition, the Board is considering whether to address segment reporting for business-oriented health care and other “business-like” NFPs in conjunction with this project, or as a separate project.


*These resources can be found at the following sites.


http://www.fasb.org/cs/ContentServer?c=Document_C &pagename=FASB%2FDocument_C%2FDocumentPage &cid=1176168379971


http://www.fasb.org/cs/ContentServer?c=Document_C &pagename=FASB%2FDocument_C%2FDocumentPage &cid=1176168379996


http://players.brightcove.net/2205030511001/default_ default/index.html?videoId=5081273341001


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