Gifts-In-Kind

Donations of tangible and intangible personal property and contributions of services. Tangible gifts-in kind include clothing, furniture, equipment, inventory, and supplies, among other things. Intangible gifts in-kind include contributions of advertising, patents, royalties, and copyrights. Gifts in-kind can also include things such as discounted rent. Services provided include legal, accounting, plumbing, nursing, physicians, and other professional services. Gifts in-kind are recorded when a donor provides the item unconditionally and without receiving anything in return. However, if the donated asset has no value and no alternative use, it should not be recognized in the financial statements. Donated services are generally recognized in the financial statements if those services (a) create or enhance a nonfinancial asset, or (b) require specialized skills, are provided by entities or persons possessing those skills, and would need to be purchased if they were not recognized. For example, if an accountant performs the bookkeeping services for a non-profit at no charge, the organization would need to recognize the value of those services as a contribution and related expense, because those services would need to be purchased if not otherwise provided.