1. NATURE OF ORGANIZATIONS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Impairment of LongLived Assets The carrying value of long-lived assets are reviewed if the facts and circumstances, such as significant declines in revenues, earnings or cash flows, or material adverse changes in the business climate indicate that they may be impaired. The Organizations perform their review by comparing the carrying amounts of long-lived assets to the estimated undiscounted cash flows relating to such assets. If any impairment in the value of the long-lived assets is indicated, the carrying value of the long-lived assets is adjusted to reflect such impairment. Deferred Membership Fees and Services Membership, subscription and seminar revenues are deferred when received and recognized as revenue over the life of the membership and subscription or when the seminar occurs. Interfund Payable/Receivable Amounts represent advances received by the Property Fund and the Foundation from the Operating Fund for operating expenses. Such funds totaled $2,749,912 at December 31, 2015 and is reflected in the combining statement of financial position included as part of the supplementary information accompanying the combined financial statements. Contributions and Promises to Give Contributions received or made, including promises to give or pledges receivable, are recognized at fair value in the period in which they are received or made. Support that is restricted by the donor is reported as an increase in unrestricted net assets if the restriction expires in the reporting period in which the support is recognized. All other donor-restricted support is reported as an increase in temporarily or permanently restricted net assets, depending on the nature of the restriction. When a donor restriction expires (that is, when a stipulated time restriction ends or purpose restriction is accomplished), temporarily restricted net assets are reclassified to unrestricted net assets and reported in the Combined Statement of Activities as “Net assets released from restrictions”. Contributions are recognized when the donor makes a promise to give to the Organizations, that is, in substance, unconditional. All other donor-restricted contributions are reported as increases in temporarily or permanently restricted net assets depending on the nature of the restrictions. The Organizations use the allowance method to determine the estimated unconditional promises to give that are doubtful of collection. Management reviews outstanding promises to give on an ongoing basis. The allowance is based on prior years’ experience and management’s analysis of specific promises made. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. An allowance was not deemed necessary as of December 31, 2015. Revenues from Operating Activities AWS generates revenues from operating activities including holding conventions, providing educational services, selling memberships and issuing certifications. Revenues are recorded as related expenditures are incurred, services are performed, products are delivered or once an event takes place. Volunteer Services A large number of people have contributed significant amounts of time to the activities of the Organizations. Since these contributions do not meet the criteria for revenue recognition, they are not reflected in the Combined Statement of Activities. JUNE 2016 / WELDING JOURNAL 49 AMERICAN WELDING SOCIETY, INC., AND AWS FOUNDATION NOTES TO COMBINED FINANCIAL STATEMENTS DECEMBER 31, 2015
Welding Journal | June 2016
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