Essay On Analyzing The Balance Sheet Of Make-A-Wish Foundation

Make-A-Wish Foundation is a non-profit organization founded in the US which grants wishes to children suffering from life threatening illnesses. The foundation’s vision is to make every eligible child’s wish to come true for which they provide a series of experiences for them. The foundation is 501c3 non-profit organization in the Unites States and is tax-exempt under the Internal Revenue Code. This paper examines the Annual Report of the foundation for the year 2014 and analysis whether it complies with FASB’s Statement of Financial Accounting, Standard No. 117.

According to Financial Accounting Standards Board [FASB] (1993), FAS 117 requires “that all not-for-profit organizations provide a statement of financial position, a statement of activities, and a statement of cash flows.” On analysis of Make-A-Wish Foundation’s Annual Report, all requirements seem to have been complied with. The Net Assets have been classified into the three categories viz. permanently restricted, temporarily restricted and unrestricted categories in the statement of activities and displayed in the statement of financial Position as is required by FASB (1993) that, “the amounts for each of three classes of net assets viz. permanently restricted, temporarily restricted, and unrestricted should be displayed in the statement of financial position. Further, the amounts of change in each of those classes of net assets should be shown in the statement of activities.”
The annual report also provides a separate statement of functional expenses totaling $ 277,334,525 which is complaint with FASB’s ruling that “the non-profit organization should provide information about expenses by (a) functional classification, (b) natural classification, (c) either functional or natural classification at the option of the organization or (d) both functional and natural classification” (Make-A-Wish, 2014, p.6).

FASB (1993) also requires that in order for the financial statements to be useful, data must be simplified, condensed, and aggregated into meaningful totals. The foundation’s financial statements provide a concise view of material transactions which are essential for the stakeholders to use. It also provides condensed and understandable notes to the financial statements which are essentially required by FAS 117. Further, the Board believes that reporting assets, liabilities, items of revenue, expenses, gains and losses into reasonably homogenous groups enhances the usefulness of financial information provided. This has been kept in mind by the foundation while preparing its annual financial statements. The notes to financial statements present that the contributions made have been segregated into seven categories and received into time-based categories. Classification of gains and losses on permanent endowments are in consistence with the Board's fundamental conclusions for contributions received. Similarly, property and assets have been classified into homogenous groups as well.

Aggregate totals have been correctly made for operations and activities of the organization in its financial statements which is as provided by FASB. Cash and Cash equivalents have been classified into operating, investing and financial activities just like a business concern as the Board feels that comparability is enhanced if same classifications are used. Change in net assets depicted in the statement of activities is also in correspondence with FAS 117.
The financial statements of Make-A-Wish foundation “provide useful information that appropriately reflects the economics of the entity’s activities, resources and obligations” (“Not-For –Profits,” 2015). The organization follows “accrual basis of accounting in accordance with generally accepted accounting principles in the US” (Make-A-Wish, 2014, p.7). Thus, they are in compliance with FASB’s ruling 117.


Financial Accounting Standards Board. (1993).
Make-A-Wish Foundation of America and Related Entities (2014). Annual Report [PDF document]. Retrieved from
Not-For-Profits. (2015). Retrieved July 26, 2015 from

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