The Statement is intended to improve the relevance, representational faithfulness, and comparability of the information that a not-for-profit entity provides in its financial reports about a combination with one or more other not-for-profit entities, businesses, or nonprofit activities. To accomplish that, this Statement establishes principles and requirements for how a not-for-profit entity:

• Determines whether a combination is a merger or an acquisition

• Applies the carryover method in accounting for a merger

• Applies the acquisition method in accounting for an acquisition, including determining which of the combining entities is the acquirer

• Determines what information to disclose to enable users of financial statements to evaluate the nature and financial effects of a merger or an acquisition.

It also is intended to improve the information a not-for-profit entity provides about goodwill and other intangible assets after an acquisition by amending FASB Statement No. 142, Goodwill and Other Intangible Assets, to make it fully applicable to not-for-profit entities.

“Statement 164 will provide important information to users of financial statements regarding not-for-profit organizations that have merged or acquired an entity,” states Jeffrey Mechanick, FASB project manager. “Input from users, received during our due process, was valuable to us in creating this guidance in an area of accounting that has needed greater clarification, helping to improve the quality of information provided to users of these financial reports.”

Statement 164 can be found online at www.fasb.org .