Nonprofits are increasingly turning to artificial intelligence (AI) to help support understaffed teams, fill resource gaps, and streamline processes. While AI has demonstrated its value in back-office applications, such as finance, accounting, and HR, operational and programmatic initiatives are emerging areas for nonprofit AI. As more nonprofits explore AI’s capabilities, it’s imperative to balance AI innovation with careful risk management. Failure to do so can jeopardize an organization’s operations, stakeholder relationships, reputation, and overall mission.

Whether you’re in the early stages of adoption or have mature AI capabilities, it’s critical to understand the top AI risks facing the nonprofit sector, as well as how to use AI in a way that is ethical and mission-aligned. Nonprofits need to be aware of common vulnerabilities and how to protect beneficiaries, donors, and their organizations. 

In the nonprofit sector, audit readiness has evolved from a basic compliance obligation into a strategic necessity that is foundational to strong governance and essential for maintaining stakeholder trust. Audit readiness enables organizations to provide clear, accurate, and timely financial information, which is vital for demonstrating transparency and accountability.

Transparency ensures that stakeholders can see how resources are being managed and allocated, fostering confidence that contributions are used as intended. Accuracy guarantees that the information shared is reliable, supporting informed decision-making and compliance with reporting requirements. Together, these qualities build accountability by demonstrating responsible stewardship and ethical management, and reassuring stakeholders that the organization is dedicated to its mission.

President Donald Trump signed into law a sweeping reconciliation tax bill, commonly known as the “One Big Beautiful Bill Act” (OBBBA) at a July 4 signing ceremony, capping a furious sprint to finish the legislation before a self-imposed Independence Day holiday deadline. The Senate had approved the bill in a 51-50 vote on July 1 after making a number of last-minute changes following intense bicameral negotiations. The House then voted 218- 214 on July 3 to send the bill to the president’s desk.

With the legislation now final, tax-exempt organizations should focus on assessing its impact and identifying planning opportunities and challenges. The OBBBA introduces both tax cuts and tax increases that would affect nearly all businesses and investors. The Joint Committee on Taxation (JCT) scored the bill as a net tax cut of $4.5 trillion over 10 years using traditional scoring. Under the current policy baseline the Senate used for purposes of the reconciliation rules, that cost drops to just $715 billion. The Senate scored the provisions against a baseline that assumes temporary provisions have already been extended, essentially wiping out the cost of extending the tax cuts in the Tax Cuts and Jobs Act (TCJA).

Missing ERISA plan documents can significantly increase costs and long-term risk for employers and plan sponsors. For example, a former employee or their heirs may file a claim for benefits they mistakenly believe are due. Here, the burden falls on the plan to provide records that prove the distribution was previously made to the employee — sometimes decades ago — or pay the claim. This scenario highlights the critical role of records retention policies.

Read on to learn more about ERISA plan records retention guidelines, unusual circumstances that may complicate the plan sponsor’s role, and best practices for preserving and maintaining crucial records.

In response to stakeholder concerns about diversity in current accounting practice for share-based payment awards granted to customers, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-04, Clarifications to Share-Based Consideration Payable to a Customer (ASU 2025-04). The ASU clarifies the following about share-based consideration payable to a customer: 

• Vesting conditions based on purchases by customers or their customers are performance conditions. 

• The guidance in Accounting Standards Codification (ASC) 718, Compensation — Stock Compensation, on measuring a share-based payment is applied rather than the guidance on constraining variable consideration in ASC 606, Revenue from Contracts with Customers, when determining the value of such awards. 

Additionally, the ASU eliminates the policy election to account for forfeitures as they occur for customer awards with service conditions. As a result, an entity must adjust the transaction price for a contract with a customer for the probability that a customer award with a performance condition will vest and for the estimate of forfeitures for a customer award with a service condition.

The Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2025-03, Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, to address stakeholder concerns about unintuitive accounting outcomes in transactions involving variable interest entities (VIEs). For example, many operating companies have entered the U.S. public markets by merging with a special-purpose acquisition company (SPAC). While a SPAC merger might be economically similar to conducting an IPO, under the old guidance, it often resulted in a new basis of accounting for the operating company instead of carryover basis. Stakeholders expressed concerns to the FASB about this inconsistency, which will be less likely to occur under the new ASU.

After adopting the ASU, an entity must assess the factors in ASC 805, Business Combinations, to determine the accounting acquirer in an acquisition transaction primarily effected by exchanging equity interests when the legal acquiree is a VIE that meets the definition of a business. 

Maintaining compliance with fiduciary responsibilities is a primary task for plan sponsors. Yet mistakes occur, especially given the complexity of the Employee Retirement Income Security Act (ERISA) of 1974. When certain fiduciary breaches or prohibited transactions are identified related to ERISA benefits, plan sponsors may look for remedies that can right the wrong. The Voluntary Fiduciary Correction Program (VFCP) provided by the Department of Labor (DOL) since 2006 is an option, but only for 19 specified prohibited transactions. A recent update to the VFCP, effective March 17, 2025, added a new self-correction component to the program. This article describes the VFCP and the update in its current form. 

Year-end audits may be conducted for a host of reasons, including investor requirements and regulatory compliance. While all accounting matters are important to an audit, this article explores essential considerations that may be overlooked or misunderstood, leading into audit season for most companies: lease modifications and remeasurements, new segment disclosures, goodwill and intangible impairment considerations, as well as the measurement of credit losses covered by FASB Topic 326.

Based on investor and other constituent feedback requests for more information about income statement expenses, the Financial Accounting Standards Board (FASB) introduced guidance requiring expanded disclosures for public business entities (as defined in U.S. GAAP) about specific income statement expenses in Accounting Standards Update (ASU) No. 2024-03: Income Statement — Reporting Comprehensive  Income — Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. 

This Bulletin summarizes the ASU, including the new disclosure requirements and effective dates. This ASU does not change income statement presentation requirements but instead expands the disclosure requirements for specific costs and expenses.

The Employee Retirement Income Security Act of 1974 (ERISA) represents a key moment for retirement security in the United States — and September 4, 2024, marked its 50th anniversary. 

While its enactment is certainly an important milestone, ERISA’s most enduring impact may be that it began an era of continued enhancements to employee protections and contributed to the reduction of discriminatory treatment of U.S. workers. The 1974 landmark act opened the door for new laws and regulations, paving the way for many of the employee protections now considered standard for the American workforce. In this article, we will look at some of the key protections that were not part of ERISA’s original framework but grew from its foundation.

As we approach the end of 2024, advisors must guide clients through the intricacies of tax and estate planning strategies, taking advantage of current economic opportunities while preparing for potential shifts based on political developments. This involves leveraging today’s favorable conditions, especially in light of this week’s Presidential election, which could significantly alter the estate planning landscape. Let’s explore how to craft strategic plans that will allow clients to navigate these complexities and ensure long-term success.

Two significant regulatory changes to retirement plans require immediate attention from plan sponsors, both to ensure current operational compliance and to comply with upcoming deadlines. Many long-term, part-time (LTPT) employees are now eligible for 401(k) retirement plans; there is also a new method of counting defined contribution retirement plan participants on Form 5500 Annual Return/Report. It’s important to note that a retirement plan’s audit status could be affected as these changes take effect.

Nearly half of surveyed physicians in their 50s recently said they plan to retire by their early 60s. The medical field can expect a significant shortage of primary care doctors in the years ahead, which means it will be challenging to ensure continuity in leadership, operations and patient care. But the right kind of ownership transition plan can mitigate these challenges and ensure physician (and patient) retention and the best patient care.

On June 20, the U.S. Supreme Court issued its decision in Moore v. United States, upholding the constitutionality of the Mandatory Repatriation Tax under the 2017 Tax Cuts and Jobs Act. The Moore decision is one high-net-worth individuals and their advisors don’t want to ignore. If nothing else, the ruling reaffirms Congress’ broad taxing authority but leaves open significant questions about the future of wealth taxation in the United States.

In a landmark decision, the Supreme Court addressed a crucial issue regarding the valuation of shares in closely held corporations for federal estate tax purposes. The case, Connelly v. United States (2024), clarified whether life insurance proceeds used to redeem a deceased shareholder’s stock should be factored into the stock’s valuation for estate tax calculations.

Business valuation is a critical process that determines the economic value of a company or an ownership interest within it. Accurate valuation is essential for making informed investment decisions, negotiating sales or mergers, and complying with legal and tax requirements.

As record numbers of boomers reach retirement age, more private companies than ever must wrestle with transition challenges.

A gifting strategy that considers minority interest discounts, the timing of gifts and anticipated appreciation can save millions of dollars in taxes.

Hoensheid v. Commissioner (T.C. Memo 2023-34) underscores the significance of timing and proper appraisal in tax planning, particularly concerning charitable contributions.

If you audit or manage a startup company or other privately held business, don’t overlook the treatment of stock-based compensation. If you do, the financials might not stand up to an audit, which could compromise the company’s capital-raising efforts going forward.