Which of the following is not one of the criteria specified in the FASB Codification for determining whether joint costs with a fundraising appeal can be reported with program expenses rather than as fundraising expenses?

• A. The relationship to the overall fundraising objective
• B. The allocation method
• C. The level of donor involvement
• D. Time period

Answer: (D)

The important idea is how joint costs from a fundraising appeal are classified between program expenses and fundraising expenses under the FASB Codification. When a fundraising appeal includes a program element, three factors guide whether the joint costs can be reported with the program expenses rather than as fundraising expenses: how the joint cost relates to the overall fundraising objective, the method used to allocate the joint costs between the program and the fundraising components, and the level of donor involvement in the program element. Time period does not factor into that classification—the duration of the campaign isn’t a criterion for determining where the costs belong. In practice, if the joint cost primarily advances the program element or depends on substantial donor participation to deliver the program, it would be justifiable to report it with program expenses; if it mainly serves the fundraising objective, it would be reported as fundraising.