World Doctors (WD)is a Not-For-Profit Organization That Provides Medical Expertise

question 20

Essay

World Doctors (WD)is a not-for-profit organization that provides medical expertise and equipment in areas of the world that cannot afford this type of service or have been struck with a disaster and need additional medical expertise. It is organized with numerous affiliated organizations. Recently, you have been appointed treasurer and the accountant has come to you with the following questions:
1. WD set up a new NFP, which it will use specifically for fundraising purposes. The board of directors of this agency is a separate board, but any funds raised will be paid to WD at the end of each year, after all related costs have been deducted.
2. WD purchased shares in a profit-seeking enterprise that manufactures and distributes medical equipment. The rational for this decision was to be able to get a seat on the board and influence the level of donated equipment made to WD each year. WD purchased 25% in this company.
3. Two directors of WD's board sit on a board (of a total of six members)of an NFP involved in providing relief when disaster strikes around the world.
Required:
Determine the accounting and reporting treatment of the affiliates described above.

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Definitions:

Internal Validity

The extent to which a study accurately establishes a cause-effect relationship within its controlled variables.

Observer Bias

The distortion of measurement or perception due to the personal beliefs, expectations, or experiences of the researcher or observer.

Unusual Problems

Issues or difficulties that deviate from what is typically encountered or expected in everyday life or in standard diagnostic frameworks.

Uncommon Disorder

A rare or infrequent medical or psychological condition that affects a small percentage of the population.