For 25 years, the definition of collections used by the Financial Accounting Standards Board (FASB) and the AAM Code of Ethics for Museums have been out of alignment in regards to the use of proceeds from the sale of deaccessioned collections. Generally accepted accounting principles state that an entity need not recognize contributions of works of art, historical treasures, and similar assets if the donated items are added to collections and meet three conditions. One condition states that an entity must be subject to an organizational policy that requires the proceeds from sales of collection items to be used to acquire other items for collections.
FASB recently issued the exposure document (link below) that would bring the accounting principle into alignment with the AAM Code of Ethics by allowing proceeds to be used for direct care of existing collections as well as acquisition.
FASB is seeking comments on this proposed change. Comments may be submitted online or by mail (see page 2 of the exposure document for details) and must be received by August 10.The Alliance has written a letter of support for the proposed changes (link below) and encourages museums to provide feedback to FASB.Exposure Document: https://www.dropbox.com/s/gf1rrq22zybns3v/Proposed_ASU_2018-XX-Not-for-Profit_Entities_%28Topic_958%29-Updating_the_Definition_of_Collections.pdf
Alliance letter of support: https://www.dropbox.com/s/2q5yjy6ob6tgdus/AAM%20Response%20-%20FASB%20Exposure%20Document.pdf
American Alliance of Museums2451 Crystal Drive, Suite 1005Arlington, VA 22202