Final answer:
The financial statements for a nongovernmental not-for-profit college or university will typically include a Statement of financial position, Statement of activities, and Statement of cash flows, with some institutions adding a Statement of functional expenses. These mirror the private sector balance sheet, income statement, and cash flow statement but are tailored to the not-for-profit context.
Step-by-step explanation:
The financial statements for a nongovernmental not-for-profit college or university would typically include: Statement of financial position; Statement of activities; and Statement of cash flows. Some entities may also prepare a Statement of functional expenses, but this is not always the case. These statements provide a comprehensive look at the financial health of an institution by detailing assets, liabilities, revenues, expenses, and cash flows.
Similarly, the balance sheet of a bank, as an example from the private sector, lists assets and liabilities, with the net worth being the difference between the total assets and total liabilities, which is known as bank capital. This concept of net worth is akin to the nonprofit's net assets.
In the context of a nongovernmental not-for-profit college or university, the Statement of net assets; Statement of revenues, expenses and changes in net assets; Statement of cash flows are equivalent to a for-profit organization's balance sheet, income statement, and cash flow statement, reflecting the specific accounting methods used by not-for-profits.