Joint Activities with a Fund-Raising Appeal The Joint Costs of Multi-purpose Activities is the subject of AICPA Statement of Position No. 98-It applies when an organization combines the fundraising function with another function - usually some type of program activity, such as public education ("Joint Cost Allocation | Nonprofit Accounting Basics," n.d.). There are three criteria that must be met in order for a non-for profit organization; Purpose, audience, and content. The purpose indicates the reason for doing the activity. The question that must be answered is: Does the purpose of the activity meet the accomplishment of a program function? As described by the AICPA Statement of Position 98-2, the audience helps determine whether or not the activity is solely a fundraising activity - Did the activity target mostly rich people, or prior donors? If so, there is a presumption that it is primarily a fundraising activity. The third criterion that should be met when determining joint costs for multi-purpose activities is content. For example - Is the content of the activity genuinely program-oriented? Generally, the joint activity needs to ask the audience to take a specific action that will help accomplish the NFP’s mission (Reck, Lowensohn, Wilson, & Wilson, 2013, p. 557).
Below are three different scenarios in which I will determine whether or not the purpose, audience, and content criteria has been met as described in Chapter 13 of the AICPA, Audit and Accounting Guide. I will provide my reasoning for each scenario.
Scenario #1
The Green Group’s mission is to protect the environment by increasing the portion of waste recycled by the public. The group conducts a door-to-door canvass of communities that recycle a low portion of their waste. The canvassers share their knowledge about the environmental problems caused by not recycling with households, asking them to change their recycling habits. The canvassers also ask for charitable contributions to continue this work, although these canvassers have not participated in fund-raising activities before.
• Purpose: To protect the environment by increasing the portion of waste recycled by the public.
• Audience: Communities that recycle a low portion of their waste
• Content: To share knowledge about environmental problems caused by not recycling.

Rationale:
In this scenario, the criterion set forth by the AICPA Statement of Position 98-2 is being met; this activity is considered a bona fide activity. In this case, it is correct to allocate the joint costs between the functional program expenses in order to support all expenditures to include fund-raising related expenditures. As stated above, the activity is supporting the mission of the organization. The fact that the group is targeting people in communities that have low activity in recycling activities supports that mission. The purpose of campaign is to educate them in the importance of recycling in order to inspire them to recycle more, no monetary interest is involved and “a call to action” is present.

Scenario#2
Central University’s mission is to educate students in various academic pursuits. The political science department holds a special lecture series in which prominent world leaders speak about current events. Admission is priced at $250, which is above the $50 fair value of other lectures on campus, resulting in a $200 contribution. Invitations are sent to previous attendees and donors who have contributed significant amounts in the past.
• Purpose: To educate students in various academic pursuits.
• Audience: Previous attendees and donors who have contributed significant amounts in the past.
• Content: To hold a special lecture series in which prominent world leaders speak about current events.
Rationale:
Based on the information provided, two out of the three criteria are met: the purpose and content. The audience criterion is not met because of the fact that it appears that Central University is targeting previous attendees that have made significant monetary contributions in the past. Moreover, the price exceeds the fair value of other lectures offered by the campus. Based on this information, 100% of the costs associated with this activity should be reported as fund-raising costs.
Scenario#3
The mission of Kid’s Camp is to provide summer camps for economically disadvantaged youths. It conducts a door-to-door solicitation campaign for its camp programs by sending volunteers to homes in upper-class neighborhoods. The volunteers explain the camp’s programs and distribute leaflets explaining the organization’s mission. Solicitors say, “Although your own children most likely are not eligible to attend this camp, we ask for your financial support so that children less fortunate can have this summer camp experience.”\

• Purpose: To collect contributions.
• Audience: People who live in homes in upper-class neighborhoods.
• Content: To distribute leaflets explaining the organization’s mission and ask people for their financial support.
Rationale:
In my opinion, none of the criteria described in Chapter 13 of the AICPA Audit and Accounting Guide is being met. Although this activity is considered a bona fide activity under AICPA SOP 98-2, there is no call to action involved. The group is simply asking for monetary donations without educating people; also, the volunteers are targeting a group of people based on their financial status and whose children cannot participate in the camps. This implies that the organization is only interested in the amount of contributions these donors can potentially provide to the organization. The fact that they are asking people to read a pamphlet with information does not promote the mission of the company nor does it encourage these individuals to take any type of action to support the organization’s mission.

References
Joint Cost Allocation | Nonprofit Accounting Basics. (n.d.). Retrieved from http://www.nonprofitaccountingbasics.org/fundraising/joint-cost-allocation
Login to Schoology. (n.d.). Retrieved September 11, 2015, from https://www.schoology.com/assignment/305430334/info
Reck, J. L., Lowensohn, S. L., Wilson, E. R., & Wilson, E. R. (2013). Accounting for non-profit organizations. In Accounting for governmental and nonprofit entities (p. 557). New York: McGraw-Hill/Irwin.