Académique Documents
Professionnel Documents
Culture Documents
What is NPO?
Organizations which are formed not for earning profits but for a charitable or social purpose.
Example: Schools Trusts Colleges Clubs Hospitals Societies Mosque
Source of Income
Capital income (from non-operational activities) Revenue income (from normal operational activities)
-Specific donation -Legacies / will -Sales of NCA -Entrance fees (if stated to be capitalized -Grant/subsidies for building
-Subscription -Entrance fees -General donations -Life membership (apportionated) -Interest -Rental received -Collection of activities (matches, competition etc) -Profit from business activities -Grant/subsidies for maintenance
Expenditure
Capital expenditure (for non-operational activities) -all the cost of purchases of NCA -cost of increasing the Value of NCA Revenue expenditure (for normal operational activities) -Rental -Salaries/wages -Repairs & maintanance -depreciation -Honorarium -Cost of Refreshment -Printing -Insurance -Prizes/trophies (matches/ competition)
Financial Statements
Receipt and Payment Account Income and Expenditure Account Balance Sheet.
donors
members
period.
To Bal b/d Cash Bank To Revenue Receipts Subscription General Donations Sale of newspaper Sale of periodicals Sale of old sports material Locker rent Sale of scraps Proceeds of show Miscellaneous Receipts Entrance fee Grant in aid To Capital Receipts Legacies Life Membership fees Specific Donation Sale of Investment Sale of fixed assets Endowment Fund To Bal c/d (Bank O/D)
By Bal b/d (Bank O/D) By Revenue Payments Wages & Salaries Rent, Rates & Taxes Insurance Printing & Stationary Postage Advertising Sundry Expenses Telephone charges Audit fees Honorarium Conveyance Newspapers Repairs By Capital Payments Purchase of fixed Assets Purchase of investments Fixed deposits By Bal Bank Cash
It does not take into consideration both capital income & capital expenditure. All non-cash adjustments like depreciation, outstanding or prepaid expenses & accrued or advance income, provision, etc. need to be adjusted through this account.
XXX XXX
(All the revenue expenditure only) Surplus/Deficit of income over expenditure (XXX) XXX
3)Balance Sheet
The preparation of their Balance Sheet is on the same
Balance Sheet as at .
Non-current Assets Current Assets Total Assets Financed by: Accumulated Fund Opening Accumulated Fund +/- surplus/deficit of income over expenditure Non-current liabilities (including life Membership fees) Current Liabilities Total Liabilities and Accumulated Fund XXX XXX
XXX
XXX XXX
XXX XXX XXX XXX XXX
Terminologies
No NPO 1 Receipts and Payment 2 Income and Expenditure PO Cash Book (Cash & Bank) Income Statement
3 4 5
calculate profit or loss from that trading aspect. (format: same as business income statement)
Profit or loss calculated by preparing trading Acc
Add: Other Revenues XXX Less: Other Expenses (XXX) Net Profit to be transferred to Income and Expenditure Statement XXX
##(Same as the income statement of profit organization)
3) Balance sheet
Non-current Assets Accumulated depreciation bank cash
Adjustment on Sales
Total sales = cash sales + credit sales
Sales Ledger Control Account -Balance b/d - Balance b/d -Sales (credit) - Return inwards -Bank (dishonored cheque) - Cash/bank (received payment) -Interest - Discount Allowed -Bank/Cash(refund) - Bad debts -Legal fees - Bank/Cash (bad debt -Bad debts recovered recovered) -Carriage - Purchase Ledger Control -Discount Allowed (cancelled) Acc (contra) -Balance c/d -Balance c/d
Adjustment on Purchases
Total purchase = cash purchase + credit purchase
Purchase Ledger Control Account -Balance b/d -Balance b/d -Cash/Bank (payment) -Purchase (credit) -Return Outwards -Interest -Discount Received -Cash/Bank (refund) -Sales Ledger Control Acc-Legal Fees (contra) -Carriage -Balance c/d -Discount Received (cancelled) -Balance c/d
Adjustment on Revenues
(including subscription and life membership fees)
Dr Particulars Balance b/d (accrued) REVENUES ACC RM Particulars XXX Balance b/d (prepaid) Cr. RM XXX
XXX
XXX
XXX
Accrued = due/not yet paid/in arrears/payless than actual Prepaid = in advance/pay more than actual/including next month , year
life membership fee instead of paying periodic subscription. Such amount is treated as capital income and fair proportion has to be credited to revenue income. Example: life membership amount RM1000 year of membership 10 years So, the amount to be credited to revenue income is RM100 (in income and expenditure) while the balance will treated as capital income, RM900 (in balance sheet)
Adjustment on Expenses
Dr Particulars Balance b/d (prepaid) Receipts and Payments EXPENSES ACC RM Particulars XXX Balance b/d (accrued) Income and XXX Expenditure Acc (balancing figure) XXX Balance c/d (prepaid) XXX Accrued = due/not yet paid/in arrears/payless than actual Prepaid = in advance/pay more than actual/including next month , year Cr. RM XXX
Adjustment on Depreciation
Accum.depreciation of non-current assets
Balance c/d
Balance b/d)
Income Statement
Accum.depreciation for previous years 1.Stated in question 2.cost-NBV Depreciation for current years 1.Policy given 2.No policy (cost-NBV)