Npo

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

10 October 2011 when should fund accounting be used in npo ? ? is it an exception to the fact that donations for revenue purpose should be credited to i and e ?

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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10 October 2011 when the donation is received for special purpose rather than the general purpose of NPO, fund accounting is used

e.g. Donation recieved for the consruction of Playground, Hospital ward, School Building etc.

Querist : Anonymous

Querist : Anonymous (Querist)

10 October 2011 sir,to summarise can i say if donation recd for a specific purpose(revenue or capital in nature) we use fund accounting

if recd for general nature--we see revenue or capital...revenue goes to i and e and capital -fund accounting

and prize fund is used as a fund irrespective of being revenue in nature as it is for a specific purpose ?

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CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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12 October 2011 if donation recd for a specific purpose(revenue or capital in nature) we use fund accounting

the above line quoted by u is right look
fund arises only when the donation is recd with specific instruction about the manner in which expenditure of that donation is recd

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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12 October 2011 look and try to understand the basic purpose of creating the fund

If the money is recd for specific purpose, then the same amount should be spent on the same purpose else it would be spent on the normal business of the organisation.

CA Pushpendra Gaur

CA Pushpendra Gaur (Expert)
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12 October 2011 just try to understand if ur father has given the money for buying of books plus for ur genearal expenses called as ur pocket money

just imagine what will happen if u dont keep the money given for the books seperately, there r highly chances that u may spent the money given for books on general purpose.

but if u keep that money in different pocket named as "fund" then it will not be spent on other purpose.

I hope u understand now, contact for further doubts

Querist : Anonymous

Querist : Anonymous (Querist)

12 October 2011 if i receive a donation for distribution of prizes and ther is no prize fund existing,,,i should still create a p.f ?