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    Financial Statements of Non-Profit Organisations

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    Petrina
    The document discusses financial statements for non-trading organizations. It states that non-trading organizations prepare receipts and payments statements or income and expenditure statements to measure financial performance. It also discusses calculating profit and loss from special activities and incorporating them into financial statements, and different types of income that may require special treatment.

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    Financial Statements of Non-Profit Organisations

    Uploaded by

    Petrina
    87 views6 pages
    The document discusses financial statements for non-trading organizations. It states that non-trading organizations prepare receipts and payments statements or income and expenditure statements to measure financial performance. It also discusses calculating profit and loss from special activities and incorporating them into financial statements, and different types of income that may require special treatment.

    Original Description:

    Summarized notes on non-profit organizations in accounting

    Original Title

    Financial Statements of non-profit organisations

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    The document discusses financial statements for non-trading organizations. It states that non-trading organizations prepare receipts and payments statements or income and expenditure statements to measure financial performance. It also discusses calculating profit and loss from special activities and incorporating them into financial statements, and different types of income that may require special treatment.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    87 views6 pages

    Financial Statements of Non-Profit Organisations

    Uploaded by

    Petrina
    The document discusses financial statements for non-trading organizations. It states that non-trading organizations prepare receipts and payments statements or income and expenditure statements to measure financial performance. It also discusses calculating profit and loss from special activities and incorporating them into financial statements, and different types of income that may require special treatment.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 6

    RECEIPTS AND PAYMENTS

    STATEMENTS AND INCOME AND


    EXPENDITURE STATEMENTS

    C MBAHIJONA

    24 August 2022 Fundamentals of Accounting - AFE3582 C Mbahijona 1


    LEARNING OUTCOME
    • Be able to draw up income and expenditure statements and
    balance sheets for non-trading organisations;
    • Be able to draw up receipts and payments statements for non-
    trading organisations;
    • Be able to calculate profit and losses from special activities and
    incorporate them into financial statements;
    • Understand various forms of income may need special
    treatment.

    24 August 2022 Fundamentals of Accounting - AFE3582 C Mbahijona 2


    NON-TRADING ORGANISATIONS
    • Non-profit organisation are clubs, association and other non-
    profit organisation whose intention in not to make profit.
    • These organisation are run so that their members can do things
    such as play football or chess or for certain activities of interest
    to members.
    • Members contribute membership fee to cover the cost of running
    the association.
    • Financial statements prepared by these organisations to
    measure financial performance are either Receipts and Payment
    Statements or Income and Expenditure Statements and balance
    sheet to reflect on financial position.

    24 August 2022 Fundamentals of Accounting - AFE3582 C Mbahijona 3


    RECEIPTS AND PAYMENTS STATEMENTS

    Profit Making Firm Non-Profit Making Firm

    Income Statement Income and Expenditure

    Net Profit Surplus of Income over


    Expenditure
    Net Loss Excess of Expenditure over
    Income

    24 August 2022 Fundamentals of Accounting - AFE3582 C Mbahijona 4


    PROFIT OR LOSS FOR A SPECIAL
    PURPOSE
    • Sometimes there are reasons why a non-profit organisation
    would want to calculate a profit or loss.
    • This where something is done to make a profit. The profit is not
    to be kept, but used to pay for the main purpose of the
    organisation. For instance:
    • A football club may have discos or dances which people pay to
    go to. Any profit made is used to pay for organisation expenses.

    24 August 2022 Fundamentals of Accounting - AFE3582 C Mbahijona 5


    ACCUMULATED FUNDS
    • A sole trader would have a capital account, while a non-profit
    making organisation would instead have an accumulated fund.
    The effect is the same as capital, as it is the difference between
    assets and liabilities.
    Sole Trader: Capital + Liabilities = Assets

    Non-Profit Organisation: Accumulated Fund + Liabilities = Assets

    24 August 2022 Fundamentals of Accounting - AFE3582 C Mbahijona 6

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