NOT-FOR PROFITS & CHARITIES
As a Not-for-profit organization you have different reporting requirements than most businesses. With the requirements always changing you need a firm that specializes in the non-profit sector and the unique set of accounting standards for not-for-profit organizations (ASNPO).
Non-profit accounting refers to the unique system of recording and reporting that is applied to the transactions engaged in by a non-profit organization.
A non-profit entity is one that has no ownership interests, has an operating purpose other than to earn a profit, and which receives significant contributions from third parties that do not expect to receive a return.
Non-profit accounting employs the following concepts that differ from the accounting by a for-profit entity and therefore the reporting looks a little different as well. For example, the balance sheet is replaced with a statement of financial position. Financials have fund balances and may include additional columns you wouldn’t see in a for-profit organization. For example, the statement of retained earnings becomes the statement of changes in net assets. Normally, you would see a prior year column and a current year column. However, for a non-profit, you may have current year columns split out to included items for Invested in Capital Assets, Restricted Funds and General Funds. This is to account for those income and expense items that are for certain programs or funds that can only be used for a specific purpose.
The Non-profit world is based on accountability aspect of finances. This includes keeping a budget, reporting to donors on use of funds, and filing required reporting with the CRA. The government requires a special tax return to be filed annually. There are Each return has its own unique reporting requirements.
Non-Profits with larger amounts of government funding may require audited financial statements or Reviewed financial Statements and those that don’t may only require a notice to reader. We are able to offer all these services and are experienced in the special reporting requirements of Non-profit organizations.