CA K Reny Philip Partner Philips Cherian amp Associates ID: 502618
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Slide1
An overview and professional opportunity in NPO Sectors
CA K.
Reny
Philip
Partner
Philips
Cherian
& AssociatesSlide2
EVOLUTION AND GROWTH OF NPOS
History of Indian NPO sector
Evolution over the years and role of CAs
NGO Sector
Slide3
Professional opportunities of Chartered Accountants in NPO sector.
1. Consultants at the Conceptualization and formation stage of NPOs
2. Statutory Auditors and Internal Auditors
3. Auditors on behalf of donors and funding agencies
4. Reviewers of Financial Management Systems
5. Advisors on Financial Management and Systems
6. Trainers / Resource Persons
7. Finance Managers and CFOs
8. Senior Management Team Members and CEOs
9. Members and / or Chairpersons of Advisory Bodies
10. Lobbying or advocating for Accounting standards, laws etcSlide4
1.Consultants at the Conceptualization and formation stage of NPOs
Conceptualizing – Deciding the form of organization of the charity on the basis of need of the client and consistent with law of the land.
The decision also depends on various factors including
Size of the Institution
Legal requirement
Initial Cost
Recurring cost
Compliance Required
Corporate Structure
Number of persons required to constitute
Global appearance
Advantages and disadvantages of deciding the form of institution
Characteristics
Activities
……..
contdSlide5
……….Consultants at the Conceptualization and formation stage of NPOs
Contd
……
ii. Formation of organization - Drafting of Trust deed, Bye Laws of Society, MOA & AOA of section 25/ section 8 company etc and registration
Other services include applying for various statutory and related registration
a.PAN/TAN
b. 12 A Registration
c. 80 G
Regn
d.FCRA
e. 35 AC
f. Service Tax
g. Profession Tax
h. PF /ESI
regn
Slide6
2. As Statutory Auditors & Internal Auditors of NPO
In addition to the audit in respective laws of incorporation , the major laws for which Audit is applicable to NGO sector
organisations
are
Income Tax Act 1961.
Statutory Audit
44 AB Audit ( In case there is business turnover beyond limits prescribed)
Foreign Contribution (Regulation) Act 2010Slide7
3. Auditors on Behalf of Donors and Funding Agencies:
An auditor has to peruse the DONOR-NGO agreement to report on the compliance on the terms of the agreement to the Donor.
The auditor is asked by the donors to submit a special audit report/utilization certificates to them in addition to signing the financial statements.Slide8
4. Reviewers of Financial Management System
NGO sector organizations has to be of high standards to meet the demands of the various stakeholders
Expert help is necessary as both the international agencies and the NGOs are interested in improving the standards of accounting, financial reporting and legal compliance aspects.Slide9
5.Advisors on Financial Management and Systems:
Donor agencies have several requirements in relation to financial accounting and reporting when they provide funds to the NGO.
NGOs need good advisors on various financial management and legal aspects for themselves, and other
organisations
dealing with them.Slide10
6.Trainers / Resource Persons in Financial
The NGO sector staff, management team, board persons and officer-bearers are mostly from diverse fields and not necessarily experts on financial management. Smaller NGOs find it extremely difficult to get qualified persons for accounting and financial management. Thus NGO staff requires a lot of training in accounting and legal compliances. Even board members need orientation on financial management to play their role effectively as treasurers or members of Finance Advisory Committee.Slide11
7.Finance Managers and CFOs:
In larger NGOs, there is a great need for qualified persons to occupy the positions of finance managers.Slide12
8.Senior Management Team members and CEOs:
In few national and international NGOs in the recent past Chartered Accountants are selected for the top positions.
It is an interesting responsibility to lead a non-profit
organisation
whose main goal is changing the lives of people especially the downtrodden and the underprivileged in society.
Slide13
9.Member of Advisory Bodies: As the Boards and Governing Bodies of NGO sector
There is a good scope for Chartered Accountants to become members of these Committees and play a useful role. This role may be honorary but for those who would like to contribute to the NGO sector, this is a sure way.
There is a great need for financial experts on the Boards, Governing Bodies and Committees of NGO sector
organisations
. Here Chartered Accountants can play a vital role in the Governance .Slide14
10. Lobbying or advocating for Accounting Standards, Laws etc:
This is an emerging new role, which is a felt need for NGO sector
organisations
. There is a great need to lobby with the respective authority or the Government Agency to amend the respective legislation or the regulation which is adversely affecting the NGO sector. Slide15
An Untapped Area full of Professional Opportunities
special opportunities especially for smaller firms, individuals and proprietorship firms of Chartered Accountants
Corporate social responsibility (CSR)
Chartered accountants Network is an excellent way for nation building Slide16