01-27-2006, 09:34 PM
Dear all,
There are two methods of accounting being following by NGOs, Trusts etc in Pakistan, One the accrual basis of accounting and second cash basis of accounting,
If the accrual basis is being followed then it will present the Balance Sheet and Income and Expenditure Account (together with the notes), It will be capitalizing its fixed assets and allocate the depreciation charge on yearly basis follwoign the matching concept.
If the cash basis of accounting is being followed then only 'Receipt and Payment Account' (together with the notes) will be prepared, irrespective of nature and volume of payments. The NGO will simply show the outflow of cash for the fixed assets purchased during the a particular period.
Thanks,
SMR
There are two methods of accounting being following by NGOs, Trusts etc in Pakistan, One the accrual basis of accounting and second cash basis of accounting,
If the accrual basis is being followed then it will present the Balance Sheet and Income and Expenditure Account (together with the notes), It will be capitalizing its fixed assets and allocate the depreciation charge on yearly basis follwoign the matching concept.
If the cash basis of accounting is being followed then only 'Receipt and Payment Account' (together with the notes) will be prepared, irrespective of nature and volume of payments. The NGO will simply show the outflow of cash for the fixed assets purchased during the a particular period.
Thanks,
SMR
