Balance Sheet of Non-Profit Organisations

Read this article to learn about the preparation of balance sheet for non-profit organizations.

The balance sheet of non-profit organizations is prepared in the same manner as in the case of business enterprises. Assets of the organization are recorded on the ‘Right-hand side’ and Liabilities on the ‘Left-hand side’. Except for some peculiar transactions, the items are also same. The term ‘Capital’ is nowhere found in the case of non-profit organizations; instead Capital Fund, General Fund or Accumulated Fund is appearing in the Balance Sheet.

The amount of this fund is calculated by deducting the amount of liabilities from the value of assets. In this manner we can say that the method of finding out this fund is exactly same that as of calculating the capital of any business enterprise.

The surplus or deficit of the year is adjusted to the fund of previous year. It is worth mentioning that the items which have been capitalized during the current year should also be added. Specific funds created for some specific purposes are shown on the liabilities side. For example, Match Fund, Prize Fund etc. are shown on the liabilities side.

The amounts received on account of these funds, if invested separately, are represented by specific assets in the balance sheet on assets side respectively. For example, Match Fund Investments, Prize Fund Investments etc. are shown on the assets side.

A specimen of Balance Sheet is given below:

Balance Sheet

Balance Sheet

shopify traffic stats