2012 Presented by Cheryl-Lynn Freeman

Joy in the Morning Sunday Mornings 07:30 09:30am

Seminars: Financial Effectiveness Accounting & Tax Fundraising and Marketing ABC Financial Management

NPO Definition NPO Registration: 1. Legal requirement 2. Reasons to register: Advantages & Disadvantages of registering 3. Options available 4. Process 5. Legislative requirements after registration

A non-profit organisation is defined as: a trust, company or other association of persons: (a) established for a public purpose, and (b) the income and property of which are not distributable to its members or office bearers except as reasonable compensation for services rendered Any organisation that is not for profit and is not part of government can apply for registration; that is: Non-governmental organisations (NGO). Community-based organisations (CBO). Faith-based organisations (FBO). Organisations that have registered as Section 21 companies under the Company Act of 2008. Trusts that have registered with Master of the Supreme Court Any other voluntary association that is not for profit.

No, it is not a legal requirement Constitution protects each individual's freedom of religion, belief, and association. Any group of people may gather together, worship, and practice their faith without informing the government or seeking its permission "Why do we want to register?"

Reasons for registering

Stewardship

Name Protection

Titus 1:7 For an overseer, as God's steward, must be above reproach. Matthew 25:20-21 And he who had received 25:20the five talents came forward, bringing five talents more, saying, Master, you delivered to me five talents; here I have made five talents more. His master said to him, Well done, good and faithful servant. You have been faithful over a little; I will set you over much. Enter into the joy of your master.

In 2001 a tax system: Public Benefit Organisations (PBOs) In order to qualify as a PBO, an organisation must: Be a trust, an association or a Section 21 company; Public benefit activities (the list of which includes religious activities) "public character Register as NPO Submit constitution to SARS & comply with income tax act

Protecting its name from being used or misused by others. - One or both groups may want to establish an exclusive right to continue to use the church's name.

Churches foot in communities Good governance & excellence 5:14Matthew 5:14-16 You are the light of the world. A city set on a hill cannot be hidden. Nor do people light a lamp and put it under a basket, but on a stand, and it gives light to all in the house. In the same way, let your light shine before others, so that they may see your good works and give glory to your Father who is in heaven. Donors: financial & governance structure in place Register: Constitution and financial practices must comply with the rules and standards specified in the Non-Profit Organisations Act (Act 71 of 1997)

Titus 1:7 For an overseer, as God's steward, must be above reproach.

Few benefits Administration Additional costs Compliance

Register 1 NPO under Church Name/Community Project name Register as voluntary association Each branch manage operate independently, but under one name Administration separate, only for NPO submissions

HEAD OFFICE Branch 1

Branch 2

Branch 3

Branch 4

Branch 5

Branch 6

Branch 7

Branch 8

One narrative report & one set of financial statements Determine consistent governance & accounting policy

1. Complete an application form, together with two copies of the organisation's founding documents in full. 2. Fill in and sign an application form in full. 3. Sign two copies of the organisation's founding documents e.g constitution, memorandum of associations or trust deed (not compulsory in terms of the Act). 4. Send an application for registration (strictly by mail). 5. Send documents to: HSRC Building 134 Pretorius Street Pretoria 0001 or Directorate: Non-Profit Organisations Department Of Social Development Private Bag X901 Pretoria 0001

HOW LONG DOES THE REGISTRATION PROCESS TAKE? 2 Months Receipt of application An acknowledgement letter is send to the organisation A registration certificate follows if the application meets the requirements of the NPO Act. Process is free

Requirements for registration The founding document or constitution of an NPO must comply with a number of requirements in order for it to be registered. These 'mandatory requirements' are as follows:"(2) Unless the laws in terms of which a non-profit organisation is established or incorporated make provision for the matters in this sub-section, the constitution of a non-profit organisation that intends to register must state the organisation's name; state the organisation's main and ancillary objectives; officestate that the organisation's income and property are not distributable to its members or office-bearers, except as reasonable compensation for services rendered; make provision for the organisation to be a body corporate and have an identity and existence distinct from its members or office-bearers; make provision for the organisation's continued existence notwithstanding changes in the composition of its membership or office-bearers; officeensure that the members or office-bearers have no rights in the property or other assets of the organisation solely by virtue officeof their being members or office-bearers; specify the powers of the organisation; specify the organisational structures and mechanisms for its governance; set out the rules for convening and conducting meetings, including quorums required for and the minutes to be kept of those meetings; determine the manner in which decisions are to be made; provide that the organisation's financial transactions must be conducted by means of a banking account; determine a date for the end of the organisation's financial year; set out a procedure for changing the constitution; set out a procedure by which the organisation may be wound up or dissolved; provide that, when the organisation is being wound up or dissolved, any asset remaining after all its liabilities have been met, must be transferred to another non-profit organisation having similar objectives." nonEssentially, the Act's 'mandatory' registration requirements include clauses, which: characterise non-profit organisations, (whether they be set up as a Voluntary Association, Trust or Section 21) and distinguish them from for-profit organisations, (Section 12 (2)(b, c, f & o)); clarify the legal status of NPOs and provide that the NPO is a body corporate, which means it has a legal personality distinct from its members, (Section 12 (2)(d, e));

Physical Address: HSRC Building 134 Pretorius Street Pretoria 0002 Tel: 012 312 7500 E-mail: npoenquiry@socdev.gov.za Postal Address: NPO Directorate Department Of Social Development Private Bag X901 Pretoria 0001

16OBLIGATIONS: sections 16-23 of the Act. Documentation of the NPO (section 16 & 17 Obligations) Registered status and registration number of the NPO must be reflected on all its documents. Must comply with the provisions of its founding document.

Finances of the NPO (section 17 Obligations) Keep accounting records of its income, expenditure, assets and liabilities Draw up financial statements, within 6 months after the end of its financial year, which must include as least: 1. a statement of income and expenditure for that financial year; and 2. a balance sheet showing its assets, liabilities and financial position as at the end of that financial year.

Within two months after drawing up its financial statements, the organisation must arrange for a written report to be compiled by an accounting officer. The Accounting Officer report must state whether or not: - financial statements of the organisation are consistent with its accounting records; - the accounting policies of the organisation are appropriate and have been appropriately applied in the preparation of the financial statements; and - the organisation has complied with the provisions of this Act and of its constitution which relate to financial - matters. - Accounting Officer is a registered person paid to deal with organisations' books of accounts according to accounting and financial procedures and principles.

Preserve each of its books of account, supporting vouchers, records of subscriptions or levies paid by its members, income and expenditure statements, balance sheets and accounting officers reports, in an original or reproduced form, for at least five years.

Required Information to be submitted to the NPO Directorate Every registered Nonprofit Organisations must, in writing, provide the Directorate with:Within nine (9) months after its financial year, a narrative report of its activities in the prescribed form together with its financial statements and the accounting officers report accordingly to its obligation of keep records. the names and physical, business and residential addresses of its office-bearers within one month after any appointment or election of its office-bearers even if their appointment or election did not result in any changes to its office-bearers; a physical address in the Republic of South Africa for the service of documents to be received from the Directorate. notice of any change of address within one month before a new address for service of documents will take effect; and such other information as may be prescribed.

Changes to the Founding Document (section 19) When the NPO changes its constitution or name, it must send the NPO Directorate with:A copy of the resolution and a certificate signed by a duly authorised office-bearer confirming that the resolution complies with its constitutions and all relevant laws; Where the NPO has resolved to change its name, the original of its current certificate of registration.

Winding-up or Dissolution of the NPO (section 23) When the organisation resolves to wind-up or dissolve it must, within one month after completing of the dissolution process, send to the Directorate a written notice that the organisation dissolved with:Certified copies of all relevant documents confirming the winding up or dissolution; and A copy of the narrative report, financial statements and the accounting officers report for the period from its previous financial year end of the written notice.

Improves the credibility of church can account to a public office. Brings church into a formal system. Helps the church to get organised. Helps in finding ways of getting benefits like tax incentives and funding opportunities

Ecclesiastes 7: 11 & 12 Wisdom, like an inheritance, it is a good thing and benefits those who see the sun. Wisdom is a shelter as money is a shelter, but the advantage of knowledge is this: Wisdom preserves those who have it. The implementation of a dream/vision depends on the application of knowledge & wisdom to unlock reality

Free financial resources www.ngoaccounting.org Free organisational and leadership guides www.nonprofitconsultant.org.za http://www.dsd.gov.za/npo/ Free accounting software http://www.turbocash.net/ (will provide training to treasurers)

Financial and Accounting Training Compiling financial statements Running church/npo info seminars Questions Email: cheryl@allaboutmzansi.com Website: www.ngoaccounting.org