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Cape Town – FNB this week joined a consortium of tax and accounting professionals to help stay the NPO (non-profit organisations) sector following a News24 exposé which revealed that more than half of the nearly 140 000 registered non-profits were not compliant with the NPO Act.
READ: Tax, accounting bodies step in after Zuma NPO exposé
Of these, five of the six non-profit organisations associated with President Jacob Zuma were non-compliant with the law, News24 reported.
The Ministry of Social Development has 140 513 NPOs on its database, with more than half non-compliant.
In reaction to the expose the SA Institute of Tax Professionals (SAIT) and the SA Institute for Business Accountants (SAIBA) committed R10m to help NPOs become compliant because the sector “is critical in a democratic South Africa”.
Stiaan Klue, Chief Executive of the SAIT told Fin24 this week should the NPO sector fail, it could derail the already frail economy. “NPOs are critical stakeholders and are contributing significantly to uplifting the poor and destitute from poverty," said Klue.
On Friday, FNB added its support by donating a bookkeeping product worth an estimated R80m to assist NPOs to comply with the filing requirements of the Department of Social Development and the SA Revenue Service.
"The monetary value of the software sponsored by FNB is estimated at R80m", said Nicolaas van Wyk CE of the SA Institute for Business Accountants.
The legal requirement to present financial statements are onerous, and compliance can essentially be achieved by using FNB’s Instant Accounting product, he said.
NPOs rely heavily on donor funds and most donor and funding agencies require registration as NPO as a prerequisite for an entity to receive money.
The NPO Act requires that NPOs keep track of their income and expenses, prepare financial statements and submit these for scrutiny to the department. They also need to submit reports on how they spent their funds and what impact they had on their communities. Lastly they have to appoint an expert, in the form of an accounting officer, to issue a compliance report stating compliance to the NPOs constitution and the NPO Act.
News24 reported on Monday that non-profit organisations run by President Zuma's immediate family - including his four wives - have not filed financial reports in years, a breach of the law which effectively keeps any income and expenditure by the trusts from public scrutiny.
NPOs can secure the Instant Accounting product by registering at www.npoassist.co.za.
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