How is donation refundable shown in balance sheet of NPO?
Answers
Answer:
Specific Donation:
For example, a donor donates ₹ 10,00,000 for the library. It means the donation should be used only for the library, i.e., it is a specific donation. Specific donations are capitalized and are shown on the liabilities side of the Balance Sheet.
Answer:
ACCOUNTING
How Do I Report a Refund this Year of a Donation Given in a Prior Year?
Anonymous October 2, 2011
How do I show in accounting and report a refund this year of a donation given in a prior year?
I have 3 questions about this same issue:
A person donates $500 this year, but I will refund to them this year $100 from a donation they made several years ago to a church project Fund (the project was abandoned).
1) When I refund the donation this year I would apply the refund to the donation income account that the original donation was applied to several years ago, so it will appear on the P&L as if we received less donation income this year. Is this the right way to do it?
2) Some people who donated to the fund for the project that was abandoned would also like to be refunded, but they will be refunded at a later time. In the accounting, how should I change the donation income from several years ago, into a liability this year? Would I just make a Journal Entry this year, dated when refund was agreed upon, that debits the Donation Income account and credits the Liability account?
3) When I refund the donation, should it appear that the donor gave $100 less donation in this year? Should their year end acknowledgement show that they gave only $400 this year, not $500? I understand that we should notify them that there may be tax consequences & they may want to consider filing an amended tax return to remove any deduction claimed in relation to the donation that will be refunded and they should discuss the options with their tax advisor. So, does that mean that the refund would not affect the year end acknowledgment of donations for this year?