Tag Archive for: Foreign Contribution

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New Updates related to CSR Audit

Utilisation Certificate is asked by every Funding Agency and CSR funding Corporates. Generally, NGO frequently submits various reports of the implementing of the project including financial spent and position. At the end of the project or year-end, an audited utilisation certificate is asked, which includes expenses spent on the project against budget and remaining fund balance.

No Uniform format for UC

But the problem with UC is that there is no proper format suggested in any act or law. Thus, every auditor issued UC as per their format or funding agency insist in a particular format. This happens with CSR corporate also. And it is very difficult for statutory auditor of corporate to rely upon UC.

ICAI issued Advisory

So, ICAI (Institute of Chartered Accountants) has issued an advisory to its member regarding this recently. In such advisory, it is instructed to member / CAs to provide UC in a particular format of the report which is called “Independent Practitioner’s Report on Utilisation Funds” . Also, ICAI has advised such companies to obtain such Report from NGOs / CSR entity.

Download Advisory from Here

Lets talk about Report

It is usual audit report, but includes following :-

  • Management (NGO) Responsibility
  • Auditor’s Responsibility
  • Opinion of Auditor

So, under this report, Auditor has to give audit report after considering following :-

  • Checked whether the entity has incurred amounts on the Corporate Social Responsibility (CSR) activities specified in Schedule VII of the Companies Act, 2013.
  • Traced and agreed the amounts in the attached Statement.
  • Traced the amount spent on CSR activities from the bank statements / cash book of the entity.
  • Checked whether amounts spent on CSR activities have been adequately disclosed in the financial statements.
  • Obtained written representation from the management of the entity on the total amount unspent and their plan to disburse the unspent amount related to the project
  • Tested the arithmetical and clerical accuracy of the Statement

Conclusion

Thus, now onwards, most of corporates will ask NGOs to submit UC in this particular format for CSR projects.

Checkout my Video

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Revised Annual Return FC-4 Form – FCRA Update

At the beginning of the Financial Year, FCRA department has made changes to FCRA Annual Return, which is in Form FC4. The more detailed, more refined format has been introduced. Let us have a look at new changes.

Activity/Project wise utilization

Earlier:- Only total figures of utilization.
New:- You need to give details of opening balance, receipts, utilization and closing balance of each activity/project.

Each Donor Details

Earlier:- Only details of donors who had given more than Rs. 20,000 to be given.
New:- Now, details of each and every foreign donor (1st recipient and 2nd recipient) is to be given.

Fixed Assets Details

Earlier:- Only a total of fresh assets purchased during the year was to mention.
New:- Now, details of each fixed assets purchased during the year from foreign contribution is to be mentioned. e.g. Type of assets, project name, amount etc..

FD Details

Earlier:- Earlier it was not cleared which amount should be displayed. FD closing balance or matured or utilized, bit confusion was prevailing.
New:- Now, very clear tabs given to write the opening balance of FD, new FDs made, the maturity of FD and Closing Balance of FD.

How to file FC-4 return?

Check out below video showing detail presentation on the procedure of FC-4 Form.

 

 

Did I miss something?

Hope this will help you in your NGO, if you have any question,  you can ask here or chat with us. Also your comments are welcome on the above subjects.

 

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