Charity Grant

mowzer

Hi

Not sure if this is a silly question, but i'm preparing the accounts of a small charity which has received a grant during the year of about £30,000. They had not used it by the year end and i am unsure of where to put it in the accounts.

Should it just be shown as a debtor in the balance sheet and disclosed in the notes?

Please advise :001_smile:

Poodle

Hi Mowzer,

If you have received a grant then surely this would be a credit?

If the grant was given for a specific reason then I would put this into a restricted fund account at the bottom part of the balance sheet to be drawn upon at some point in the future.

Poodle

mowzer

Thanks

It is for something specific so that helps

ben179v

I would show it as deferred income on the balance sheet, it should not hit the SOFA.

mowzer

Thanks

Dean

I'm sure Steve will correct me if i'm wrong here but this is dealt with under SSAP 4:

http://www.frc.org.uk/asb/technical/standards/pub0399.html

As the funds have been received but not spent at the year-end I would think that they would be held as a current liability on the balance sheet.

Regards

Dean

Poodle

Hi

I usedto be employed by a large university that was a charity and regularly received restricted funds.

I used to treat these as follows:

On receipt the funds were credited to a 'restricted funds' reserve. As the funds were spent for the restricted purpose matching amounts were journaled as income to the SOFA.

I also had to add a 'restricted funds reconciliation' note to the accounts.

Unless the SORP has changed then I would imagine that this is still what you have to do

Poodle

peugeot

Dean,

SSAP 4 deals with Government Grants, rather than charitable grants. SSAP 4 is considered to be somewhat beyond the scope of charities as there is a 'SoRP'.

It is a long time since I have done any work on charities and am a bit out of date, but I do know the income recognition for charities has been recently revamped. I have provided a link which should answer your queries:

http://www.stewardship.org.uk/documents/SORP_2005_detailed_draft.pdf

I think section 6 might shed some light for you all.

Kind regards
Steve

Poodle

Thanks Steve,

I tried to find this document but could not

Poodle

paulr

Good morning,
just tagging onto the good points raised previously;
either show as restricted or unrestricted funds,-- restricted if monies are
designated for specific purposes,
best wishes,
paulr.

mowzer

peugeot wrote: »

Dean,

SSAP 4 deals with Government Grants, rather than charitable grants. SSAP 4 is considered to be somewhat beyond the scope of charities as there is a 'SoRP'.

It is a long time since I have done any work on charities and am a bit out of date, but I do know the income recognition for charities has been recently revamped. I have provided a link which should answer your queries:

http://www.stewardship.org.uk/documents/SORP_2005_detailed_draft.pdf

I think section 6 might shed some light for you all.

Kind regards
Steve

Thanks a lot

I feel a lot more confident seeing it for myself :001_smile:

James F

I work for a charity and it should be shown in the SOFA and a credit balance on the balance sheet under deferred income.

mowzer

Thanks James

I only do accounts for the one charity voluntarily, so needed a bit of a reminder about where things go!

Think i've got it sorted now :001_smile: