Accounting (AS)·Non-profit organisations · NSSCAS 3.2.2
Income & expenditure account and SOFP
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A club does not make a profit — it makes a surplus or a deficit, and it shows this in an income and expenditure account instead of an income statement. In this lesson we work out the profit on a fundraising braai, make all six adjustments, and then build the full income and expenditure account and statement of financial position for the Katutura Netball Club. This is a favourite Paper 1 structured question, and the examiner expects the exact annexe layout, line by line.
What you'll learn in this lesson
By the end you should be able to (NSSCAS Accounting (AS) 3.2.2):
- make the following adjustments in the accounts of non-profit making organisations: accrued expenses, accrued income, prepaid expenses, income received in advance, depreciation, bad debts including subscriptions written off, profit or loss on disposal of non-current assets
- prepare an income statement to calculate the profit on a fund raising activity and the transfer to the income and expenditure account
- prepare an income and expenditure account to include only the net amounts from other fund raising activities
- prepare a statement of financial position
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Miss Olivia and Mike talk through the whole topic — with the figure and working drawn live.