Specialised Entities

Question 1

What is a not for profit organisation?

Answer 1

An organisation which exists for a public interest generally identified by the following characteristics:

No shareholders
No dividends
Social, Cultural, Philanthropic

Question 2

Differences between a not-for-profit and normal company?

Answer 2

Accountable to the public - greater public interest
Cash flow is key
Budgets - public accountability

Question 3

Why is comparability difficult with not for profits

Answer 3

Liabilities - Difficult to measure contract liability, is a public service a liability? How do we measure the performance and liability?

Basis of accounting - Cash basis rather than accruals as expenses can be uncertain