A non-profit organization has a number of distinctive features, namely:
- It is not created for profit;
- even if the profit was made, then under no circumstances should it be divided between the founders or other investors.
Despite the goals, in some cases the authorized capital of a nonprofit organization is formed.
Creation goals
The main goal of any non-profit enterprise is to serve the interests of society and achieve certain benefits in their interests. In fact, such an organization should bring certain benefits, for example, cultural, to fulfill a social function or educational, to help people in need, sometimes even animals. An organization may carry out an educational function.
Often, NPOs are created to fulfill the function of developing and implementing a healthy lifestyle. There are many societies that provide free legal assistance or help resolve conflict situations.
As can be seen from the goals of creating a legal entity, its activity does not imply the existence of entrepreneurial risks, therefore, the authorized capital of a non-profit organization should not be formed.
Company registration
Like all other legal entities, an NPO is considered established as soon as it is registered. Such an organization can be formed in the form of:
- fund;
- association or union;
- consumer cooperative;
- institutions.
Share capital or fund
At the level of legislation, there is no requirement for the formation of the authorized capital of a non-profit organization.
At the same time, at the level of legislative acts, sources of financing for charitable foundations that are related to non-profit organizations are established:
- contributions of the founders;
- other contributions;
- revenues from sales;
- income from the organization’s own property;
- dividends, interest on deposits;
- donations
- other sources.
In the same Civil Code it is established that all NPOs formed at the expense of the contributions of the founders are required to form the authorized capital.
And immediately a conflict arises: if an NPO does not carry out entrepreneurial activity, then some of these points directly allow its conduct. Consequently, a non-profit organization has the right to conclude transactions that will allow you to make a profit. Naturally, entrepreneurial activity should have an ultimate goal - charity.
The size of the authorized capital of a non-profit organization must be less than the market value of the property of the enterprise.
However, if a statutory fund is formed, then the participants of the company and the founders are not entitled to demand payments from profit or payment of a certain percentage of income, but the founders are not liable for the obligations of the company.
Amount of capital
The minimum size of the authorized capital of a non-profit organization must be created at the level established for the LLC, that is, it must be at least 100 minimum wages.
Property Fund and its formation
In practice, if an NPO is engaged in business, the formation of property capital is its right, and not its obligation. In such cases, the authorized capital of a non-profit organization is formed, the property from which still does not give the right to dispose of the profit for further business activities or is not distributed among the founders of the company.That is, in fact, all profits should go to charity and to cover the costs of the enterprise.
Capital accounting
The authorized capital of a non-profit organization is subject to accounting according to the same rules of accounting and tax rules and standards that are accepted for all enterprises of the country.
Capital formation is carried out using the 80th account, which is in the Chart of Accounts. The procedure for the distribution of property and money in the Criminal Code should be specified by local documents (Charter). As soon as the registration of NPOs has been completed, all received contributions to the enterprise should be displayed on this account.
If deposits in the capital are made in kind (real estate or other property), then its value is determined by agreement between the founders of the NPO. If the property is transferred for use, then its value is determined in the amount of rent.
All NPOs are required to report in an established form on the annual movement of property. And non-profit enterprises related to state ownership must publish property reports in the media.