Ready for your annual audit and filing of tax returns? Check if you have everything in place

We have made a comprehensive checklist for you to discuss with you Chartered Accountant before your audited accounts are signed off and your annual returns are filed as required under Income Tax and FCRA.

AUDIT, INCOME TAX AND FCRA CHECKLIST

Disclaimer: The list of documents/ points/ links to sample documents mentioned in this document are only illustrative and not exhaustive. You may refer to the relevant acts/ statutory provisions and if required consult a Chartered Accountant or a legal advisor. 

LIST OF DOCUMENTS TO BE INCLUDED IN AUDITED ANNUAL ACCOUNTS 

1.    Auditor's Report (typically on the letterhead of the CA/auditor).

2.    Balance Sheet (Signed and stamped by the CA/auditor), signed by your Chief Functionary & Board Members

3.    Income and Expenditure Account ((Signed and stamped by the CA/auditor), signed by your Chief Functionary & Board Members

4.    Receipts and Payment Account. This is mandatory if you have an FCRA registration. (Signed and stamped by the CA/auditor), signed by your Chief Functionary & Board Members. However, it is a good practice to prepare consolidated Receipts and Payments account (both foreign and domestic transactions) irrespective of whether you have an FCRA account or not.

5.    ​Notes to Accounts (including significant accounting policies). Also, you can include your organisation's registration details, date of filing income-tax return and FCRA return and details of 12A, 80G, 35AC and FCRA registration. 

6.    Fixed Assets Schedule.  

7.    Complete Schedules if your balance sheet, income and expenditure account mention the same. Each page should be stamped along with the initials of the CA. 

8.    Ensure that year (i.e. 2015 or 2016) is correctly mentioned in all schedules and annexures. 

9.    Ensure that there are no typo errors or rounding off errors across all pages.

10. Ideally, figures for previous year should be provided in all statements and schedules.

11.Would be good to have the pages numbered. Also, use a clear font and ensure the original copy is of good quality print. 

12.Payment of fees/ salary/ remuneration/ reimbursements to Trustees/ Governing Body members/ Directors should be tracked and reported separately. 

13.If your CA/auditor makes any comment/ qualification in their draft audit report, discuss the issues with them and provide your response in a management report so that the CA/auditor can incorporate the same in their final report. 

14. Ensure you have shared an action taken report with your CA/auditor on issues that they raised in the previous year’s report. 

15. If your accountant has made separate project wise/ location wise accounts and also separately for FCRA and domestic transactions, please ensure that the accountant has also prepared consolidated statements for the organisation as a whole.     

INCOME TAX FILINGS

1.    ​Please ensure that you file your income-tax return within the due date (which is generally 30 September of that year) because it is a sign of good governance and increases your transparency. (Please note that filing your income tax return on time is a criterion for GuideStar India Gold and Platinum certification). 

2.    Form 10B – Audit report under Income-tax Act, 1961 (‘IT Act’)

a.    Please ensure that your CA files Form 10B online in the income-tax e-filing website and provides you with an Acknowledgement of filing the same. Please view the sample document of Form 10B which is filed online. You may also view an acknowledgement of uploading Form 10B online.

b.    Please ensure that related party transactions under section 13(3) of the IT Act mentioned in Form 10B match with the details provided in your audited financial statements.

3.    ​In case you file your return with a Digital Signature, then you need not send the acknowledgement (ITR-V) to the Centralised Processing Centre, Bengaluru. In case you file your return without a Digital Signature, then you are required to sign the ITR-V and post the signed copy of the ITR-V to Centralised Processing Centre, Bengaluru. While uploading ITR-V on the GuideStar India website, please ensure that you upload a signed copy of the ITR-V.

FCRA FILINGS

1.  Please ensure that you file your FCRA annual return within the due date (which is generally 31 December of that year) because it is a sign of good governance and increases your transparency. (Please note that filing your FCRA return on time is a criterion for GuideStar India Gold and Platinum certification).

2. Prepare and disclose your FCRA quarterly disclosure of foreign receipts and details of donors within 15 days of end of each quarter. You can either upload the details on the FCRA website or display the same on your website. Please note that this disclosure has to be filed even if you have NIL receipts. You may click here to view a sample disclosure form.

3.   Ensure timely intimation to Ministry of Home Affairs with regard to change of address/ bank account details/ more than 50% change in governing body, etc.    

​

Other points to be looked into​

AUDITED ACCOUNTS

Sr. No	Items	Action to be taken
1	Mostly for Gujarat and Maharashtra NGOs: - For the query regarding whether tenders were invited for repairs or construction involving expenditure exceeding Rs.5000/-	In case there was no such expenditure in your organisation, then ensure that the auditor writes 'NOT APPLICABLE' in your audit report. Leaving it blank or writing “No” may be construed as non-compliance. Wherever it is applicable then ensure that the auditor provides further details.
2	Fixed Assets register	Please ensure that you maintain fixed assets register and get it audited by your Auditor.
3	Cash register - The auditor's generally write a comment saying that they have not tallied or verified the cash balance	Please ensure that you maintain a cash register and get a certificate of the cash balance on the last date and get the same verified/ audited by the auditor.
4	Loans From Trustee/ Member	In case the Trust/ Society/ Section8/25 Company has received any loan from a Trustee/ Board Member then it is a good practice to mention the details (amount of loan, the rate of interest of the loan, name of the trustee etc.) in the audited accounts.
5	Loan given to Trustee/ Member	In case the Trust/ Society/ Section 8/25 Company has given any loan to a Trustee/ Board Member then it is a good practice to mention the details (amount of loan, the rate of interest of the loan, name of the trustee etc.) in the audited accounts.
6	Related Party Transactions	In case the Trust/ Society/ Section 8/25 Company has entered into any transaction with related parties, then please ensure that Auditor mentions complete details of such transactions in the audited accounts and Form 10B (income-tax audit report).

FCRA

7

Any non-compliance under FCRA. for e.g. (funds received in another bank account)

In case there is any non-compliance on account of FCRA, if the Auditor makes any comments in the audited financials ('Notes to Accounts') then please ensure that the auditor provides adequate details of such non-compliance.

INCOME TAX  & OTHER LITIGATIONS

8

Any ongoing assessment/ litigation

Please discuss with your Auditor and ensure that s/he provides adequate details of such assessments/ litigation in the audited accounts.

Due dates at a glance

Income Tax return online submission	30th September 2016
Form 10B online submission	30th September 2016
FCRA annual return	31st December 2016
Intimation of quarterly disclosure of foreign receipts and details of donors	15th July 2016, 15th October 2016, 15th January 2016, 15th April 2017

Get your NGO certified for FREE by GuideStar India by March 27! Apply for GuideStar India NGO Transparency Awards!

GuideStar India invites you to participate in the GuideStar India NGO Transparency Awards 2016 to get recognised for demonstrating transparency of your organisation in the public domain. This is a one-time opportunity to get certified for free to receive GuideStar India’s Transparency Key/ Transparency Badge/ Gold or Platinum Seal certifying your organisation’s transparency, with validity till Dec 2016. There are more than 1600 awards to be won through a simple and transparent process. You get to know in advance through this mailer, the critieria for different levels, you choose one level that best suits you and we verify the information you share in an objective manner. There are no long reports to be written. Just a simple form that takes about 10 minutes to fill,  followed by updating your profile on www.guidestarindia.org along with upload of key documents. It is like appearing for an exam where you know the entire question paper in advance! All you need to do is respond correctly, diligently and swiftly! While March 24 is the last date, awards will be given away to the fastest qualifiers on first come first served basis! The first 35 winners have already been announced!

http://www.guidestarindia.org/NGOTransparencyAwards.aspx#'LeaderBoard'

Why do we need awards for Transparency

We believe that while there are many awards to recognise NGOs for their programmes (for many of these awards, we are partners), there is a need to have awards that illuminate transparency and public accountability of several civil society organisations in order to collectively enhance credibility of the sector, inspire greater trust in their work and garner support for their cause from corporate, institutions and the general public. In order to reach and motivate newer donor audiences, volunteers and other types of supporters, NGOs need to embrace new tools and methods towards significantly expanding their circle of trust.

NGO registration with minimum information has enabled over 6000 NGOs to gain entry into  www.guidestarindia.org to voluntarily demonstrate their transparency. Our NGO certification programme is a rigorous verification of in-depth information shared by NGOs in the public domain, creating a pool of pre-vetted organisations. GuideStar India NGO Transparency Awards combine the power of our registration and certification programmes to help you create your online “safe-deposit locker” of valuable information about your organisation which is “open” for public view, thus unlocking your potential to garner support.

Eligibility: you may please apply for these awards, only if:

a.     Your organisation has a currently valid registration as a Society/ Trust/ Sec 8 or Sec 25 company

b.     Your organisation has its IT PAN

c.      Your organisation has a 12A registration under the Income Tax Act

d.     Your organisation has filed its Income Tax Return (ITR) for F.Y. 2014-15.

-Please note that your organisation is eligible to apply even if your organisation does not have 80G, 35AC or FCRA. However, if you have these registrations, you need to provide details as explained in “Criteria and requirement of documents & information”.

-Organisations certified by GuideStar India in the past are also eligible to apply.

PARTICIPATION IS FREE.

Criteria at a glance for different levels

Level	Criteria	Number of Prizes for the fastest qualifiers	Award
Foundation: Transparency Key	ITPAN, Registration certificate, 12A, ITR FY 2014-15 & Address Proof, minimum disclosures on GSI	1000	e-Transparency Key
Intermediate: Transparency Badge	Criteria for Transparency Key +1 year old org, MoA/ Deed, 1 yr Audited accounts, 10B, 80G/35AC (only if org has these registrations), FC return (only if org has FCRA), medium level disclosures on GSI	500	e-Transparency Badge
Advanced: Gold Seal	Criteria for Transparency Key & Badge + timely filing of IT Return, 2 yrs Audited Accounts, 2 years 10B, Annual Report (if prepared), no material qualifications in latest audit report, many disclosures incl. Board member details on GSI + undertaking for shortlisted orgs	100	e-Gold Seal, Certificate & Medal Rs1,000 worth prizes for the first 50
Champion: (open only to the first 100 finalists) Platinum Seal	All of the above + AR disclosure template, donor references	10	e-Platinum Seal, Certificate & Trophy Rs10,000 worth prizes for 10 winners

Steps:

1.     Read this mailer entirely, understand the criteria and decide the level for which you would like to apply. You may apply for ONLY ONE LEVEL. Each organisation can fill ONLY ONE FORM. In the event of multiple forms being submitted, the first form will be considered, irrespective of the level applied for and its completeness. You may directly apply for the desired level and do not have to start at Foundation level as you may apply for only one level for the awards. Participation in the awards is FREE.

2.     Apply for the awards in the online application form. You may download the blank form in MS Word, for your reference before you start filling the online application form.

3.     A. If your organisation is not yet registered on www.guidestarindia.org: After filling the awards application form, immediately send a mail to awards@guidestarindia.org attaching your Society/ Trust/ Section 25 or Sec 8 Company registration certificate. GuideStar India team will verify your details and if approved for GuideStar India registration, will email your login credentials for your online profile. Then you may proceed further with step 4 which needs to be completed within 2 working days of receiving the login credentials.

B. If your organisation has a GuideStar Number (GSN) at the time of applying for the awards:  Simply proceed to step 4. You need to complete step 4 within 2 working days of submitting the award application form.

4.     You need to login at www.guidestarindia.org and update information and upload documents. Refer to the detailed criteria and process one-pager applicable to the level you have chosen to apply:

Click here: GuideStar India Transparency Key Foundation Level/ GuideStar India Transparency Badge Intermediate Level/ GuideStar India Gold Seal Advanced Level

In case you fill the form incorrectly, your application will be disqualified even if you update the required information on www.guidestarindia.org.

5.     If your organisation is shortlisted for Intermediate/ Advanced levels or as a finalist for Champion level, you will be asked to provide in a short period, a signed undertaking, additional information and documents.

6.     Please read the terms and conditions governing the awards before you apply. Submission of the online form implies you have accepted the terms and conditions. 

Benefits of participating in GuideStar India NGO Transparency Awards

·      These awards are designed on the lines of applications for online grants and registration on giving portals. The process equips you to respond swiftly and meet requirements of online fundraising and volunteering portals.

·      As you complete the process of updating the required information and uploading the required documents on your profile at www.guidestarindia.org, your online profile gets richer, more organised and becomes available to those among the 3000 monthly visitors to our portal who may search for NGOs of their preferred cause/ location/ other criteria, for taking informed decisions about your organisation.

•      If your organisation qualifies and wins any of the 1610 awards, you may use the Transaparency Key/ Badge/ Gold or Platinum Seal that is awarded to you right till Dec 2016.  You may use the e-certificate in your grant appeals/ proposals, on your website, mailers and other communication & marketing material.

•      If your organisation qualifies and wins any of the 1610 awards, depending on the level, you would pre-qualify for participation in crowdfunding portals, online payment gateways, become eligible to apply for substantial scholarship to the Post Graduate Programme in Development Management of SPJIMR, etc. Organisations such as Dasra, Probono Unplugged, SmallChange and Danamojo.org use GuideStar India Certification to determine eligibility to participate in their programmes. Our certified NGOs such as Freedom for You Foundation, Samerth Charitable Trust, Blue Cross of India and PANI have shared stories of how GuideStar India certification helped them to raise funds from institutional funders & corporate and was helpful to resolve registration issues with government departments.

•      By storing and displaying your information on India’s most reliable repository on NGO information, you enhance your transparency, improve your online presence and the prospect of being found by numerous netizens seeking information on NGOs.

•      An updated and more complete profile on www.guidestarindia.org would save time in responding to donors and in filing statutory returns.

•      Winning organisations would get featured on GuideStar India’s list of awardees which would be shared with philanthropic intermediaries, donor institutions and government organisations.

Last Date:

While March 24 is the last date, awards will be given away to the fastest qualifiers on first come first served basis! For more details, visit: http://www.guidestarindia.org/NGOTransparencyAwards.aspx

Come, participate in this initiative to collectively enhance the credibility of NGOs in India. Begin the journey at the level that best suits you.

Ready to apply? Start right away by going to the Steps!

There are plenty of awards to be Won! So do share this post with your other NGO friends and network members!