JICPA publishes Non-profit Organization Accounting and Audit Practice Committee Research Report No. 25,"Toward Establishing an Accounting Framework for Non-Profit Organizations"
JICPA published, on July 2, 2013, Non-profit Organization Accounting and Audit Practice Committee Research Report No. 25, "Toward Establishing an Accounting Framework for Non-Profit Organizations."
Currently, accounting standards and rules on preparing financial statements vary between different types of non-profit organizations in Japan, and this is making it difficult for the users of financial statements to conduct cross-sectional study of the information. In addition, the number of organizations that discloses their financial information to the public, for example, by using their website, is limited, and it is often the case that the financial statements are prepared simply to meet the regulatory requirements.
In contrast, non-profit organizations have grown to become one of the key players in local communities, generally as those that support the welfare of citizens, or sometimes, have served as entities that put forward proposals or conduct monitoring of governments or governmental agencies. It is important to note that the public's expectation to non-profit organizations has increased over the years, and non-profit organizations are now required to meet the expectation by strengthening their financial basis and achieving autonomous management.
In order for the non-profit organizations to achieve these, JICPA believes that it will be important to install certain mechanisms which will strengthen the supply of resources from the private sector to the non-profit organizations and facilitate autonomous management. Therefore, as a part of an effort to assist non-profit organizations, the report has been published to provide common accounting framework to be used by non-profit organizations to meet the needs of various stakeholders.
This report will serve as a starting point for further discussion for establishing an accounting framework for non-profit organizations, and JICPA will continue to engage in the discussion by incorporating diverse views from a wide range of stakeholders.
The report is available only in Japanese.