The preparation of financial statements is crucial for accountability and decision-making and for trust and confidence in NPOs. However, there are no common international accounting standards for NPOs, unlike in the private and public sectors. The International Financial Reporting for Non-Profit Organisations (IFR4NPO) project aims to respond to these issues by strengthening NPO governance and financial management through the development of internationally applicable financial reporting Guidance for non-profit organisations.

In this regard, first Exposure Draft of International Non-Profit Accounting Guidance (INPAG) was issued by Chartered Institute of Public Finance and Accountancy (CIPFA) and Humentum in November, 2022. INPAG ED1 was focused on the overarching framework for NPO financial reporting. INPAG ED2 was focused on some of the key accounting transactions that are relevant for NPO financial reporting which included Expenses on grants and donations, Revenue, Inventories and Foreign Currency translation.

Recently, following Exposure Draft of INPAG Part-3 has been issued in May, 2024 for public comments by September 16, 2024.

• International Non-Profit Accounting Guidance Part 3

ED3 is the last of three Exposure Drafts that will be published and taken together will comprise the full INPAG. The focus of ED3 is on the presentation of financial information which includes the following new sections on:

• a) fund accounting,
• b) classification of expenses,
• c) fundraising costs, and
• d) supplementary information about specified funds or activities, such as, particular grants or projects.

The above-mentioned Exposure Draft is open for public comments with last date as August 14, 2024. The downloadable version is available at: https://resource.cdn.icai.org/80736asb64907.pdf

Comments on the abovementioned Exposure Draft may be submitted through any of the following modes: