NGO Accounting and Financial Reporting Services
Fund-based books, grant utilisation certificates and audit-ready statements for trusts, societies and Section 8 companies.
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NGO accounting is the maintenance of books and financial statements for non-profit organisations in a way that tracks every grant, donation and expense by its source and purpose. It is needed by trusts, societies and Section 8 companies, because donors, the Income Tax Department and, where applicable, the foreign contribution authorities all expect clear records. Our team of accountants and Chartered Accountants maintains fund-wise books, prepares receipts and payments and income and expenditure statements with a balance sheet, issues grant utilisation certificates, and gets the accounts ready for audit and for the audit reports that exempt organisations must furnish.
Who provides this service: our team of Chartered Accountants.
Who Needs NGO Accounting?
- Public charitable trusts that need audit-ready books and exemption records
- Societies with multiple project grants and reporting duties to funders
- Section 8 companies that must follow the Companies Act accounting framework
- NGOs registered under FCRA that must keep separate and traceable records
- Organisations that have fallen behind on bookkeeping and need to catch up before audit
Key Benefits
- Books kept by fund and project, so restricted grants are never mixed with general funds
- Receipts and payments, income and expenditure and balance sheet prepared in a format suited to your entity type
- Grant utilisation certificates and funder reports prepared from the same records
- Accounts organised so that the exemption-related audit report and tax return can be prepared without rework
- Separate accounting trail for foreign contribution where the organisation is registered under FCRA
- Regular review that catches classification errors, missing vouchers and unrecorded donations early
How It Works
Understanding the organisation
We study your entity type, funding sources, projects and reporting obligations to funders, so that the chart of accounts and fund structure match how the organisation actually operates and reports.
Setting up the books
Our team sets up the accounting system with separate heads for corpus, general funds and restricted project funds, with cost centres by project and a clear policy for allocating shared expenses.
Regular bookkeeping
Donations, grants, expenses and bank entries are recorded with supporting vouchers. Receipts for donations are reconciled with bank credits, and TDS on payments is tracked where it applies to the organisation.
Funder reports and utilisation certificates
For each grant we prepare the utilisation statement from the project ledger and, where a funder requires it, the certificate for signature by a Chartered Accountant after verifying the records.
Year-end statements and audit support
We prepare the financial statements, schedules and reconciliations, and support the auditor with queries. Where the organisation claims exemption, the required audit report is prepared on the basis of these records.
Return filing and handover
The statements feed into the income tax return and other filings. We then hand over a closed set of books, with a list of open points and recommendations to strengthen internal controls for the next year.
Documents Required
- Registration certificate and governing document of the organisation
- PAN and, where applicable, 12A, 80G and FCRA documents
- Bank statements for all accounts, including any designated FCRA account
- Grant agreements, sanction letters and donor correspondence
- Donation receipts, donor details and cash deposit records
- Expense vouchers, invoices, salary and consultant payment records
- Fixed asset register and records of assets purchased from grants
- Previous year financial statements and audit reports
- Minutes of trustee, governing body or board meetings approving major spends
Timeline and Fees
Indicative timeline: Initial set-up usually takes one to two weeks after records are received; ongoing bookkeeping runs monthly or quarterly, and year-end statements depend on the audit schedule and the authority or funder timelines.
Professional fee: Our professional fee depends on the number of bank accounts, projects and funds, transaction volume, whether FCRA records are required and whether audit support and return filing are included. Contact us for a fixed monthly or annual quote.
What Can Go Wrong if This Is Missed or Done Incorrectly
- Poor records can weaken the audit report and put the income tax exemption of the organisation at risk
- Mixing restricted grant money with general funds can lead to funder disputes or demands for refund
- Incomplete FCRA records can lead to notices or adverse findings during inspection
- Unreconciled bank and donation records make it difficult to answer department or donor queries on time
Frequently Asked Questions
How is NGO accounting different from business accounting?
A business measures profit. An NGO has to show that money was received and used for its stated purposes, often by fund or project. That means tracking restricted grants separately, reporting surplus as a fund balance, and following the form of financial statements that suit its legal structure and funders.
Do NGOs have to keep books of accounts?
Yes. Trusts, societies and Section 8 companies are expected to maintain proper books, and registered charities claiming exemption must keep records that support the audit report and return filing. Section 8 companies also follow the Companies Act. State laws for societies and public trusts may add their own requirements.
What is a grant utilisation certificate?
It is a statement, usually certified by a Chartered Accountant, that shows how much of a particular grant was received, how much was spent on approved heads and what balance remains. Funders ask for it to release instalments or close the project. It has to agree with your project ledger and bank records.
Is an audit compulsory for an NGO?
It depends on the organisation type and on the law that applies. A Section 8 company must be audited under the Companies Act, exempt trusts and institutions are generally required to obtain an audit report in the prescribed form, and state laws or funders may demand an audit as well. We confirm what applies to you.
How should foreign contribution be recorded in the books?
Organisations with FCRA registration need to keep foreign contribution receipts and utilisation traceable, with bank accounts and records separate from domestic funds. Accounting entries should show the donor, purpose and utilisation. We design the ledgers so that annual return figures can be drawn directly from the books.
Can you take over the books if our accounts are in a mess?
Yes. We start with a review of the available records, bank statements and vouchers, identify what has to be rebuilt and prepare a plan with a realistic timeline. Some gaps, such as missing donor details, can only be fixed with the help of the organisation, so we will list exactly what we need.
Official Sources
Rules, forms and fees change. Check the current position on the official portal:
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Last reviewed: . Laws, fees and procedures change; check the official portal before you act.
Disclaimer: The information on this page is for general informational purposes only and does not constitute professional legal, tax or compliance advice. Requirements vary by situation. Please consult a qualified CA or CS for advice specific to your needs. Government fees and timelines are subject to change; verify with the relevant authority before proceeding.