Some NPOs will face issues of lack of government funding because of funding cuts. Or an organization might rely on donations — depending on individual donors year to year. This can make funding complicated as donors may have to change how much they donate to an NPO depending on how well they have done financially.
Manning Elliott has seen that some of these NPOs are trying to find new ways to generate revenue in lieu of a lack of funding and donations. However, the NPO must stay within its organizational mandate.
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If an NPO decides to open a store or conduct an activity that is not in keeping with its original mandate, it will run into problems during tax time. If the NPO is running a business, it can be taxed like a normal corporation. If a separate taxable corporation is not set up and the activities run through the NPO, this can be detrimental to the organization and its status. Manning Elliott advisors are trained and skilled at helping NPOs navigate the complexities and the filing processes, and setting up a subsidiary to avoid these issues.
Manning Elliott also helps NPOs look at the internal controls of the organization. Being in the NPO sector means there is a limited number of staff involved, and those that are involved are performing many responsibilities, resulting in a lack of segregation of duties.
With the limited resources and a lack of people in place, there’s always an opportunity for people in the NPO sector to commit fraud. Manning Elliott can enter the picture, go in and provide recommendations on what kind of controls it should have in place. Having strong governance will mean the world for the health of your NPO and safeguarding of assets.