Difference betwwen ??

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AMIT

AMIT (Querist)
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26 July 2010
DIFFERENCE BETWEEN WITH EXAMPLE PLZ.

INCOME AND EXPENDITURE &

RECEIPT AND PAYMENTS ?

Shudhanshu Agrawal

Shudhanshu Agrawal (Expert)
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26 July 2010 First of all i want to tell you that these are parts of financial statements which are prepared by Non profit organisations.

1- Receipt and Expenditure A/c is a kind of Cash A/c in which receipt means amount we have received either in cash or in bank account and payments means where we made the payments either in cash or through bank account.

2- Income & Expenditure A/c is a kind of P & L A/c. As NPO are not allowed to earn profits thats y they prepare income & expenditure account in which they mention how they have earned the income and where they have spent it.

Difference between income & expenditure and Receipt and payment account is that former is prepared on accrual and cash basis where as later is prepared on cash basis only.

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CA Sanat Pyne

CA Sanat Pyne (Expert)
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26 July 2010 well explained by Shudhanshu jee.
In point no 1. Except
Receipts & payments a/c instead of Receipt and Expenditure A/c

AMIT

AMIT (Querist)
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27 July 2010 DOES NPO MEANS ?

"Charitable , Religious institutions , religious trust "

CA Puneet Jethliya

CA Puneet Jethliya (Expert)
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27 July 2010 i favour to shudanshu ji, he explained well.
No doubts and no further clarification required on this matter.

Further more If any doubt then I will resolve it.

Shudhanshu Agrawal

Shudhanshu Agrawal (Expert)
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27 July 2010 If you want to know about NPO then i will suggest you to go through Section 11 to 13 of Income Tax Act, 1961 and Section 25 of Companies Act, 1956.

In brief i can say that NPO means those organisations who's main objective is social welfare and not earning profit. Take the example of our Central Goverment whenever they present budget, they prepare Income & Expenditure A/c and not Profit & Loss A/c.

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