Accounting in the Non-profit Organization - Theory and Practice

The bachelor thesis deals with accounting in a non-profit organisation. The theoretical part explains basic terms regarding non-profit organisations and their characteristics. It introduces various types of non-profit organisations and relevant legislation. Further it summarises the accounting principles with accent to the accounting differences between profit and non-profit organisations. It also describes the sources of funding of non-profit organisations. The thesis is applied on the Local Action Group (LAG) Landscape of my Heart, whose main aim is the support of the rural development in South and Central regions of the Czech Republic. The practical part analyses the accounting regime and financing structure of the selected organisation. The analysis of accounting regime describes the accounting specifics of the LAG Landscape of my Heart, for example accounting for donations, grants and membership fees. An advantage for the non-profit organisation is that the income from donations and membership fees is exempt from the income taxation. The analysis of multi-source financing helped to find out that over 75% of the group's resources come from grants. Therefore it was recommended that the organisation should try to obtain more individual donors or start supplementary actions