an initiative of FMSF & CPA




Every organisation which receives foreign contributions is required to furnish a certificate from a chartered accountant. The proforma of the certificate to be given by the chartered accountant is provided in Form FC-6. Along with this certificate, audited Balance Sheet, Income & Expenditure statement and the statement of receipt and payment account should also be submitted. On the basis of the relevant books and vouchers, the chartered accountant is required to certify the following:

1. the brought forward balance of the foreign contribution at the beginning of the year.

2. the foreign contribution received during the year

3. the unutilized balance of foreign contribution at the end of the year

4. certify that the association has maintained the account of foreign contribution and records relating thereto in the manner specified in the Foreign Contribution (Regulation) Act, 2010.

5. the information furnished in the certificate and in the enclosed balance sheet , income & expenditure statement and statement of receipt and payment are correct.

Filing of Annual Returns

According to the provision of Rule 17 of the FCRR, 2011, following are the guidelines provided with regards to filing of annual return.

(1) Every person who receives foreign contribution under the Act shall submit a report in Form FC-6, accompanied by an income and expenditure statement, receipt and payment account, and balance sheet for every financial year beginning on the 1st day of April within nine months of the closure of the financial year, to the Secretary to the Government of India, Ministry of Home Affairs, New Delhi. 16.

(2) The annual return in Form FC-6 shall reflect the foreign contribution received in the exclusive bank account and include the details in respect of the funds transferred to other bank accounts for utilisation. (3) If the foreign contribution relates only to articles, the intimation shall be submitted in Form FC-7.

(4) If the foreign contribution relates to foreign securities, the intimation shall be submitted in Form FC-8.

(5) Every report submitted under sub-rules (2) to (4) shall be duly certified by a chartered accountant.

(6) Every such return in Form FC-6 shall also be accompanied by a copy of a statement of account from the bank where the exclusive foreign contribution account is maintained by the person, duly certified by an officer of such bank.

(7) The accounting statements referred to above in the preceding sub-rule shall be preserved by the person for a period of six years.

(8) A ‘NIL’ report shall be furnished even if no foreign contribution is received during a financial year.

Declaration and authentication

The FC-6 form is required to be signed by the Chief Functionary of the organisation and a certificate is also required to be given by a Chartered Accountant giving a brief summary of the FCRA funds movement and the opening & closing balances of FCRA Funds.

The Term “Chief Functionary” has not been defined in the FCRA Act or Rules. Normally the head of the organisation should be construed as the Chief Functionary. The organisation may also designate any office bearer as the Chief Functionary through a General Body/Governing Body resolution, for the purposes of filing the FCRA returns, Forms etc.

Delay in Filing FC-6

FCRA is silent about consequences for delay in filing FC-6. It can be constructed that an NGO would stand the risk of losing the FCRA registration if it does not file returns properly but whenever an NGO is not able to file FC-6 by 31st December, it should write a letter to the FCRA office explaining the circumstances causing the delay. Normally FCRA authorities condone such delay in filing of returns.

Audit by Central Government

The Central government has a right to appoint a “Group A” gazetted officer to audit the accounts of an association or organisation. The relevant sections in this regard is reproduced as under —

Section 20

“Where any person who has been granted a certificate or given prior permission, fails to furnish any intimation under this Act within the time specified therefor or the intimation so furnished is not in accordance with law or if, after inspection of such intimation, the Central Government has any reasonable cause to believe that any provision of this Act has been, or is being, contravened, the Central Government may, by general or special order, authorise such gazetted officer, holding a Group A post under the Central Government or any other officer or authority or organisation, as it may think fit, to audit any books of account kept or maintained by such person and thereupon every such officer shall have the right to enter in or upon any premises at any reasonable hour, before sunset and after sunrise, for the purpose of auditing the said books of account:

Provided that any information obtained from such audit shall be kept confidential and shall not be disclosed except for the purposes of this Act.