of Books of Account
FCRA 2010 and FCRR, 2011 do not prescribe any specific
method of accounting. Therefore, any legally consistent
and otherwise acceptable method of accounting can be
used for maintaining books of account for FCRA purposes.
Method of Accounting
Section 19 of the FCRA 2010 provides that proper
books of account with regard to FC receipt and utilisation
should be maintained. In the past, it was assumed
FCRA required cash basis of reporting (if not accounting).
Further Rule 11 of FCRR 2011 provides that separate
books of account and records should be maintained
for foreign contribution received and utilised.
Earlier, filing of Income and Expenditure account
was not necessary which implied that FCRA reporting
on cash basis. However, with the inclusion of
Income and Expenditure account it is clear that
2010 both accounting and reporting need not necessarily
on cash basis.
As per the requirement of FC-4 statement, the
foreign contribution should be reported on
cash basis as
far as receipts are concerned and the utilisation
be reported based on the method of accounting
Preservation of Books of Accounts
FCRR 2011 provides that the financial statements
should be preserved upto six years. This
provision is a great
relief to the various organisations as in
the old Act, the power to call for information
not defined. Now the organisations should
preserve financial statement and records thereof
six years only.
AUDIT & FILING
The proforma of the certificate to be given
by the chartered accountant is provided
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
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.
According to the FCRA Amendment Rules,
2015, FCRA annual returns needs to
be filed online
has become mandatory to file online
returns at the FCRA website which should be digitally
by the chief functionary alongwith
Size Limit of PDF document
signed and seal Charted Accountant Certificate(with
C.A registration number).
Certificate of Chief Functionary.
Statement of Accounts(It should contain Payment
Account, Income and Expenditure Statement, and
of Account from Bank duly certified by the officer
of such bank.
Further, the annual returns should
be authenticated by the signature
and seal of the
association with the following
Dimension of Signature should be 140(Width) * 60(Hight)
that the size of the scanned signature image is
not more than 50 KB.
Dimension of Seal of Association should be 140(Width)
* 60(Hight) Pixel only.
that the size of the scanned image of Seal of Association
is not more than 100 KB.
A nil return is required to be filed annually. However,
documents such as certificate from Chartered Accountant
and financial statements would not be required to be
Declaration and authentication
The Term “Chief Functionary” has not
been defined in the FCRA Act or Rules. Normally the
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.
COMPULSORY QUARTERLY UPLOADING OF GRANT INFORMATION
WITHOUT ANY FINANCIAL LIMIT
4.5.1 Further, on quarterly basis all persons / organizations
who have been granted registration or prior permission
shall have to upload their financial information
pertaining to the donor and the detail of grants
information should be uploaded on their website or
on the website as may be specified by the Central
It may be noted that the amended rule does not provide
any relaxation to smaller NGOs.
After the amended law, all organizations without
any financial limit shall have to upload financial
in their website or fill the requisite Form at
the FCRA website. The information to be uploaded
(i) Detail of the donors
(ii) Amount received
(iii) The date of receipt.
The information should be uploaded within 15
days following the last day of the quarter
in which the
funds were received.
It may be noted that all the organizations
have to upload 1st quarter financial information
from October,15 to December,15) by 15th
of January, 2016.
Delay in Filing FC-4
FCRA was previously silent about consequences
for delay in filing FC-6. However, recently,
issued a notice about the penalties involved
with respect to delay in Filing of FCRA
department has specified the various
authorities for compounding of such offence.
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
this regard is reproduced as under —
“ 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 thereof 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.