Non-profit organisations (vzw/asbl): accounting obligations

As a non-profit organisation (NPO), you are legally required to keep records and prepare annual financial statements. The exact way to proceed depends upon the size of your association, based upon new definitions and accounting models introduced by the Companies and Associations Code (CAC).

THE SIZE CRITERION

There are 4 sizes of NPO, but most of them are in the category "small micro NPO"

1. The small micro NPO

The small micro NPO does not exceed more than one of the following criteria:

• 5 FTE workers on average over the year
• 334,500 Euros of revenues (excluding VAT)
• 1,337,500 Euros of total assets
• 1,337,500 Euros of total debts

2. The micro NPO

The micro NPO does not exceed more than one of the following criteria:

• 10 FTE workers on average over the year
• 7,000,000 Euros of turnover excluding VAT (excluding exceptional income)
• 3,500,000 Euros total balance sheet

3. The small NPO

The small NPO does not exceed more than one of the following criteria:

• 50 FTE workers on average over the course of the year
• 9,000,000 Euros of turnover excluding VAT (excluding exceptional income)
• 4,500,000 Euros total balance sheet

4.The large NPO

The large NPO does not exceed more than one of the following criteria:

• 50 FTE workers on average over the course of the year
• 9,000,000 Euros of turnover excluding VAT (excluding exceptional income)
• 4,500,000 Euros total balance sheet

ACCOUNTING REQUIREMENTS

There are three new accounting models: full, abbreviated and micro. These will have to be used for the filing of accounts, as of the year 2020, for all NPOs, as well as international NPOs and foundations, except for those corresponding to the size of "small micro NPO".

These models are available on the website of the National Bank of Belgium (NBB).

1. The small micro NPO

The NPO of this size is the only one able to maintain simplified accounting, of which it keeps track in a unique book of accounts which includes a statement of income and expenses.

It will also be necessary to carry out at least once a year an inventory of the assets (buildings, machines, stock, etc.), the credits, the debts (financial, towards suppliers, etc.), the rights (subsidies, donations to be received, etc.) and its commitments (mortgages, guarantees provided, etc.). This will make it possible to establish the state of the NPO's assets. The Board of Directors (BOD) will be responsible for the criteria according to which this inventory must be carried out.

The small micro NPO can, however, choose spontaneously to maintain double-entry bookkeeping (through the use of accounting software), using the abbreviated model or the micro model.

Regardless of the type of accounting system used, the small micro NPO does not have to file its accounts and inventory with the NBB, but with the clerk of the Commercial Court within one month after the annual general meeting.

2. The micro NPO and the small NPO

The micro or small NPO will maintain double-entry accounts, using the abbreviated model or the micro model, and will file its accounts with the NBB.

3. The large NPO

The large NPO will also maintain double-entry accounts, using the complete model, and will file its accounts with the NBB. The large NPO must also appoint, via its General Assembly (GA), one or more auditors whose role is to monitor the financial situation and the annual accounts.

GENERAL OBLIGATIONS

BUDGET

All NPOs are obliged to draw up a budget for the following year and to have it approved by the General Assembly, at the latest 6 months after the end of the accounting year. You are free to choose the form of your budget yourself, as it is not determined by legal provisions. However, it is advisable to draw up the budget upon the basis of the same scheme as your annual accounts.

Good to know: the budget will remain internal. Unlike your annual accounts, you do not have to file it with a third party.

SOCIAL BALANCE SHEET FROM 20 EMPLOYEES

NPOs which employ an average of 20 or more employees per year - including small NPOs - must draw up a social balance sheet. It is included in the standardised templates (abridged and complete) for the annual accounts for associations and foundations. You will find here some templates for social balance sheets.

Pay attention to the new obligations !

Following the implementation of the new CAC, don't forget to comply with these obligations:

• As of 11 October 2020, directors of companies, including NPOs, must be registered in the UBO (Ultimate Beneficial Owners) register.
• Your Articles of Association will have to be adapted and filed with the clerk of the Enterprise Court before 1 January 2024 in order to comply with the CAC.