Introduction to Governmental and Not For Profit Accounting
The music outreach program organization duly formed is a form of not-for-profit organization. This is because the organization is established to meet the needs of the youth within the community. According to Razek & Hosch (1985), a not-for-profit organization is that organization whose agenda is to satisfy the needs of a group or entire community. It is an organization that does not focus on generating profits for its members rather it pursue the goal of bringing the members together to address a certain issue facing the community.
Based on the case at hand, the organization focuses on bringing on board the local youth through music outreach programs. The organization will bring the local youth together to nurture and develop their music talents. It is a good move towards promoting good morals to the local youth as well as making them active and focused. The organization will be funded by the mayor through city grants making it a community activity.
Generally, the organization can be said to be a not for profit making because it aims at benefiting the local youth of the community. Besides, it is designed to develop the morals of the youth through music outreach programs. Furthermore, it will be funded by the city not the government thus limiting it from being a government organization. Any governmental organization is funded by the government but not the city council as per this case. Finally, the organization will be run and managed by directors and staff elected and hired by the Mayor respectively. In case the organization was governmental then the president and the ministry of Youth Affairs would conduct those exercises.
Changing the NFPO to a Governmental Organization
There are various changes that the organization will need to make in case it wants to be governmental. According to Razek & Hosch (1985), a governmental organization refers to an organization that is established, run and managed by the government. This is to mean that the funding, appointment of directors and hiring of staff for the organization is conducted by a government agency. The first step in changing the organization to become governmental, then it needs to be registered under the ministry of youth affairs. This is the government department that deals with all matters that pertain the local youth within a nation. It foresees all the operations of the organization and makes all the necessary budgeting for the organization. Upon registration, the ministry will provide the organization with an operating certificate.
Additionally, the organization will have to provide the government agency with a proposal detailing its operations within a specified time. This proposal will assist the government agency in determining the worthiness of the stated activities by the organization. As a result, the government ministry determines those activities that it feels they need priority for the organization. Besides, the ministry or the government department will determine the amount of funds that the organization needs to operate within the financial year. The approval of the proposal will thus act as the source of funding for the governmental organization.
Finally, the organization will have to run its operations as per the stipulated by the government department. Thus, the organization will have to work hand in hand with the department in all its activities. Additionally, the organization will have to maintain books of account detailing all its operations within the financial year. Additionally, the organization will be entitled to make financial statements for the financial year. This will allow the government to conduct an audit of how the funds have been used.
References
Razek, J. & Hosch, G. (1985). Introduction to governmental and not-for-profit accounting (1st ed.). Englewood Cliffs, NJ: Prentice-Hall.
