Non-profit entities (NPEs) are organizations that pursue social, humanitarian, cultural, educational, religious, or other goals without seeking profit. They play a significant role in the economic and social development of African countries, complementing the actions of public authorities and the private sector.
However, these entities face challenges in producing and communicating reliable, transparent, and comparable financial information that meets the needs of their stakeholders (donors, partners, beneficiaries, supervisory authorities, etc.).
To address this situation, the Organization for the Harmonization of Business Law in Africa (OHADA) adopted, during its 53rd Council of Ministers session held in Niamey (Niger) on December 21 and 22, 2022, a Uniform Act related to the Accounting System for Non-Profit Entities (SYCEBNL). This text, supplementing the Uniform Act on Accounting Law and Financial Information (OHADA), will significantly improve the quality of the information produced within the OHADA space.
What is SYCEBNL and Who is it For?
SYCEBNL is a financial information organization system aimed at presenting financial statements that accurately reflect the financial position, performance, and cash flow variations of NPEs to meet the needs of all users of this information. This accounting framework applies to entities such as associations, professional orders and similar entities, development projects, and related entities.
Principles and Rules of SYCEBNL
SYCEBNL is based on accrual accounting, which records transactions as soon as they are concluded, regardless of their payment or collection date. It relies on universal accounting principles, such as prudence, consistency of methods, going concern, non-offsetting, etc. It also includes specific rules for NPEs, such as the accounting of grants, donations, contributions, legacies, personnel expenses, fixed assets, etc.
Structure of SYCEBNL
SYCEBNL comprises 04 parts:
- Legal provisions, definitions, and conceptual framework, outlining the objectives, scope, concepts, and fundamental principles of the accounting system.
- Structure, content, and operation of accounts, presenting the chart of accounts, codification rules, account operations, and centralization.
- Transactions and specific problems, dealing with the particular cases of accounting for regular and exceptional operations of NPEs.
- Presentation of financial statements, defining the content, form, and preparation modalities of the NPEs’ summary documents.
The financial statements of NPEs consist of the balance sheet, income statement, cash flow statement, statement of changes in equity, annex, and management report. These financial statements must be prepared annually and certified by an auditor, in accordance with the audit standards applicable in the OHADA space.
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