Explain three features of Not-for-Profit Organisation.

Solution :-

Features of Not-for-Profit Organisation are:-
1) Purpose - Not-for-Profit Organisations are set up with the prime objective of providing services and not to earn profit thereby enhancing the welfare of society. Such organisations include schools, hospitals, trade unions, religious organisations, etc.
​​​​​2) Ownership - The organization is established as a trust or a charitable society. The person/s or the groups of individuals who who govern and manage the working of an NPO are known as trustees. Therefore, it does not have an individual or group of an individual as an owner and it belongs to society.
3) Source of Income - NPO's main sources of income are donations, subscriptions, life membership fees, grants, etc.
4) Final Accounts - As these organisations are not set up with profit motive, they do not prepare Trading and Profit and Loss Account. Instead, they maintain Receipts and Payments Account, Income and Expenditure Account and Balance Sheet.

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