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

Last modified:

Thursday 27 May 2021

A non-profit organisation is legally obliged to keep accounts and draw up annual accounts. As to the system used, that depends on the size of the association: small, large, or very large.

Small non-profit organisation

From an accounting perspective, a non-profit organisation is labelled as ‘small’ if it does not exceed more than one of the following criteria:

  • An annual workforce average of 5 full-time employees
  • Yearly receipts: 334,000 euros (excluding exceptional income)
  • A balance sheet total of 1,337,000 euros

Accounting obligations

The 'small non-profit organisation' is the only type of non-profit organisation allowed to work with simplified bookkeeping, the so-called 'single-entry bookkeeping' or 'cash bookkeeping'. With simplified bookkeeping, you only keep a financial journal.

This financial journal consists of a cash and a bank ledger.

  • The cash ledger records all cash income and expenditure.
  • The bank ledger records all income and expenditure made to or from bank accounts.

However, a small non-profit organisation can also spontaneously choose to use a double-entry bookkeeping system, just like large non-profit organisations. If you opt for simplified bookkeeping, you do not file the annual accounts with the National Bank of Belgium, but you do file them with the registry of the Commercial Court in your district. Concerning filing the accounts at the registry, no date is fixed but the law provides that a non-profit organisation which, for the first year, has not filed its accounts of income and expenditure, may be dissolved by judicial decision.

The non-for-profit organisation must also carry out an inventory at least once a year of its assets (buildings, machinery, stock, etc.), its receivables, its debts (financial, to suppliers, etc.), its rights (subsidies, donations to be received, etc.) and its commitments (mortgages, guarantees given, etc.). This will make it possible to establish the state of its assets. It is the Board of Directors (BoD) that defines the criteria according to which this inventory must be carried out.

Large non-profit organisation

A non-profit organisation is labelled as ‘large’ as soon as it exceeds at least two of the following three criteria:

  • An annual workforce average of 5 full-time employees
  • Yearly receipts: 334,500 euros (excluding exceptional income)
  • A balance sheet total of 1,337,000 euros

Accounting-obligations

Large non-profit organisations must use a double-entry accounting system with annual accounts. These annual accounts must be filed with the National Bank of Belgium within thirty days of their approval by the General Meeting.

Good to know: large non-profit organisations may use the abbreviated model for associations and foundations when drawing up their annual accounts.

Very large non-profit organisation

A non-profit organisation is labelled as ‘very large’ as soon as it exceeds at least two of the following three criteria:

  • An annual workforce average of 50 full-time employees
  • Yearly receipts: 7,300,000 euros (excluding exceptional income)
  • A balance sheet total of 3,650,000 euros

Good to know: As soon as a non-profit organisation has a workforce in excess of 100 full-time employees, it is automatically a very large non-profit organisation, regardless of the income or the balance sheet total.

Accounting-obligations

Very large non-profit organisations use the double-entry accounting system and draw up their annual accounts according to the full model for associations and foundations. These annual accounts must be filed with the National Bank of Belgium within thirty days of their approval by the General Meeting. In addition, they need to appoint one or more accredited statutory auditors to carry out the audit of the financial situation and the annual accounts of the non-profit organisation.

General obligations

Budget

All non-profit organisations must draw up an annual budget for the next financial year and then have it approved by the General Meeting  no later than 6 months after the end of the accounting year. The non-profit organisation may determine the form of its budget, as there are no legal provisions to that effect, but it is advisable to draw it up on the basis of the same scheme as your annual accounts or your income and expenditure statement.  

Good to know: The budget remains internal. Unlike the annual accounts, there is no obligation to submit it to an external party. 

Social balance sheet from 20 employees

Non-profit organisations with an average annual workforce of 20 employees or more – including small non-profit organisations – must complete a social balance sheet. This is part of the standard models (abbreviated and full) of the annual accounts for associations and foundations. Click here to view several social balance sheet templates.

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