Where dangers lurk and how to counter them

Foundation management: Do it well, but do it right

Foundations are subject to special documentation obligations. With unified accounting, you can meet the different requirements of the local tax office and the state supervisory authority cost-effectively.

Foundations serve good causes. To encourage this, the state grants tax benefits. In return, however, it also imposes special conditions. Violations can lead to everything from the revocation of non-profit status to the personal liability of the foundation's board of directors.

Foundations are supervised by two authorities at once. On the one hand, the local tax office checks whether the rules of non-profit law are observed and whether the funds are used in a timely manner. On the other hand, the state supervisory authority checks that the founder's will is upheld and that the capital is maintained.

Two authorities – different requirements

However, both authorities set different requirements for accounting, so that two different sets of documentation are necessary, requiring a large number of subsidiary accounts and reconciliations.

Unified accounting meets the requirements of all sides

KPMG’s unified accounting offers an efficient solution to meet the complex tax documentation and accounting requirements of the various authorities. This special form of accounting was recognised by all authorities.

Unified accounting is based on double-entry bookkeeping and documents both the maintenance of capital and the proper use of funds, together with the statutory formation of reserves. This eliminates the need for separate accounts. At the same time, it provides the basis for the preparation of the required tax returns.

Double-entry bookkeeping reduces sources of error. Unified accounting is used for internal control and documentation and serves as a comparison and control instrument.

Specially adapted to the requirements of non-profit foundations, unified accounting creates more time for the essential work of the foundation. More than 300 foundations already take advantage of this benefit.