Meaning and Characteristics of Non-Profit Organisation Video Lecture | SSC CGL Tier 2 - Study Material, Online Tests, Previous Year

Non-profit organizations are entities that are established to fulfill a social or public benefit rather than to generate profit. These organizations use any surplus funds to further their mission rather than distributing them as profits or dividends.

The characteristics of a non-profit organization include: - Their primary goal is to benefit the community or a specific cause, rather than making money for individuals or shareholders. - They are tax-exempt, meaning they do not have to pay certain taxes. - They rely on donations, grants, and funding from individuals, corporations, and government agencies. - They have a board of directors or trustees who oversee the organization's operations and ensure it remains focused on its mission. - They are required to be transparent and accountable, providing financial reports and other information to the public.

Non-profit organizations differ from for-profit organizations in several ways: - Non-profits have a mission focused on benefiting the community or a specific cause, while for-profits aim to generate profit for their owners or shareholders. - Non-profits are tax-exempt, while for-profits are subject to various taxes. - Non-profits rely on donations, grants, and funding, while for-profits generate revenue through the sale of goods or services. - Non-profits are governed by a board of directors or trustees, while for-profits are typically managed by owners or shareholders.

Non-profit organizations sustain themselves financially through various methods: - Donations: They rely on individuals, corporations, and philanthropic foundations to contribute funds. - Grants: They apply for grants from government agencies, foundations, and other organizations that provide funding for specific projects or initiatives. - Fundraising: They organize events or campaigns to raise funds from the public. - Sponsorships: They seek partnerships with corporations or businesses that provide financial support in exchange for recognition or association with the organization's cause. - Membership fees: Some non-profits charge membership fees to individuals or organizations who wish to support and be part of their mission.

Non-profit organizations are required to be transparent and accountable in their operations. Some reporting and transparency requirements include: - Financial reporting: Non-profits must prepare and disclose financial statements, including an annual report, detailing their income, expenses, and assets. - IRS Form 990: In the United States, non-profits are required to file an annual information return, Form 990, with the Internal Revenue Service (IRS). This form provides information about the organization's finances, governance, and activities. - Public accessibility: Non-profits should make their financial reports, governing documents, and other relevant information available to the public upon request or through their website. - Donor disclosures: In some jurisdictions, non-profits must disclose certain information about their major donors, including their names and contribution amounts, to ensure transparency and prevent conflicts of interest.