Accounts for Clubs & Societies (Cambridge (CIE) IGCSE Accounting)

Clubs and societies are classed as non-trading organisations

These types of businesses provide a service or facility for a fee called a subscription

They do not operate with the sole aim of making a profit

Clubs and societies do not always keep a full set of accounting records

Their main accounting records tend to be

• A receipts and payments account

  • This is a simple cash book

• Trading sections of income statements for each one of any trading activities

  • Such as a café or a shop

  • These are prepared in the same way as for sole traders

• An income and expenditure account 

  • This shows the sources of income and expenses of the organisation

  • This is equivalent to the income statement for a sole trader

• A subscription account

  • This calculates the fees that should have been received from members during the year

• A statement of financial position

  • This is prepared in a similar way to that of sole traders

Income statements are prepared when the club or society involves a trading activity which buys and sells goods to raise extra money

A separate income statement is prepared for each trading activity

The profits or losses made from the trading activities are transferred to the income and expenditure account

The income statement is prepared similarly to the trading section of the income statement of any other business

The main differences are:

• A gross profit is not calculated

• The expenses related to the trading activity are included in the cost of sales