Accountancy Part AAccounts for Non Profit Organsiation

Which of the following is not prepared by a Not-for-Profit Organisati…

Which of the following is not prepared by a Not-for-Profit Organisation as part of its final accounts?

Answer & explanation

Correct answer: option 4

The correct answer is Option (4) → Cash flow statement

The final accounts of a Not-for-Profit Organisation are the Receipt and Payment Account, the Income and Expenditure Account and the Balance Sheet. A Cash Flow Statement (AS-3) is prepared by companies; it is not part of an NPO’s final accounts.

Option (1) Receipt and payment A/C — A true statement. It is prepared; it summarises the cash and bank transactions.

Option (2) Income and Expenditure A/C — A true statement. It is prepared; it shows the surplus or deficit of the year.

Option (3) Balance Sheet — A true statement. It is prepared; it shows assets, liabilities and the capital fund.

Note: This question is from the pre-rationalised NCERT book. The topic is not there in the latest NCERT book (2026-27), but it is still in the CUET 2026 syllabus, so do not skip it.

NCERT (Pre-rationalised edition):
Final Accounts or Financial Statements – “… For this purpose, they have to prepare their final accounts at the end of the accounting period and the general principles of accounting are fully applicable in their preparation as stated earlier, the final accounts of a ‘not-for-profit organisation’ consist of the following: (i) Receipt and Payment Account (ii) Income and Expenditure Account, and (iii) Balance Sheet.”