Happy Always Essay

2328 words - 9 pages

Nonprofit organizationA nonprofit organization or not-for-profit organization often called an NPO or simply a nonprofit and non-commercial organization often called an NCO, is an organization that uses surplus revenues to achieve its goals rather than distributing them as profit or dividends. StatesWhile not-for-profit organizations are permitted to generate surplus revenues, they must be retained by the organization for its self-preservation, expansion, or plans. NPOs have controlling members or boards. Many have paid staff including management, while others employ unpaid volunteers and even executives who work with or without compensation (occasionally nominal). Where there is a token fee, in general, it is used to meet legal requirements for establishing a contract between the executive and the organization.
The extent to which an NPO can generate surplus revenues may be constrained or use of surplus revenues may be restricted.

Nature and goalsSome NPOs may also be a charity or service organization; they may be organized as a not-for-profit corporation or as a trust, a cooperative, or they exist informally. A very similar type of organization termed a supporting organization operates like a foundation, but they are more complicated to administer, hold more favorable tax status and are restricted in the public charities they support. Their goal is not to be successful in terms of wealth, but in terms of giving value to the groups of people they administer to.Legal aspectsNPOs have a wide diversity of structures and purposes. For legal classification, there are, nevertheless, some elements of importance:Economic activity.Supervision and management provisions.Representation.Accountability and auditing provisions.Provisions for the amendment of the statutes or articles of incorporation.Provisions for the dissolution of the entity.Tax status of corporate and private donors.Tax status of the foundation.Some of the above must be, in most jurisdictions, expressed in the charter of establishment. Others may be provided by the supervising authority at each particular jurisdiction.While affiliations will not affect a legal status, they may be taken into consideration by legal proceedings as an indication of purpose.Most countries have laws which regulate the establishment and management of NPOs, and which require compliance with corporate governance regimes. Most larger organizations are required to publish their financial reports detailing their income and expenditure publicly. In many aspects they are similar to corporate business entities though there are often significant differences. Both not-for-profit and for-profit corporate entities must have board members, steering committee members, or trustees who owe the organization a fiduciary duty of loyalty and trust. A notable exception to this involves churches, which are often not required to disclose finances to anyone, including church members.Formation and structureNonprofit organizations are...

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