Income and Expenditure Accounts


Clubs, societies, credit unions and other non-profit organisations do not draw up Statement of

Comprehensive Income s; instead they prepare an INCOME AND EXPENDITURE ACCOUNT.

Where income is greater than expenditure the excess is referred to as the surplus of income over expenditure.

Where expenditure is greater than income the excess is referred to as the excess of expenditure over income.

In the Statement of Financial Position commercial entities describe the net assets as CAPITAL whereas non-profit organisations describe net assets as accumulated funds.


The main sources of income for clubs and societies are:

  • Social events
  • Members subscriptions
  • Life members’ subscriptions
  • Special events e.g. annual dinner evening
  • Investment income

Members Subscriptions

Members of clubs and societies usually pay an annual subscription to the club/society.  The income received plus arrears of subscriptions for the current year, less arrears subscriptions for the previous year are treated as income in the income and expenditure account.  Subscriptions received in advance are treated as an accrual in the Statement of Financial Position.

Life Members’ Subscription

Often members of a club/society may pay a life members subscription, this should be recognised in the income and expenditure account over a defined period of time for example 10 years.  The residue should be shown in the Statement of Financial Position beneath the accumulated fund.


  • Special Events

It is usual to show the surplus/deficit arising on special events as a separate item of income/expenditure in the income and expenditure account

Investment Income

The investment income accruing for the year should be included in the income and expenditure account.


The main items of expenditure for clubs and societies are:  rent, rates, light and heat, postage and stationery, depreciation of equipment, staff wages and a secretary’s/treasurer’s honorarium.


The Statement of Financial Position of a club/society follows the same format as commercial entities.  However, the net assets are represented by an accumulated fund rather than capital.


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