Background
I've recently volunteered as an accountant for a small not-for-profit organisation that runs development projects for adults with mental health difficulties. This organisation is a company limited by guarantee (not a charity) and has no paid employees and no fixed assets. The organisation was set-up around seven years ago by the project coordinator who is paid a fee for their services. There is an independent Board overseeing the work.
Query
The Board has previously re-cognised the unpaid effort of the project coordinator during the organisation start-up period. Fees only began to be paid when project funding was secured. The intention was to provide compensation for this unpaid effort at a later date. The Board had previously agreed and minuted this intention to pay fees as and when sufficient unrestricted funds became available. This arrangement seems to be some form of interest free, unsecured liability with no specified repayment date - there is no paperwork as such, only a Board meeting minute including the agreed amount. There has been no accounting for this liability or note in the accounts. I'd be very grateful for any guidance on the accounting treatment for this situation.
Thanks for your help.