I have a grant that was made by the parent to the subsidiary entity in 2018 and it was posted as an inter-co. transaction Both entities are not-for -profits. There was no obligation on the part of the subsidiary to pay back the funds as it was a donation. Is this the correct way of posting this as an inter-co if there was no obligation to pay back the funds? I can't see how I can clear the inter-co on both sides if there is no obligation to pay back the funds. Please help on this.
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Dr expense, Cr interco in giver
Dr interco Cr income in the receiver
If you are sure that is what it is
On what little we have here, I have a few CT qualms.
"Both not-for-profits" ? Does that mean both registered charities?
If not...one a regd charity?
Both in CT? Only one?
On joining Founders Pledge, every member makes a binding pledge to donate a portion of their personal proceeds on liquidity (exit proceeds) to charity.
It is NOT a small operation - according to their website:
TOTAL VALUE PLEDGED = $7.0 billion
FULFILLED COMMITMENTS = $773 million (since founding in 2015)
... but nor is it a charity - it is a "a London-based charitable initiative".
None of my business (and not answering OP's question) but I do wonder why such an outfit would be making a grant to a subsidiary entity?
That doesn't sound like a charitable donation (or indeed grant), so what was it?
I suspect:
Payment from Company limited by guarantee (not registered as a charity) to another group member.
The trading company?