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treatment of Grant Funding and exp for a CASC

I need to know how to present the income and expenditure of a grant for capital building

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I am hoping to get some advice on the accounts for an amateur sports club that has received a specific grant to fund a new building project. My question is this, should the grant and the expenditure be shown in the income and expenditure statement ( profit and loss) , or should it be shown on the balance sheet as it is capitalising the value of the overall premises. the grant itself is to fund a new building project and current 250k has been received and 264k has been spent. If shown as part of the profit and loss the overall result is a loss if removed and sits on the balance sheet the club would show a profit, therefore I assume tax would be applicable -  Any advice would be very much appreciated - Sarah

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By Paul Crowley
19th Oct 2021 12:37

Is this DIY or do you have an accountant acting?

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By johnt27
19th Oct 2021 13:49

Standard accounting rules would apply to a CASC or sports club, so the accounting treatment of the grant and building work would be on the balance sheet.

If that leaves a profit, unless you've failed some of the CASC exemptions, there should be no tax payable.

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Replying to johnt27:
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By Monkgp
23rd Oct 2021 07:36

Hi John

Thank you for this, and sorry for the slow reply I have been away. I think the club have received poor advice when it was initially setup but I understand it is too late to change as all the deeds and the grants have been granted to the club as it is , and to change to a charity the club has to be closed and a charity opened, is that correct ? perhaps after the building work is complete then maybe but also a rather large loan has been taken out in the name of the CASC so that might also impace making any changes especially as it is for over 20 years. As far as the accounts are concerned , do i code all the expenditure to the balance sheet which serves to inccrease the value, but what about the grants to cover those costs, i am hoping they also get coded to the balance sheet and not counted as taxable income ? many thanks for you help I really appreciate it

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By Monkgp
19th Oct 2021 13:59

That is great and what I thought, thank you so much for confirming this for me

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By CJS88
19th Oct 2021 15:58

Has this happened yet?
If not then:-
Why (oh why) is the club not registered as a charity?
Have you thought about putting the asset into a separate charity to protect it from the members?

PM me if you want to talk things over.

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Replying to CJS88:
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By johnt27
19th Oct 2021 16:14

Many questions but the main being, just why?

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Replying to CJS88:
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By Paul Crowley
03rd Nov 2021 13:19

+1
Charities get much more sympathy from all outsiders as there is proper regulation

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