The role of auditing applied to the third sector

Before we talk about Third sector auditing it is important to remember that it is composed of companies that carry out philanthropic activities, providing society with an improvement in the quality of life, medical care, access to cultural events and educational campaigns, also contributing to social inclusion. It is made up of institutions that, despite producing and selling goods and services, are not governmental and do not seek profit, but rather development and social welfare.

Because of their characteristics, it is precisely because of them that it is important to Third sector auditing, because they need to be transparent and reliable before society and government, so that they can achieve new investments and, consequently, reach a larger number of people.

The Federal Accounting Council, through the Brazilian Accounting Standards, defined the standard NBC T 10.19.1.3, which states that a non-profit entity is one in which the positive result is not intended for the holders of equity and the profit or loss are referred to, respectively, as a surplus or deficit. According to NBC T 10.19.1.4, they carry out welfare, health, educational, religious, cultural, sporting, charitable, social, class council, and other activities, managing people, things, and interests around a heritage with a common or community purpose. The institution can also produce and sell products and services, but the revenue and the surplus achieved must be fully reverted to the maintenance and improvement of the institution itself.

And it is in this regard that Third sector auditing appears to play a relevant role in the demonstration of the work carried out by these companies, since it is they that will verify and validate the facts and the destination of the funds collected. Unfortunately, many third sector organizations engage in fraudulent schemes, evading the main purpose of their existence and purpose, passing on a negative image to a large part of society. In addition, these organizations have a series of benefits in the form of their constitution and objectives, and they must clearly demonstrate their activities to continue enjoying these benefits.

The financial statements of third sector companies must follow the principles of Law 6,404/1976, with only a few changes in the naming of some balance sheet and profit and loss accounts. They must prepare their financial statements, in accordance with Brazilian Accounting Standards, so they are required to publish the financial statements, validated by Third sector auditing, making it possible to identify the origin of the resources and their correct application, providing greater reliability. That is why the Third sector auditing plays a relevant role, as it will clearly and accurately demonstrate the facts and operational activities of the entities that make up this important sector. Volunteers, donors, partners, and the government expect that the allocated resources will be effectively allocated to their primary purpose, and that is why transparency is vital in these organizations. TATICCA — ALLINIAL GLOBAL also provides integrated auditing, accounting, tax, corporate finance, financial advisory, risk advisory, technology, business consulting and training services. For more information, visit www.taticca.com.br or email taticca@taticca.com.br. Our company has professionals with extensive experience in the market and has certified methodologies for carrying out activities.

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