The draft federal law amending Article 7 of the Federal Law on Accounting in connection with organising accounting at NGOs was drafted by the Ministry of Economic Development.

In accordance with Clause 3 of Article 7 of the Federal Law on Accounting, the head of an economic entity (excluding lending organisations) is obliged to entrust accounting to the chief accountant or another of the company’s officials, or to sign an agreement for the provision of accounting services with another company or person. The only exception is for the head of a small or medium-sized business, who is allowed to assume the powers of accountant.

In other words, NGOs are equated to big businesses in terms of accounting.

However, at this time the heads of over 3,000 NGOs personally keep their organisations’ books because they have no money to hire accountants or specialised accounting companies. At the same time, many NGOs do not engage in financial or economic activities.

The bill allows NGO heads to keep their organisations’ books, with the exception of NGOs whose monetary income and other receipts in the preceding year exceeded 3 million roubles, bar associations, law firms, legal aid agencies, law chambers, notary offices, housing and housing construction cooperatives, consumer lending cooperatives, agricultural consumer cooperatives, microfinancing organisations, mutual insurance companies, publicly-funded companies, state corporations and companies, political parties and their regional branches and any other structural units, self-regulating organisations, and NGOs included in the register of NGOs that are foreign agents in accordance with Clause 10 of Article 13 of the Federal Law on Non-Governmental Organisations.

The draft law was considered and approved at a Government meeting on June 17, 2013.