This article provides a step by step guide on how to file annual returns of Incorporated Trustees. Just like other registered entities, Incorporated Trustees (NGOs) are expected to file their annual returns every year except for the year of incorporation. This is in pursuant to Section 848 of the Companies and Allied Matters Act (CAMA) 2020.
The process of filing annual returns of Incorporated Trustees is very straight forward as there is a specific annual return form to be completed. The annual return form specifies the required information to be supplied. What you need to do is to ensure that the form is filled correctly.
What is Incorporated Trustee?
An incorporated trustee is a legal entity created for the purpose of managing assets or conducting activities on behalf of a group or organization. This entity is formed under the law and is recognized as a separate legal entity from the individuals who form it. Incorporated trustees are typically used for nonprofit organizations, charities, religious groups, and other entities that have a collective purpose or mission.
Key Features of Incorporated Trustees:
Separate Legal Entity: The incorporated trustee is a separate legal entity from its founders or members. This means it can own property, enter into contracts, sue and be sued in its own name.
Perpetual Succession: Incorporated trustees have perpetual succession, meaning they continue to exist even if the individuals who formed it or are currently managing it change over time. The entity remains in existence until it is formally dissolved.
Limited Liability: The individuals involved in the incorporated trustee (trustees or members) typically have limited liability. This means they are not personally liable for the debts and obligations of the trustee beyond their initial investment or contribution.
Regulated Structure: Incorporated trustees are subject to regulations and must adhere to specific legal and reporting requirements. These regulations vary depending on the jurisdiction but generally include maintaining proper records, filing annual reports, and ensuring that activities align with the stated purpose of the organization.
Governance: The governance structure of an incorporated trustee is usually defined by its founding documents, such as a constitution.. These documents outline the roles and responsibilities of trustees or board members, the purpose of the organization, and how decisions are made.
Examples of Incorporated Trustees:
Charitable Organizations: Many charities are incorporated as trustees to manage donations, grants, and other resources for their charitable purposes. For example, the Red Cross Society is an incorporated entity that manages funds and resources to provide emergency assistance and disaster relief.
Religious Institutions: Churches, mosques, temples, and other religious organizations often incorporate trustees to manage their properties and finances.
Nonprofit Organizations: Nonprofits focusing on education, health, social services, and other causes may incorporate as trustees to manage their activities and assets. An example is the Bill & Melinda Gates Foundation, which is an incorporated nonprofit organization that manages a large endowment to support global health and development projects.
Foundations: Many private foundations are incorporated trustees. These foundations manage funds and distribute grants to support various causes. For example, the Ford Foundation is an incorporated trustee that provides grants to support social justice initiatives worldwide.
Legal Framework:
The legal framework for incorporated trustees varies by country. In Nigeria, incorporated trustees are registered under Part C of the Companies and Allied Matters Act (CAMA), 2020. This provides a legal framework for religious, educational, literary, scientific, social, development, cultural, sporting, and charitable organizations to incorporate and operate.
Incorporated trustees play a crucial role in managing and protecting the interests of nonprofit and charitable organizations. By providing a legal structure that ensures continuity, limited liability, and regulatory oversight, incorporated trustees help organizations effectively pursue their missions while safeguarding assets and resources.
How to File File Annual Return of Incorporated Trustees Online
Below is the highlight the information you are to provide if you are filing annual return for an NGO.
Incorporated Trustees Details: You will complete this section by providing the name, registration and the classification of the association.
Registered Office Address: Registered address includes the number/building name, street, city/town/village, local government, postcode, and state. You can find this information from the registration document of the incorporated trustees.
Annual Return Details: In this section, you will need to indicate the year of the annual return, financial year start, financial year end, gross assets, net assets, sources of income for the year, bankers, bank and balances as at the end of the financial year, trustees benefits during the year.
Trustees Details: You are to provide the personal details of the trustees. The details to provide include surname, forename(s), nationality, date of birth, gender, telephone number, identity number, identity type(such as driver’s license, voter’s card, international passport, NIN, Age declaration, National Identity card), Email address, and occupation of the trustees. Other information required in this section are the residential and service addresses of the trustees. The details of each address include number/building name, street, city/town/village, local government, postal code and state of the trustees.
Particulars of Governing Council: These are the executives that are in charge of the administration and operation of the incorporated trustees. You are to fill in the surname, other names, and the position of the governing council. In addition, provide the residential address and service address of the trustees. The details of each address include number/building name, street, city/town/village, local government, postal code and state of the governing council.
Certification: This part of the form is standard for all annual returns of incorporated trusteed. The part states: We certify that the information given in this form is correct to the best of our knowledge and has been brought to the attention of all the trustees.
Authentication: The person authorizing the annual return who may be a trustee, secretary or any other authorized person of the association will write his/her name and description in this section.
Presented for filing by: This is where the accredited agent that is filing the annual return for the incorporated trustees will put his name, address, phone number, email address, accreditation number, signature and date.
Timeline for Filing of Annual Returns of Incorporated Trustees
When should the annual return of incorporated trustees be filed? Annual returns for incorporated trustees should be filed with the Corporate and Affairs Commission (CAC) between 30th June and 31st December for the preceding financial year.
Requirements for the Filing of Return of Incorporated Trustees
If you want to file annual return for Incorporated Trustees, below are the requirements.
- Completed Annual Return Form for Incorporated Trustees. This form is now online. The accredited agent will complete the form online based on the information provided by a trustee, secretary or any authorized officer of the Incorporated Trustees.
- Audited financial statements of the Incorporated Trustees for the year in which the return is made. This is explained in details below.
- Payment of the required annual return filing fee with penalty (where applicable).
Statement of Affairs Vs Audited Financial Statements
While filing annual returns for incorporated trustees, you can either upload statement of affairs or audited financial statements. However, you need to understand that the statement of affairs and audited financial statements are two different types of financial documents, each serving distinct purposes:
Statement of Affairs: A statement of affairs is a financial report that provides a summary of an organization’s assets and liabilities at a specific point in time. It is often used in situations where an entity is yet to commence operations or formal accounting records are not maintained, such as during insolvency or for very small entities. It typically includes a list of assets, liabilities, and the overall financial position. It might not include detailed income and expenditure accounts. This is less formal and may not require a professional audit. It’s more like a simplified snapshot of the financial standing of an entity.
Audited Financial Statements: Audited financial statements are comprehensive reports that have been reviewed and verified by an independent auditor. They include a detailed presentation of an organization’s financial activities over a specific period (usually a fiscal year). These statements typically include a balance sheet, income statement, cash flow statement, and notes to the accounts. The auditor’s report is also included, providing an opinion on the accuracy and fairness of the financial statements. These are required for larger organizations or those with more complex financial transactions. The audit provides assurance to stakeholders that the financial statements are accurate and comply with accounting standards.
Filing Fee of Annual Return for Incorporated Trustees
The fee to be paid for the filing of annual return of incorporated trustees is N5,000 and additional penalty of N10,000 for late filing (when the annual return is filed late)
Do you want to file annual return of incorporated trustees? You can contact us.