ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has directed the registered chartable and non-profit organisations to separately issue statement of all funds, grants, contributions, donations received from local and foreign sources.
The SECP has issued SRO 1574(I)/2021 to amend Associations with Charitable and Not for Profit Objects Regulations, 2018, here on Monday.
According to the revised regulations, the company shall ensure that its income and expenditure accounts clearly exhibit a statement of all funds, grants, contributions, donations received from local and foreign sources separately.
The directors’ report prepared under the Act shall also include information, pertaining to compliance with the relevant provisions of the Act; compliance with all the provisions and conditions of these regulations; compliance with the all conditions provided in the license (if any) and confirmation to the effect that prior security clearance in terms of these regulations, in respect of foreign donation, foreign member, foreign director and foreign chief executive officer, if any, has been obtained.
The company shall receive all funds, grants, contributions and donations (except funds, grants, contributions and donations received in kind) through proper banking channels: Provided that amounts equivalent to or less than twenty thousand rupees can be received in cash for which proper entries in the books and records of donor shall be maintained by the Company and such amount shall be deposited not later than three working days of the receipt, in the bank account of the company, the SECP said.
The company may make investment, whatsoever, in any of its associated companies or associated undertakings subject to compliance of the requirements of section 199 of the Act and the regulations made thereunder.
The board shall also frame and follow a broad policy specifying mechanism for such investments and shall carry out due diligence before making such investment and shall also disclose interest of directors of the company, if any, the SECP stated.
The commission shall obtain prior security clearance in accordance with policy approved by the government in respect of foreign funding or donation or foreign promoters, foreign directors, or foreign chief executive officer of applicant seeking license under these regulations.
The company, subsequent to grant of license, shall obtain prior security clearance through an application made to the commission in case it intends to: (i) Receive foreign funding or donation; or (ii) Induct foreign member; or (iii) Appoint foreign director or foreign chief executive officer. and; all the conditions provided in the license granted under section 42 of the Act, including renewal of license, which are in contradiction to these regulations shall have no effect henceforth, the SECP added.
Copyright Business Recorder, 2021