South Africa Department of Social Development has urged non-profit organisations (NPOs) to comply with registration requirements after deregistering over 6 200 NPOs.
The department warned that more than 200,000 organisations, including NPOs, voluntary associations and trusts, risk deregistration for failing to submit annual reports as required by the NPO Act.
Acting Deputy Director-General of Welfare Services, Mpho Mngxitama, said non-compliant NPOs will lose privileges such as tax exemptions, government funding and support.
Mngxitama pointed out that all NPOs registered with the department of Social development needed to understand that they were legally recognised and need to be accountable and transparent because NPOs use public funds therefore, it is important for accountability and transparency so that anyone who finds the NPO has got the trust and belief that it is being used for the right purposes and intentions.
Non-profit organisations play a crucial role in South Africa providing solutions to various social, economic, and environmental issues. However, compliance with the NPO Act is essential to ensure transparency, accountability, and the proper use of resources.
The Act mandates that all registered NPOs submit annual reports detailing their activities and financial statements within nine months of their financial year-end. Failure to comply can lead to deregistration, resulting in the loss of legal status and associated benefits.
The impact of deregistration varies across provinces. Gauteng, as the economic hub of South Africa, has the highest number of non-compliant NPOs. KwaZulu-Natal and the Western Cape.
The smaller and volunteer-driven NOPs, struggle with compliance due to limited resources and capacity. The requirement to submit annual reports, including financial statements and an accounting officer’s report, can be challenging due to these complications the department of social development has implemented measures to assist NPOs in achieving compliance. Initiatives such as the #KnowYourNPOStatus campaign aim to raise awareness about compliance requirements and provide support to organisations in submitting necessary documentation.
