Abstract

Not for Profit Organizations (NPOs) are the subject in the middle of a relevant debate by scholars, politicians and public opinion and some efforts were done to measure economic dimensions of “third sector” by Research centres and international institutions while there is a remarkable lack of homogeneity concerning NPOs’ accounting regulation in the European Union. Each country has its own accounting regulatory system, strongly depending by civil and tax laws; this reduces both NPO’s disclosure and prevents scholars to comprehend the real state of social economy system at European level and their financial performance. Moreover it makes NPOs’ chance to operate in a foreign country into the enlarged EU very difficult and make difficult an homogeneity in NPOs treatment at European level. A European agenda to support the accountability development in the third sector should define a minimum common framework for institutional and governance features, financial accounting and social accountability for different kinds of NPO, beginning starting from the different national regulations. In particular an hypothesys of “European NPOss’ framework” for financial reporting (a first step to a better accountability) hasve to consider different regulations in order to: a) legal entities form in which NPOs arehave constituted instituted in EU countries end and their regulations (specific for NPOs or general for commercial entities); b) accounting and auditing obligations (keep accounting records, prepare annual accounts, provide financial reporting) and audit them; c) mandatory annual report provided by the NPOs (mission statement, asset and liability statement, statement of financial activities, explanatory notes, trustees report) d) disclosure of accounts disclosure (make the accounts available to the public on request or deposit it in a public register); e) accounting principles for NPOs (cash or accrual basis, light regulation for smaller entities, Ifrs implementation); f) a model for NPOs financial performance evaluation based on financial statement (significant ratio in accounting aggregates; To define a common framework we start from a comparationmatching between Spanish, Italian, and English regulations (law and practice) applied to NPOs to highlight similarities and differences. The paper is the first step of a wider research whose final goal is a “meeting path” to a common accounting framework for non profit organizations in European Union.