Dear Dialogue Members,
Greetings from SRRF!!!
Following query received from Mr. Subodh of BRLP.
Dear Sir,
I am from a Govt Society . People from foreign country like Indonesia / Bangladesh want exposure visit of our society. We have to facilitate them for accommodation / vehicles / community resource fees etc. They want to send all reimbursement cost as per budget in project account.
What is our statutory obligation for accepting reimbursement cost from foreign countries. Please update us with reference of concerned act and its provisions.
With regards
Subodh
Dear Subodh,
Perhaps we need to revisit the definition of Foreign Contribution (FC), to understand the situation better. As per S. 2(h) FC is defined as donation, delivery or transfer made by any foreign source. Thus transfer by any foreign source tantamounts to be termed as FC. The reason why often transfers for reimbursements are not considered under FC is because in accounting treatment all reimbursements are treated through advance accounts and hence do not fall as expenditure in accounts.
However my suggestion to treat the same as FC and deposit it in FCRA account is basically on two grounds
(1) Definition states any transfer and here purpose is not considered.
(2) More on practical grounds, FCRA officials who may look into such aspects are not so well versed with accounting principles to understand finer details between utilisation (as expenditure) and reimbursement.
rgds
subhash
Dear Subhashjee and team members
Thanks for response. We have suggested foreign team members to make all payment on accommodation and logistic arrangement directly to vendors but how we can solve this issue in future as we always get request for exposure of our society and CBOs.
We hope to hear some concrete reply or way for compliance of statutory obligation.
With regards
Subodh
Dear Sir
Thanks for response. We expect concrete evidence under FCRA act.
With regards
Subodh
I too am not very sure, but I think it needs clearance from FCRA.
Thussu
Dear Mr. Subodh,
Greetings from Hyderabad!
“The amount” is paid in foreign currency by foreign participants for participation in an exposure visit and this amount will utilized for the purpose of meeting the expenditure of organizing the exposure visit. This will not treated as foreign contribution and as such no permission under FCRA is required.
I would request some other comments also as I am not sure.
Thanks and regards,
B V Soma Sastry