Improvements of Accounting Treatment and Financial Reporting for Religious Organizations in Korea*－A Study for Setting the Accounting Guide to Religious Organizations－
Asian Tax Journal Vol. 6 No. 4 (2005), pp. 33-56
Abstract
The purpose of the study is to explore the problems of accounting treatments and financial reporting for religious organizations which are nonprofit organizations but peculiar in some aspects, and to provide underlying direction for preparing accounting guides in Korea. Research methodologies applied are archival and case studies, not questionnaire survey considering the closed nature of religious organizations, and also include direct interview with accounting employees. As a result of the study, various problems related to accounting and reporting for religious organizations are discovered as follows： First, supervisory regulations concerning religious accounting of governmental authorities are insufficient. Second, accounting level of buddhist temples is that of single entry bookkeeping. Third, protestant christian churches make use of modified accrual basis which adopts double entry bookkeeping in principle, but does not apply depreciation on tangible fixed assets. Fourth, catholic churches utilize double entry bookkeeping, but are very poor in stipulating accounting guidelines. Coping with problems mentioned above, major improvements for preparing accounting guides to be made have been excavated as follows： First, the problems of accounting for religious organization explored above should be solved. Second, the accounting guidelines for nonprofit organizations by Korea Accounting Institute should be reflected. Third, the accounting guides to nonprofit organizations or religious organizations by the United States and Japan should be considered. Fourth, the Church Accounting Standards by presbyterian christian churches as exemplar should be taken into account. Fifth, statutory tax laws regarding nonprofit entities, if possible, should be applied. Sixth, the most recently proposed Local and Municipal Accounting Standards should be mirrored.
Keywords
- Nonprofit Accounting
- Accounting for Religious Organizations
- Religious Accounting