Uganda Adopts the International Non-Profit Accounting Standard: What Non-Profit Organisations Need to Know

Introduction

The International Non-Profit Accounting Standard (INPAS) was developed through the International Financial Reporting for Non-Profit Organisations (IFR4NPO) project and officially launched in October 2025. It is an internationally applicable financial reporting framework built specifically around the funding models, accountability obligations and public benefit objectives of Non-Profit Organisations (NPOs). It is based on the IFRS for Small and Medium-sized Entities accounting standard, with modifications to address the distinctive reporting needs of the non-profit sector.

INPAS provides tailored guidance on grant and donor income recognition, restricted and unrestricted funding, financial statements, narrative reporting and harmonised grant and donor reporting. Its objective is to improve the transparency, consistency, comparability and credibility of NPO financial reporting.

The Institute of Certified Public Accountants of Uganda (ICPAU) has adopted INPAS for use by NPOs in Uganda. The announcement was made during ICPAU’s 31st Annual Seminar in September 2026. This is a significant development for NGOs, charities, foundations, faith-based organisations and other entities operating on a non-profit basis.

Key Areas Addressed by INPAS

Recognition and reporting of grants and donations. INPAS provides a framework for accounting for grants, donations and other funding. Accounting treatment requires consideration of the substance of the funding arrangement, including conditions, obligations and restrictions attached to resources. NPOs should review grant agreements and donation terms carefully, as the timing and manner of recognition may differ depending on the requirements and nature of the arrangement.

Restricted and unrestricted funds. Restricted funds are subject to specified restrictions on their use; unrestricted funds are generally available for the organisation’s permitted activities, subject to its governing documents and applicable requirements. Appropriate identification and reporting demonstrate that resources have been applied to their intended purposes, improve project-level accountability and strengthen oversight by management, boards, donors and auditors.

Standardised financial statements. A common reporting framework promotes consistency in the preparation and presentation of NPO financial statements, improving comparability and understandability across organisations and reporting periods and supporting informed decisions by donors, regulators and other stakeholders.

Narrative reporting. Financial statements can be complemented by information about an organisation’s activities, objectives, use of resources and performance. This helps stakeholders understand both its financial position and how its resources support its mission and intended outcomes.

Harmonised grant and donor reporting. INPAS includes a guide intended to streamline grant reporting and promote consistency in information provided to funders. This is relevant to NPOs preparing multiple reports using donor-specific templates, classifications and reporting periods. Harmonisation may reduce duplication and administrative costs, but organisations must still comply with contractual reporting obligations under individual grant agreements.

What Does Adoption Mean for NPOs in Uganda?

Adoption is an important step towards a more consistent, sector-specific financial reporting framework. Its practical implications will depend on the implementation arrangements to be issued by ICPAU.

NPOs should assess whether their existing accounting policies, financial systems, grant management processes and reporting practices can support the new framework.

ICPAU is still developing the implementation framework. Following public consultation, the Institute is expected to provide guidance on the organisations to which INPAS will apply, implementation timelines, transition arrangements and the extent of narrative reporting requirements.

Organisations should distinguish between adoption of the standard and finalisation of local implementation requirements. Applicable reporting obligations, effective dates and other local requirements should be confirmed against subsequent ICPAU guidance.

Recommended Preparatory Actions

1. Conduct a preliminary gap assessment: Compare existing accounting policies and financial reporting practices against INPAS and identify areas requiring review.
2. Review grant and funding arrangements: Compile grant agreements, donation terms and other funding documents to identify conditions, restrictions, obligations, deliverables and reporting requirements.
3. Assess fund tracking procedures: Determine whether restricted and unrestricted resources can be separately identified, monitored and reconciled to accounting records and project reports.
4. Evaluate financial systems: Review the chart of accounts, accounting software and project accounting procedures to establish whether they can generate the financial and funding information required under INPAS.
5. Engage management, boards and auditors: Brief key decision-makers on adoption and establish a preliminary transition plan, subject to formal ICPAU guidance.
6. Build staff capacity: Arrange training for finance personnel, programme managers and employees responsible for funds management and financial reporting.
7. Monitor ICPAU guidance: Follow announcements on scope of application, effective dates, transition requirements, narrative reporting obligations and other implementation requirements.

Adoption does not automatically change an NPO’s existing statutory, regulatory or contractual obligations. Organisations should continue to assess their obligations under Ugandan law, regulatory requirements and donor agreements.

Conclusion

ICPAU’s adoption of INPAS is a significant step towards strengthening transparency, accountability and consistency in Uganda’s non-profit sector. A framework tailored to NPOs’ operational and funding realities can improve financial stewardship, enhance donor confidence and support more meaningful reporting on organisational performance.

NGOs and other NPOs should begin reviewing their accounting policies, grant management processes, internal controls and financial reporting systems. A structured readiness assessment should follow once ICPAU issues its implementation framework.

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Disclaimer

This alert is for general informational purposes only and does not constitute legal advice. Its information may not be the most up-to-date legal or other information. Links to third-party resources are provided for convenience and do not imply endorsement by TASLAF, its lawyers or affiliates. Readers should obtain advice from qualified counsel on their particular circumstances before acting or refraining from acting on this information.

Prepared by TASLAF Advocates — NGO & Social Enterprise Practice.