TOPIC 1 NON-COMMERCIAL ORGANIZATIONS. DEFINITION. TYPES 1. Look at the following definitions. Learn them. Find synonymous words and write them out. What is non-commercial organization? Non-commercial organization is the entity that is not working to earn profit. At the end of the financial year, the profit is not distributed among the owners, but is used for the objective of the organization. What is the main purpose of a non-profit organization? Nonprofits raise money but they spend it to further their mission, not to benefit the donors or founders. They are allowed to pay employees. Nonprofit purposes include feeding the homeless, managing an association of businesses and preaching the gospel. What are non-commercial activities? Non-commercial (also spelled noncommercial) refers to an activity or entity that does not, in some sense, involve commerce, at least relative to similar activities that do have a commercial objective or emphasis. Why do we need nonprofits? Nonprofit organizations play a vital role in building healthy communities by providing critical services that contribute to economic stability and mobility. They also strengthen communities in other important ways. Frequently, nonprofit leaders are the voice of the people they serve. Is there a difference between a non-profit and not-for-profit company? Definition of Non-profit Organization A nonprofit organization or NPO are the companies with limited liability. The organization is formed propagating charity, religion, science and art and can sometimes be operated as not for profit organization. The profits earned by the organization must be applied for achieving the objects of the entity rather than distributing to its owners as dividends. Definition of Not for Profit Organization Not for Profit Organization refers to an organization whose sole purpose is to achieve the objects of the entity. The company does not work for earning the profit. These type of organizations can include club like women’s club, sport’s club, etc. or an association or any other group formed by people. A Non-profit organization is an organization which works for promoting science, commerce, art or any other charitable purpose. A Not-for-Profit organization is an organization that does not distribute its profits to owners but retains it for fulfilling organizations objectives. Key Differences Between Non-profit and Not for Profit Organization - A Non-Profit Organization is a larger than a Not for Profit Organizations. - A Non-Profit Organization may include charitable trust or cooperative society while Not for Profit Organizations includes clubs and association of persons. - A Non-Profit Organization is a separate legal entity, whereas Not for Profit Organization is not. The two entities are alike, but still, there are differences between them. The major similarity between them is that both the organization is not working for earning the profit. A Non-Profit Organization may work as a Not for Profit Organization, but a Not for Profit Organization cannot function as a Non-Profit Organization. Why are nonprofits important to the economy? Nonprofit organizations play a growing role in the social and economic well-being of a country by providing services, goods and resources to meet community needs.
