Sr.

No Mandatory Requirements of PCP Certification

1 REGISTRATION AS NPO

The organisation is established for religious, educational, charitable, welfare [purposes for general public], or for the
a)
promotion of an amateur sport

The organisation is formed and registered [by or] under any law as a non-profit Organization. The organisation has
b)
obtained registration/licenses from relevant public authorities 1.

2 ACTIVITIES WITHIN SCOPE OF WORK

The programmes and activities fall within the scope defined by the registration authority. Organization’s area of
a)
operations is wholly in Pakistan.

3 LEGAL UNDERTAKINGS

a) Undertaking for compliance with legal & regulatory requirements of relevant registration law

b) Undertaking for non-indulgence in money laundering and terror financing

Undertaking for maintenance of records of foreign nationals further stating that no foreign national is working
c)
without valid visa under its umbrella and without prior security clearance from relevant authorities

d) Undertaking for non-propagation of the views of any religious sect or political party

Undertaking for nonexistence of any adverse decree during the last ten years against the applicant NPO in any of the
e)
civil courts in Pakistan on grounds of fraud or breach of trust.

4 PROVISION OF SERVICE TO GENERAL PUBLIC OR A SUFFICIENT SECTION OF THE GENERAL PUBLIC 2

The applicant organisation ensures provision of benefit/service to the general public, or a sufficient section of the
a)
general public

5 MAINTENANCE OF RECORD OF BENEFICIARIES & PROGRAM EXPENDITURE

a) The applicant organisation maintains record of beneficiaries & program expenditure

1
This includes the following registrations/licenses;
i. NPO established by an Act of National or Provincial Assemblies or an Ordinance
ii. NPO registered under a valid NPO Registration law excluding the Trade Organisations Act
iii. INGO having a valid MoU with Ministry of Interior under the INGO registration policy or, in case of
renewal of MoU, an acknowledgement letter from MoI reflecting that application for renewal of MoU has
been submitted to MoI
iv. A valid license issued by SECP to an NPO registered under Section 42 of Companies Act, 2017 or an
acknowledgement letter from SECP reflecting that application for renewal of license has been submitted to
SECP by the NPO.
v. A valid license issued by the Healthcare Sector Regulator, if applicable, or an acknowledgement letter from
relevant Healthcare Regulator reflecting that application for license has been submitted by the NPO.
2
The standards of General Public Utility shall be pro-rated in provisional cases.
 i. The applicant organisation has submitted details of beneficiaries including names and contact

ii. The organisation provides free/partial free service to its beneficiaries.

a) The organisation has formulated a governing document

7 MAINTENANCE OF RECORD OF GOVERNING BODY MEMBERS & THEIR MEETINGS 3

a) The applicant organisation maintains record of governing body members including their names and CNICs.

8 PAYMENT OF REMUNERATION/BENEFIT TO MEMBERS45

The organisation prohibits any portion of its money, property or income being paid or transferred directly by way of
a)
dividend, bonus or profit to any of its members or their relatives.

The organization ensures that all Related party transactions with members of the organization are conducted at arm’s
b)
length

i. The applicant organization has declared all related party transactions

ii. Related party transactions are conducted at arm’s length

9 COMPLIANCE WITH TAX LAWS & REGULATIONS

a) As required by law, the applicant organisation has obtained registration from the tax department

i. The applicant organisation has a valid national tax number (NTN)

b) The applicant organisation has complied with the following periodic filing requirement as required by the tax law

i. Annual filing of income tax returns during the evaluation period

ii. Monthly filing of withholding tax statements during the evaluation period

iii. Filing of sales tax returns during the evaluation period 6

The constitution, memorandum and articles of association, trust deed, rules and regulations or bye-laws, as the case
c)
may be, specifying the aims and objects of the organization provide-

3
This shall not be applicable on INGOs
4
Corrective action be enforced prospectively in cases where payment of benefit / private benefit to members has
been stopped by organization.
5
This shall not be applicable on INGOs

6
Applicable on organisations registered for sales tax
 for the audit of the annual accounts of the organization every year by a qualified accountant as specified in clause (f)
i.
of sub-rule (2) of rule 211of Income Tax Rules, 2002

for the quorum of a meeting of the members of the body in which the control of the affairs of the organization vests,
ii.
being not less than four or one-third of the total number of the members of such body, whichever is greater

for the quorum of a meeting of the members of the body in which the control of the affairs of the trust vests, being not
iii. less than three or one-third of the total number of the members of such a body, whichever is greater

for the transfer of its assets, in the event of its dissolution, after meeting all liabilities, if any, to another organization
iv. which is an approved non-profit organization, within three months of the dissolution under intimation to the
Commissioner

v. for the utilization of its money, property or income or any part thereof solely for promoting its objects;

for prohibiting any portion of its money, property or income being paid or transferred directly by way of dividend,
vi.
bonus or profit to any of its members or the relative or relatives of a member or members;

v
for the maintenance of accounts of the organization being kept in a scheduled bank or in a post office or national
ii.
savings organization, National Bank of Pakistan or nationalized commercial banks

for prohibiting the making of any changes in the constitution, memorandum and articles of association, trust deed,
viii.
rules and regulations or bye-laws, as the case may be, without the prior approval of the Commissioner: Provided this
clause will have effect only in cases where the approval is granted

for restricting the surpluses or monies validly set apart, excluding restricted funds, up to twenty-five percent of the
total income of the year. Provided that such surpluses or monies set apart are invested in Government securities,
[National Saving Schemes, issued by the Central Directorate of National Savings] NIT units, a collective investment
ix. scheme authorized or registered under the Non-Banking Finance Companies (Establishment and Regulation) Rules,
2003, mutual fund, a real estate investment trust approved and authorized under the Real Estate Investment Trust
Rules, 2006, or scheduled banks. For the purpose of this rule, “restricted funds” mean any fund received by the
organization but could not be spent and treated as revenue during year due to any obligation placed by the donor

The applicant organisation has ensured provision of appropriate information so as to make determination with
d)
regard to the following:

Organisation restricts surplus funds or monies set apart in compliance with the requirements specified in ITR,
i.
2002.

Organisation restricts its management & administrative expenditure in compliance with the requirements
ii.
specified in ITO 2001 & Income Tax Rules, 2002.
 iii. Organisation’s salary expense is within the prescribed threshold given in ITR 2002

10 BANKING OF FUNDS7
a) The organisation maintains its accounts in a scheduled bank.
b)
The bank account (s) are operated on dual mandate/joint signatory system

11 MAINTENANCE OF BOOKS OF ACCOUNTS

a) The organisation ensures preparation and maintenance of books of accounts and related breakups

12 AUDIT OF FINANCIAL STATEMENTS BY AN EXTERNAL AUDITOR8

a) An external auditor has audited the accounts of the organisation in Pak Rupees, for the evaluation period.

13 MAINTENANCE OF RECORD OF DONORS & DONATIONS

a) The applicant organisation maintains record of donors & donations

i. The applicant organisation has submitted details of donors (both national and foreign)

ii. The applicant organisation has submitted details of donations and relevant breakups

14 SAFEGUARDING OF ASSETS

All assets of the organisation (fixed as well as investments) are held in the name of or are legally assigned to the
a)
organisation or its Governing Body

b) The organisation maintains proper books of accounts with regard to its assets

The charter of the organization prescribes that in case of its dissolution any assets, remaining after the settlement of
c)
debts and liabilities, shall be transferred to a body or bodies in accordance with the applicable laws

7
The bank account (s) shall be in the name of the organisation. All Funds of the applicant organisation shall be
deposited in bank and shall be transacted through its official bank accounts.
8
The following guidelines shall be followed:
i. The application shall be evaluated by PCP against audited accounts of the evaluation period.
ii. The external auditor shall be registered with relevant registration authority in accordance with Income Tax Rules.
iii. The audit shall be an organizational audit covering all projects and programmes and the total expense of the organisation.
The name reflecting on the audited accounts shall be the same as mentioned on the registration and tax registration
certificates as well as bank accounts maintenance letter. PCP should have sufficient documentation to support the
assumption that the organization applying for the certification is same as the one whose audited accounts have been
presented.
iv. The audited accounts shall reflect a clear opinion in relation to true and fair representation of the account.
v. There shall be no unresolved qualified opinion of material nature in the audited accounts.