On Wednesday, February 28, the Finance Working Group held an info session “Receiving and Accounting of Charitable and Humanitarian Aid”. The event was attended by 300 municipal professionals from all over Ukraine.
“Order No. 953, which regulates the passage and accounting of humanitarian aid, entered into force at the end of 2023, and its important provisions will come into effect on April 1. Amendments to the Law on Humanitarian Aid entered into force in January 2024. In order for local self-government to be able to adapt to new legislation, our experts provided an explanation of the steps to be taken when receiving charitable and humanitarian aid and its reflection in the budget records, accounting and reporting, including tax accounting,” said Inna Sviatna, Adviser on Municipal Finances and Management at the Regional Office of U-LEAD with Europe in the Vinnytsia Oblast.
At the info session, Inna Sviatna and her colleagues, Nataliia Liubchenko and Olena Savchenko, advisers at the Regional Offices in the Khmelnytskyi and Kirovohrad Oblasts, provided clarification on the specific aspects of the accounting of humanitarian aid, as well as recommendations on the accounting of assets received free of charge, their use and, if necessary, further transfer.
Expanding the circle of beneficiaries and recipients; changing the transfer procedure
The experts highlighted the updated terminology regarding beneficiaries and recipients of humanitarian aid, as well as the expansion of the list of recipients of humanitarian aid. Non-profit state and municipal enterprises, institutions, organisations and local self-government bodies (e.g. health care facilities) and providers of medical and/or rehabilitation services that have a contract with the National Health Service of Ukraine were added to the already existing list. These recipients can also acquire the status of beneficiaries of aid (end consumers who use it).
Local self-government bodies can only be recipients of humanitarian and charitable aid and cannot be donors. They must keep exhaustive records of all humanitarian and charitable aid. The main principle of working with material values received from donors and benefactors is to immediately transfer them to target organisations or institutions upon receipt.
The procedure for receiving humanitarian aid is as follows: written offer of the donor, provision of written consent, signing of primary documents, recording of recipients, reflection in accounting (recording of humanitarian aid), transfer to beneficiaries and reporting.
“At the stage of forming a written agreement, please consider who will be the recipient and what needs the assistance will be used towards, as well as its path to the recipient. As for changing the recipient, which will be indicated in the primary documents, it can be done only with the consent of the donor unless such consent is indicated in pre-approved documents,” the expert said.
Accounting and reporting on the use of the aid are important activities of the recipient. The experts reminded that upon customs clearance of humanitarian aid, an inventory description in the automated system must be submitted by budgetary institutions within 15 days, by recipients of medical humanitarian aid within 60 days and within 90 days in other cases. In addition, the recipient of humanitarian aid must submit a report on the availability and distribution of humanitarian aid by the 15th day of the month following the month of customs clearance of the goods and then do it monthly until the aid is fully distributed. Declared humanitarian aid, which has not been reported within 90 calendar days upon entry of information on customs clearance, will be considered to have been used for other purposes.
Specific aspects of customs clearance and registration of humanitarian aid from 1 April 2024
The use of an automated system for registering humanitarian aid is introduced at the legislative level.
Any humanitarian cargo can now be declared exclusively by an organisation/institution that is included in the Unified Register of Recipients of Humanitarian Aid. According to the automated humanitarian aid recording system, 7448 aid recipients registered on the platform from December 2023 to February 2024.
The simplified declaration mechanism, i.e. submitting a paper customs declaration directly at the checkpoint, is valid only until 1 April 2024. After that, humanitarian cargo can only be imported under a previously submitted electronic declaration.