Association Loi 1901 Case Study

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An “Association Loi 1901” is the term used in France for a non-profit-making organisation of two or more people. This is the legal structure of most youth orchestras and other cultural democratisation projects in France. The name comes for the convention having entered into French law on 1 July 1901. The association must be declared if a bank account is required, if it collects membership fees or organises fundraising, or if the members undertake any legal action or buy or sell on its behalf.
3.1.1 Financing non-profits through their own resources
To finance a non-profit organisation, an assessment of its internal and external financing ability needs to be made. The non-profit organisation’s internal financing ability concerns the capability
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A subsidy is a benefit granted by a public authority to a body carrying a project of general or local interest usually in the form of a cash payment or tax reduction. It is a free payment with no counterpart, punctual and partial. Furthermore, according to the Act of 1999, a structure is unable to hold more than 80% of public funding. Finally, it is a discretionary decision; therefore it is precarious since no justification is required. In practice, the beneficiaries of subsidies are legal entities and serve “local public interest” where the subsidies paid by the community must benefit the public of the same community. Subsidies come in two different forms: financial subsidies and donations in kind. Financial subsidies concern all cash subsidies or tax reductions. The fundamental issue concerning subsidies is when the money gets into the bank account. There is a legal obligation only in multi-year agreements since 2002. In this case, the organisation may ask that the money be paid before March 31. Transfers can be done at once or in installments and there is no VAT for grants. Donations in kind concern the provision of goods and services and may also be the case if it is less than the market price. The same rules apply for cash grants. Donations in kind take multiple forms: provision of locals or provision of materials and technical resources. The association should promote and complete the missions of local public services in a binding

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