Meaning of Non-Profit

Use of the term "non-profit" does not mean that an organisation cannot make a profit. What this does mean is that the organisation's members are not allowed by law to run the organisation for their own profit i.e. to pay profit dividends out of the association's funds into their own pockets.

Instead any profit that is made must be reinvested back into the organisation to improve facilities, programs and services for the general membership..

It is allowed that a member can perform work for the organisation and be paid a salary, wage or honorarium. However, it is very often the case that the constitution of the organisation will not permit a member of the management committee to also be a paid employee at the same time as this would be a conflict of interest.

 

 

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