Q.What is legacy ?

A legacy is money or property received by a not-for-profit organisation under the will of a deceased person; it is a capital receipt normally added to the Capital Fund.

In the accounts of a not-for-profit organisation (club, society, trust), a legacy is the amount donated to the organisation according to the will (testament) of a person who has died. It appears on the receipts side of the Receipts and Payments Account.

Its treatment:

• A legacy is generally a non-recurring, capital receipt (it arises once, from a will, not from regular operations). Hence it is capitalised — added to the Capital Fund in the Balance Sheet, not shown as income.
• Only where a legacy is small and recurring in nature may it be treated as revenue income and credited to the Income and Expenditure Account. …