Volunteer visibility : what and how Australian not-for-profit organisations report volunteer contributions

The enhanced social profile of not-for-profit organisations (NFPs) and the role of volunteers have resulted in calls for NFPs to be more accountable and to disclose information relating to such contributions. In this study we identify, locate and categorise the extent of disclosures made in relation to volunteer contributions. We find that disclosure was more prevalent on NFP websites compared to digital annual report disclosures. We find that more NFPs provided disclosure on the activities of their volunteers than other items pertaining to volunteers. The valuation of volunteer contributions was the least likely to be disclosed. The findings contribute to international debate over the inclusion of volunteer contributions in the assessment of a NFP’s accountability over its resources and ultimately the enhancement of its sustainability.

Vatkst, profit og strategisk orienteering i gazellevirksomheder (Growth, profitability and strategic orientation among gazelle firms)

Growth and profitability are often essential parts of the overall managerial goals of firms. High growth can be seen as an indicator of success and as a mean for achieving competitive advantage and higher profitability. But high growth can also lead to a number of managerial and organisational challenges, that may affect the profitability negatively. The aim of this article is to analyse the relationship between growth and profitability for Danish gazelle firms, and furthermore to investigate how the strategic orientation of the firm affects this relationship. Our study finds a clear positive relationship between growth and profitability among gazelle firms pursuing a broad market strategy. A managerial implication of this is that the growth strategy should be clearly integrated with the general strategic orientation of the firm.

Strategic issues for the Not-for-profit sector

Bringing together some of Australia’s leading and emerging researchers studying different aspects of the not-for-profit (NFP) sector, Strategic Issues in the Not-for-Profit Sector draws on original Australian and comparative research to provide a spirited exploration of strategic issues facing NFP organisations. A diverse, vital and ever-growing sector in Australia, the NFP sector provides the organisational framework through which many of the most disadvantaged in the community receive access to services and support. However, pressures such as a changing composition, an erosion of financial sustainability, the need to professionalise, and demographic trends affecting patterns of volunteering have put pressure on the NFP sector to innovate and grow in new directions. Strategic Issues in the Not-for-Profit Sector considers the local and global drivers of change, as well as the industry, policy and community imperatives impacting upon NFP sustainability, providing a unique insight into not only the strategic issues, but also strategic responses emerging within the sector.

From go to woe : how a not-for-profit managed the change to accrual accounting

Purpose – The aim of this paper is to examine the process of change in an Australian not-for-profit organization, from a cash-based to an accrual-based accounting system. Its particular focus is the relationship between the image portrayed by accrual accounting adoption and the technical realities of the new system. Design/methodology/approach – Data were gathered from interviews, documents and meetings, and were contextualized and interpreted using institutional theory. Findings – The decision to change to accrual accounting was made at the top of the organizational hierarchy in response to institutional pressure to present a corporate image. The implementation of the new system was poorly conceived, inadequately resourced, and hampered by an authoritarian structure that effectively ignored the technical incompetence and training needs of many accounting staff. This resulted in an accounting system half way between cash and accrual, and very different from the system as it had been promoted. The process caused conflict at all levels of the organizational hierarchy. Research limitations/implications – Accounting in not-for-profit organizations is an under-researched area offering potential for fruitful research in a changing institutional landscape. This institutional approach, while offering just one interpretation of the qualitative data gathered in this project, provides valuable insights about the process of change. Practical implications – Not-for-profit organizations play a vital economic and social role, and need carefully to assess their responses to ongoing institutional pressures. In implementing change, they face the challenge of balancing the promotion of an institutionally acceptable image and the need for technical efficiencies. Originality/value – The examination of change in an organization provides a rich context for the exploration of the dynamic, problematic process by which a new accounting practice is embedded and institutionalized. Keywords Institutional theory, Not-for-profit organizations, Accrual accounting, Change process, Qualitative research, Change management, Decision making, Training needs, Australia Paper type Research paper

Big, bigger, best? The impact of reforms on the not-for-profit sector in Queensland

Organisations within the not-for-profit sector provide services to individuals and groups that government and for-profit organisations cannot or will not consider. The not-for-profit sector has come to be a vibrant and rich agglomeration of services and programs that operate under a myriad of philosophical stances, service orientation, client groupings and operational capacities. In Australia these organisations and services are providing social support and service assistance to many people in the community; often targeting their assistance to the most difficult of clients. Initially, in undertaking this role, the not-for-profit sector received limited sponsorship from government. Over time governments assumed greater responsibility in the form of service grants to particular groups: ‘the worthy poor’. More recently, they have entered into contractual service agreements with the not-for-profit sector, which specify the nature of the outcomes to be achieved and, to a degree, the way in which the services will be provided. A consequence of this growing shift to a more marketised model of service contracting, often offered-up under the label of enhanced collaborative practice, has been increased competitiveness between agencies that had previously worked well together (Keast and Brown, 2006). Another trend emerging from the market approach is the entrance of for-profit providers. These larger organisations have higher levels of organisational capacity with considerable organisational slack to allow them to adopt new service roles. Shaped almost as ‘shadow governments’ they appear to be a strong preference for governments looking for greater accountability of outcomes and an easier way to control the interaction with the conventional not-for-profit sector. The question is will governments’ apparent preference for larger organisational arrangements lead to the demise of the vibrancy of the not-for-profit sector and impact on service provision to those people who fall outside of the remit of the new service providers? To address this issue, this paper uses information gleaned from a state-wide survey of not-for-profit organisations in Queensland, Australia which included organisational size, operational scope, funding arrangements and governance/management approaches. Supplementing this information is qualitative data derived from 17 focus groups and 120 interviews conducted over ten years of study of this sector. The findings contribute to greater understanding of the practice and theory of the future provision of social services.

Not for profit income tax exemption : is there a hole in the bucket, dear Henry?

Australia’s Future Tax System Review, headed by the then head of the Australian Treasury, and the Productivity Commission’s Research Report on the not for profit sector, both examined the state of tax concessions to Australia’s not for profit sector in the light of the High Court’s decision in Commissioner of Taxation v Word Investments Ltd. Despite being unable to quantify with any certainty the pre- or post-Word Investments cost of the tax concessions, both Reports indicated their support for continuation of the income tax exemption. However, the government acted in the 2011 Budget to target the not for profit income tax concessions more precisely, mainly on competitive neutrality grounds. This article examines the income tax exemption by applying the five taxation design principles, proposed in the Australia’s Future Tax System Review, for assessing tax expenditure. The conclusion is that the exemptions can be justified and, further, that a rationale for the exemption can be consistent with the reasoning in the Word Investments case.

Corporate profit and impression management in developing markets

In this study, we examine how organisations in Fiji communicate or legitimise their profit. We base the need for understanding this phenomenon on the following premise. Organisations are part of a wider society, and in competition for scarce resources. Organisations obtain the rights to consume resources upon conception, but must continually legitimise their rights of existence and the need to access the resources. Legitimacy is the ability to continue to justify one’s authority to exist in a society. Organisations rights to resources are contractual, and have a moral obligation to act in a responsible manner and justify their outcomes, actions, and activities to external stakeholders. Such justifications would be an attempt at legitimizing their existence by some form of impression management. Impression management refers to the process by which individuals attempt to influence the impression of others (Melo et al. 2009). In corporate reporting, impression management occurs when management selects, display, and presents that information in a manner that distorts readers’ perceptions of corporate achievements (Neu 1991; Patten 2002), and is managed best through disclosures (O’Donovan 2002). In developing economies, there is significant Government protection that creates near-monopoly sectors and industries. The rendered protection permits organisations to provide essential services to the community at reasonable costs. Organisations in these sectors and industries have an ominous need to legitimise their position and actions. The bond between the organisations and the society is much stronger, making organisations devote more effort in communicating their activities. Protection permits organisations to make reasonable profits to sustain their operations. Society may not accept abnormal profits from operational efficiencies. Profit is fundamental to the society’s perception of an organisation, amplifying the need for the firm to justify a level of profit. Abnormal profit for organisations construes bad news, and organisations would make relevant disclosures to manage stakeholder impressions on profit (Patten 2002). Organisations can manage impressions by disclosing information in a particular way. That is, organisations would want to put the impression that the abnormal profit is justified and the society will obtain its benefits in future. Such form of impression management requires unambiguous disclosure of information. The readability of corporate disclosures is an important indicator of organisational abnormal profit-related legitimacy efforts in developing economies.

Profit and organisational legitimacy in an emerging market

While there is common acknowledgement that the main aim of organisations is to maximise shareholder wealth, firms also have the obligation to manage the needs of a broader group of stakeholders as these firms are a product of social creation. In this study, we test the notion that the concept, profit, is fundamental to society’s perception of the firm in an emerging market, and the need for a firm to legitimise a level of profit. We evaluate the relationship between the readability of various components of corporate annual reports and the level of profit, and we also take into account the nature of disclosure (mandatory and non-mandatory), the size of the firm and the nature of setup (public enterprises and publicly listed companies). Our findings suggest that, as with developed markets, in emerging markets profit is indeed an important determinant of the nature of operations of a firm, and that firms consider readability of their disclosures in attempting to legitimise a level of profit.

Not-for-profit ratios for financial resilience and internal accountability : a study of Australian international aid organisations

Not-for-profit (NFP) financial ratio research has focused primarily on organisational efficiency measurements for external stakeholders. Ratios that also capture information about stability, capacity (liquidity), gearing and sustainability, enable an assessment of financial resilience. They are thus valuable tools that can provide a framework of internal accountability between boards and management. The establishment of an Australian NFP regulator highlights the importance of NFP sustainability, and affirms the timeliness of this paper. We propose a suite of key financial ratios for use by NFP boards and management, and demonstrate its practical usefulness by applying the ratios to financial data from the 2009 reports of ACFID (Australian Council for International Development)-affiliated international aid organisations.