Rowena Sinclair and Carolyn J. Cordery
This commissioned paper reviews literature outlining reasons for a perceived gap between academics and standard setters as policy makers. The aim of this paper is to emphasise how…
Abstract
Purpose
This commissioned paper reviews literature outlining reasons for a perceived gap between academics and standard setters as policy makers. The aim of this paper is to emphasise how academics and standard setters can collaborate on accounting and audit research and assist standard setters to act in the public interest.
Design/methodology/approach
The approach is primarily a literature and document review of relevant issues, summarising New Zealand’s standard setting arrangements, providing examples of successful policy-changing research, and making recommendations on future research topics.
Findings
Despite the long-held views of a gap between academic researchers and standard setters, increasingly standard setters utilise research and request input from academics in their deliberations. Standard setters can increase the likelihood of relevant research by promoting critical issues for research and connecting their practitioner networks with academics. Academics can bridge the gap by selecting topics of mutual interest and by communicating their findings extensively and well.
Practical implications
Increasing collaboration should lead to better accounting and audit standards.
Originality/value
This paper highlights matters of concern in the New Zealand standard setting environment where there is a strategic objective to undertake research.
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Carolyn Cordery and Rowena Sinclair
The purpose of this paper is to set the scene for this special issue by synthesising the vast array of literature on performance measurement to examine what constitutes…
Abstract
Purpose
The purpose of this paper is to set the scene for this special issue by synthesising the vast array of literature on performance measurement to examine what constitutes performance measurement, and why it is important for the third sector. It also analyses key issues of performance measurement and introduces the papers that comprise this special issue of Qualitative Research in Accounting & Management.
Design/methodology/approach
This paper takes the form of a literature review. The authors draw on extensive research on performance measurement from a diverse range of disciplines to identify and explore key definitions, opportunities and challenges with performance measurement in the third sector.
Findings
Economic/financial efficiency approaches, programme theories, strategic and participatory approaches all present opportunities and challenges when measuring performance in the third sector. The papers in this special issue demonstrate the manner in which different organisations have dealt with these.
Research limitations/implications
This special issue of Qualitative Research in Accounting & Management aims to stimulate qualitative research into performance measurement frameworks within the third sector both inside organisations and to their external stakeholders (supporters, clients and the general public).
Practical implications
Those charged with governance and management in the third sector organisations (TSOs) will seek to use appropriate approaches to measuring and managing performance in order to learn and to discharge accountability. The different aspects of performance measurement will also be of interest to funders, donors, and those who seek accountability from TSOs.
Originality/value
The categorisations of methods and approaches to performance measurement should guide researchers and practitioners alike. A future research programme is also derived.
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The purpose of this study is to compare the use of performance information by board members and executives of a large Australian community service organization in order to…
Abstract
Purpose
The purpose of this study is to compare the use of performance information by board members and executives of a large Australian community service organization in order to ascertain what they focused on and how they worked together in effecting organizational governance.
Design/methodology/approach
Field based case study using stewardship theory.
Findings
While board members and executives worked closely together within a mutually agreed organizational space, there was a clear bifurcation of focus with the board concerned more with the financial performance and the executive more with service performance. Further differentiation of role with respect to financial performance was observed such that the board's attention was directed most to issues that presented the greatest risk to the organization. The study found that board members and executives “cut across” traditionally assigned roles, thus demonstrating a joint mode of organizational governance that was underpinned by organizational policies, processes and structures.
Research limitations/implications
This paper provides rich empirical evidence in relation to matters that have been subject to high levels of theorisation; by answering recent calls from scholars for in-depth research on governance processes; and by identifying the common threads that link research on not-for-profit governance with stewardship theory and the extended concepts of accountability. It contributes to practice by providing a comprehensive explanation of a contemporary governance arrangement. It contributes to the public policy debate since a key issue currently under review in Australia, and New Zealand, to name just two jurisdictions, is the attribution of responsibilities by key decision makers in charities, in particular, the vexed question of management involvement in governance processes.
Originality/value
The paper provides rich empirical data about an issue of ongoing importance to third sector organizations.
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Emma O'Brien and Stuart Tooley
– The purpose of this study is to identify the extent to which not-for-profit (NFP) organisations disclose information on volunteer contributions of services.
Abstract
Purpose
The purpose of this study is to identify the extent to which not-for-profit (NFP) organisations disclose information on volunteer contributions of services.
Design/methodology/approach
The study relies on information disclosed in the web sites of NFP organisations.
Findings
This paper finds that disclosure was more prevalent on NFP web sites compared to digital annual report disclosures. This paper finds that more NFPs provided disclosure on the activities of their volunteers than other items pertaining to volunteers and the quantification and valuation of volunteer contributions were the least likely to be disclosed. Importantly, the findings illustrate an accountability deficiency in the comprehensiveness of disclosure which results in an under-representation of the contribution that volunteers provide to organisational sustainability and impact on mission fulfilment.
Research limitations/implications
The convenience sample size restricts further interrogation to tease out organisational characteristics that may influence current disclosure practices.
Practical implications
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.
Originality/value
This exploratory study examines the current state of practice in the disclosure of volunteer contributions at an organisational level in the Australian context.
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The purpose of this paper is to outline a method developed for analysis of narrative reporting by charities concerning the carrying out of their aims for public benefit (as…
Abstract
Purpose
The purpose of this paper is to outline a method developed for analysis of narrative reporting by charities concerning the carrying out of their aims for public benefit (as required by charity law). It seeks to assess the effectiveness of the method as a means of measuring performance of third sector organisations (TSOs).
Design/methodology/approach
The method presented was used for qualitative reviewing and scoring of 1,400 sets of charity reports and accounts from England and Wales on 22 variables, with most variables involving an assessment of narratives on a five-point quality score. Various methods of standardising the scoring between different reviewers and different types of charities are considered.
Findings
The method was found to be largely effective in discriminating between charities which had a clear focus on the public benefit requirement and those which did not. However, other factors, such as lack of awareness of the requirements and levels of concern regarding charitable status, appear to have had a substantial impact on reporting practice.
Research limitations/implications
The limitations and uncertainties in converting a qualitative assessment of a narrative into a numerical score are discussed.
Practical implications
The method is likely to be of value for other studies of narrative reporting in financial statements, especially in relation to fulfilment by TSOs of the purposes for which they were established.
Originality/value
The paper contributes both to the understanding of narrative reporting by TSOs and to the development of methodological approaches for such analysis.
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Ciaran Connolly and Noel Hyndman
– The purpose of this paper is to explore accountability from the perspective of charity donors.
Abstract
Purpose
The purpose of this paper is to explore accountability from the perspective of charity donors.
Design/methodology/approach
The research utilises semi-structured interviews with a range of donors. In addition, it summarises the main findings from key related research (that uses document content analysis and questionnaire surveys) as a basis for better appreciating donor engagement.
Findings
This research offers evidence that while donors are viewed as the key stakeholder to whom a charity should be accountable, the relevance of the information commonly disclosed in formal charity communications is questionable. This is viewed as significant in terms of small dependent donors, although less critical in the case of non-dependent large donors who have power to demand individualised information. However, although all donors do not particularly engage with these formal communications, they are viewed by them as having significance and their production and publication serves as an important legitimising tool in the sector (enhancing trust and reputation).
Research limitations/implications
This research is based on semi-structured interviews with individual small donors and large institutional donors to large UK charities and therefore any generalising of the conclusions beyond large charities, and beyond the UK, should be undertaken with care. In addition, it focuses solely on the perceptions of donors, and other stakeholder groups are also important in this process.
Originality/value
Despite the widespread acceptance that charities have a duty to discharge accountability to their stakeholders, there is limited knowledge of their information needs and whether the performance information currently being disclosed fulfils them. This study provides a unique insight into the perspective of a key stakeholder group (donors) with respect to accountability.
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Silvia Payer-Langthaler and Martin R.W. Hiebl
– This paper aims to analyze how performance may be defined in the context of a religious organization. The authors do so by studying the case of a Benedictine abbey.
Abstract
Purpose
This paper aims to analyze how performance may be defined in the context of a religious organization. The authors do so by studying the case of a Benedictine abbey.
Design/methodology/approach
Using an etymologically derived understanding of performance, and predominantly based on the Regula Benedicti (the central guideline for Benedictine monks), the authors first conceptually develop an understanding of performance in Benedictine abbeys. The authors then apply this understanding in a single case study.
Findings
The authors found that in order to comply with the Benedictine mission laid out in the Regula Benedicti, Benedictine abbeys need to balance sacred and secular goals. The authors also derived six key actions in order to accomplish these goals. The case study shows that an imbalance in these key actions may cause severe (financial) distress.
Research limitations/implications
The study provides an alternative framing of the term “performance” and further evidence that only a combined pursuit of sacred and secular goals seems useful for religious organizations. Researchers interested in religious organizations might find the conceptual approach and findings useful to analyze performance in such organizations.
Practical implications
Benedictine abbeys and other religious organizations may find the analysis valuable to critically analyze their current strategies and focal activities. Moreover, this paper's results might also be worthwhile for other faith-based or third-sector organizations when seeking an alternative framing of performance.
Originality/value
This paper provides a new framing of “performance” and is the first to analyze what performance might mean in the context of a Benedictine abbey.
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This paper aims to provide insights into how organizational performance in a prior period may influence the nature of control subsequently used by senior not-for-profit (NFP…
Abstract
Purpose
This paper aims to provide insights into how organizational performance in a prior period may influence the nature of control subsequently used by senior not-for-profit (NFP) managers.
Design/methodology/approach
This investigation is based on data collected from semi-structured interviews of CEOs and senior executives in 32 Australian NFPs.
Findings
Although performance has a considerable influence on the subsequent use of control, the findings point to a broad conceptualisation of performance as it is perceived to apply within a NFP context. Moreover, the roles of formal management control systems and informal control are quite distinct, with the latter predominating in responding to prior performance.
Originality/value
Despite recognition in the management accounting literature of the likely influence of organizational performance in previous periods on control, empirical studies investigating organizational performance as an antecedent to the use of control have been surprisingly limited. The current study directly responds to this gap in our knowledge, and also, to prior calls for the need for more management control research into the NFP sector. This contribution is important in view of the considerable economic and social impact of this sector in most Western economies, coupled with the increasing recognition of the importance of both performance and control within this sector.
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Keith Hooper, Rowena Sinclair, Doris Hui and Kelvin Mataira
Charities are becoming recognised as playing an important part in communities by furthering government's social objectives through increasing support to disadvantaged members of…
Abstract
Purpose
Charities are becoming recognised as playing an important part in communities by furthering government's social objectives through increasing support to disadvantaged members of society. As charities multiply in number, it becomes increasingly difficult for fund providers and contributors to determine which charity to support. In New Zealand there is a move towards providing public access to the financial accounts of charities to assist stakeholders in their decision making and to enhance transparency in charities. However, this assumes that these financial accounts are understandable by all stakeholders. This paper aims to identify four problems that limit the way forward for financial reporting by New Zealand charities.
Design/methodology/approach
The first section of the paper comprises a review of the literature on charities' financial accounts with a particular focus on the four problems identified above. The paper then reports the results of eight interviews with charitable organisations, auditors and academics that have expertise in charity financial reporting, with a particular emphasis on the four identified problems.
Findings
There was agreement that unresolved, these four problems could limit the way forward in financial reporting by New Zealand charities. Some recommendations are proposed that suggest a way forward with regard to these problems, so that the users of the financial reports of charities may benefit.
Research limitations/implications
Highlights a need for further research into these problems to identify the feasibility of the proposed recommendations.
Originality/value
The enactment of the Charities Act 2005 in New Zealand and its requirement to include financial accounts on a publicly available register has raised the profile of the financial reports of charities. However, there has been limited research into the financial reporting by New Zealand charities, so this paper is a timely evaluation of four specific problems that could limit the way forward of financial reporting by New Zealand charities.