Online Financial Disclosure as an Accountability Mechanism for NGOs Across the Globe
Paper accepted at Revista Universo Contábil (Brazil) (2016)
17 Pages Posted: 23 Jul 2016 Last revised: 27 Sep 2018
Date Written: June 29, 2016
Abstract
The expansion of the Third Sector in terms of size, scope, and importance has brought on a greater need for accountability and legitimacy. The disclosure of reports on financial and operating performance is a powerful tool for NGOs, allowing for a dialogue with their stakeholders, as well as a resource in and of itself, given the vital part it plays in the acquisition of financial support. Parallel to this, the evolution and ever-expanding use of information technology facilitates the disclosure and diffusion of information to stakeholders around the world. The objective of the present work is to evaluate the level of financial disclosure shown by world´s top 100 NGOs as per the Global Journal´s 2013 Ranking, employing a checklist based on related literature and collecting data from the reports concerning the 2013 year that they make available online. Correspondence analysis showed that the level of financial disclosure is associated with the size of the organization, which suggests that along with a larger size, NGOs show a higher level of finance-based disclosure. Finally, the lack of information made available online by the Top 100 NGOs, along with the absence of financial-accounting standards in this realm hinder analysis of these organizations. Towards these ends, the checklist created in this study stands to assist NGOs that need increased disclosure levels but are limited by financial and human resource considerations.
Keywords: Accountability, Non-Governmental Organization, Disclosure, Stakeholders, Legitimacy
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