Financial Reporting Lags in the Non-profit Sector: An Empirical Analysis

Reheul, Anne-Mie; Caneghem, Tom Van; Verbruggen, Sandra

doi:10.1007/s11266-012-9344-3

Cited by 37 publications

(18 citation statements)

References 58 publications

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“…12 In order to test H2 (NPO size), sub-samples are created based on the natural logarithm of total assets (in thousands of EUR) (to be denoted by SIZE) (see e.g., Verbruggen et al Verbruggen et al 2011;Jegers 2013). In order to test H3 (reliance upon donations and/or grants), sub-samples are created based on the ratio of 'membership contributions, other contributions, bequests and grants' over total assets (to be denoted by DONSUBS) (see e.g., Calabrese 2011; Reheul et al 2014). In order to test H4, sub-samples are created based on the ratio of financial debt over total assets (to be denoted by FINLEV) (see e.g., Jegers 2013).…”

Section: Methodsmentioning

confidence: 99%

“…As discussed in Reheul et al (2014), Belgian NPOs have been faced with quite extensive reforms of accounting and reporting requirements in the recent past. The original Belgian non-profit legislation of 1921 introduced hardly any accounting and reporting rules.…”

Section: Learning Curve Effectmentioning

confidence: 99%

“…Several prior studies report findings that are in line with these arguments. In the Belgian context, Verbruggen et al Reheul et al (2014) indicate that larger NPOs report significantly more quickly than small(er) NPOs. Consistent with the argument that larger organizations are characterized by more resources, Mook et al (2007) observe that larger NPOs are significantly more likely to keep records on volunteer value (and quantify them).…”

Section: Size Of the Npomentioning

confidence: 99%

“…In the literature, it is quite common to classify NPOs into 'donative' versus 'commercial' organizations, 8 depending upon their main source of financing (see e.g., Hansmann 1987; Calabrese 2011; Balsam and Harris 2014; Reheul et al 2014). Based on resource dependence theory, the aforementioned distinction is highly relevant, because an organization's need for resources is argued to determine its decisions and actions (see e.g., Pfeffer and Salancik 1978;Vermeer et al 2009).…”

Section: Resource Dependencementioning

confidence: 99%

“…In line with these arguments, Verbruggen et al (2011) document a positive relationship between reliance on government funding and the degree of compliance with financial reporting standards. In addition, Reheul et al (2014) document that NPOs that rely more heavily on donations and/or grants are significantly less likely to file their FS late. 9 Nevertheless, the fact that FS serve a more prominent monitoring role for donative NPOs also gives rise to certain financial reporting incentives.…”

Section: Resource Dependencementioning

confidence: 99%

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NPO Financial Statement Quality: An Empirical Analysis Based on Benford’s Law

Caneghem

2015

Voluntas

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In order to assess the accuracy of the figures reported in NPOs' financial statements, I perform a digital analysis on Belgian non-profit organizations' financial statements for accounting years 2007 up to 2012. Specifically, I compare observed frequencies for digits in the second-from-the-left position with expected frequencies based on Benford's Law. Results based on the full sample indicate that observed frequencies strongly conform to Benford's Law (and thus suggest a high degree of accuracy of the figures reported in NPOs' financial statements). Nevertheless, I note statistically significant deviations from Benford's Law (both for the entire distribution and at the individual digit level). The largest deviation is noted for zeroes in the second position (i.e., a significantly positive deviation), which can be explained based on humans' reliance upon so-called cognitive reference points. Considering different sub-samples, I note that observed deviations from Benford's Law are largest for the smallest non-profits and those non-profits that rely most heavily on grants and/or donations.Résumé Afin d'évaluer l'exactitude des chiffres indiqués dans les états financiers des organisations à but non lucratif, j'effectue une analyse numérique des états financiers des OBNL belges pour les exercices 2007 à 2012. Plus précisément, je compare les fréquences observées des chiffres en deuxième position en partant de la gauche avec les fréquences attendues sur la base de la loi de Benford. Les résultats établis sur l'ensemble de l'échantillon indiquent que les fréquences observées sont fortement conformes à la loi de Benford (et semblent donc indiquer un degré élevé d'exactitude des chiffres déclarés dans les états financiers des OBNL). Néanmoins, je constate des écarts significatifs du point de vue statistique par rapport à la loi de Benford (tant pour toute la répartition qu'au niveau des chiffres individuels). Le & Tom Van Caneghem tom.vancaneghem@kuleuven.be 1 KU Leuven, plus grand écart se reconnaît par des zéros en deuxième position (soit un écart positif significatif), qui peut s'expliquer par le recours des humains à ce que l'on appelle les repères cognitifs. Compte tenu des sous-échantillons différents, je remarque que les écarts observés par rapport à la loi de Benford sont plus grands pour les petites organisations à but non lucratif et pour celles qui dépendent le plus des subventions ou des dons. Zusammenfassung Mittels einer digitalen Analyse der Jahresabschlüsse belgischer gemeinnütziger Organisationen für die Geschäftsjahre 2007 bis 2012 prüfe ich die Richtigkeit der in den Jahresabschlüssen dieser Organisationen ausgewiesenen Zahlen. Ich vergleiche insbesondere die beobachtete Häufigkeit der Ziffern an der zweiten Stelle von links, wobei für die erwartete Häufigkeit das Benfordsche Gesetz angewandt wird. Die Ergebnisse aus der gesamten Stichprobe zeigen, dass die beobachtete Häufigkeit dem Benfordschen Gesetz starkentspricht (und somit auf ein hohes Maß an Richtigkeit der in den Jahresabschlüssen der gemeinn...

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Section: Methodsmentioning

confidence: 99%

Section: Learning Curve Effectmentioning

confidence: 99%

Section: Size Of the Npomentioning

confidence: 99%

Section: Resource Dependencementioning

confidence: 99%

Section: Resource Dependencementioning

confidence: 99%

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NPO Financial Statement Quality: An Empirical Analysis Based on Benford’s Law

Caneghem

2015

Voluntas

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Whom you connect with matters for transparency: Board networks, political embeddedness, and information disclosure by Chinese foundations

Zhou

Zhu

Zheng

2021

Nonprofit Mgmnt & Ldrshp

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Although the requirements for nonprofit transparency are increasing worldwide, the implementation of disclosure practices remains questioned. Drawing on social network theory, this study proposed that the size of and position in interlocking board networks can increase the propensity of foundations to promote transparency.It also hypothesized that political embeddedness, measured by the presence of powerful government officials,

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To comply, or not to comply: the question is why

Reheul,

Van Caneghem

2024

Eur J Law Econ

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Financial Reporting Lags in the Non-profit Sector: An Empirical Analysis

Cited by 37 publications

References 58 publications

NPO Financial Statement Quality: An Empirical Analysis Based on Benford’s Law

NPO Financial Statement Quality: An Empirical Analysis Based on Benford’s Law

Whom you connect with matters for transparency: Board networks, political embeddedness, and information disclosure by Chinese foundations

To comply, or not to comply: the question is why

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