Financial performance trends of United States Hockey Inc: a resource-dependency approach

Abstract

Purpose -The purpose of this paper is to examine the 2009 to 2016 financial performance of the US Hockey Inc., using financial effectiveness indicators and financial efficiency ratios.Design/methodology/approach -With the assistance of financial trend analysis, archival data were used to examine the financial performance (evaluated by net income), financial effectiveness (indicated by total assets and total revenues) and financial efficiency (examined by programme services ratios and return on assets) of US Hockey Inc.Findings -On average, the financial performance of the organization was positive ($30,895 net income per year). Financial effectiveness was steady with increases in assets and revenues. Financial efficiency was poor with 79% of revenues spent on programme services and 1.45% average return on asset.Research limitations/implications -The results can be generalized to similar national non-profit sports federations but not corporate sports entities with dissimilar financial goals.Practical implications -The results revealed that national non-profit sports federations can boost their financial performance by maintaining a double strategically focus on both financial effectiveness and financial efficiency.Originality/value -The study used both financial effectiveness and financial efficiency measures to evaluate the financial performances of a national non-profit sports federationa neglected approach similar studies.

Financial performance of the United Kingdom's national non-profit sport federations: a binary logistic regression approach

“…Past studies also attest to diverse forms of sponsorships from cash, equipment, service, materials, products, etc., geared towards boosting income for continued survival as donations dwindle (Séguin et al , 2005; Doherty and Murray, 2007; Berrett and Slack, 2001; Giannoulakis, 2014). Furthermore, to reduce the dependence on donations and sponsorships, NNSFs are gradually getting better at increasing their ROA by renting, leasing and offering marketable and profitable programming or services (Omondi-Ochieng, 2019; Schmidgall and DeFranco, 2004).…”

“…Implications concerning net income: Previous studies indicate that the combined use of financial effectiveness and efficiency is robustly advantageous and is associated with net income of NNSFs (Omondi-Ochieng, 2019; Sparvero and Kent, 2014). Despite the value of assessing and measuring overall financial performance, the results of the present study indicated the difficulty of simultaneously achieving a balance between financial efficiency and financial effectiveness.…”

“…Financial performance measurements are fundamental to management planning and control activities and accordingly have received considerable attention by both management practitioners and sports theorists (Omondi-Ochieng, 2019; Sparvero and Kent, 2014; Winand et al , 2012). This study aimed to predict the financial performance of NNSFs in England and Wales using financial effectiveness and financial efficiency indicators.…”

“…For instance, Sparvero and Kent (2014) evaluated the financial performance of 84 USA NNSFs from 2002 to 2010 with the assistance of expense ratio, working capital, operating margin, debt ratio, etc. Recently, other researchers also examined various US NNSFs, including USA hockey (Omondi-Ochieng, 2019), USA table tennis (Omondi-Ochieng, 2018a), USA triathlon (Omondi-Ochieng, 2018b) and USA bobsled and skeleton (Omondi-Ochieng, 2018c) federations, as well as US college football programs (Omondi-Ochieng, 2018d), concluding that the combined calculation of financial effectiveness (indicated by total assets and total revenues) and financial efficiency (designated by program service ratio and support service ratio) are key in determining financial performance, the focus of this study.…”

“…These two random examples highlight how NNSFs in England and Wales still rely on donations. The RDT has previously been used in other sports-related studies such as (Hodge and Piccolo, 2005; Vos et al , 2011; Taylor et al , 2018; Omondi-Ochieng, 2019; Wicker et al , 2013a, b; Sharpe, 2006; Wicker and Breur, 2011).…”