Nonprofit accountability and the National Center for Charitable Statistics

Pollak, Thomas H.; Lampkin, Linda M.

doi:10.1002/pf.3105

Cited by 9 publications

(6 citation statements)

References 2 publications

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“…Organizational size plays a very important role in understanding nonprofit overhead (Pollak & Lampkin, 2001). Small, nonprofessional nonprofits are often run by volunteers who manage operations and put together fundraisers.…”

Section: Overhead As a Function Of Organizational Sizementioning

confidence: 99%

“…The starvation cycle occurs when an organization reduces overhead expenditures (in reality or through creative accounting) to gain a competitive edge in donor markets. Over time, donor expectations become more unrealistic and nonprofits spend even less on overhead, resulting in the erosion of administrative infrastructure and starving productive capacity (Bruno-van Vijfeijken & Schmitz, 2011;Haycock & Scanlon, 1992;Pollak & Lampkin, 2001). Despite the attention, most evidence of the existence and severity of the cycle has been primarily anecdotal (such as Pallotta, 2008) and there is no empirical work dedicated to establishing the existence and mechanics of the phenomenon.…”

Section: Introductionmentioning

confidence: 99%

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Anatomy of the Nonprofit Starvation Cycle

Lecy

Searing

2014

Nonprofit and Voluntary Sector Quarterly

158

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The nonprofit starvation cycle is a debilitating trend of under-investment in organizational infrastructure that is fed by potentially misleading financial reporting and donor expectations of increasingly low overhead expenses. Since its original reporting in 2004, the phenomenon has been referenced several times, but seldom explored empirically. This study uses 25 years of nonprofit data to examine the existence, duration, and mechanics behind the nonprofit starvation cycle. Our results show a definite downward trend in reported overhead costs, reflecting a deep cut in administrative expenses partially offset by an increase in fundraising expenses. The organization’s size is instrumental to its behavior, with a sharp rise in reported overhead occurring when revenues equal $100,000, but diminishing at $550,000. Finally, the brunt of the cuts have fallen on nonexecutive staff wages and professional fees, which heightens the concern of potentially ill effects derived from a fixation on overhead cost reduction.

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Section: Overhead As a Function Of Organizational Sizementioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Anatomy of the Nonprofit Starvation Cycle

Lecy

Searing

2014

Nonprofit and Voluntary Sector Quarterly

158

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“…Excluding newly endowed organizations that provide single‐organization support or solely fundraising functions reduces the number of organizations building meaningful endowment to only 1,855, or 1.4% of that narrower sample. Such organizations are important in the endowment landscape (Pollak & Durnford, ), but complicate the identification of meaningful endowments based on an organization's own expenses and likely inflate the estimates of meaningfully endowed organizations.…”

Section: Data and Methods Overviewmentioning

confidence: 99%

“…Supporting organizations have varying degrees of independence from their related organizations and fulfill a number of roles including fundraising, grantmaking, and managing investments and endowments. A supporting arrangement might exist, for example, to benefit from scale economies in managing funds, to limit liability of the supported organization, or to hold real estate (Pollak & Durnford, ). Supporting organizations may also be formed to avoid more stringent regulatory requirements associated with classification as a private foundation (Internal Revenue Service, ).…”

Section: Related Literature Research Questions and Hypothesesmentioning

confidence: 99%

Starting from scratch: Building of meaningful endowments by public charities

Ely

Katz

Calabrese

2020

Nonprofit Mgmnt & Ldrshp

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Most nonprofits lack a true endowment and endowment wealth is concentrated in a relatively small number of organizations and subsectors. This study supports an operational definition of material endowment, equal to or greater than annual expenses, and investigates how common it is for a nonprofit to establish a meaningful endowment over time. Specifically, we address whether the sector's enthusiasm over the potential of endowment building is reflected in charitable organizations' experiences. Using financial data, we find that building a meaningful permanent endowment is a rare achievement among public charities over a period of two decades. Meaningful endowment creation, achieved by less than 2% of the sample, is more common for organizations with donor attachments, the need for subsidization of mission services, those with more fundraising costs, and those with more donative revenue portfolios.

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“…The advent of electronically submitted T3010 forms will offer evident benefits to researchers and field practitioners. In particular, electronic filing will dramatically improve the accuracy, completeness, timeliness, and overall quality of the data (Polak & Lamkin, 2001). …”

Section: Anserjmentioning

confidence: 99%

Uncovering Research Potential of Administrative Data on Charitable Foundations in Canada

Khovrenkov

Gidluck²

2018

CJNSER

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ASTRACTThis is the first study of its kind to assess the untapped research capacity of administrative data on Canadian foundations. More than twenty years of records collected by the Canada Revenue Agency (CRA) for the entire population of foundations is publicly accessible to researchers. Canadian data offers greater opportunity for nuanced analysis of the charitable foundation sector than information from the comparatively small sample available for U.S. foundations. Despite the richness of Canadian data and the potential it has to inform grantmaking and administrative practices of foundations, the academic community has paid little attention to this wealth of statistical information. This article explores some of the questions that this data can potentially answer. Consultations with foundation representatives help illuminate the directions that the foundation sector would like researchers to pursue with this data. RÉSUMÉCeci est la première étude de son genre à évaluer comment certaines données administratives pourraient contribuer à la recherche sur les fondations caritatives canadiennes. En effet, plus de vingt ans de données accumulées par l'Agence du revenu du Canada pour la population entière des fondations sont maintenant accessibles aux chercheurs. Ces données canadiennes représentent une occasion exceptionnelle pour effectuer une analyse nuancée du secteur des fondations caritatives, occasion qui est meilleure qu'aux États-Unis, où l'échantillon est relativement petit. Malgré la richesse des données canadiennes et leur potentiel d'améliorer l'octroi de bourses et l'administration des fondations canadiennes, la communauté académique a porté peu d'attention jusqu'à présent à cette manne de statistiques. Cet article-ci en revanche explore quelques-unes des questions auxquelles ces données pourraient porter des réponses. En outre, des consultations faites auprès des représentants de certaines fondations aident à signaler les directions que le secteur pourrait prendre grâce à ces données.

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Nonprofit accountability and the National Center for Charitable Statistics

Cited by 9 publications

References 2 publications

Anatomy of the Nonprofit Starvation Cycle

Anatomy of the Nonprofit Starvation Cycle

Starting from scratch: Building of meaningful endowments by public charities

Uncovering Research Potential of Administrative Data on Charitable Foundations in Canada

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