Financial Reserves : A Necessary Condition for Not-for-Profit Sustainability?

Booth, Michael S., McGregor-Lowndes, Myles, Ryan, Christine M., & Irvine, Helen (2015) Financial Reserves : A Necessary Condition for Not-for-Profit Sustainability? In Hoque, Zahirul & Parker, Lee (Eds.) Performance Management in Nonprofit Organizations : Global Perspectives. Routledge, Taylor & Francis Group, New York, pp. 109-135.

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Abstract

Should not-for-profit (NFP) organisations hold reserves to hedge uncertainty and protect mission delivery? This chapter outlines the nature and contxt of NFP reserves. many would accept that actors within NFP organisations have a broad accountability to ensure sustinability where an appropriate mission exists, and that sustinability is assisted or ensured through the purposeful accumulation of reserves. This chapter examins current relevant literature on reserves, reviews various approaches to reserves accumulation across jurisdictions and reports what is known about practice. We highlight the tension faced by NFP organisations, balancing mission spending against the need to hedge uncertainty. We investigate the role of reserves, and how an appropriate level is determined to ensure a NFP board's accountability for organisational sustinability. This issue is particularly significant in the period following the global financial crisis, and while practitioner interest is evident, there has been little academic attention paid to the topic of NFP reserves, and 'very few [articles] have even forcused on related topics' (Calabrese, 2011, p. 282).

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ID Code: 79510
Item Type: Book Chapter
Keywords: Not-for-Profit Sustainability, Not-for-Profit reserves, Reserves accumulation
ISBN: 9781138787988
Subjects: Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000)
Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > BUSINESS AND MANAGEMENT (150300)
Divisions: Current > Research Centres > Australian Centre for Philanthropy and Nonprofit Studies
Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Accountancy
Deposited On: 16 Dec 2014 23:21
Last Modified: 17 Dec 2015 15:13

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