Financial and Non-Financial Reporting for Non-Profit Organizations

Abstract

Purpose – The purpose of this study is to evaluate the financial and non-financial reporting of Non-Profit Organisations (NPOs), whose main objectives are to make social contributions, and to propose a framework for financial reporting since there is no framework for financial reporting, and to evaluate their contributions to the Sustainable Development Goals (SDGs) in their non-financial information. Design/methodology/approach- The study was conducted on the financial and non-financial reports of LFIs operating in Turkey. Accordingly, the study first assessed the financial reports of 177 organisations that qualify as LFIs, and proposed a framework for reporting financial information by determining that LFIs do not share their financial information with the public due to the lack of obligations. A qualitative research design was applied to assess the non-financial information of the LFIs and content analysis of the information on SDGs of these organisations on their corporate websites was conducted. All of the LFIs that qualify as LFIs and provide information on sustainability on their corporate websites were included in the scope of the study. Findings – According to the results of the analysis, only 22 of the 177 corporate websites analysed reported information on SDGs in their reports under different names. In these 22 reports, SDG 3 Healthy and Quality Life and SDG 5 Gender Equality (18 reports) are the most contributed goals, while SDG 4 Quality Education and SDG 13 Climate Action (17 reports) are the second most contributed goals. Discussion – When the literature studies are evaluated, there is a need for both financial and non-financial information to be reported in order for LNGOs, in other words, the "third sector" to be effective, transparent and accountable at all levels. In this context, it can be said that there is a need for a framework in which both financial and non-financial reports can be prepared more systematically by non-profit organisations, which are established with the aim of benefiting the society and whose number and the economic and social area they cover are gradually increasing in the world. The paper concludes with some suggestions for further empirical and conceptual research projects designed to analyse the management systems and details of sustainability in LFPs.