The determinants of transparency in nonprofit organizations: An exploratory study

This study provides descriptive evidence regarding the nature of voluntary financial disclosure in the nonprofit sector. The ability of outside stakeholders to access organization-specific information concerning the operations of a nonprofit organization is important for donation decisions. Members of the U. S. Senate, donors, and other stakeholders have expressed concern about the lack of transparency in the nonprofit sector. This study identifies factors associated with greater transparency in the nonprofit sector. Based on our study, a nonprofit is more likely to allow us access to its audited financial statements if it is a larger organization, has more debt, a larger contribution ratio, an NTEE classification of Higher Education, or a higher compensation expense ratio. (C) 2009 Elsevier Ltd. All rights reserved.