Charitable organizations are often evaluated by donors and regulators based on various efficiency ratios, including the program ratio. We explore whether charities conform to donor pressure to maintain or improve program ratios when allocating resources. We use a sample of 5,626 charities...

This study surveys 200 nonprofit executives to investigate the pressure they experience to manage so-called efficiency ratios. Specifically, we investigate whether managers' perceptions of such pressure depends on the type of contributors and on manager characteristics. We measure pressure in...

We survey 200 nonprofit executives to investigate the pressure they experience to manage so-called efficiency ratios, and their reactions to that pressure. Specifically, we investigate whether managers' perceptions of donor pressure are influenced by 1) the degree to which they rely on...

We study how charities adjust spending when revenues change. Understanding the decision to spend or save revenues provides insights into management behavior and resource allocations. Our results indicate that, on average, the marginal change in overall spending is substantially less than the...

This paper identifies a helpful red flag stakeholders can use to detect whether a nonprofit has potentially managed its financial information. This red flag is reporting an identical program ratio – that is, the NPO reports the exact same ratio in multiple years – while reporting a large...

This chapter focuses on research that examines whether, why, and how nonprofits supply financial reports that have been intentionally manipulated. Research shows that, among other financial measures, nonprofits intentionally manipulate efficiency ratios, earnings, and revenues to appease...

Ethics has been identified as an important factor that can affect auditors' professional skepticism For example, prior research finds that auditors who are more concerned with professional ethics exhibit greater professional skepticism. Further, the literature suggests that professional...

Auditors and clients are often required to resolve difficult, complex accounting issues in which they have different views. Despite its importance we have little knowledge of the effect of contextual factors on auditors' negotiation behaviors. This experimental study involving 63 experienced...

Auditor-client negotiations are a common and critical part of the financial reporting process, yet we know little about contextual factors that influence negotiation judgments from the manager's perspective. Managers have incentives to act aggressively since outcomes often materially impact...

Advanced audit data analytics tools allow auditors to analyze the entire population of accessible client transactions. Though this approach has measurable benefits for audit efficiency and effectiveness, auditors caution that it does not incrementally increase the level of assurance expressed...