Understandability and Transparency of the Financial Statements of ...

Inside Stakeholders
(Providers of resources)
Board members
Members
Employees
Professional staff
Paid workers
Volunteers
Purchasers/users of services
Creditors
Suppliers of goods and services
Donors
Private grant makers
Government funders
Outside Stakeholders
(Parties performing a review or oversight
function)
Government regulators
(accountability agents for general
public)
Media (accountability „watchdog‟
for general public)
Professional bodies
Labour unions
Employer groups
Analysts and advisors
Special interest groups/minorities
Charity „watchdog‟ organizations
Community/general public
Table 5-2 Typology of charitable stakeholders (Flack & Ryan, 2004)
O‟Dwyer & Unerman‟s (2008) study distinguishes accountability further by revealing
that while charity managers favoured the development of holistic accountability
mechanisms that exhibit accountability to a wide range of stakeholders, an hierarchical
conception of accountability that privileges a narrow range of (potentially) powerful
stakeholders has begun to dominate accountability practice. This was later supported by
Connolly, Hyndman & McMahon (2009), in an extensive study for the England and
Wales Charity Commission and the Office of the Scottish Charity Regulator. They
identified funders as the key or primary stakeholders for all charities regardless of their
size, jurisdiction and nature of activities.
However, not all funders are of equal size or importance and other researchers have
suggested that the form and extent of the accountability may vary depending on the type
of donor and charity (Hyndman & McDonnell, 2009). Cordery (2008) aimed to meet
the challenge posed by Ebrahim (2003) by undertaking an integrated study of how
particular not-for-profit organisations dealt with multiple and sometimes competing
accountability demands from their stakeholders. She found that stakeholders expected
Primary Health Organisations to prioritise either community or their funding and
service providers, which gave rise to possible conflicting demands that led to
suggestions for mechanisms to balance multiple stakeholders (Cordery, 2008).
The myriad of definitions of accountability are due in no small part to the multiple
accountabilities these various stakeholders demand (Hyndman & McDonnell, 2009).
This could lead to an over-provision, or under-provision of information if each user
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