Understandability and Transparency of the Financial Statements of ...

inter-university course approval, which has three requirements (available
http:www.nzvcc.ac.nz/aboutus/sc/cuap) that could be appropriately adapted for
charities:
Acceptability of the programme: that the proposed course of study is acceptable
to the relevant academic, professional and other communities. In relation to
charities this would be liaising with appropriate experts in the charitable
purpose area including existing charities;
Resources: that the university has the capacity to deliver the course with regards
to appropriate staffing, physical resources and support services. In relation to
charities this would mean ensuring sufficient staff, both paid and unpaid, are
available to cover the delivery of the charitable purpose and the administration
of the charity. Also there is a need for appropriate and sufficient funding sources
with expert assistance available as required, including accountants and auditors;
and
Evaluation and review: that the university has adequate and effective evaluation
and monitoring procedures for ensuring the programme meets its objectives and
should continue to be offered. In relation to charities this would ensure that an
effective governance structure was in place as well as appropriate levels of:
professional (Chapter Six); fiduciary (Chapter Seven); and performance
(Chapter Eight) accountability with an evaluation process for all performance
measurements, particularly outcome reporting.
New Zealand has a large number of charities pursuing an ever-dwindling charity dollar,
and with limited numbers of people prepared to work in them. As the sector matures
into the new era of increased transparency through the Charities Register, there will
need to be a natural attrition of charities that are not effective. Otherwise, with no
current limit on taxation rebates, the New Zealand tax payers are effectively funding
charities that may not be meeting beneficiaries‟ needs and may in fact be doing more
harm than good.
8.5 Summary
In their increasingly difficult pursuit of ever dwindling donations, charities will need to
be proactive in convincing potential donors and funders that their charity is needful and
deserving of financial support. One way to do this is for charities to use performance
accountability tools to: justify their spending, i.e. output reporting; demonstrate the
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