This will help reinforce some of the ideas listed in Chapter 8 and
provide some insight into the challenges associated with Not-for-Profit
organizations.
Read through Chapter 8 and complete question 3 that begins on page
401 of our text. Try to pick an organization that’s relevant to you and
your future goals.
Question 3:
Not-for-profit organizations lack the authority to levy taxes for support of their programs and must
finance their operations from a variety of revenue streams. Some are commercial and operate largely
from the sale of goods or services (including revenue from service contracts with governments), others
are charitable and operate with various sorts of donated support, and others combine revenue from a
variety of sources. Select a not-for-profit organization in your area and analyze its revenue resources.
The entity should be chosen because you are interested in the service provided by that entity and
because the entity will cooperate with your review and assessment.
a. Analyze the revenues received by the entity (taxes, charges, donations, etc.0rovide disaggregated
data), examine trends and shifts, determine whether sources are sensitive to general economic
conditions, explore limits and con- trols that the entity may face, and review the processes by which
revenue decisions are made. You should pay particular attention to the division of revenues from use of
endowment, charges for services, and annual donations. To what extent does the entity employ the
principle that those using services must pay (an analog to the benefits-received principle in taxation)? In
light of the purpose of the entity, to what extent is payment for service appropriate?
b.
Examine how the entity manages fund development, that is, money raising. Is it selfadministered, or does another entity administer the system, possibly by contract? Are protective
controls properly in place? What are the costs associated with this activity?
c. On the basis of your investigation, what do you conclude about revenues
available to the entity? Do you have recommendations for reform and restructuring? Be specific. Link
your conclusions to the information developed in your analysis.
question 4:
For this assignment, please pick an article of your choosing relating to
either the government or non-profit finance world and provide the
reference as part of your review. As you complete this review, don’t
forget my suggested Summarize, Analyze and Assess format. Two
pages minimum please. No late submissions can be accepted.

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