The Anchoring of ISOBROs Model for Annual Reports and the Effect of the Administration Percentage

Jeanette Joy Friis

Student thesis: Master thesis

Abstract

Five years ago, the industry association for the danish charity organizations, ISOBRO, compiled a model for their members to use, when they prepared their annual reports. This model should make the annual reports more comparable and transparent for the users of the reports, especially the people who wants to donate money to the organizations. Furthermore, one of the focus points was the financial ratio, administration percentage, which is used to show how much of the received funds the organizations spend on administration. The purpose of this master thesis is to investigate the anchoring of the model among the members of ISOBRO and how this affects the comparability of the administration percentage. The organizations, which are members of ISOBRO has been contacted with a questionnaire about their use of the model and their calculation of the administration percentage. To support the analysis for those organizations which have not responded to the questionnaire, the annual reports of all the members have been checked for the above. The conclusion shows that the model is not anchored amongst the organizations as only 2 % of the smaller organizations uses the model, and about 30 % of the bigger organizations are using it. The anchoring of the administration percentage is higher as 26 % of the smaller organizations and 54 % of the bigger organizations calculates the ratio. This master thesis recommends how to make the model more anchored amongst the members, based on their answers to why they are not using the model and what could be changed to make them want to use it. For example, the knowledge of the model must be greater both amongst the members, but also among their auditors who prepares the annual reports for many of the organizations. It could also be considered compiling a new less complex model for the smaller organizations, due to their lack of resources implementing the model as it is now. But the question is whether it is possible to create comparability when the organizations are diverse in size, purpose, and structure.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
LanguageDanish
Publication date2021
Number of pages77