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Accounting Notes Accounting in Non-Governmental Organisations Notes

Topic 1 Reading – Ngo Management Debate Lewis, 2007 Notes

Updated Topic 1 Reading – Ngo Management Debate Lewis, 2007 Notes

Accounting in Non-Governmental Organisations Notes

Accounting in Non-Governmental Organisations

Approximately 66 pages

AC310: Management Accounting, Financial Management and Organizational Control - Modules 2 (Accounting in Non-Governmental Organisations).

These notes cover the second module of the AC310 Management Accounting course at LSE which covers the following topics: Measuring the performance and effectiveness of NGOs, use of 'business-like' management control and financial management systems, evaluation of programme efficiency and impact, accountability to donors and beneficiaries, role of accounting in ...

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Introduction

  • Increasing role of the third sector in public policy

    • “global associational revolution” (Salamon, 1994)

    • International non-state actors are increasingly contributing to transnational social policy (Deacon et al 1997)

  • NGOs are a subsector of the third sector

    • May serve as a counterweight to the excesses of the state and the market (Hadenius and Uggla, 1996)

    • ‘alternatives’ to the status quo (Mitlin et al. 2005)

  • Potential role of NGOs in working to link poor people with the benefits of globalization (Tembo, 2004)

  • ‘Global civil society’

    • e.g. protests about GM food, policy activism on climate change, opposition to current international trade rules (Anheier et al. 2001)

      • i.e. G8 Gleneagles summit 2005 protests (Glasius et al. 2006)

  • NGOs are important in humanitarian relief in the context of wars and natural disasters (Bennett, 1995)

  • Lewis focuses on the ‘non-governmental development organizations as defined by Fowler (1997)

  • NGDOs ‘legitimised by the existence of poverty’

Literature on NGOs

  • Traditional literature on NGO work focused on descriptive rather than analytical

    • As well as a focus on individual organizational cases

    • Strongly prescriptive or normative tone

    • (Clarke, 1998; Stewart, 1997)

  • Field of NGO management moved forward in 2002

    • Fowler and Edwards (2002) drew together a collection of writings on the topic

  • Rapidly changing management fads and management ‘gurus’ (Micklewait and Wooldridge, 1996)

  • Lewis argues that there is an ‘emerging field of NGO management’

  • Relatively little attention is given to the way NGOs development roles can be managed

NGOs’ critics and supporters

  • Many voices are critical of NGOs

  • “Some people have criticized the shift away from donor support to state institutions towards a more privatized and potentially less accountable…” (Hanlon, 1991; Tvedt, 1998)

  • Tandon (1996) is a long standing critic of the ways in which NGOs play a role in sustaining and extending neocolonial relations in Africa

  • Observations of NGO work no living up to expectations in humanitarian assistance (e.g. Abdel Ati 1993)

  • Neo-conservative US right have seen NGOs as potentially harmful to US foreign policy and business interests

    • E.g. American Enterprise Institute (AEI) – a US Republican supporting think tank criticized NGOs in 2003

  • AEI and others set up an NGO watchdog site – www.ngowatch.org

    • Lists grievances in relation to NGOs

  • Moves by US administration to use private contractors in place of NGOs in Afghanistan and Iraq for reconstruction and relief work

  • “…few NGOs have developed structures that genuinely respond to grassroots demands” (Edwards et al. 2000) – A long-term pro-NGO writer

  • International donors are more shy about NGOs than they were in the 1990s

  • Examples of critical articles:

    • ‘Sins of the secular Missionaries’ (The Economist, January 2000)

      • ‘non-governmental’ is often a misnomer because many NGOs increasingly depend on public funds

      • NGOs can get into bad ways because they are not accountable to anyone

    • ‘Alliances between companies and non-governmental organizations attracts varying degrees of enthusiasm’ (Financial Times, November 2002)

      • Increasing relations between NGOs and the world of business

    • ‘Hearts and minds at any cost’ (The Guardian, July 2004)

      • Boundaries between public and private agencies in Iraq and Afghanistan have been eroded, making it difficult for NGOs to exist independently

      • Blames many of the NGOs for outgrowing their ‘charitable’ origins, leading them to become largely funded by governments

    • ‘The $1.6tn non-profit sector behaves (or misbehaves) more and more like big business” (Newsweek, September 2005)

      • Argues that greater regulation is needed

      • Many NGOs are searching for more independent non-governmental sources of income

        • Iraq conflict was a wake-up call to some NGOs

      • In Iraq, the US government compels US NGOs to display American logos on aid deliveries and discussions with the press must be officially cleared

The diverse organizational universe of development NGOs: brief examples

  • Bangladesh Rural Advancement Committee (BRAC) (Lovell, 1992)

  • 1990s was a heyday for NGOs

    • Interest in NGOs has since become more critical

    • No longer seen as the ‘magic bullet’ for poverty reduction (Hulme and Edwards, 1997)

      • Questions of efficiency, accountability and effectiveness (Fowler, 1997, 2000)

  • Work on NGO management rarely extends beyond the US and Britain in its geographical focus (Lewis, 1999; Hailey 2006)

A conceptual framework for NGO management

  • Context is crucial to analyzing NGO management practices

  • A good conceptual framework is the links between activities, organization and relationships within the context of environment

  • Lewis doubts whether a ‘how to manage an NGO’ book could be written

Concept of Management

  • Study of management is normally in the context of commercial businesses

  • Management tends to focus on Western ideas and models

    • But...

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