The effects of information from NGOs' financial statements on charitable contributions: evidence from Croatia

The purpose of this study is to identify data from the financial reportsof NGOs that influence donors’ willingness to donate. Using logistic regression,the authors attempt to identify the accounting measures associatedwith donations among the NGOs in our sample. The study included a sampleof 2,981 NGOs in Croatia that use a double-entry accounting system. Theresults show that several accounting variables have an impact on donations,including organizational size, volunteer staff, revenue concentration,government grants, business-like income, debt ratio and adequacy of equity.The study has some limitations. First, the sample covered mainly largeCroatian NGOs. Second, by design, the focus was on a broad sample whichincludes different types of organizations, so there is the possibility that theeffects of organizational and financial characteristics on donations are notequal across the sample of different types of organizations. This study helpsto fill the gap in the literature on this topic by examining the relationshipbetween information from NGOs financial reports and giving behaviour. This study also presents new empirical findings from a large sample studyfrom Croatia with a different institutional background. Research results providenew insights into how financial disclosure can meet the needs of donors. Ovaj članak istražuje reakcije ulagača na objavu tromjesečne dobiti za kompanijesa Zagrebačke burze. Empirijsko istraživanje temeljeno na studiji događajai 409 opservacija potvrđuje da investitori reagiraju na objavu tromjesečne dobiti,dok Friedmanov test ukazuje da su reakcije najčešće na objave dobiti iz drugogtromjesečja (Q2). Pojava abnormalnih standardiziranih povrata na dan objave sugerirada hipoteza efikasnih tržišta u polujakom obliku ne vrijedi za hrvatsko tržištekapitala. Štoviše, postoje dokazi o postupnoj prilagodbi cijena dionica nakondana objave dobiti. Longitudinalna analiza za razdoblje 2010-2022. pokazala jeda su reakcije ulagača stabilne te da nema trenda rasta ili pada standardiziranihabnormalnih povrata. Ocijenjeni regresijski model otkrio je da nekoliko karakteristikakompanije utječe na informacijski sadržaj tromjesečne dobiti. Varijablaiznenađenja dobiti pozitivno utječe na standardizirane abnormalne povrate, dokvarijable veličina kompanije i objava gubitka negativno utječu na standardiziraneabnormalne povrate. Rezultati istraživanja potvrđuju regulatorima tržišta kapitalapraktične koristi od tromjesečnog financijskog izvještavanja,