Restricted Funding: Restricting Development?

  • Brendan ClerkinEmail author
  • Martin Quinn
Original Paper


This paper examines, from a management accounting perspective, the efficacy of the dominant ‘restricted’ funding structure in the international development NGO sector in terms of overall sector effectiveness, and whether it is the most appropriate means of funding NGOs. The objective is to encourage theoretical debate around the tensions highlighted between external accountability for funding and overall value-for-money delivered by individual development NGOs and the wider international development sector. From unique access to three internationally recognised major NGOs, our case studies reveal management accounting as broadly homogenous, with some nuanced distinctions both within and between the cases; but the scope of management accounting emerges as relatively limited. This is despite the NGOs utilising complex accounting software, employing qualified accounting staff, and having a large annual income. Using the broad principles of systems theory to frame our approach, this paper suggests that due to the ‘restricted’ nature of funding awarded to NGOs by institutional donors, accounting is dominated by external accountability reporting to the detriment of management accounting. These relatively novel data on management accounting practices at international development NGOs help illustrate how, potentially, NGOs are missing opportunities to utilise, or even improve, value-for-money in terms of how various program themes, geographic areas or time periods are delivering better or worse discernible impact for the money spent.


Non-governmental organisation International development Charity Accounting Accountability Funding Systems theory 


Compliance with Ethical Standards

Conflict of interest

The authors declare that they have no conflict of interest.


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Copyright information

© International Society for Third-Sector Research and The Johns Hopkins University 2018

Authors and Affiliations

  1. 1.Business SchoolDublin City UniversityDublin 9Ireland
  2. 2.Queen’s University Management SchoolBelfastUK

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