Predicting Organizational Mortality: How Financial Management Matters

Managing financial resources is one of the most important responsibilities of every organization; however, the literature still cannot provide an answer to an important question: how does financial health matter to organizational mortality, especially for nonprofit organizations? To advance our know...

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Bibliographic Details
Published in:	Administration & society 2022-05, Vol.54 (5), p.828-856
Main Authors:	Park, Young Joo, Shon, Jongmin, Lu, Jiahuan
Format:	Article
Language:	eng
Subjects:	Dissolution Financial management Liquidity Mortality Nonprofit organizations Profitability Solvency
Online Access:	Get full text
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Summary:	Managing financial resources is one of the most important responsibilities of every organization; however, the literature still cannot provide an answer to an important question: how does financial health matter to organizational mortality, especially for nonprofit organizations? To advance our knowledge in this regard, this study empirically examines the effects of solvency, profitability, margin, and liquidity on nonprofit dissolution. Higher solvency, profitability, and margin have significant effects on reducing the likelihood of nonprofit dissolution, but liquidity does not function as a significant predictor.
ISSN:	0095-3997 1552-3039