Accountability through Reporting: The Case of Foundations in Malaysia

Abstract

A non-profit entity faces multiple accountabilities as the main stakeholders are wider. Reporting is arguably one of the mechanisms to show the discharge of accountability. This paper identifies the reason for the reporting practices of foundations – non-profit entities. Using the ‘accountability reporting’ framework (Ebrahim, 2003a) the reporting practices were viewed from the legal, bureaucratic, and social perspectives. Four foundations with different legal structures were examined through semi-structured interviews, supported by document reviews. The study found that the reporting practices were guided by the perceived importance of the main stakeholder. In the absence of dedicated accounting standards, the reporting practices follow who the foundations perceive they should be accountable to the most. Different foundation undertook reporting practices differently. The study indicates the importance of being sensitised towards the organisational and legal structure of foundations. As NPO – including foundation is established to assist beneficiaries, this main mission should always be privileged despite different organisational/legal structures. Future research may be undertaken to itemise the reporting difference among these foundations in order to identify the trend and relationship of accountability and reporting choice. Keywords: accountability, foundation, non-profit organization, reporting, Malaysia