The Financial Condition of South African Public Universities: A Framework for Nonprofit Financial Analysis in a Small-N Context

Abstract

A number of methodological challenges are faced by those who would research the financial condition of a small population of nonprofit organisations. In addition, the relevant literature is intensively focussed on large-population studies. This paper examines the entire population of 23 South African nonprofit public universities for the period 2007-2014 in order to demonstrate that such problems are not insurmountable. Furthermore, it is shown that the small-population context provides an opportunity for responding appropriately to weaknesses in accounting rules and practice. Well-documented inaccuracies arising from the use of nonprofit financial databases are also avoided. In addition to demonstrating the feasibility of nonprofit financial analysis in small populations, the research therefore contributes to the literature by being amongst the first to propose a dimensionality for nonprofit financial condition that is developed on the basis of paying close attention to the mitigation of inadequacies in the financial reporting system.