There has been revelations recently in relation to salary top-ups at charities in Ireland. With donations falling and services being cut due to funding constraints, executive salaries remain under the microscope. This practice has attracted criticism and is affecting the credibility of many charitable organisations. Charities specifically identified as using donations or other sources of funding to improve salaries for executives will undoubtedly suffer most but many fared poorly in the pay stakes are likely to experience a negative effect too on the basis of guilt by association. Charitable organizations are a kind of business that fits within the non-profit organization category. In general, this type of entity is sometimes referred to as a charity or foundation, which can be run publicly or privately. Some charities may be centred around religious, educational or other public interest activities that are philanthropic in nature. Depending upon the location of the charity, the legal definition of what constitutes a charitable organization may vary according to its country of origin.
Therefore, the tax implications for a charity will also depend upon the region or country in which the charitable organization operates Registration and filing requirements for entities that engage in charitable activities and solicit contributions are also determined by its originating state or region. Charitable organizations must comply with government tax relief guidelines, as specified by the Revenue Service Department. For a charitable organization to qualify as tax exempt, it must refrain from certain activities, such as political campaign and earnings may not benefit any individual. Some charitable organizations operate as private foundations that obtain their principal funding through a corporation, family, individual or other single financial source that does not solicit public funding.
Private foundations usually use endowment funds to provide grants to outside or affiliated organizations that support the foundation objectives. Public, operating foundations or charities usually receive grants from the government, private foundations and individuals. Although some public charities may engage in grant making activities, the majority of them are concerned with tax-exempt activities. Kinds of charitable organizations that are considered organized for public benefit can include those which offer relief for the poor, distressed or underserved, and those with religious, educational or scientific affiliations. Some charitable organizations are engaged in the creation and management of monuments, public buildings or works. Many charities work to enhance society by offering social services, lessen government burden and combat community deterioration.
Aim: – The central research question that this study is to answer is;- Since the practice has undoubtedly damaged the sector to what extent is this detrimental and what do the future hold for the charity organisation and what can be done to improve the situation. The paper will specifically define; Whether the charities have the right to increase salaries
What the implications are
Are the executive not worth a salary rise?
Can the organisation the same differently
Significance – The purpose of this paper is to examine whether the registered charities in Ireland have adopted the principle-based corporate governance practices. The paper will address some important questions: how charities are managed and controlled; whether the funds donated to registered charities are utilised effectively; the nature of the corporate governance practiced by registered charities; and the nature of compliance to legislation. This study offers insights for policy makers and practitioners interested in adopting good corporate governance practices within their country. From the study organisations will also understand people’s perceptions on sector and if the public is detoured from donating in light of executive’s salary top-ups. The study will help the general public understand issues relating to management and control of charitable organisations. Research limitations/implications – Caution should be exercised when interpreting and generalising the paper’s results, as this study is a case study of registered charities in Ireland and information comprised only of large charities that have significant revenue. It should also be noted that there was a small sample size, which may have had a bearing on the results. Research design and methodology
Design is selected for research should be the one most suited so as to achieve an answer to the proposed research question. For the purpose of the proposed research question the researcher has chosen to carry out a descriptive qualitative research design in the hopes to explore perceptions of the general public in the salary top-ups as well as the experience of the charity providers. Qualitative research design is a research method used extensively by scientists and researchers studying human behaviour and habits. This subjective approach will allow exploration of behaviours charity organisations managements. This technique will also expose perspectives, feelings, and experiences in depth as well as quality and complexity of the situation as regarded by other stakeholders. Additionally the absence of a hypothesis and simple “yes and no” answer make this technic is extremely appropriate.
In contrast, quantitative research is a formal systematic approach which incorporates numerical data to obtain information which would not be suitable for this study. There are four common approaches within qualitative research, phenomenology, grounded theory, ethnography, and historiography. As the research is meant to be simple none of the above approaches were deemed suitable for this study – therefore a simple descriptive qualitative methodology was chosen. The descriptive design aims to describe the essential findings in a rigorous way that is free from distortion and bias as well as help discover new meaning, describe what currently exists, verify the rate of which top-ups occur, and categorise the information. The aim of this choice is to facilitate identifying any issues with this practice. Research strategy and Data collection
The research will constitute focus groups and structured interviews. The interviews will be conducted in person (individual or group) as well as through phone or mail. Face to face interviews will not only allow to observe any non-verbal communication but also for both the interviewer and participant seek any clarification necessary. Questionnaires for both interviews and focus group questions will be carefully designed. The manner in which questions are asked is critical. The construction of the questions will highly be observed. It is anticipated that up to 5 focus group sessions 30 individual and 10 group will be conducted. The interviews and any necessary follow-up interviews will be conducted in time. In addition, follow-up clarifying interviews will be conducted as far as possible. All interviews will be tape-recorded and will be audio-taped with permission from the participant to ascertain an accurate account of the interview which can be replayed for analytic purposes – anonymity will be assured during the course of the recording.
Participants will be reminded of their right to withdraw from the study or terminate the interview at any time before commencing the session. Field notes in conjunction with the interviews, follow-up interviews, observations, and casual encounters with subjects will be written. Memoranda also will be written while listening to taped interviews, typing transcripts, and reflecting upon a particular interview. It is anticipated that ongoing data analysis will take place throughout the study. All of the taped interviews, memoranda, and field notes will be entered into computer files. The Ethnographer, a software program that uses a coding system organized around different topics and themes will also be employed at a later stage. A scheme of numbers and letters will be used to designate major categories and subcategories. “Hard copies” of all computer files of data also can be coded using coloured pens to mark the margins with the appropriate numbers and letters if needed. Connections between categories and themes will be used to further understanding of the information.
Purposive sample will be acquired by recruiting staff from the general association of charitable organisations, management staff of charity companies and lastly relevant personnel from the Consumer Association of Ireland as well as the as well as from the concerned parties. There will be some exclusion and inclusion criteria adopted in selecting who to participate in the study. Minimum of five year’s work experience in the charity will be required for those working within the sector – this is to obtain the opinions of those most experienced and exposed to this area. The chosen participants from the Consumer Association of Ireland will be a well familiar with the charity organisations operations. No ordinary members of the general public will be chosen.
Non-operations staff from the charity organisations will not be chosen. Prior to gaining consent from participants, letters requesting permission to carry out the study will be sent to management of all relevant charity organisations. Data Analysis
The purpose of data analysis is to organize, provide structure to, and elicit meaning from research data. For this research data analysis will be ongoing in conjunction with data collection. Interviews will be transcribed and analysis of the transcripts will be carried out. However the researcher will seek clarification of any issues at the time of interviewing. In order to achieve complete data saturation, reading and re-reading is necessary to ensure all recurring information and variations are identified. The volumes of data are gathered will be processed through categorising and identifying similar themes. This process will allow the interpretation of findings much easily.
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