FINANCIAL RISKS IN THE ACTIVITIES OF NON-PROFIT ORGANIZATIONS: CHALLENGES AND WAYS TO OVERCOME
Abstract
The article is devoted to the analysis of financial risks in non-profit organizations, focusing on the challenges they face and strategies for overcoming them. The article examines financial risks that hinder the stable functioning of non-profit organizations aimed at achieving socially beneficial goals, rather than making a profit. Non-profit organizations, due to their dependence on external sources of financing and the often unstable economic environment, face various financial difficulties that complicate their activities, such as the instability of funding sources, difficulties in managing limited resources, and issues with legal regulations that can lead to serious financial problems, affect the ability of such organizations to implement programs, and maintain financial stability. The article emphasizes that minimizing risks and ensuring the viability of non-profit organizations require a systemic approach, which includes, in particular, effective financial management practices, diversification of funding sources, and legal support. It is highlighted that due to fluctuating economic conditions, legal and organizational barriers, as well as the instability of the financing market, non-profit organizations often experience a reduction in the financial resources they can attract. It is argued that the inability to predict and control external financial support, together with the instability of donations, creates a serious problem for non-profit organizations. Another important issue is the effectiveness of financial management in conditions of limited resources, when non-profit organizations need to optimize their expenses to ensure that each resource spent is justified and meets the strategic goals of the organization. A recommended algorithm of actions aimed at overcoming financial risks is presented, which includes such key steps as regular monitoring of the financial environment, diversification of funding sources, reasonable financial planning, development of legal strategies to ensure compliance with regulatory requirements, and others. The need for a comprehensive approach to risk management is emphasized, which includes strategies, the implementation of which will help non-profit organizations adapt to changing conditions, ensuring their stability and the continuation of their social missions.
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