The Research On Non-profit Organizations’ Financial Supervision By The Government

Since the eighties of last century, non-profit organization (NPO) in China have undergone rapid development. At the same time the limitations and financial problems of NPO unceasingly exposed. Regulation is becoming more and more important. As an extremely significant pole in the operating of our society, administrative strength of our country plays an important role in the process of supervising NPO. However, in practice, the effete of our government’s financial supervision is not satisfying, it still have some problems. So in the market of economy environment, it is a new subject for government to structure a set of financial supervision system which can monitoring the use of public funds and ensure that the nature of NPO are not alienated.Taking the supervision plight of China’s NPO as the starting point, this paper focused on the problem of supervise NPO, aimed to investigate the effective way of NPO’s financial supervision by the government. First of all, the thesis reviews the current research situation form domestic and international. Then it elaborates some related theories and concludes that the principal-agent theory, public property rights theory and the theory of public responsibility provide a solid theoretical support for this research. Then the article also describes the financial characteristics of NPO, that the public nature of its financial activities, the lack of the inherent financial responsibility and the harmful of financial corruption determines the external supervision is necessary. In a number of external supervision body, the dominant position of government’s supervision can not be replaced. This is also demonstrated from a theoretical point that government need to supervise the financial affairs of NPO. With this theoretical framework, the thesis demonstrated its necessity from a practical point. Thus, in drawing the advanced experience of the United States and Britain, the article try to give some policy recommendations that can improve the government’s financial supervision to NPO, including:improve the system of legal supervision to NPO, reform the government system of financial supervision to NPO, improve the system of mandatory disclosure of NPO’s financial information, strengthen the supervision of NPO’s risk investment.