The number of charities and non-profit organisations in Ireland is expected to drop in coming years, with one in 10 at risk of folding as they do not have the funds to plan beyond the next six months.
The predictions are based on data from accountancy firm Grant Thornton.
According to the company’s 2012 not-for- profit survey, the main factors in the expected decline include a fall-off in State and voluntary funding, increasing challenges in financing organisations and continuing struggles with corporate governance.
Government funding is nearly twice as important as voluntary fundraising to charities, with those surveyed saying 60 per cent of their funding comes from the State and 34 per cent from voluntary contributions.
Aside from planning for the future, financing current activities is also a significant concern for the charities surveyed. Nearly one in three cited day to day funding pressure as the most challenging issue facing their operation.
Almost one-fifth of those surveyed said they did not intend to comply with voluntary governance codes in the future.
“Charities need to recognise the risks, diversify their fundraising activities, adopt best practice in the sector and achieve rationalisation though alliances and mergers with like-minded organisations,” said Turlough Mullen of Grant Thornton.