Feeding the Flock: The Role of the Revenue Portfolio in the Financial Growth of Congregations and Religious Organizations

ABSTRACT

There have been fewer population‐level studies of religious organization revenues compared to other nonprofit organizations. This discrepancy is due to the exemption of houses of worship from filing the U.S. Form 990, which is the basis for most nonprofit financial analysis in academic literature. Using granular financial data on over 30,000 religious organizations in Canada from 2009 to 2016, we explore the characteristics of the revenue portfolios for this under‐studied subsector of tax‐exempt organizations. In addition to providing useful descriptive information, such as the differences between funding portfolios by religion or denomination, we identify characteristics associated with financial growth using dynamic difference‐generalized method of moments estimations. We find that donations where receipts were given drive almost all portfolios, while revenues that comprise the portfolio fringe vary widely in form and importance for growth. This study yields information useful to practitioners and researchers interested in nonprofit finance and the financial management.