Revisiting the Prediction of Financial Vulnerability

Whether or not a nonprofit organization is vulnerable to financial problems is a concern of all stakeholders of the organization. Recently, Greenlee and Trussel (2000) and Trussel and Greenlee (2001) expanded Tuckman and Chang's work (1991) to predict which organizations are financially vulnerable. This article extends the work of these authors by developing a model of financial vulnerability that includes four financial indicators, controls for the sector to which an organization belongs, and is based on a sample of over ninety‐four thousand organizations. The model is useful as a screening, monitoring, and attention‐getting device.