Financial Analysis of Municipal Sport, Tourism and Cultural Organizations

The current research analyses the performance of municipal sport, tourism and culture organizations in Laconia, Greece. The evaluation of local authorities is a very important issue, especially given the increasing decentralization in the decision-making process and resource management from the Central Government to local governments and the increasing responsibility of the local authorities to provide effective services to taxpayers. Result of this is the increasing need for effective management of sport, tourism and cultural organizations, which requires the evaluation of their performance. In this study, we perform a primary research regarding the financial analysis of two municipal cultural and sport organizations using financial ratio analysis. Also we provide a literature review regarding the conceptual definition, operation and methodologies of the evaluation of local governments and their entities, especially those regarding culture, tourism and sports. In conclusion, the study shows that, regarding the examined entities, while some ratios are positive, in contrast, other indicators are being considered as negative. Examining and taking into account the above positive and negative elements, it can be concluded that, by improving the planning of the regular (operating) income and expenditures, the negative ratios will be converted to positive, resulting in positive overall performance for both examined entities.