Financial performance of BRAC International’s social enterprises: A study of activities of the finance department

Abstract

BRAC International works in ten nations in Africa and Asia with the goal of creating a world devoid of all forms of exploitation and prejudice and one in which everyone has the chance to reach their full potential. In order to better serve its more than 650,000 clients, 96% of whom are women, BRAC first expanded its microfinance operations internationally in 2002. Currently, BRAC operates in Afghanistan, Liberia, Myanmar, the Philippines, Sierra Leone, South Sudan, Tanzania, Rwanda, Kenya, and Uganda across Asia and Africa. The ability of BRAC International to expand the scope of income-generating initiatives, microfinance, and social enterprises is crucial for the institution's long-term viability. The objective of my report is to comprehend BRAC International's current financial situation in light of the financial success of social entrepreneurs operating within its member nations. The overall performance of the social enterprise is satisfactory, but the financial ratios show that the return on assets, debt-to-asset ratio, and liquidity ratio are all below average, and the income growth is erratic. I have compared the statistics with the two years before, and it is evident that the pandemic's impact caused the financial ratios to decrease while remaining stable in the year 2019. The company needs to improve its financial ratios to boost profitability in order to deal with the negative effects. BRAC International should put more emphasis on social enterprise activities and take the initiative to develop alternative metrics to assess performance because it primarily relies on microfinance.