What financial ratio is most commonly used to evaluate charitable organizations?

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The program expenses to total expenses ratio is the most commonly used financial ratio to evaluate charitable organizations because it highlights the portion of an organization's expenses that are directly related to program activities and can help assess its efficiency and transparency in using donor funds for its intended purposes. Other ratios, such as current assets to current liabilities or total expenses to total revenues, may be relevant for evaluating other types of organizations, but are not as meaningful in assessing charities. The increase in net assets to total assets ratio may also provide some insight into an organization's financial stability and ability to fund future activities, but it is less commonly used in the context of evaluating charitable organizations.

What Financial Ratio Is Most Commonly Used to Evaluate Charitable