An Overview of University Finances

• Author: Cheryl Foy
• Pages: 179-189

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 

An Overview of University Finances

In Chapter , we began the discussion of the government’s role in uni-

versity nances. In this chapter, we take a closer look. is chapter is not

about how to read balance sheets and university nancial statements. When

universities look for board members, they look for a certain number of

members who have strong nancial backgrounds and are nancially literate,

so that the board has the requisite expertise to oversee university nances.

Even if you aren’t recruited because of your nancial expertise, you should

learn to read nancial statements. e focus of this chapter, however, is a

further understanding of university nances and the issues the board and

leadership team face in making nancial decisions.

It won’t surprise you to know that the nancial picture for universities

is complex . e board has a role in approving the budget and must under-

stand the strategic choices and the risks associated with budget decisions.

e board plays a primary role in ensuring the nancial sustainability of

the university. Board members should understand revenue sources, main

categories of expenditures, and trends that underlie nancial sustainability.

is is not an easy thing to learn. ere are provincial dierences, and

those will have an eect on your university. For example, in , the

Ontario government undertook a review of its post-secondary education

funding formula and, in a bid to include other objectives, switched from

1 Ben Lewis, “University Funding in Ontario and the Implications of the New Performance-

Based Funding Model, a Discussion” Academic Matters (13 December 2017), online: