Evaluating Financial Sustainability of Higher Education Institutions

Sazonov, Sergey; Kharlamova, Ekaterina; Chekhovskaya, I.A.; Polyanskaya, E. A.

doi:10.5539/ass.v11n20p34

Cited by 36 publications

(25 citation statements)

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“…The accounting system used in US colleges and universities has since changed, but some of these indicators are still in use. Sazonov et al [34] proposed other indicators for financial sustainability, mostly focused on working capital, fixed assets, and the sources of capital in universities. The (now defunct) Higher Education Funding Council for England (HEFCE) considered the following performance indicators: (a) total income, (b) operating surplus as % of total income, (c) historical cost surplus as % of total income, (d) cash flow from operating activities as % of total income, (e) net liquidity as number of days' expenditure, (f) external borrowing as % of total income, (g) discretionary reserves as % of total income [35].…”

Section: Financial Reporting and The Analysis Of Financial Sustainabimentioning

confidence: 99%

Changing the Accounting System to Foster Universities’ Financial Sustainability: First Evidence from Italy

et al. 2019

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According to the European University Association, nowadays financial sustainability is one of the key challenges for Higher Education Institutions. The financial sustainability of public universities is threatened by cutbacks in public funding and by society’s growing demand for improvements to the volume and quality of services provided. A recent reform in Italy has determined that universities are required to move to accrual accounting, starting from the assumption that this system responds more effectively to issues relating to financial stability control. This paper evaluates whether the new financial reporting system is better placed to represent the universities’ conditions of financial sustainability. Moreover, specific measures have been developed to investigate which financial strategies, if any, have been adopted in Italian universities to react to the new competitive context. Working in collaboration with practitioners from the HE sector, the research team developed a framework based on specific financial ratios to assess the financial sustainability of these institutions and to analyse their financial strategies. The findings reveal that, notwithstanding some common features, there are significant variations between Italian universities and they are addressing the new challenges with a range of different approaches.

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Section: Financial Reporting and The Analysis Of Financial Sustainabimentioning

confidence: 99%

Changing the Accounting System to Foster Universities’ Financial Sustainability: First Evidence from Italy

et al. 2019

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“…A regional flagship HEI should pay a particular attention to efficient interaction with both customers and consumers of educational services, with federal, regional, and municipal authorities, and with the regional community. [9,10] The tasks of a regional HEI can be formulated in accordance with the particular nature of the region's development: [7] 1) Training of highly qualified specialists showing both technological (engineering) culture and social mobility, being capable of both modernizing the economy (including solving the problems of the green economy) and promoting technological development of the region;…”

Section: Education Institutionsmentioning

confidence: 99%

Building a Financial Model for Developing a Flagship Technical Higher Education Institution

Sazonov¹,

Kharlamova²

2019

Proceedings of the International Scientific Conference "Far East Con" (ISCFEC 2018)

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This paper covers both the problem of funding flagship technical universities and that of choosing a better financing model in the current context. Financial support of a higher professional education institution is highly important for the state. Therefore, studying the methods for capital raising to invest the country's higher education institutions (HEI) seems to be the task of highest priority. It is also important that any specific HEI realizes which funding sources are the most preferable for it, how efficiently the sources are utilized, and in what way its personal activity should be developed in the coming future. To select the best model for funding a newly emerged regional flagship HEI is particularly essential. The model of regional flagship technical HEI development should provide variants and mechanisms for developing regional systems in the following context: -limited federal and regional resources; -low demand for innovation; -problems with human resources,differently vectored interests of the subjects involved in the process. This paper studies and determines the optimal model of financing a regional flagship technical university via mathematical methods by viewing the case of Volgograd State Technical University.

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“…The level of financial sustainability of the HEI has to ensure the timely repayment of the payables on current liabilities, responsiveness to the changing market conditions, ability of financing the new programmes and strengthening the material and technical base. Only those institutions that have sound financial structures and stable income flows will be able to fulfil their multiple missions [15].…”

Section: Introductionmentioning

confidence: 99%

Measuring financial sustainability of private higher education institutions

Cernostana

2018

Engineering for Rural Development

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Abstract. Currently, one of the main priorities of the development of the higher education system is ensuring the quality of education. As it is noted in "Standards and Guidelines for Quality Assurance in the European Higher Education Area", developed by the European Association for Quality Assurance in Higher Education (ENQA), institutions should ensure the availability of sufficient, relevant education resources. At present, there is no single methodology for assessing the financial provision of educational services supplied by private commercial companies in Latvia. The aim of this paper is to define a set of indicators for assessing the financial sustainability of a private higher education institution (PHEI). The author presents the results of the financial sustainability analysis (based on such ratios as leverage, debt-equity, liquidity, etc.) of Latvian PHEIs and suggests: 1) indicators most suitable for assessing sustainability of an educational institution; 2) permissible range of these indicators recommended for Latvia and methodology for their aggregation. The developed methodology may be recommended to national committees of quality assessment for accreditation procedures of higher education institutions (HEIs) and study programmes. In addition, it will allow to harmonise information on the use of financial resources in preparing self-assessments and other reports by HEIs. The novelty of this research consists in the development of the system of indicators specific for assessing the sustainability of such private enterprises, which provide higher education services and are controlled and regulated by the state. The author's contribution is in substantiation of the thesis that a private HEI should be viewed not as an ordinary economic subject, but as a socially significant business entity that fulfils the requirement of the society to educate high-quality specialists.

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Evaluating Financial Sustainability of Higher Education Institutions

Cited by 36 publications

References 1 publication

Changing the Accounting System to Foster Universities’ Financial Sustainability: First Evidence from Italy

Changing the Accounting System to Foster Universities’ Financial Sustainability: First Evidence from Italy

Building a Financial Model for Developing a Flagship Technical Higher Education Institution

Measuring financial sustainability of private higher education institutions

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