FINANCIAL STRATEGY
Our priorities, in support of the long-term viability and sustainability of the University, are to:
Maintain the upward trajectory of the operating surplus and invest the cash generated in maintaining and enhancing our infrastructure.
Cash inflow from operations is a critical element of our capital financing and we will increase this year-on-year to a level that will sustain our current infrastructure and create adaptive capacity for future requirements. We will also maintain and maximise, as far as possible, capital grant funding in order to support our investment in infrastructure and to achieve the objectives outlined in our core strategies.
Borrow for investment at a level that will not put the University at risk.
In order to ensure appropriate use of borrowings, we will undertake a regular review of capacity, driven by affordability, which will inform the authorised net debt levels set by Council. The price and term of our borrowings will be driven by our credit worthiness; we will continue to strive for a consistent operating performance to ensure that our credit rating remains high. Our borrowing arrangements will also be informed by the requirement that debt investment must provide a return overall in excess of cost.
Maintain a sustainable recurrent investment in the academic, corporate and support operations.
In order to achieve this objective concurrently with the above priorities we must, in simple terms, ensure that income increases consistently at a greater level than costs and that costs are controlled and deliver value for money. In order to create the capacity for investment, we will control costs by establishing and funding agreed staffing levels throughout the University, with regular critical review, and to invest in creating adaptive capacity in staff. We will also continue our ongoing programme of process reviews, and our programme of investment in information systems development and backlog maintenance of systems.We will also establish ‘venture’ funding for research and teaching initiatives in order to facilitate development.
Continue to develop and operate systems and processes that ensure proper budgetary and financial control and deliver value for money.
We will continue to review and develop our three-year budgeting process and resource allocation mechanisms, devolving our financial decision-making to the most appropriate level through the allocation of resources to faculties, with Deans as budget holders. We will review our financial reporting systems to ensure the provision of accurate, transparent and up-to-date information to assess and monitor financial performance. This programme will also encompass the development of a centralised online purchasing system to enhance efficiency and value for money, and continued implementation of full economic costing to ensure that our research and teaching are accurately costed and properly priced.
Develop and sustain a strong philanthropic fundraising operation.
We will continue to build positive long-term relationships with alumni, major benefactors and other stakeholders, while seeking progressively to increase our income from philanthropic fundraising. We will ensure that our fundraising activities are supported by a well-resourced and professional central team.
Our progress and achievements against these priorities will be measured through:
- Outcomes of our internal audit processes concerning financial and budgetary management and value for money.
- The University’s credit rating.
- Monitoring of internal strategic performance indicators relating to surplus generation; cash flow; borrowings and income sources.