CQUniversity Annual Report - Central Queensland University

CQUniversity ANNUAL REPORT 2012
OUR FINANCIAL PERFORMANCE
RESULT FOR 2012
The University recorded a signifi cant loss for the year of $24.668m,
which is deterioration on the loss of the previous year of $3.763m. A
downturn in international student revenue contributed to this loss,
resulting in revenue of $17.671m less than in 2011. The University
responded to this by undertaking restructuring to offset the decline in
student numbers and incurred redundancies in excess of $4m.
In addition, the University continued to invest in the development of
new programs and facilities. This contributed around $8m to the loss
position as the University renovated space for new laboratories and
purchased significant equipment to support these programs.
CQUniversity’s research area also contributed to this loss due to
spending funds that had been received in a prior period, resulting in
expenditure exceeding grants and other revenue for the year.
REVENUE PERFORMANCE DOMESTIC LOAD
There was a 19.8% increase in Australian Government funding
received in 2012 compared to 2011.
The Commonwealth Grant Scheme income increased by 15.65% to
$77.616m reflecting an increase in domestic student load of 13.4%,
with indexation of Commonwealth funding and continued growth in our
health programs.
The University set aggressive domestic student enrolment targets in
the 2012 budget and the actual result was better than expected. The
revenue targets for domestic funded load was exceeded by $9.552m
giving a total of $106.176m (refer to Table 19).
TABLE 19: BUDGET 2012 COMPARED TO ACTUAL
AUSTRALIAN FUNDED LOAD EFTSL AND DOLLARS
(EXCLUDING RESEARCH STUDENTS)
2012
Budget
2012
Actual
Variance
to Budget
Percentage
Variance
Australian 6574 6880 306 4.65%
funded load
EFTSL
Australian $96.624m $106.176m $9.552m 9.88%
funded load
REVENUE
Source: CQU Budget document 2012 / Actual EFTSL per the University dashboard, Actual Revenue
for CGS and HECS per CQUniversity Financials
REVENUE PERFORMANCE FEE-PAYING
STUDENTS AUSTRALIAN AND
INTERNATIONAL
Revenue from fees and charges continued in decline, due to a
continued drop in international students studying at the metropolitan
campuses. This was further compounded by the related drop in
Management Fee of $7.75m received from C Management Services.
The University budgeted for a decline in international students
however the size of the decline exceeded expectations. The
University delivered 32 413 courses compared to a budget
of 38 581 courses and actual delivery of 40 731 courses the
previous year. This resulted in a loss of revenue from 2011 to
2012 of $17.671m (refer to Table 20).
TABLE 20: BUDGET 2011 COMPARED TO ACTUAL FEE-
PAYING LOAN COURSES AND DOLLARS (EXCLUDING
RESEARCH STUDENTS)
Fee-paying
student
COURSES
Fee-paying
student
REVENUE
2012
Budget
2012
Actual
Variance
to Budget
Percentage
Variance
38 581 32 413 6168 16.0%
$84.873m $73.789m $11.084m 13.0%
Source: CQU Budget document 2012 / Actual courses and revenue per the University
dashboard
Other signifi cant revenue movements include a decline in Fee
Revenue due to non-payment of $7.75m in Management Fee
from C Management Services Pty Ltd and a decline in investment
income due to much lower than expected interest rates,
non-payment of distributions from the investment in the Queensland
Investment Corporation Growth Fund and no dividend payment from
C Management Services Pty Ltd.
EXPENDITURE PERFORMANCE
Total expenditure increased from $262.823m in 2011 to $275.534m in
2012, an increase of $12.7m or 4.8%.
General operations was overspent by $6.428m which relates to
$4m for accounting adjustments for leases and additional leases
commenced during the year that were not budgeted, and salaries
of $2.79m. Restructuring carried out during 2012 to reduce staffi ng
numbers cost the University in excess of $4m.
Research and restricted funds contributed $12.434m to the loss.
The bulk of this expenditure is attributed to the University-funded
investment into new buildings, new programs, building renovation
and purchase of equipment for new program delivery. As these are
internally funded projects there is no revenue to offset against the
expenditure. Without this investment into new programs the University
would not be refl ecting the growth in domestic student numbers that
was occurring by the end of 2012. The University has in the past few
years invested a signifi cant amount from its reserves into programs
and buildings to re-invigorate the domestic business. In 2012 the
University saw an increase in load of 13.4% and applications by the
end of 2012 suggest in excess of 10% growth in 2013.
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OUR FINANCIAL PERFORMANCE