Report on University Finances
The New School’s fiscal 2011 financial results demonstrate an ongoing rebound from recent years’ economic challenges. Enrollments and investments produced top-line revenue growth, outpacing expenses and contributing to an increase in total net assets of $35.9 million for the year ended June 30, 2011. Fiscal 2011 was a positive year for the school from an accounting and financial reporting perspective.
The university had an increase of $6.8 million from unrestricted operating activities based on revenues of $303.1 million, resulting in a 2.2% operating margin, comparable to last year’s 4.8%. The slight decline in operating margins from 2010 to 2011 reflects continued investments in academic programs. Undergraduate enrollment growth in particular contributed to the positive results.
The most significant change in the university’s balance sheet is the addition of $301 million of tax-exempt debt. The debt was incurred to partially finance construction of the University Center. The debt, along with generous contributions for the building, has allowed the project to move ahead. I am pleased to report that Moody’s Investor Service and Standard & Poor’s rated the bonds A3 and A-, respectively.
Although 2011 was a difficult year for contributions in general, unrestricted giving from trustees and friends remained robust.
We depend on endowment investment return for only 3% of our expenses; we have only fixed-rate, long-term debt; we have no outstanding derivative instruments with counterparty or market risk; and we enjoy ready access to cash. Our financial position is strong.
Chief Financial Officer and Senior Vice President for Finance and Business
The New School