Mangels Presents FY20 Operating Budget to Actual Report

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Kathy Mangels, vice president for finance and administration, presented a new report to the Board of Regents on Sept. 20 which compares the FY20 University operating budget to actual year-to-date revenues and expenditures. This will be a standing report to the Board to assist them with their fiduciary responsibilities as Regents.

In order to make a meaningful comparison between budget and actual, annual revenue and expense budgets have been adjusted to reflect the amounts anticipated for the reporting period based on known University business cycles and accounting practices. For example, while state appropriations are received equally over the twelve months in the fiscal year, tuition and student fees are recognized with billing cycles at the beginning of each semester.  On the expense side, staff personnel expenses are divided equally over the twelve months of the fiscal year, while faculty and student personnel costs are divided over the period between August and May.

The report presented to the Board reflected budget to actual data for the months of July and August with a budgeted surplus for FY20 of $32.1 million. Actual surplus reported through August stands at $37.1 million, Mangels said, up from $36.4 million a year ago.

“Because of our tuition and fee cycle, we expect a large surplus of revenue at this time in the fiscal year,” she said. “However, that revenue has to fund personnel and operating expenses throughout the semester until the next billing cycle for the Spring semester.”

Mangels also stressed to the Board the importance of net tuition revenue, tuition and fees less institutional scholarships, because it represents the University’s largest source of revenue. While the report reflects higher than anticipated tuition and fees, it also reflects higher than anticipated scholarship and fee waiver expense. This higher than budget scholarship expense is expected to continue for some time, as the University phases out the previous merit scholarship program at the same time new students are beginning to receive Copper Dome Program scholarships.

Other reasons for the surplus at the end of August are increased state appropriations and lower personnel expenses. Mangels indicated the University will continue to report state appropriation revenues in excess of the budget throughout FY20 because the final state budget approved by the legislature and signed by Gov. Mike Parson included $1 million in new funding directed to the University’s core appropriation.  Southeast received this funding after it had finalized its FY20 budget. Personnel expenses will also continue to track under budget as this differential is created by vacancies across campus.

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