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  1. 1. Framework for Multi-year Strategic Financial Planning October 2006
  2. 2. Contextual Background <ul><li>External financial review – key recommendations </li></ul><ul><li>Rapidly changing landscape </li></ul><ul><li>It’s about more than balancing our budgets </li></ul>
  3. 3. UNB Strategic Financial Planning Multi-year Financial Road Map <ul><li>5-Year Forecasts </li></ul><ul><li>Operations - Optimistic </li></ul><ul><li>Capital - Best Estimates </li></ul><ul><li>Endowments - Pessimistic </li></ul><ul><li>Sensitivity Analysis </li></ul><ul><li>Change in Key Variables </li></ul>Strategic Priorities - Costing of Priorities Assessment of Options and Choices 5-Year Financial Road Map - Targets Revenue/Funding Options - Groupings and ranges
  4. 4. UNBF Enrolment 2001-2005 Projections for 2006-2011 Graduate and Undergraduate (full and part-time) as of October 1, 2006
  5. 5. University of New Brunswick Fredericton Campus Operating Budget Forecasts September 18, 2006 (Best Estimate Assumptions) $(000’s)
  6. 6. UNB Fredericton Campus Operating Budget 5-Year Ranges 3.43% - 4.47% Optimistic .86% - 2.34% Pessimistic 2.13% - 3.43% Best Estimate Revenue Growth 2.54% - 2.94% 4.14% - 5.23% 3.87% - 3.74% Expenditure Growth
  7. 7. University of New Brunswick Fredericton Campus Revenue Composition and 5-Year Forecast Forecasted Growth (5-year Simple Average) 100.0% 6.86% 33.27% 59.87% Current % Distribution 3.14% 3.58% Other 2.96% Tuition Revenue 3.20% Provincial Operating Grant Best Estimate Operating Revenue
  8. 8. University of New Brunswick Annual Basic Tuition Fee Increase Changing Landscape
  9. 9. University of New Brunswick Fredericton Campus Expenditures Cost Structure Profile and 5-Year Forecast Plus Net Ancillaries Inherent Inflation (5-year Simple Average) 3.72% 100.00% 3.82% 9.70% Maintenance and Utilities 14.36% 19.02% 56.92% Current % Expenditures 3.79% Administration & Development 3.20% Academic & Student Support 3.84% Faculties and Departments Best Estimate Operating Expenditures
  10. 10. University of New Brunswick Fredericton Campus Budget Growth Rates Changing Landscape
  11. 11. UNB Fredericton Campus Annual Operating Budget Shortfall Best Estimate Assumptions $(millions)
  12. 12. UNB Fredericton Campus Infrastructure Renewal Funds $ Available compared to Requirements
  13. 13. UNB Fredericton Options/Choices <ul><li>Combination </li></ul><ul><li>Revenue initiatives </li></ul><ul><li>Expense initiatives </li></ul><ul><ul><li>Recalibration to a new lower level </li></ul></ul><ul><ul><li>Rebalancing cost structures </li></ul></ul><ul><li>Investments to strengthen </li></ul><ul><ul><li>Financial Environment </li></ul></ul>UNB/Partners/Stakeholders
  14. 14. UNB Fredericton Campus <ul><li>2007-08 Budget Planning </li></ul>
  15. 15. University of New Brunswick 2007-08 Budget Key Parameters (for discussion) <ul><li>Operating Budget </li></ul><ul><li>What will be the overall target – balanced budget or other </li></ul><ul><li>Basic tuition fee planning is currently in the 4-5% zone, is this appropriate </li></ul><ul><li>What other sources of revenue are realistic </li></ul><ul><li>Expenditure reductions/restrictions will be required – to what level and with what impact on operations </li></ul><ul><li>What level of financial flexibility should be sustained or established </li></ul><ul><li>To what degree should budgets contain investments in key strategic priorities </li></ul>
  16. 16. University of New Brunswick 2007-08 Budget Key Parameters (for discussion) <ul><li>Capital Budget </li></ul><ul><li>What is the overall expected level of infrastructure renewal funding levels </li></ul><ul><li>Is the expected level of funding acceptable given standards and requirements, what can be done about this </li></ul><ul><li>What will be the level of new cash flow from land development, how will these funds be strategically deployed. </li></ul><ul><li>Are there other capital projects on the horizon that must be considered in the 2007-08 budget, if so, what are the implications. </li></ul>
  17. 17. University of New Brunswick 2007-08 Budget Key Parameters (for discussion) <ul><li>Endowments and Restricted Funds </li></ul><ul><li>What is the expected level of endowment funding available to support operational and capital requirements. </li></ul><ul><li>We are planning to continue with the current endowment spending rate of 4.5%, is this appropriate. </li></ul><ul><li>What is the general strategy for campaign proceeds that are undesignated. </li></ul><ul><li>What level of support from the operating budget will be required to service “Forging Our Futures” commitments. </li></ul>
  18. 18. University of New Brunswick Fredericton Campus 2007-08 Budget Planning <ul><li>NEXT STEPS </li></ul><ul><ul><li>Discussing/answering questions </li></ul></ul><ul><ul><li>Determining balance </li></ul></ul><ul><ul><li>Reviewing options </li></ul></ul><ul><ul><li>Next meeting, October 31, 2006 </li></ul></ul>