BU budget remains on track

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This article was published 30/11/2020 (844 days ago), so information in it may no longer be current.

Brandon University is on track to post a surplus of $628,343 in this 2020-21 fiscal year, according to the latest projection.

Anything in the black is good news, university vice-president of administration and finance Scott Lamont said, but the surplus leaves very little wiggle room.

“It’s just under one per cent of our budgeted expenditures, so that’s very tight,” he said, pointing to a number of variables that have the potential to skew it into the red by the time the fiscal year caps off on March 31.

Lamont provided the university’s board of governors with a fiscal update during their Saturday meeting, which was held remotely via the Zoom online platform.

The latest projections use numbers gathered Sept. 30, which are extrapolated to the end of the fiscal year to offer the latest estimate of how things are going.

As always, the accuracy of this estimate will be tested in the coming months — a test made more strenuous in the unprecedented days of the COVID-19 pandemic throwing countless things out of whack.

“This year, the budget is substantially more difficult — more uncertain than it has been in the past,” Lamont said.

In anticipation of an unusual year, this year’s budget accommodated for things like fewer travel opportunities and on-site staff, a drop in sales of goods and services and fewer donations.

Although their original projections have changed as actuals materialized, the overall picture currently skews to the financial positive.

The university has taken to trimming unnecessary expenses as the fiscal year progressed, Lamont said, and managed to slash $931,987 beyond what was originally budgeted.

At the same time, revenues are down $303,644 from what was originally budgeted for, mainly due to a projected $1.68-million drop in the sale of goods and services beyond the $1.48-million reduction originally anticipated.

“We normally plan on having about 300 students in residence,” Lamont said. “There are 118 students that were in residence for the first term, and expect that number to actually drop a bit in the second term given that most of our classes are offered online.”

Approximately 40 per cent of students have at least one in-person class, while 95 per cent of students have at least one online class, he said.

It appears students are becoming more comfortable with the new online environment as time rolls on, with the total number of first-time students currently down 5.5 per cent, which is less than the 10 per cent recorded earlier in the pandemic.

The drop in both domestic and international students is also less than previously anticipated, though both have fluctuated during the past several months. As it currently stands, domestic enrolment appears down 4.2 per cent, which is a boost from the eight per cent reduction projected in August. International students are up 1.5 per cent, which is a jump from the five per cent drop budgeted for.

The accompanying boost in credit hours has resulted in the original budget appearing more pessimistic than what is now materializing, with associated revenue projected to be up more than $1 million.

Still, Lamont cautioned that these numbers can change by forces even thousands of kilometres away, pointing to recent unrest in Nigeria, where residents found their internet access interrupted recently.

Of the university’s 418 international students, 176 are Nigerian, and the loss of this student population would cost the university $1.4 million.

When it comes to domestic students, a one per cent change in enrolment equals $109,444.

There’s also the funding and regulations that come down from the province to contend with. Earlier this year, the province recently backtracked on a one per cent cut in operating grants to post-secondary institutions via a temporary transitional fund, which results in a positive variance of $376,000 this fiscal year — assuming it comes in, that is.

Another issue relates to an expensive change in accounting standards the university was told in July would not be imposed until 2022-23, but which the treasury board announced on Nov. 5 would come into play in the current fiscal year — “Despite their communication in July,” Lamont added.

This change in asset retirement obligations adds a $700,000 annual amortization expense for asbestos remediation and equipment that has a high cost related to decommissioning, such as X-ray machines and MRIs.

Lamont said Brandon University has joined other post-secondary institutions in urging the province to re-think this requirement’s altered timeline, which none of them have budgeted for.

Lamont said he’ll be presenting another projection early next year using Jan. 31 numbers.

Relaying a quote from Mark Twain, he said: “It’s difficult to make predictions, particularly about the future.”

Splicing modern context onto the end of the quote, he added: “When the future is as uncertain and as different from the past as this year has been, it has been particularly difficult.”

» tclarke@brandonsun.com

» Twitter: @TylerClarkeMB