Dear faculty and staff,
On October 23, we will present the audited financial results for 2023-24 to the Board of Governors for approval. We wanted to share some key highlights, as these results are closely linked to our operating budget and our focus on maintaining fiscal sustainability. To help provide clarity and context, a breakdown of the university’s funds is available on our Financial Services web page.
U of G’s 2023-24 Financials
The University ended the 2023-24 fiscal year with a surplus of $29.4 million, primarily driven by the performance of our investments. While this is a positive outcome, it is important to note that the surplus includes an operating budget deficit of $13.9 million. This marks the fourth consecutive year of a structural deficit in the operating budget. This highlights the serious challenges the University continues to encounter, particularly in sustaining day-to-day operations, which are solely funded by the operating budget and encompass salaries, utilities, supplies and other routine operating costs. This ongoing operating budget deficit is largely driven by external factors, including the 2019 tuition reduction and freeze, stagnant operating grants and rising expenses due to high inflation.
While the current results are not where we want to be, the University community has made significant strides. The hard work and dedication of faculty and staff in adapting to a dynamic environment have significantly contributed to our successes, particularly with our Strategic Transformation.
Strategic Transformation
Over the past several months, there has been consistent progress made through collaborative initiatives in support of our Strategic Transformation that have focused on establishing efficiencies, expanding innovative revenue generating opportunities and implementing modernized systems.
These collective efforts have resulted in Strategic Transformation achieving $13.1 million in savings and helped moved us closer to long-term financial sustainability.
As we continue to navigate the ongoing unprecedented and challenging fiscal environment, our approach to Strategic Transformation will evolve so we can continue to build on our progress, and this includes refining our action plan.
To further advance Strategic Transformation and long-term financial sustainability, we are transitioning the work of the Strategic Transformation Office (STO) to be embedded in the Provost and Vice President Finance and Operations (VPFO) portfolios. As we move forward, transitioning to a fully integrated model will enhance collaboration and engagement among our functional units. This will empower them to take a more active role in implementing change through decision-making, strategy, and execution that aligns with daily operations.
The STO has been essential in initiating and coordinating complex, cross-departmental projects that required dedicated oversight and resources. Based on learnings from our early work with the STO and external consultants, it’s become evident that adopting an integrated model is the appropriate next step in fostering meaningful and sustainable progress by allowing our functional units to lead transformation efforts more effectively. Under this new structure, the specialized skills and insights from members of the STO will continue to provide essential support and guidance to functional leads as they take a more prominent role.
The executive lead of STO will be supporting this transition as we begin working more directly with departments and functional leads on the Strategic Transformation objectives to increase revenue and reduce expenses. Under this new structure, focus will continue to be on collaborative planning, digital transformations and the involvement of functional leads to support in identifying solutions within their areas.
Thank you for your support in moving the University closer to long-term financial sustainability. We will provide updates on Strategic Transformation as we continue to progress on plans.