Trusteeship Articles By Topic: Finance and Endowment

All across the country, declining state support for public universities is prompting reassessments of traditional partnerships, while also presenting an opportunity to re-examine what it is that we as universities do, how we do it, and why we do it.

The steep economic recession, coupled with increased national expectations and demand for higher education, poses serious challenges for board and presidential leadership. A special panel at AGB's recent National Conference on Trusteeship, moderated by AGB President Richard Legon, examined those challenges. The following Q&A is excerpted from the discussion.

Each year, the Department of Education tests the financial ability of colleges to administer federal student-aid programs. It has made the results widely available over the past two years, and if last year is a precedent, the 2010 fiscal year data will be coming out in August. Boards should understand how the test is constructed and how their institution can best respond.

Much has been made of the Internal Revenue Service's introduction of the completely revised Form 990 last year. The new Form 990 is no longer a document focused on financial data. It is now a governance-centric document that places its primary focus on the work of the governing body. The board must now be a partner with management and the organization's consultants to ensure that the organization's governance is effective, up-to-date, and properly explained to the public.

The global economy is undergoing significant structural changes. What are the implications for a college or university's long-term planning, investment strategies, and many other strategic issues of concern to boards? Experts from AGB's Foundation Leadership Forum weigh in.

As state appropriations per student have dropped, public universities have moved toward reliance on other sources of support. The former president of the University of Virginia describes his institution's experience in successfully raising private funds and how boards can play a vital role.

In the grand economic scheme, the intense public pressure to lower costs came late to higher education. Now that it’s arrived, though, it’s here with a vengeance. No institution—public or private, non-profit or for-profit—has escaped the always difficult, sometimes protracted discussions of how to increase efficiency and lower costs. Although this intense pressure predates the recent great recession, the “new” economic climate has made the situation worse.