UBC’s Financial Results for 2020/21
The 2020/2021 fiscal year was unprecedented and challenging in many ways for the global economy — and for UBC — due to the onset of COVID-19. However, the collective resilience of our university community has enabled us to weather the impact of the pandemic more positively than anticipated.
Our audited financial statements, which were approved by UBC’s Board of Governors on June 24, illustrate a healthy financial position for the university as we close the 2020/21 fiscal year.
In early 2020 UBC’s financial teams mobilized quickly to plan for how COVID-19 might affect university operations in the following fiscal year. We conservatively anticipated considerable impacts on revenue, mainly through ancillary operations and student tuition.
While the negative impact on ancillary operations (including campus housing, food services, summer programs, etc.) did materialize, the university did not experience the expected reduction in tuition revenue. Our financial results for 2020/21 are much more positive than expected, due to several factors including:
Our students and faculty rallied for the transition to online learning through 2020/21 far beyond what we could have expected, as the hard work and innovation of our community enabled an enriched remote learning experience. For-credit student enrolment remained steady as a result.
Our financial teams continued to deliver active, prudent, and thoughtful financial management in support of teaching, learning, and research, and a potential decline in revenues was partially mitigated by a reduction in discretionary spending as well as the use of hiring delays.
We benefitted from increased federal research funding in 2020/21, along with related increases in salaries and benefits, other operational costs, and grants to third parties.
Our investment income was higher than expected due to strong market returns, along with the one-time sales of two UBC spin-off companies.
Our operating costs were lower than expected because of reduced operations due to COVID-19, and we experienced lower than planned discretionary spending on travel, professional fees, and supplies and sundries.
While we are reporting a $63m operating fund deficit for 2020/21, largely due to the impact of COVID-19 on ancillary operations, this is mitigated by significantly positive movement in non-operating funds driven by accounting factors and investment returns.
As a result, the university is ending the 2020/21 fiscal year with a consolidated accounting surplus of $82m.
“The collective resilience, innovation, and dedication of our community has played a major factor in supporting UBC’s strong financial position,” says UBC’s Vice-President Finance & Operations, Peter Smailes. “Our financial strategy will continue to focus on supporting our diverse and talented students, faculty, and staff, and we look forward to September when we anticipate returning to our beautiful campuses in person.”
While uncertainty remains high across some areas as we head into 2021/22, UBC’s financial position is prudently overseen by the university’s Executive and Board of Governors, and our liquidity position is closely monitored and remains in good health. External validation through leading credit rating agencies continuously rate UBC highly — in February 2021 the university was reaffirmed with an Aa1 rating from Moody’s Investors Service, who assessed UBC to have an “outstanding market position” and in March 2021 the university was re-issued an AA+ rating from Standard and Poor’s.
Our budget for 2021/22 demonstrates how UBC is committed to investing in its students, furthering the academic mandate, and promoting a more inclusive, diverse, and vibrant community. While there continues to be uncertainty relating to the financial impact of COVID-19, the university has sufficient reserves and liquidity to persevere and to continue thriving.