Queen’s saw a $45.6 million surplus at the end of the 2013-14 fiscal year, as confirmed by audited financial statements approved by the Board of Trustees at its Sept. 19 meeting.

This is the second consecutive year Queen’s has posted a surplus. At the end of the 2012-13 fiscal year, beginning May 1 and ending April 30, the University saw a surplus of $22.6 million.

Revenues for the 2013-14 fiscal year amounted to $835.4 million, compared to $799.2 million the previous year. Expenses were $789.8 million and $776.6 million for each year, respectively.

This represents a 4.5 per cent increase in revenues, mainly due to increases in donations and student fees.

Caroline Davis, vice-principal of finance and administration, told the Journal via email that $18.5 million of the surplus represents investment income from the Pooled Endowment Fund, an investment pool containing donations to the University.

Another $15 million came from excess returns on the Pooled Investment Fund, which earns returns on money in reserve and unspent funds, and short-term investments. These returns helped eliminate previous years’ operating deficits.

Davis added that the audited statements reflect the University’s recovery from the 2008 financial crisis. According to 2008-09 financial statements, the University saw a deficit of $64.9 million — a 569.1 per cent negative change from 2007-08. In 2009-10 statements, due to changes in accounting policy, this was restated to a loss of $51.2 million.

An increase in revenue from all fee sources of 5.5 per cent, attributed mainly to increases in enrolment and tuition fees, also contributed to the 2013-14 increase in revenue.

Davis said domestic undergraduate tuition fees were increased by three per cent from 2012-13 to 2013-14. This meets the average annual domestic fee increase cap dictated by a provincial tuition fee framework implemented in March 2013.

As long as the University’s average tuition fee increases don’t exceed three per cent per year, it can increase fees at an annual rate of five per cent for incoming graduate students and students enrolled in professional programs, and four per cent for students continuing in these programs. Professional programs include the Faculty of Education and the School of Nursing.

Before the framework was implemented, tuition fees could be increased by eight per cent in graduate and professional programs.

Between 2012-13 and 2013-14, increases in tuition fees for international students were between five and 11 per cent for undergraduate students, Davis said. International student fees aren’t regulated by the provincial funding framework.

Increases in tuition fees for international graduate students were between zero and eight per cent, she added. This excludes the School of Business.

The increases varied based on program and “were implemented with due regard for student demand, market considerations, and academic quality,” Davis said.

International tuition fee increases represent 10 per cent of the $12.7 million in fee increases between 2012-13 and 2013-14.

Despite the surplus, Davis said the University faces some financial challenges, “which underscore the need for continued careful stewardship of university financial resources.”

The financial statements highlight uncertainty surrounding provincial government funding, low interest rates, deferred maintenance and a pension plan “that is not financially sustainable”.

Davis said the deficit of the provincial government makes future grant funding uncertain.

“With limited provincial funding directed towards deferred maintenance, Queen’s, along with other Ontario Universities, has a significant deferred maintenance backlog,” Davis said.

In light of this, she added, the University has allocated additional funding to deferred maintenance in the operating budget for the current fiscal year.

As for the pension plan, Davis added that the University “continues to look at options to make the pension plan sustainable.” One option is the Jointly Sponsored Pension Plan, “where risks would be shared equally between the university and the employees.”

“The 2015-16 budget process, currently underway, will look carefully at how to fund special payments for the solvency deficit going forward,” she said.