What does a major public university like the University of Akron (UA) do when faced with declining enrollment and, as a result, diminishing revenue? It calls on one of the biggest global accounting firms in the world, Ernst & Young (EY).
Here’s the problem: For the last four years, the University of Akron (UA) has been fraught with declining enrollment. Most recently, in FY17 “first time, full time” freshman student enrollment was down by 20%. Meanwhile, in that same year, the school struggled to operate under a budgeted deficit of $18 million.
As a result, back in August 2016, UA asked EY to assess the school’s current financial state and recommend suggestions to boost revenue and cut costs. The assessment confirmed UA’s need for immediate action, prompting UA President Matthew Wilson to consult with faculty members, students, alumni, industry leaders, and the local community to develop a 2-year financial transformation plan.
The transformation plan uses a three-pronged approach centering on stabilization, investment, and growth, and includes:
- Increasing student retention, graduation rates, and fundraising
- Optimizing availability of early buyout options, graduate assistantships, and scholarships
- Using more resources to attract and recruit more freshman students, adult students, transfer students, and international students
- Lowering spending on information technology, travel, and utilities
- Offering students greater access to advisory support outlets
- Providing more flexible educational program options
- Building stronger relationships with employers and community colleges
By implementing the transformation plan, UA hopes to save $25 million in FY18 and as much as $45 million by June 2019. Although EY’s initial assessment was paid for anonymously, UA has opted to enter into a 6-month contract with the Big Four firm to the tune of $200,000 a month from December 8, 2016 through June 30, 2017.