Harvey Mudd College (the “College”) has experienced a positive fiscal year primarily due to a gain in its pooled investment funds and h
Financial Review By Andrew Dorantes, vice president for administration and finance and treasurer
Harvey Mudd College has experienced a positive fiscal year, primarily due to a gain in our pooled investment funds and higher than budgeted enrollment. Following are highlights of the 2010–11 fiscal year.
Financial Position Harvey Mudd College ended the fiscal year with assets in excess of $377 million. This total is composed primarily of investments
Financial Operations Total revenues were $57 million for fiscal year 2010–11 compared to $51 million for fiscal year 2009–10. This is due to an increase in net student revenues resulting from increased enrollment and gifts to fund endowed faculty positions. Total expenses for 2010–11 were approximately $50 million. For the year ending June 30, 2011, the College experienced
an operating surplus of approximately $17,000 after a number of transfers to high priority areas, as approved by the Board of Trustee Budget and Financial Planning Committee: $400,000 of additional support for the renewal and replacement fund, $400,000 of startup funds for new faculty, and $163,500 of additional support for academic and administrative department needs. The key factors influencing the positive balance were higher than budgeted enrollment and salary savings from unfilled positions.
Endowment Investments The endowment produced a total return of 19.5 percent for the fiscal year ending June 30, 2011. This total return compares with the Standard & Poor 500 index return of 30.7 percent and the Barclays Aggregate Bond index return of 3.9 percent. Market value of the endowment was $243 million at year’s end, representing an equivalent of $317,000 per student. Endowment payout provided 23 percent of the College’s
UDITORIUM FROM GROUND FLOOR TERRACE The teaching and learning building is scheduled to open in fall 2013. September 25, 2009
of $304 million and of land, buildings and equipment of $54 million. Liabilities of $33 million consist primarily of long- term bonds payable and of payables to annuitants and trust beneficiaries. The College issued $15 million of long-term bonds through the California Educational Facilities Authority for the construction of the teaching and learning building or various other capital projects, if needed. As part of that process, Moody’s Investors Service increased HMC’s credit rating to Aa3. During the 2010–11 fiscal year, total net assets increased
by $37 million. This increase in net assets resulted from an increase in the value of the investment pool from both realized and unrealized gains in the value of investments. As of June 30, 2011, net assets totaled $344 million, comprised of three net asset categories: 1) unrestricted (those over which the College has full discretion) of $112 million, 2) temporarily restricted (those given to the College for a specific purpose) of $127 million, and 3) permanently restricted (those given to the College to be held in perpetuity) of $105 million.
operating revenues during the fiscal year. The College employs a formula that governs the annual payout of endowment earnings to support operations. Endowment payout will continue to decline, as a result of the decline in the endowment in 2008 and 2009, and will impact the endowment’s ability to provide funding for operations. The formula is designed to balance the need for endowment resources to support current activities with the equally important goal of preserving the value of endowment funds for future generations of students and faculty.
Summary Harvey Mudd College has been monitoring the economy, the volatile stock market, and their effect on the College’s investment pool and operating budget. The College’s administration and trustees have and will continue to prepare for various scenarios that may occur as a result of economic uncertainty. With the leadership of President Maria Klawe and the board of trustees, Harvey Mudd College will continue to thrive and achieve its mission of recruiting and educating the best and brightest students in the fields of engineering, science and mathematics.
48 Har vey Mudd College FALL/WINTER 2011
BOORA ARCHITECTS
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