Key financial metrics on Australia’s higher education sector - 1st edition
The HTML version of this report will be available shortly.
TEQSA is committed to ensuring that stakeholders in Australia’s higher education sector have access to relevant information to enable and better inform decision making. Through the Provider Information Request (PIR), TEQSA collates and then analyses a range of provider data as part of its ongoing monitoring and quality assurance role. The first whole-of-higher education sector view was presented in 2014 when TEQSA published its Statistics Report on TEQSA Registered Higher Education Providers. That report presented high level information across four key areas: providers, students, academic staff and finances, and was well received by the sector. The third iteration of the Statistics Report is due to be released in the first half of 2016.
As part of its continuous sector engagement, TEQSA held a series of roundtable sessions with providers during August and September 2015. One theme to emerge from the sessions was strong support for the public release of selected sector data and analysis held by TEQSA. In November 2015, TEQSA conducted a formal consultation process seeking sector views on the publication of a financial metrics report. The consultation process closed in January 2016. The responses to the consultation were broadly supportive of the public release of this report and TEQSA has incorporated common feedback into this report.
This report is the first release of selected financial data analysed by TEQSA as part of its sector monitoring. It provides a snapshot of selected key financial metrics across the whole of Australia’s higher education sector that has not previously been disseminated.
Assessing the financial position and performance of a provider is a complex process which involves analysing a number of quantitative metrics and understanding the provider’s mission, governance, and management structures. TEQSA conducts an annual financial assessment of each provider, which analyses ten commonly-accepted financial metrics reflecting the key business drivers critical to financial viability and sustainability. TEQSA consulted with the sector prior to adopting these financial metrics in 2013, and received broad support for their adoption.
The five financial metrics in this report have been selected for their importance in measuring the capacity and capability of providers to deploy financial resources in a way that supports quality in the delivery of higher education. Importantly, the selected metrics are reasonably comparable across all providers and also provide visibility of financial position and performance at the sector and sub-sector levels. The definitions and calculation methodology for each measure are available in the Glossary.
TEQSA recognises that there is little publicly available information on Australia’s higher education sector beyond the university sector. Broadly, this report aims to enhance and improve the level of publicly available financial information on Australia’s higher education sector with a view to better informing decision making by sector stakeholders.
For many providers financial data is commercial-in-confidence; as such, information in this report has been presented in an aggregated, de-identified manner. The analysis and key metrics presented in this report allow users, in particular existing higher education providers, to better understand how their entity’s financial performance on key financial metrics compares with other similar providers and the sector more broadly.
There are a number of ways that higher education providers can be grouped. This includes for example: categorisation according to different funding and legislative arrangements, different data reporting requirements and collection mechanisms, or a reflection of clusters of providers with similar characteristics or selected attributes.
For the purposes of this report, TEQSA has grouped providers by broad operating model, and by provider EFTSL size bands. The provider operating types used in this report are: ‘Universities’, ‘Non-University For-Profit’, ‘Non-University Not-for-Profit’ and ‘TAFE’ (Technical and Further Education).
There are a small number of providers that were not required to submit financial data as part of the TEQSA PIR due to context such as the provider was recently registered as a higher education provider, was in the process of merging with another entity, was in the final stages of teaching out courses (and withdrawing registration), or had its registration cancelled by TEQSA at the time of data collection.
In addition to the exclusions identified above, in a handful of cases irregular or abnormal data points have been excluded to avoid misleading interpretations of individual provider financial situations. Providers have also been excluded where sufficient data was not available to perform the calculation of a particular financial metric. As such, the number of providers presented in a particular chart may be less than the number of providers listed for its respective provider type or size band. Further details can be found in the Appendices and Explanatory notes of this report.
The data used in this report has been drawn from the 2014 TEQSA PIR collection and includes data from providers’ financial year ends of 31 December 2013 or 30 June 2014.