Sandstone on hold at Sydney University

It was revealed last week the university had a deficit of $160 million and has lost $271 million in investments.

A report showed the university was the hardest hit by the global financial crisis out of 10 higher education institutions in NSW and carried the highest level of debt.

NSW Auditor-General Peter Achterstraat made the findings in a financial audit of all universities established under State Government legislation.

“The university has incurred an operating loss of $160 million for 2008 compared to a surplus of $187 million in 2007, largely as a result of the global financial crisis and volatility in financial markets,” he said.

It also experienced a further drop of $211 million in investments, expense losses of $45 million realised on the sale of investments and a fall of $75 million in investment income earned over the past year.

Mr Achterstraat said Sydney University’s investments had fallen by 23 per cent from $1.15 billion in 2007 to $884 million in December 2008.

“The decrease in investments held is due to falling investment values and the use of investment to partly fund its capital building program,” he said.

“The university advised that it does not believe the fall in value will materially impact on its operations, however it may result in the deferral of some capital works programs.”

For 2009 and 2011, the capital works program stood at more than $1 billion, which was to be funded by grants, operating surplus and borrowings.

It included improving buildings, backlog maintenance, providing suitable staff and student accommodation and replacing outdated teaching and research facilities.

The university also recently spent $87.1 million on the Jane Foss Russell building, Darlington Public Domain and the Madsen Geosciences refurbishment.

Mr Achterstraat said superannuation liabilities also rose from $330 million in 2007 to $797 million in 2008 but the majority would be covered by the Australian Government.

Source: http://sydney-central.whereilive.com.au/news/story/sandstone-on-hold-at-sydney-university/