The university's financial management--the need of financial resources diversification in higher education.

Muscalu, Emanoil ; Todericiu, Ramona ; Titu, Mihail 等

1. INTRODUCTION

In order to obtain a new character, focused on change, a university needs a high level of financial resources and especially founds of which the university has to use them freely. To increase the financial support becomes a major priority because all over the world the Government tries to reduce the budget for the higher education institutions. Having in view these conditions a permanent preoccupation of the universities is the development of new strategies of diversification the extra budgetary financial resources, the analyses proves that the number of student will decrease and the students which pay the tuition fees will not be able to assure a sustainable financial resource. The research founds, the partnerships with other Universities from Romania and from abroad could be considered to be essential for the new strategy of diversification of the financial resources. Now, for all the Romanian universities regardless of size of profile the main and the vital problem in developing the activities is to attract supplementary founds which together with the founds from the budget to lead to a continuous development of the institution and consolidate its position on the market. Building a diversified financial base in an university supposes to create a portfolio of clients for meeting the expenses which grow continuously. An extended financial resource portfolio gives to the university the possibility to overcome the restrictions enforced by a unique financial resource. This stage it is characterized "as well through the University's special preoccupation of identifying the new financial sources--alternative sources- for compensating the government contribution, through the efficient use of the available resources but also through the ministry's attempts of improving the system of assigning the budget for the universities, of refining the formulas of financing ". As long as "the university's main mission, which characterize the past few centuries, was to create a capable administration in order to "manage" the government, the government accepted to be the only financial support having in view the conditions in which the universities had as main purpose to satisfy the need of qualified personnel for its services". The universities' purpose has been change in the past few decades, becoming institutions focused on satisfying the needs of the productive sectors and of the society in general. In the same time with this change "the government stops being the main and the only beneficiary of the public services from the higher education and therefore the main and the unique financial resource". (Todericiu, 2007)

2. THEORETICAL CONSIDERATION. WAYS OF ATTRACTING SUPPLEMENTARY FOUNDS

Attracting supplementary founds for the Romanian higher education has at this stage the following essential characteristics: the means of attracting founds are specific for each university, and inside the universities, the faculties have different preoccupations and potential having in view the profile and the forms of education (economics, law, sociology and psychology, informatics, foreign languages) for developing tuition fee education; to attract founds it is a conjugated action of the entire managerial team from the university and faculty's level, the main role being held by the Rector; the university's prestige and the higher education quality are very important in attracting founds. Starting from the need of attracting supplementary financial resources in the situation of the diminished financial support from the government, David Warner says that, each university has to diversify the financial resources and he emphasizes the development of some activities which "generate income". Of course we wonder which are these activities which will "generate income" for the universities? It is considered that, are some aspects of the "activities which generate income" all the generated incomes beside the financial support provided by the Ministry: research incomes, external grants, incomes from the lucrative activities (business) and the tuition fees and the administrative taxes.

From David Warner's point of view it is very important that before starting any activity in order to attract extra budgetary resources the top management of the university has to assure itself that all the basically activities are managed accordingly and function as efficient as possible. It is essential for the financial management that the universities to be aware of the fact that the easiest--but not the only one--way of obtaining the resources it is that of maximizing the incomes from the base activities. The academic management specialists say that the most used ways of attracting supplementary founds are:

a. Private institutions which benefit of the higher education services and products and the next few arguments come to sustain this statement: when new technologies are implemented the general academic training reduces the training or recycling period; the trained persons have a bigger productivity, productivity which it is transferred to the other employees and generate positive effects over the entire organization; the society in general (what justify the financial support from public founds) and the enterprises absorb the largest part of the external benefits generated by the graduates of the higher education system; the first and the most important beneficiary of the scientific and technique progress which it is made, are the universities and the enterprises. In a state or private organization "there are individual benefits of the one who graduated a higher education program: the high value of the academic diploma on the labor market, in the OCDE's countries, the participation rate on the labor market of the academic diplomats it is with 15% higher then the average. The unemployment rate it is 4,7% for academic diplomats compared with 8,5% the average, the academic diplomats' salaries are higher then the salaries of the one with a lower qualification".

b. Attracting founds through the scientific research development: the income obtained by the Romanian universities out of scientific research in the past few years it is growing (it is said that the higher education institutions without research it is not a true university) being essential for supporting, strengthening the teaching activity, especially for the senior year students and the graduates being a resource of new and important incomes through exploiting the created intellectual property.

c. Financial support through sponsorships: at the Romanian university level the sums obtained through sponsorships are insignificant because of the fact that the legislation does not encourage the firms to sponsor the cultural actions which could be sponsored but the sponsor has to be found and attracted in this process, a factor which depends by the university's capacity of persuasion and through diverse motivations to obtain financial support.

d. Financial support through European projects: since our country has been accepted between the European community's countries the Romanian universities have new financial opportunities. Now in the university's budget of expenses, the European projects' contribution it is a low percentage out of the total amount of the incomes. There are many financial resources and include organizations like: The European found of Regional development "The European social found" (having in view the economic performances of a region, the two of them could be combined as creating the Found of Investment in the Academic Objective). (Todericiu, 2007)

e. Tuition fee training: the tuition fees for the higher education could have positive consequences not only for the universities but for students too. But in the future, the students who pay will be more concerned to analyze the study period costs compared to the future incomes, without neglecting the possibility of non-monetary benefits after graduation. For now the Romanian universities collect low taxes and do not take into consideration the market's factors when they establish those tuition fees.

The development of the tuition fee education has to be a real preoccupation at the level of each higher education institutions; this creates a financial resource and an important component of the institution's image abroad regarding the receptivity, sensibility and adaptability of it to the social and economic environment for training and professional reconversion of the higher education graduates.

f. International students: the enrolment of the international students it represents one of the priorities around the world being a supplementary income resource. Having in view the increasing number of international students it is compulsory that in our country the tuition fees to be established by each university, the amount should be settled having in view the university's strategy and not to be imposed by the Ministry. For the success of these actions the universities have to be aware of what exactly the international students are interested in, what make them choose one university or another.

The Great Britain embassy's specialists, after a study made said that, choosing one university or another depends by the next aspects: the training quality; the employment perspectives; the accessibility at social facilities; personal security; good accommodation conditions; climate conditions near the one from the origin country; qualification recognized internationally; the teaching system similar to the origin country eventually taught in a language of world wide spread; short term classes. (Oprean & Titu, 2008)

From this perspective Romania has to solve many of its problems like: to restructure the curricula at European level, study programs in foreign languages, to improve the accommodation conditions in order to attract a high number of international students. It is very important to identify the international student's market. In the IDP report it is mentioned that the students which would like to study abroad take their decision having in view the next factors: the training quality, the employment perspectives after graduation, the training to be accessible, the life style and personal security. The British Consulate has a different view. They consider that the next few factors are necessary for recruiting the international students: "the qualification (diploma)after graduation has to have international recognition and appreciated by the student's origin country; the duration of the training has to be as short as possible; the classes to be in English (French could be an alternative); the course quality should be good; the curricula should be relevant for the students aspiration regarding the carrier (for example, first of all business, finance, computers, engineering, medical sciences, and design); good teachers and facilities; life support and transportation expenses" The British consultant do not take into consideration the life style problems as being very important saying that, the foreign students come to study not to have fun! The Romanian universities whose strategy foresees the international students recruitment as a key way of increasing the incomes, and they should try to clarify the next few problems: What means of recruiting do they have use? What form of organization brings the best results knowing that in these situations the speed it is essential? What level of investment it is necessary and which are the necessary time spaces for having success? What social and academic problems the international students confront with? From our point of view clarifying those problems it is essential in order to implement the new coherent strategies of attracting international students. (Titu & Oprean, 2007)

g. Study loans--modern financial source for the higher education;

h. The programs entirely paid;

i. The lucrative activities;

j. Services selling and renting the facilities.

3. CONCLUSIONS

It is very important that the universities to think about the next few aspects: Which it is the corresponding percentage from the university's incomes which come from each one from the above identified areas? Is there an optimum state and if yes which is that? Which of these areas could produce the largest profit, from example the excess of the income compared to the expenses? How easy is for a institution to organize all kinds of activities of which costs are equal or bigger than the income? Which are the areas which could produce the largest income without any specific usage which could be used by the university? Which of the profit areas could be extended with minimum effort? For now doesn't exist a clear answer to these questions, but, they could be taken into consideration by the universities. (Muscalu, 2004), (Todericiu, 2007)

4. REFERENCES

Muscalu, E. (2001). Universitary Strategies, Efficient Publishing House, Bucharest

Oprean, C. & Titu, M. (2008). Quality Management in the Economy and Organisation Based on Knowledge, AGIR Publishing House, Bucharest

Todericiu, R. (2007). Universitary Management from the European and Globalising Perspective, ULBS Publishing House, Sibiu

Titu, M. & Oprean, C. (2007). Quality Management, University of Pitesti Publishing House, ISBN 978-973-690-646-6, Pitesti

Titu, M. & Oprean, C. (2007). Strategic Management, University of Pitesti Publishing House, Pitesti