2021 Annual Report: A satisfactory result

The financial results for 2021 were very close to the budgeted. 2021 began with a deficit of DKK 19m and ended with a small surplus, thanks to higher returns on investments than forecast.

Aarhus University’s accounts for 2021 have been approved by the board, and the ‘result after financial items’ was a DKK 14m surplus. Returns on AU’s investment last year were almost twice the amount forecast; AU’s result before financial items was a DKK 19m deficit.

Chair of the Board Connie Hedegaard was satisfied with the accounts.

“The university has delivered on all of the significant parameters, and the board agree that the results are in the ballpark,” Hedegaard said.

A surplus is not just a plus

The university had budgeted with a DKK 48m shortfall 2021,which was to be covered by funds from the financial reserves. And at most companies, a positive result is cause for celebration.  But that’s not exactly how the university’s finances work.

The university budgeted with a shortfall because the universities aren’t supposed to sit on piles of cash, explained Hedegaard:

“Our funds are meant to be used, to drive research, education, innovation and consultancy that create knowledge and value for society. That said, it’s difficult to predict and influence returns on our investments. Particularly in the past few years due to Covid. But in short, this surplus means the university has the muscles to invest in the university’s development, and hopefully we’re now in a place where Covid is no longer limiting and slowing us down, as it has in the past few years.”

Investment will continue

Aarhus University has budgeted with a deficit for 2022 as well. The deficit has been calculated at DKK 47m, among other reasons because the university wishes to draw on its financial reserves to maintain investments in its engineering programmes as well as the digitalisation strategy – including the new studies administration system.

Covid has contributed to uncertainty in the university’s finances in recent years. A new factor that will affect the university’s finances in coming years is the political agreement to relocate and cut student places. How this agreement will affect the university’s finances will become clearer over the course of the year.

“Our goal for the coming years is still to invest the university’s financial reserves in strengthening our research and degree programmes and administrative support. The university has come up with a solid plan for this, and the board have great confidence in the university’s management of its finances. There is a high level of academic ambition, as there should be, and the board will regularly follow up on how things progress. Among other issues, in relation to bringing the financial reserves into play,” said Hedegaard.