An insidious disease.A NEW REPORT SUGGESTS THAT if hidden campus costs are not carefully tracked, they could lead to dire straits Noun 1. dire straits - a state of extreme distress desperate straits straits, strait, pass - a bad or difficult situation or state of affairs for institutions of higher education higher education Study beyond the level of secondary education. Institutions of higher education include not only colleges and universities but also professional schools in such fields as law, theology, medicine, business, music, and art. . "The Cost Disease in Higher Education," from Bridger, a Darien, Ill. consulting and management services firm, lays out startling star·tle v. star·tled, star·tling, star·tles v.tr. 1. To cause to make a quick involuntary movement or start. 2. To alarm, frighten, or surprise suddenly. See Synonyms at frighten. figures regarding costs and IHEs. Indirect costs Indirect costs are costs that are not directly accountable to a particular function or product; these are fixed costs. Indirect costs include taxes, administration, personnel and security costs. See also
The situation is fixable, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the report. By evaluating indirect costs and taking smart steps to manage them, college and university administrators can gain control of escalating tuition. If they don't, as student debt skyrockets institutions serving middle-income students could experience a net decline of nearly one million students within a decade. Production costs are often overlooked because institutions don't often have the tools in place, says John Krieger, president of Bridger. "They don't have the general ledger General Ledger A company's accounting records. This formal ledger contains all the financial accounts and statements of a business. Notes: The ledger uses two columns: one records debits, the other has offsetting credits. packages, they don't have the line item details." He adds, "If you can't measure it, you can't manage it." Krieger suggests that administrators took closely at line items, come up with cost solutions consistent with the institution's mission, and implement solutions in a transparent manner. The complete Bridget report can be obtained from Steven Hatch, director of business development, by writing to shatch@bridgerED.com. A new peer comparison tool, which includes indirect operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. for a group of roughly 1,100 private colleges and universities, is also available, at www.bridgerEd.com. COMPONENTS OF EDUCATIONAL AND GENERAL EXPENSE BUDGETS Interest 40% Indirect Costs 11% Benefits 6% Depreciation 14% Direct Labor/Learning Support/Campus Life 21% Direct Labor/Instruction 6% Direct Labor/Institutional Support 2% Note: Table made from pie chart. |
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