Assignment 4 Answers Howse
Introduction
The purpose of this analysis is to examine financial and organizational data from universities using information reported in tax filings. This dataset includes variables related to institutional revenue, expenses, compensation, assets, and organizational affiliations such as AJCU and Big East membership.
By analyzing these variables, this report helps individuals better understand how universities generate revenue, allocate expenses, and compensate leadership. The analysis provides insight into financial scale, operational differences, and organizational characteristics across institutions.
Comparison of Total Executive and Other Compensation Across AJCU and Non-AJCU Institutions
As Total Executive Compensation increases for AJCU schools the variability drastically increases in Total Other Employee Compensation. However, this is not the case for schools that are not Non-AJCU Institutions.
Variance in the Ratio of Total Executive Compensation to Total Other Compensation Among AJCU–Big East Institutions
Xavier University’s total executive compensation represents approximately 4% of the total compensation paid to non-executive staff. In comparison, Georgetown University maintains significantly lower executive compensation, with executive pay accounting for less than 1% of total non-executive employee compensation.
Changes in Median and Variance of Total Revenue Over Time Across All Institutions
Median total revenue across all institutions shows a general upward trend from 2015 to 2024, indicating steady financial growth over time. While there are minor fluctuations in earlier years, revenues increase notably after 2021, reaching their highest levels around 2023 before slightly declining in 2024.
The variance in total revenue increased steadily through 2021, followed by a sharp rise in 2022. Although variability declined noticeably in 2023, it increased again substantially in 2024. Overall, revenue variability has fluctuated considerably in the past three years compared to the more stable and gradual pattern observed prior to 2021.
Xavier University President Compensation vs. Peer Institutions
Based on these metrics, which compare Xavier’s president to other AJCU presidents using the 5-year average compensation (excluding years with $0 salary), it appears that she is not overcompensated.
It is important to note, however, that this analysis does not account for factors such as the size of the institution or measures of institutional success (e.g., OER). Therefore, the results do not consider the overall performance or achievements of the school over the past five years.
The Operating Expense Ratio (OER) provides insight into the financial stability and efficiency of a school, and it is likely one of the metrics used to evaluate presidential performance. Generally, a lower 5-year average OER indicates that a school—and by extension, its president—is managing resources effectively. For example, while Georgetown’s president receives a high salary, the school ranks poorly in OER. In contrast, Xavier ranks relatively well among AJCU institutions, suggesting that our president’s compensation is reasonable and not excessive.
Trends in Tuition, Gifts, and Functional Expenses Across Universities
When comparing all universities collectively, tuition revenue appears to be increasing over time, while gifts and contributions do not show a clear or consistent upward trend. In contrast, total functional expenses also demonstrate a noticeable upward trend that generally aligns with the increase in tuition revenue. This suggests that as universities generate more revenue from tuition, their overall expenses are increasing at a similar pace. However, gifts and contributions do not appear to be a major driver of this growth, as their levels remain relatively stable over the same period.