FY22 financial report print.indd

Virginia Tech Financial Report 2021-2022

Statement of Revenues, Expenses, and Changes in Net Position Operating and non-operating activities creating changes in the university’s total net position are presented in the Statement of Revenues, Expenses, and Changes in Net Position , found on page 17. The purpose of the statement is to present all revenues received and accrued, all expenses paid and accrued, and gains or losses from investments and capital assets. Operating revenues are generally received through providing goods and services to the various customers and constituencies of the university. Operating expenses are expenditures made to acquire or produce the goods and services provided in return for the operating revenues, and to carry out the missions of the university. Salaries and fringe benefits for faculty and staff are the largest type of operating expense. Non-operating revenues are revenues received for which goods and services are not di

rectly provided. Included in this category are state appropriations and gifts which supplement the payment of operating expenses of the university and support student scholarships. Therefore, the university, like most public institutions, expects to show an operating loss. Operating Revenues Total operating revenues increased by $149.3 million or 12.8% from the prior fiscal year. The growth in operating revenues came largely from auxiliary revenues ($77.5 million) such as athletics and dorm and dining programs, as they recovered from the effects of the pandemic. Student tuition and fees rose by $29.5 million reflecting small increases in tuition and fee rates as well as a continuing demand for a Virginia Tech education.

Summary of Revenues

Total Revenue by Source For the year ended June 30, 2022

Increase (Decrease) in Revenue For the years ended June 30, 2022 and 2021 (all dollars in millions)

2022

2021

Change

Student tuition and fees

Amount

Percent

(restated)

Operating revenue Student tuition and fees, net

$ 611.0 $ 581.5 $

29.5 35.7 77.5

5.1 %

362.5 299.7

326.8 222.2

10.9 % 34.9 % 20.8 % 12.8 %

Grants and contracts 1 Auxiliary enterprises Other operating revenue

31.4%

38.4

31.8

6.6

Total operating revenue

1,311.6

1,162.3

149.3

Other revenue

Non-operating revenue State appropriations

10.2%

18.6%

Grants and contracts

326.4 109.8 436.2

302.3 215.5 517.8

24.1

8.0 %

(105.7) (49.0)% (81.6) (15.8)%

Other non-operating revenue 2 Total non-operating revenue

Other non-operating revenue

5.6%

Other revenue

Capital appropriations Capital grants and gifts

13.7

-

13.7 52.7

100.0 % 41.2 % 130.4 % 53.3 %

180.7

128.0

15.4%

16.8%

Gain on disposal of capital assets

5.3

2.3

3.0

Total other revenue

199.7

130.3

69.4

State appropriations

Auxiliary enterprises

$ 1,947.5 $ 1,810.4 $ 137.1

Total revenue

7.6 %

2.0%

(1) Includes federal appropriations. (2) Includes gifts, investment income, interest expense on debt related to capital assets, federal Pell grants, CARES Act stabilization revenue, and other non-operating revenue.

Other operating revenue

Total sponsored grants and contracts grew by $35.7 million. Grants and contracts awarded by federal sponsors increased by $27.3 million, non governmental grants and contracts grew by $3.4 million, state grants and contracts rose by $3.0 million, and federal appropriations increased $2.2 million while local grants and contracts fell slightly. Other operating revenue rose by $6.6 million, largely due to an increase in sales and services of education activities. Overall, the university’s operating revenues climbed from $1,162.3 million in fiscal year 2021, to $1,311.6 million in fiscal year 2022. Non-operating and Other Revenues and Expenses Non-operating revenue and expenses totaled $436.2 million, a decrease of $81.6 million from the previous year’s total. Revenue decreases in this category resulted primarily from the downturn of the investment markets at year-end, resulting in significant unrealized investment losses for the longer-term investments with total investment earnings having a decline of $134.0 million. This decrease was offset by growth in state appropria tions of $24.2 million, an increase in COVID-19 relief funds of $9.7 mil

lion, a rise in gift revenue transferred from the Virginia Tech Foundation of $9.7 million, and smaller increases in other non-operating revenue ($6.6 million) and non-operating grants and contracts ($1.0 million). Total other revenue, expenses, gains, and losses grew by $69.4 million compared to the prior year. Capital grants and gifts increased $52.7 million due to an increase in Virginia College Building Authority (VCBA) 21st Century bonds and private funding for capital projects. For the first year in several years the university also received capital appropriation funding for its maintenance reserve program of $13.7 million. Additionally, there was an increase of $3.0 million in the gain on disposal of capital assets due to funds received for the sale of airport land to the FAA in previous years. Revenues from all sources (operating, non-operating, and other) for fiscal year 2022 totaled $1,947.5 million, increasing by $137.1 million from the prior year. Operating expenses totaled $1,638.7 million for fiscal year 2022, reflecting a year-over-year increase of $129.2 million. Total revenues less total operating expenses resulted in an increase to net position of $308.8 million.

11

Management's Discussion and Analysis