In June 2024, King received two reports from SACSCOC, our accrediting body, regarding King’s fifth-year (interim) review.
The first, which largely concerned King’s academic and student support operations, was pristine. We owed one yes-or-no answer on a brief, factual issue, and this response has already been informally provided.
The second focused on a review of King’s finances over the past few years, and we were notified that we were being given a warning. We have not yet received the detailed report, and it would not be appropriate to comment on it. But given our aggressive, multi-year effort to cut expenses and increase revenue, we did not expect this outcome.
It is important to note that King remains fully accredited and that the warning status is related to a period of time when, like every other small college, we were working hard to stabilize finances following the pandemic. Even so, our budget two years ago (less depreciation) was only 0.17% away from being balanced. Our next audited financial statement (ready this fall), should likewise show last year’s budget as balanced. Additionally, we forecast a balanced budget for the current fiscal year.
In the current academic climate, King is fortunate to have multiple strengths. Unlike many colleges, we can control our instructional costs because we have a flexible contract system instead of tenure. Our consistently low long-term debt and debt service is a fraction of what many other schools like us carry. We pay all our obligations promptly when due and, like most large businesses, have access to a large line of credit should we need it. We have not dipped into or borrowed from the corpus of our endowment. The U.S. Department of Education has graded us financially responsible.
Critically, the past two years King has also enjoyed record levels of philanthropic support, especially in unrestricted gifts, including the largest such gifts in the school’s history. We are – with the steadfast and generous help of our supporters — making financially prudent decisions for the long-term health of King and the well-being of our students.
We will work cooperatively with SACSCOC to address the warning and look forward to making our required report in spring 2025.
James Donahue
Chief Financial Officer
King University