Revenue sourcing for the financial sustainability of a university of technology: an exploratory study

Abstract

South African universities are facing significant financial challenges that threaten their sustainability. Factors such as reduced government funding, unpredictable tuition collection, and the need to generate additional revenue have become major concerns for universities. This study investigates the perceptions of academic and non-academic staff regarding revenue sourcing to enhance financial sustainability at a university of technology. Quantitative data was collected using a questionnaire. The findings show that the university is using a diversified revenue structure and that revenue sourcing is a financial challenge for the university. This implies that the university’s current revenue generation strategies are inadequate. The respondents perceived revenue sourcing as a financial challenge and that relying on a single source of revenue is not financially viable. Low research output was considered a barrier to financial sustainability and improving research output was identified as a means of improving financial sustainability. Respondents agreed that appointing staff members who could attract funding and improvements in the infrastructure of the university would assist in removing barriers to financial sustainability and increase income together with offering short courses. Recommendations suggested by the respondents to increase revenue included the need to diversify revenue sources and that offering new courses and using international collaborations and university segments to establish industrial partnerships would generate additional revenue.

Keywords:

• Financial sustainability
• universities of technology
• income streams
• South Africa

JEL CLASSIFICATION:

• I22 H52
• H27
• H83

Reviewing Editor:

• Anatoly Oleksiyenko, The Education University of Hong Kong Faculty of of Education and Human Development, Hong Kong

Subjects:

• Higher Education Management
• School Leadership
• Management & Administration

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Xolani Minenhle Ngcobo

Xolani Ngcobo is a PhD Candidate at the University of KwaZulu-Natal. He completed his Master of Accounting at the Durban University of Technology. His thesis “Exploration of revenue sources for financial sustainability of public universities in KwaZulu-Natal: A case study of Durban University of Technology” was awarded cum laude.

Ferina Marimuthu

Professor Ferina Marimuthu is the Head of Department of Financial Accounting at Durban University of Technology.Following a successful career in the tertiary sector with over two decades background in the accounting discipline, combined with a PhD in Finance which examined capital structure and financial performance of South African state-owned entities, have equipped her with fingers on the pulse.Ferina takes a keen interest in learning materials development and adding value to students’ learning experience in the classroom and has authored and edited several books in the accounting discipline as well as reviewed textbooks for international publishers. This has been the impetus for her active involvement in research in the fields of accounting and finance.

Lesley June Stainbank

Professor Lesley Stainbank is an honorary research professor at the Faculty of Accounting and Informatics, Durban University of Technology. Lesley’s main role is in the supervision of masters and doctoral students. Her research interests include accounting education and corporate governance. Her recent project’s include ‘The adoption of IFRS for SMEs in Africa.’ Amongst her many accolades is being declared as South Africa’s most published researcher in the discipline of accounting, as revealed in the research study titled: “A Profile of Accounting Research in South African Accounting Journals”, which appears in the latest volume of the South African journal Meditari Accountancy Research (MEDAR).