Page 91 - DUT Annual Report 2020

The reduction in the net surplus is attributed largely due to the following factors:
lower prevailing interest rates in 2020, resulted in a 22% reduction in investment income and;
the impact of COVID-19 on our funders, resulted in a 41% reduction in income from contracts.
COUNCIL CONTROLLED AND
SPECIFICALLY FUNDED INCOME
AND EXPENDITURE
Income
The University is highly reliant on the first and second stream income which is state subsidy, grants and tuition fees and collectively it makes up 87% (2019: 82%) of the total income. The state subsidy and grants accounted for 49% (2019: 46%) and tuition and other income accounted for 38%, (2019: 36%) of the total income. Investment income accounted for 6% (2019: 8%), contract income and sales of goods and services accounted for 2% (2019: 3%) while non-recurrent income accounted for 5% (2019: 7%) of total income.
Tuition Fees & Other Income Investment Income
Non-current Income
State Subsidy & Grants
The state subsidy and grant income increased by 8% from R1 103m in 2019 to R1 192m. This increase is mainly attributable to the following factors:
Teaching input units increased from 46 793 to 47 851.
Teaching output units increased from 8 809 to 9 222.
Research output units increased from 502.52 to 639.93.
Tuition fee and other income increased from R867m in 2019 to R937m; an increase of 8%. In the current year the tuition fee increase is attributable mainly to the curriculum subject selection and related fee combinations that the students select in their progressive study years. Investment income comprises of interest earned on short-term and long-term investments and
as well as dividends received on long-term investments. Recurrent investment income decreased by 24% from R198m in 2019 to R151m. Income from research and other activities decreased by 33% from R60m in 2019 to R40m. The decrease in investment income, income from research and other activities and sales of goods and services can be attributed largely due to the impact of COVID-19, which resulted in reduced funding from grantors. Sales from goods and services decreased by 36% to R7m from R11m in 2019.
EXPENDITURE
DURBAN UNIVERSITY OF TECHNOLOGY ANNUAL REPORT 2020
Other Operating Expenses
Depreciation & Amortisation
Personnel
Recurrent personnel costs constitute 65% (2019: 63%), other operating expenses constitute 30% (2019: 33%) while depreciation and amortisation represents 5% (2019: 4%), of recurrent total expenditure excluding finance and capital expenditure respectively. Recurrent total council controlled and specifically funded activities restricted, expenditure increased by 7% from R1 614m in 2019 to R1 723m in 2020.
PERSONNEL COSTS –
ACADEMIC AND OTHER STAFF
Personnel costs increased by 11% to R1 125m (2019: R1 018m). The increase is attributable to the upward adjustment of 5% (2019: 5%) for grades 1-5 and 6.5% (2019: 6.5%) for grades 6-16 for the year under review. The reason for the non-correlation between the effective increase in personnel compensation and the salary adjustments is due to filling of vacant posts during the year and notch adjustments for qualifying staff.
Council Controlled Ratio of Staff Costs to Recurrent Income
The ratio of staff costs to recurrent income is 52% (2019: 51%). Recurrent income is defined as state subsidy and grants and tuition fee income and other income. The ratio is below the norm due to high number of vacant positions during the year.
89
5%
49%
30%
65%
5%
38%
2%
Contract & Sales Income
6%