CBS’ finances escape coronavirus
Coronavirus has left its mark on CBS finances, but it could have been worse. Much worse, according to Kristian Dyhr, CFO at CBS. Especially less travelling and fewer conferences have saved CBS some money.
Coronavirus has indeed changed CBS. Students and staff are asked to sanitize their hands upon entering the buildings, 50 percent of the teaching takes place online, and no social activities whatsoever are allowed on CBS premises.
And this, of course, leaves its mark on the finances.
Kristian Dyhr, CFO at CBS, estimates that CBS will face coronavirus-related expenses totaling DKK 6 to 7 million in 2020 – covering the purchase of sanitizer, sanitizer dispensers, extra cleaning etc.
“It’s worth mentioning that CBS, like other Danish universities, has received a special grant of DKK 4 million from the Ministry of Higher Education and Science to cover expenses related to coronavirus,” he says.
In general, coronavirus and all the changes and restrictions it has brought have not been a blow to CBS finances. Instead, it has encouraged CBS to spend its money differently.
Right now, Kristian Dyhr expects CBS to have a surplus of DKK 68 million, compared to DKK 16 million, which was the initial estimate back in spring.
The bigger surplus results from a DKK 28 million increase in income and DKK 24 million decrease in expenses.
For example, CBS has spent far less money on traveling and conference activities this year. Usually in August, close to 100 staff members go to the US to attend the Academy of Management conference, but this year it was held online. This is just one of several examples where canceled activities have saved CBS expenses.
“Of course, there’s still some general uncertainty about how the coronavirus situation will develop and how it will affect CBS expenses and income. However, it would seem that CBS will be able to carry out all planned income-generating activities, either fully or partially online. Therefore, CBS is in far from the financial worst-case scenario described earlier,” it says in the most recent memo on CBS finances that was presented at the CBS Board Meeting on September 11.
And the worst-case scenario was a whole other ball game. In spring, Kristian Dyhr and his colleagues drew up different scenarios of how coronavirus could affect CBS’ budget. The worst-case scenario would have CBS ending up with a deficit of DKK 26 million.
That estimate was based on a significant decrease in income reflecting, for example, that CBS would receive less external funding for research, and lose out on course fees. On the other hand, CBS would still have to pay rent for the dorms and apartments for international students and researchers, who might not show up.
“The fact that CBS is avoiding the worst-case scenario is due mainly to the efforts to stop the infection spreading, which have had a positive effect both in Denmark and on campus. And the conversion to online teaching has happened so fast that it has been possible to continue the most important planned activities,” says Kristian Dyhr and continues:
“In general, everyone has worked extremely hard to ensure progress for the study programs, as well as for the various research activities, which has resulted in CBS expecting an income that is level with the figures budgeted for 2020.”
Looking towards 2021, coronavirus is expected to remain with us. For example, the Director of Campus Service, René Steffensen expects distance requirements to remain in force until December 2021. But how will that affect the budget for 2021?
“The budget for 2021 is still at a very general level, so at the moment it’s not possible to give a more detailed picture of what kind of coronavirus initiatives are planned for 2021,” says Kristian Dyhr.