Question

Central University of Illinois has a newly appointed president, Catherine Husker. This has been a challenging budget year due to the difficulties of getting a state budget passed in the State Legislature. It appears from all reports that the budget that may get passed will be only 90% of last year’s state appropriations for the University. This means the University will have to cut their own operating budget for next year because of the State’s expected reduction in appropriations to higher education.

Husker just had a meeting with the athletic director of the university, Gareth Connor, to discuss the budget for the athletic department. Central University has been a men’s football and basketball powerhouse for the last several decades. However, the women’s athletic program has had less success. Last year, though, the women’s basketball team was one of the team’s selected to participate in the NCAA Women’s Basketball Competition through an “at-large bid” due to their outstanding season.

Connor and Husker discussed the 2018 Athletic Department budget, which Connor believed was the final draft. The meeting did not go well. In fact, it went terribly.   Husker discussed four grave concerns she had about the Athletic Department budget and requested Connor to review and revise the budget in light of her concerns below. Draft II of the budget is due in two weeks time.

Concern 1: The Athletic Department is budgeting a loss of over $3 million. Given the tight fiscal position of the university, this outcome is unacceptable to Husker. A budgeted loss of $1 million is the most she will tolerate for 2018. By 2019 the Athletic Department has to operate with a balanced budget. She tells Connor this is nonnegotiable.

Concern 2: The low allocation of money to the women’s athletic program. Fox Valley News, a tabloid television show, recently ran a program titled “It’s a Man’s World at Central University Athletics’ Program.” Husker said Connor is treating woman athletes as “third-class citizens.”

Concern 3: The low academic performance of the men’s football athletes, many of whom have full scholarships. She notes that the local TV news recently ran an interview with three football-team students, only one of which “exemplified the high academic credentials she wants Central to showcase to the world.” As for the other two students, she calls one student “incoherent” and another “incapable of stringing sentences together.”

Concern 4: The outrageous salary paid to “Bull” Mason, the football coach. She notes it is twice that of the highest paid academic person on campus, a Nobel Prize winner. Moreover, Mason receives other payments from his “Football the Central Way” summer program for high school students.

Below is Draft I of the Athletic Department budget:

Central University 2017 Athletic Department Budget ($ millions)

Revenues:

            Men’s athletic programs                              $10.350

            Women’s athletic programs                            0.780

            Other (endowment income, gifts)     3.400          $14.530

Costs:

         Men’s athletic programs                              $11.040

            Women’s athletic programs                            2.800

            Other (non-assigned to programs)*              3.700          17.540

Operating Income                                                                            $( 3.010)

*Other non-assigned programs include rugby, soccer and volleyball

Men’s Athletic Programs:

                                    Football          Basketball         Swimming     Other       Total

Revenues                  $8.600           $1.500               $0.100        $0.150   $10.350

Costs                          7.400                2.700                  0.300           0.640     11.040

Full Scholarships            37                    21            6                      4          68

Women’s Athletic Programs:

                                                            Basketball         Swimming     Other       Total

Revenues                                          $0.600               $0.080        $0.100   $ 0.780

Costs                                                    1.800                  0.200           0.800       2.800

Full Scholarships                                     11            4                      2          17

REQUIRED:

Connor will be holding a half-day meeting with key officials of the Athletic Department (of which your team are some of these key officials) to discuss the university president’s concerns. In order for your team of officials to be prepared to discuss the concerns of the president at this meeting, please answer the following questions prior to the meeting.

Questions:

Who are the stakeholders? (Worth 4 pts.)

The Athletic Department is operating at a loss. What are some of the ways the Department can increase revenues? Are there any potential pitfalls or problems with any of your ideas? (Worth 6 pts.)

Answer 1

A person group or organisation that has interest of concern in a particular organisation are known as stakeholders stakeholders can affect or be affected by organisations actions objectives and policies some examples of key stakeholders are creditors directors employees Government and its agencies supplier Union and community from which the business draws its resources not all stakeholders are equal a company's customer is entitled to fair trading practices but they are not entitled to same consideration as companies employ as an example of negative impact of stakeholders is well a company needs to cast cost and plan around of layoff this negatively affects the community of workers in the area and therefore the local economy someone going shares in a business such as Microsoft is positively affected. The athlete department can increase the revenue through few things. 1. Contributions - includes amount received directly from individual Corporation associations foundations clubs or other organisation by the donor for the operation of the ethnics program amounts paid in excess of tickets value contribution include cash marketable securities an inclined contribution such as dealer provided ka April and drink products for team and staff use. 2. Ticket sales sales of admission tour click events include ticket sales to the public faculty and student and money receipt for shipping and handling of ticket does not include amount in axis of face value or sales for conference and national tournaments that are passed through transactions. 3. School funds and student fees access to support athletes includes go direct and indirect support from University including state funds tuition Where's tuition as well as Federal work study amounts to athletes. 4. Licensing includes revenue from athletes from radio and television broadcast internet and e-commerce rights receive from institution negotiated contracts trademarks and royalties sale of advertisements. other ways by which the department can increase the revenues would be support from third parties guaranteed by School housing allowances camp income tournament ballgame revenues from conferences revenue from Green programs food and other concession from restaurants and parking revenues and other resources.