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Financial Overview FY20

Mass General Brigham Incorporated (formerly known as Partners HealthCare System, Inc. (PHS)) is the sole governing member of The Massachusetts General Hospital (MGH). MGH is the sole governing member of the Institute. The Institute's activity is included in both the Mass General Brigham Incorporated financial statement and in the Mass General Hospital and Affiliates financial statement.

FY2020 Financial Report

In FY2020, the Institute addressed several significant and unprecedented challenges. Enrollment declined in the School of Nursing programs, and prerequisite and non-degree courses.  In March the COVID-19 pandemic required the Physician Assistant program to defer the program start date for its new students to the fall term of FY21 and to adjust its summer term curriculum. The Institute also incurred nearly $700K of unbudgeted COVID-19 related expenses to address the social distancing and safety of the students, faculty and staff.  Several interventions were taken to offset the impact of these events including new marketing strategies to increase enrollment and tuition and fee revenues, optimize staffing levels, and to reduce other expenses.

FY20 actual net income from operations was $42K, slightly above breakeven.  This performance continued the Institute’s trend of positive results and improvements in its financial strength. The positive results reflect the success of the Institute’s strategies to manage its resources and to advance its mission in a manner that supports students, enhanced its academic programs, and provide increased support for research activities

Revenues and Expenses

Total FY2020 operating revenues were $59.7 million compared to $60.6 million for the prior year.   Revenue from all income categories declined slightly due to changes in academic programs and COVID related restrictions.

Total operating expenses increased by $2.4 million from $57.3 million for FY2019 to $59.7 million for FY2020.  Instruction costs of $32.8 million grew by $1.4 million and comprised 55% of FY2020 expenses. Institutional support grew by $756K to $10.7 million providing increased levels of support to academic programs and students. 

Assets

Total assets increased by $44.8 million to $170.4 million as of September 2020.  The change was primarily accounting changes that required operating leases to be recognized as assets.   Increases in investments driven by changes in market value, and purchases of property and equipment for campus expansion also contributed to asset growth.

Liabilities and Net Assets

Total liabilities increased by $41.0 M to $75.6 million as of September 2020.  The change was primarily accounting changes that required operating obligations to be recognized as liabilities.  Total net assets grew by $3.8 million to $94.8 million as of September 2020 due to results from operating activities and non-operating investment and fundraising activities.

Balance Sheets:  September 30, 2020 and 2019 (in thousands)

 

2020

2019

Assets

 

 

Current assets:

 

 

Cash and equivalents

$10,474

$15,837

Investments

36,304

27,805

Current portion of investments limited as to use

4,499

11,109

Research grant receivable, net

587

412

Other current assets

2,485

2,305

Total current assets

54,349

57,468

Investments limited as to use, less current portion

5,898

4,735

Long-term investments

5,977

5,906

Interest in the net assets of affiliates

32,085

30,869

Property and equipment, net

30,882

26,471

Right-of-use operating lease assets

40,980

-

Other assets

224

144

Total assets

$170,395

$125,593

 

 

 

Liabilities and Net Assets

 

 

Current liabilities:

 

 

Current portion of notes payable to affiliates

$1,193

$1,143

Accounts payable and accrued expenses

16,822

15,450

Accrued employee compensation and benefits

1,409

1,659

Unexpended funds on research grants

187

129

Due to affiliates

1,403

1,856

Total current liabilities 

21,014

20,237

Other liabilities

 

 

Accrued other

2,874

2,478

Operating lease obligations, less current portion

41,033

-

Notes payable to affiliates, less current portion

10,674

11,867

Total liabilities

75,595

34,582

 

 

 

Net assets

 

 

Unrestricted

70,352

67,272

Donor restricted

24,448

23,739

Total net assets

94,800

91,011

 

 

 

Total liabilities and net assets

$170,395

$125,593

 

 

 

 

Statement of Operations:  Years Ended September 30, 2020 and 2019 (in thousands)

 

2020

2019

Operating revenues

 

 

Tuition and fees

$ 59,691

$ 60,104

Less: Financial aid

7,598

7,438

     Tuition and fees, net

52,093

52,666

 

 

 

Direct academic and research revenue

3,902

3,666

Indirect academic and research revenue

1,045

1,093

Other revenue

2,699

3,218

     Total operating revenues

59,739

60,643

 

 

 

Operating expenses

 

 

Instruction

32,822

31,411

Institutional support

10,722

9,966

Research

3,721

3,705

Student services

3,295

3,248

Academic support

8,963

8,745

Facilities

175

186

     Total operating expenses

59,697

57,261

 

 

 

Income from operations

42

3,382

 

 

 

Nonoperating gains (expenses)

 

 

Income from investments

3,278

1,887

Other nonoperating (expenses) income

(1,497)

62

Academic and research gifts, net of expenses

1,073

(238)

System development funding

(2)

(4)

Total nonoperating gains (expenses), net

2,852

1,707

 

 

 

Excess of revenues over expenses

2,894

5,089

 

 

 

Other changes in net assets:

 

 

Transfers from affiliates

186

116

 

 

 

Increase(decrease) in unrestricted net assets

$   3,080

$   5,205

 

 

 

Statements of Changes in Net Assets: Years Ended September 30, 2020 and 2019 (in thousands)

 

2020

2019

Unrestricted

 

 

Net assets, beginning of year

$67,272

$62,067

 

 

 

Increases (decreases)

 

 

Income (loss) from operations

42

3,382

Income (loss) from investments

3,278

1,887

Other nonoperating (expenses) income

(1,497)

62

Academic and research gifts, net of expenses

1,073

(238)

System development funding

(2)

(4)

Transfers (to) from affiliates

186

116

Change in unrestricted net assets

3,080

5,205

 

 

 

Net assets, end of year

$70,352

$67,272

 

 

 

Donor Restricted

 

 

Net assets, beginning of year

$23,739

$23,525

 

 

 

Increases (decreases)

 

 

Income (loss) from investments

518

(103)

Other nonoperating income (expenses)

144

329

Other changes in net assets

47

(12)

Change in donor restricted net assets

709

214

 

 

 

Net assets, end of year

$24,448

$23,739