(12-26-2013 10:37 PM)NJ2MDTerp Wrote: Equity in Athletics defines revenues as follows:
Revenues
All revenues attributable to intercollegiate athletic activities. This includes revenues from:
(1) appearance guarantees and options,
(2) an athletic conference, tournament or bowl games,
(3) concessions,
(4) contributions from alumni and others,
(5) institutional support,
(6) program advertising and sales, radio and television,
(7) royalties, signage and other sponsorships,
(8) sport camps,
(9) state or other government support,
(10) student activity fees,
(11) ticket and luxury box sales, and
(12) any other revenues attributable to intercollegiate athletic activities.
https://surveys.ope.ed.gov/athletics/Vie...Terms.aspx
The statement that revenue is revenue is not true for entities like this. Some of you are applying accounting principles that don't jibe with the reality of public entities and some of this money is illusory.
(9) state or other government support,
(5) institutional support,
(10) student activity fees,
These are not revenues for the university, they are internal transfers into the Athletic Fund by the university. This is no different from an internal service you might set up to determine how much the companies internal garage function or internal IT department actually costs. This is not income. If you think it's income, you need to enroll in an Urban Studies/Public Administration/Public Accounting class or two.
(12) any other revenues attributable to intercollegiate athletic activities.
This is the most difficult to determine from school to school. Where and why did the Ohio State sweatshirt or UNC tie sell? Is attributable to the academic side of the university or the athletic. If it sells at Wal-Mart or the Alumni Office, or the Student Store - how do you know? Each university can apply it's own rules.
(4) contributions from alumni and others,
If you have had a hand in raising money at the university level, you know that athletic, academic, and cultural donations can be blurred. Who cultivated the donation? Where did the relationship start? What was given in return? Again all universities can account this as they please.
Real revenue is that which is directly attributable to the sporting events, otherwise it's just a transfer of funds or the sometimes random application of a donation to a certain fund. If the donation is not cash money, how do you value the donation? If Big Kentucky Fan X gives 1000 acres to the University of Kentucky and it's his farm, and he says, use it as you see fit - who sees fit? If he says spend in the basketball program, when is the "value" actually recorded? In the year it's received, or when it sold at a later date.
The numbers used as a base set of numbers is too imprecise to measure very much, not only that, we can't even be certain the gross reporting is accurate.
This is how so many private operations end up in bankruptcy, they can't distinguish between real revenue and illusory revenue just used to cook or balance the books. Use GAAP rules, and modified accrual accounting together an you can have a data set that is useful. As it is now, we don't really know much other than large schools tend to make more total money than smaller school and even that generalization is somewhat devoid of meaning because real earnings as a value is based on an analogy of the seat being akin to a stock. The more seats, and the more value, the more money, but without expenses, legitimate expenses and not another set of phony transfers, we still know little of value.
It worries me that folks would look at the raw numbers and attempt to draw specific conclusions. However revenue is not always revenue, nor is profit always profit.
Let me boil it down to it's most simple form.
You are 16 years old and you have a job making 5.00 an hour 10 days a week cutting grass. Your income is 50 bucks a week. Your dad loans you $1000 to buy a car. That loan in NOT INCOME but according to the numbers we are given, that loan can be shown as income despite the fact we know damn well that a loan in not income. We would need to see the books of almost all the private fundraising arms of these schools, as well as how they handle their capital projects to fully understand what's happening.
If you attempt to make the case that all that matters about the data set is that it is what it is, well so is measuring the height of trees using sea level as your stating point. The trees in the mountains will always be higher than the trees on the coast.