A Research On The Risk Management Of The Loan In Chinese Universities And Colleges

Since the state adopted a policy of expanding the scale of the general tertiary education enrollment in1999, China’s higher education has been on the fast lane.After over ten years’ development, China’s highereducation achieved the shift from "elite education " to " popular education ",which palyed a great role inpromoting economic and social development and in improving the quality of the people’s moral level.Theleaps and bounds of higher education asks for huge capital support, but the growth of the national financialeducation funding is not consistent with the growth of the development of higher education, which leads toa huge funding gap in the building up of colleges and universities. The lack of school funding seriouslyrestricts the rapid development of Higher Education.Encouraged by the relevant national policies, collegesand universities embarked on a debt sponsoring way.This way effectively alleviated the tension ofuniversity funds and the education funds’ insufficient situation.The loans has made tremendouscontributions to the construction and rapid development of the universities,however,loans, for colleges anduniversities, is a "double-edged sword".With the approaching of the repayment period,the non-profitcolleges and universities are usually unable to afford at least as much as several hundred million ormulti-billion of funds for repayment of the loans.The risk of loans is gradually emerging,which not onlyaffects the normal develoment of the universities,but also brings the community the uncertainties.Therefore,to strengthen the college loans risk management becames an urgent problem for the universityadministrators to solve.Starting from the basic concept of the college loan risk, combined with the concept and nature ofChina’s university loan,this essay takes“the risk of loans in colleges and universities”as the focus of analysis. Taking into account the actual size of China’s Higher Education Loan and the specificcharacteristics of the times,it analyzes the causes of the colleges and universities loan, points out thatChina’s Higher Education Loan schooling has a certain inevitability, and then analyzes the external andinternal reasons for our colleges and universities loan risk.At last,it comes to the conclusion that ourcolleges and universities currently face the risk of loans and points out the dangers of college loans.On thisbasis,this essay builds a college loan risk management framework. University loan risk managementframework starts from the eight elements that construct the college loan risk management:the internalenvironment,goal setting, risk identification, risk assessment, risk response, control activities, informationand communication, and monitoring, combined with the specific circumstances of China’s colleges anduniversities loan risk management, from the perspective of each element, analyzes and discusses how tomonitor our colleges and universities loan risk management.By establishing the risk assessment system ofthe college bank loans, on the basis of the existing university accounting and financial managementinfrastructure, by setting a series of financial indicators of high sensitivity and scientificity,by observeingthe development trends and changes,it forecasts the financial risk that colleges and universities mayconfront. In order to deal with risks and to ensure the health and sustainable development of highereducation, on the one hand, the government should increase the investment in education budget,which canensure the coordinated growth of education and financial investment;on the other hand, the university itselfalso should broaden the capital financing channels,make every effort to increase revenue, should activelycooperate with the relevant policies to take the replacement of land,take loan restructuring with thebanking group or policy banks,should emphasize both "open sources" and "cost-cutting",which help a lotin constructing "saving colleges and universities",and must have the courage to break the existing universities management system,to reform the university management style,and to promote theestablishment of the modern university system.This essay bases on the reality of college financial management,using the research method ofcombining theory and practice, initially builds university loan risk management framework,and comes to aseries of methods and control measures for the management of the college loan risk,which provides a newway of thinking to ensure the university loan risk management and the achievement of colleges’ sustainabledevelopment.