STATEMENT OF COMPLIANCE: The Citadel is in compliance with Comprehensive Standard R1.

RATIONALE FOR JUDGMENT OF COMPLIANCE:

 The Citadel recognizes that financial stability is a vital component of quality educational programs. The college continually strives to maintain such a status by prioritizing strategic initiatives, preparing comprehensive budgets, and practicing sound financial management. That The Citadel has achieved and maintains financial stability can be demonstrated in the following ways:

• The Citadel Budget Office prepares a balanced budget (Reference 1) each year that the Board of Visitors reviews and approves. This comprehensive budgeting process ensures that appropriate fee increases and other funding sources are generated to meet projected expenses and tracks to the Strategic Plan.

• For the last five years, the South Carolina State Auditor has issued unqualified opinions on the financial statements (References 2-6) of the college. The financial statements have shown increased growth in the total fund balance for the last five years despite two years of reliance on past surpluses to meet operational requirements.

• Established bond ratings and the ability to obtain bond insurance attest to the financial stability of The Citadel. The college issued $24,350,000 in revenue bonds in 1997 and received an A2 rating with a positive outlook from Moody's Investors Service (Reference 7). A 1997 Moody's Opinion Letter (Reference 8) publication describes The Citadel as possessing "Low State Appropriation Levels Mitigated by Diverse Revenue Streams and Positive Operating Margins." As a result, the college obtained bond insurance, which subsequently led to an "AAA" Moody's designation. In January 2003, the college issued a $3,150,000 Athletic Facilities Revenue Refunding Bond (Reference 9) for 15 years with a fixed interest rate of 4.19%. In the Higher Education Sector: 2003 Industry Outlook (Reference 10), published by Moody's Investors Service, public universities were listed as stable. Within South Carolina public universities, the college's A2 credit rating is exceeded only by the credit ratings of state's flagship institutions, Clemson University and the University of South Carolina.

• In the 2002 Fiscal Status Report (Reference 11), college data was compared to Moody's 2001 A2 ratings for colleges and universities. The college compared favorably in the following ratios:
  • Unrestricted Resources to Debt
  • Expendable Resources to Debt
  • Unrestricted Operating Resources to Operations
  • Expendable Resources to Operations
  • Matriculation
  • Total Tuition Discount

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