Financial Statements

Statement of Activity and Cash Flows *

In millions
For the fiscal year ended June 30, 2007 2006 2005
Revenues
MBA Tuition and Fees $77 $73 $68
Executive Education Tuition 91 81 76
Publishing 128 119 106
Endowment Distribution 78 71 62
Unrestricted Current Use Gifts 17 12 8
Housing, Rents, and Other 9 9 9
Interest Income 5 3 2
Total Revenues $405 $368 $331
Expenses
Salaries and Benefits $179 $167 $153
Publishing and Printing 51 42 35
Space and Occupancy 40 38 35
Supplies and Equipment 9 15 15
Professional Services 25 22 16
Fellowships 22 19 17
University Assessments 11 10 10
Debt Service 7 4 4
Other Expense 31 28 22
Total Expenses $375 $345 $307

Cash From Operations

$30

$23

$24
Use of Endowment Gifts or Appreciation 14 14 13
Cash Before Capital Activities $44 $37 $37

Capital Expenses

$(20)

$(49)

$(79)
Use of Gifts for Capital Projects 3 12 49
Net Capital Expenses $(17) $(37) $(30)

New Borrowings

$7

$38

$7
Debt Principal Payments (7) (4) (3)
Other Activity (22) (26) (15)
Net Debt and Other $(22) $8 $(11)
       
Change in Unrestricted Reserves $5 $8 $(4)
Beginning Balance, Unrestricted Reserves $60 $52 $56
Ending Balance, Unrestricted Reserves $65 $60 $52

* This statement presents a managerial view of Harvard Business School operations focused primarily on cash available for use. It is not intended to present the financial results in accordance with generally accepted accounting principles (GAAP). A presentation in accordance with GAAP would report higher operating revenues for gifts and endowment distribution and would include depreciation expense, yielding income from operations of $22 million in fiscal 2007. Cash flows, however,would be equivalent under GAAP.


Consolidated Balance Sheet

In millions
For the fiscal year ended June 30, 2007 2006 2005
Assets
Cash $16 $25 $21
Unrestricted Reserves 65 60 52
Receivables, Loans, and Other Assets 182 178 165
Invested Funds:
 Endowment Investments 2,654 2,190 1,924
 Current Fund Investments 16 18 17
 Interest in Trust Held by Others 151 132 124
Facilities, Net of Accumulated Depreciation 416 415 390
Total Assets $3,500 $3,018 $2,693
Liabilities
Deposits, Advances, and Other $39 $39 $30
Deferred Revenue 50 36 34
Other Debt Owed to University 26 25 -
Building Debt 108 108 74
Total Liabilities $223 $208 $138
Composition of Net Assets
Unrestricted Reserves $65 $60 $52
Undistributed Income and Other 34 36 28
Pledge Balances 40 56 83
Student Loan Funds 10 11 11
Investment in Facilities 308 307 316
Endowment and Other Invested Funds 2,821 2,340 2,065
Total Assets Net of Liabilities $3,277 $2,810 $2,555