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THAI NGUYEN UNIVERSITY Socialist Republic of Vietnam SOUTHERN LUZON STATE UNIVERSITY Republic of the Philippines ANALYSIS ON FINANCIAL MANAGEMENT OF ULSA: BASIS FOR EFFICIENT RESOURC

THAI NGUYEN UNIVERSITY

Socialist Republic of Vietnam

SOUTHERN LUZON STATE UNIVERSITY

Republic of the Philippines

ANALYSIS ON FINANCIAL MANAGEMENT OF ULSA:

BASIS FOR EFFICIENT RESOURCE ALLOCATION

DOCTORAL DISSERTATION

ðỖ THỊ THANH HOA (English Name: EMILY)

Supervisor: Dr JOANNA PAULA ELLAGA Thainguyen University of Economics and Business Administration (TUEBA)

TNU-SLSU, 2013

TABLE OF CONTENT

LIST OF TABLES 4

LIST OF FIGURES 5

ACKNOWLEDGMENT 6

COMMITMENT 7

ABSTRACT 8

CHAPTER I INTRODUCTION 10

1.1 Background of the study 10

1.2 Statement of objectives 12

1.3 Hypotheses 15

1.4 Significance of the study 15

1.5 Scope and limitation of the study 18

1.6 Definition of terms 20

CHAPTER II REVIEW OF RELATED LITERATURE AND STUDIES 23

2.1 Literature and studies review 23

2.1.1 Foreign literature 23

2.1.2 Local literature 27

2.1.3 Foreign studies 29

2.1.4 Local studies 41

2.2 Theoretical and conceptual framework 52

2.2.1 Concept of quality and effectiveness: 52

2.2.2 The task of higher education: 54

2.2.3 Cameron’s Model of Organizational Effectiveness: 55

2.2.4 The Balanced Scorecard 57

2.2.5 Applicability of the balanced scorecard model in higher education management in Vietnam 59 2.2.6 Conceptual framework 61

CHAPTER III METHODOLOGY 63

3.1 Research design 63

3.2 Determination of sample size 63

3.3 Sampling design and techniques 63

3.4 Subject of the study 64

3.5 Research instrument 64

3.6 Validation of the instrument 65

3.7 Statistical treatment 65

CHAPTER IV RESULTS AND DISCUSSION 66

4.1 Profile of the respondent 66

4.1.1 Gender of the respondents 66

4.1.2 Age of the respondents 66

4.1.3 The highest educational attainment of the respondents 67

4.1.4 Monthly average income of the respondents 68

4.1.5 Position of the respondents 68

4.2 Assess the effect of financial management in resource allocation 69

4.2.1 Financial management of ULSA in terms of resource allocation in labor 69

4.2.2 Financial management of ULSA in terms of resource allocation in equipment and infrastructure 73

4.2.3 Financial management of ULSA in terms of resource allocation in program 75

4.2.4 Financial management of ULSA in terms of resource allocation in services provision 77 4.3 Evaluating Financial management in terms of resource allocation and propose a basis for resources allocation for ULSA 78

4.4 Regression analysis 80

4.5 Hypothesis testing 85

4.5.1 Hypothesis 1: The more investment in improving facilities, the higher effect of financial management 85

4.5.2 Hypothesis 2: To increase the percentage spent on teachers and satisfaction of teachers, it will increase the effect of financial management: 86

4.5.3 Hypothesis 3: Reduce administrative costs will increase the effect of financial management: 87

4.5.4 Hypothesis 4: The more investment in innovation program (method, examination, tests

and assessment), the higher effect of financial management 88

CHAPTER V SUMMARY, FINDINGS, CONCLUSIONS AND RECOMMENDATIONS 90

5.1 Summary 90

5.2 Conclusion 92

5.3 Recommendation 95

REFERENCES 101

APPENDIX 104

APPENDIX 1 REQUEST LETTER TO CONDUCT THE SURVEY (TO RESPONDENTS) 104

APPENDIX 2 QUESTIONNAIRE 105

APPENDIX 3 Cronbach alpha of factors of financial management 109

APPENDIX 4 CURRICULUM VITAE 112

LIST OF TABLES

Content page

Table 1.1 Resources allocation in ULSA 2012 11

Table 3.1 Five point Likert’s Scale 64

Table 4.1: Gender of the respondents 66

Table 4.2: Age of the respondents 66

Table 4.3: Education level of the respondents 67

Table 4.4: Monthly everage income of the respondents 68

Table 4.6 Frequency and Percentage Distribution of the Respondents in Financial Management in terms of Labor Resources Allocation as to Salary 70

Table 4.7 The average value of from 1.1 to 1.4 questions 71

Table 4.8 Frequency and Percentage Distribution of the Respondents in Financial Management in terms of Labor Resources Allocation as to professional development and teaching quality 72

Table 4.9 Frequency and Percentage Distribution of the Respondents in Financial Management in terms of Labor Resources Allocation as to development career 73

Table 4.10 Frequency and Percentage Distribution of the Respondents in Financial Management in terms of Resources Allocation in equipment and infrastructure 74

Table 4.11 The average value of from 4.1 to 4.3 questions 75

Table 4.12 Frequency and Percentage Distribution of the Respondents in Financial Management in terms of Resources Allocation in program 76

Table 4.13 The average value of from 5.1 to 5.4 questions 76

Table 4.14 Frequency and Percentage Distribution of the Respondents in Financial Management in terms of Resources Allocation in services provision 77

Table 4.15 The average value of from 6.1 to 6.3 questions 78

Table 4.16 Frequency and Percentage Distribution of the Respondents in Financial Management in terms of Resources Allocation 79

Table 4.17 The average value of from 7.1 to 7.6 questions 80

Table 4.18 Cronbach alpha coefficient 82

Table 4.19 F-test and Significance test 83

Table 4.20 The regression models 84

Table 4.21 gamma’s value and level of significance of hypothesis 1 86

Table 4.22 gamma’s value and level of significance of hypothesis 2 86

Table 4.23 gamma’s value and level of significance of hypothesis 3 87

Table 4.24 gamma’s value and level of significance of hypothesis 4 88

Table 1.1 Resources allocation in ULSA 2012 96

Table 5.1 The optimal rate of items in resource allocation 97

LIST OF FIGURES

Content page

Figure 1.1 Limitation of study 19

Figure 2.1 Model Balanced Scorecard 45

Figure 2.2 Diagram of the Balanced Scorecard 58

Figure 2.3 Research paradigm 61

Figure 4.1: percent of position of sample 69

Thanks for my family and all my beloved friends who have shared, encouraged and supported me so much during my DBA program to made my study feasible

The Author

Do Thi Thanh Hoa

COMMITMENT

The authors declare that this is my own research The information is used in the dissertation is credible The evaluation criteria of financial management: the basis for allocating resources have not been available in Vietnam in general and Hanoi in particular The evaluation criteria of financial management: the basis for allocating resources have not been available in Vietnam in general and Hanoi in particular The problem of resources allocation in the financial university has been mentioned However, no specific studies at the University of Socialist Labor and other universities in Vietnam This study may provide the basis for financial management to allocate resources effectively, in accordance with the actual situation of ULSA, and the reference to the financial management of the other schools and policy makers regarding the allocation of resources for education The author strongly believes that the thesis is the first study in Vietnam to build resource allocation model suitablely for University Labor – Social Affairs, and therefore it is also the first study to introduce the method of applying the standards of resources allocation of the university Therefore, the findings and conclusions of the dissertation has not been published in any other work yet

The Author

Do Thi Thanh Hoa

ABSTRACT

Starting from current reality in Vietnam, the mechanism of financial of education, including tuition fees are not renovated, a system of wage scales also take the average, so is not to encourage the dynamism and creativity of teachers and education managers; cost norms for training between branches, jobs is still averaged and not practical; mechanisms for allocating budget for institutions is also unreasonable Attracting investment from social resources for of higher education (including public schools) are limited (the Resolution No 05- NQ/BCSð January 06, 2010)

University of labour and social affairs (ULSA) is also in this general situation Now, tuition fees of ULSA are in regulated frame, infrastructure is poor, the system

of wage doesn’t encourage the employee, state budget invested in ULSA is limited, financial management is not good, resource allocation is not reasonable

The objective of this dissertation is to analyze the current status of financial management including resource allocation of University Labor - Social, in order to offer solutions to better allocate resources for it From the survey of managerial staff and lecturers of University of Labor – Social Affairs, dissertation assessed the impact

of financial management, including the allocation of resources to the factor labor, equipment and facilities, program and course providers

The dissertation used methodology of the questionnaire survey, descriptive statistical analysis, regression to give proposal for the resources allocation of the university

From the analysis of actual allocation of resources in the University of Labor and Social Affairs, the dissertation determine the respondent’s profile (gender, age, the highest education level, montly average income, the number of years of services

in the university, position), profile of the respondents is in accordance with the actual situation of ULSA Secondly, the author assess the effect of resources allocation to the factors: labor, equipment and infrastructure, course program and providing services Determining the impact of these factors is to adjust the allocation of resources for effectiveness Finally, the researcher proposes a basis for an efficient financial resources allocation for the university through regression model These model showed that the priority of investment to get high efficency

CHAPTER I INTRODUCTION 1.1 Background of the study

Education in our Vietnam ver the next decade in the context of developing world

is more rapid and complex changes Globalization and international integration in education has become an inevitable trend Scientific and technological revolution, information technology and communications, intellectual economy growing strongly, direct impact on the development of education in the world… Fast-growing demand for education to meet the demands of industrialization and modernization of the country, economic development in depth knowledge with advanced technologies and international integration, while the resources to education is limited, will create pressure on educational development (The decision No 711/Qð-TTg June 13, 2012) The core problem of a university education (higher education) can be summed up

in three words: quality, efficiency and social justice And with ULSA is two words: quality and finance How to manage finance to get high quality and financial management here is allocating the resources

The decision No 711/Qð-TTg June 13, 2012 also confirm necessary educational solutions development phase 2011-2020 is: Increasing resources for investment and innovating education financing mechanism To continue renewing education financing mechanisms to mobilize, allocate and use more effectively the resources of public and social investment in education and enhancing the autonomy of the institution, make transparency and responsibility to the State, the learner and society

to ensure financial resources for a number of Vietnamese educational institutions are capable of integrating and international competition

Current status of resources allocation in ULSA:

Table 1.1 Resources allocation in ULSA 2012

1 Salary for faculty 28,150,143,000 42.6%

Source: Accounting Department of ULSA, 2012

Currently, the quality of the teachers is inadequate, the salary of each teacher

is not high, and method of payment of salary for each teacher on fix rank and seniority to lose the its leverage In 2012, the average income of a teacher is 6.721.000VND/month (= 320 USD / month), this salary does not encourage teachers, Thus, teachers are not interested to prepare good lecture, add and update knowledge Moreover, the construction of the system of fixed wage scale, the time of wage increasing is 3 years, this salary payment does not reflect the true quality of teachers

Training program is now not really completed, ULSA invested about 12% for program but basic teaching methods are still in the old lines, mostly by traditional methods The traditional method mean that learning is mainly based on lectures so acquiring knowledge processes are passive, unilateral, does not expand the vision When problems of practices are improper such as theory, most students fall into an embarrassing situation and dare not to process Students are not interested in program Therefore, the school should innovate program and method to meet current needs

The amount of investing equipment and facility of ULSA is small The procurement of equipment and facilities were not timely and did not meet the requirements In fact, equipments and infrastructure for practice, experiments are inconsistent and outdated

Providing services of ULSA now account for a relatively large proportion of 25.5%, but the service is not really efficient Administrative procedures are cumbersome, providing information to students and parents is slow and inaccurate, service attitude is not good

ULSA need to allocate resources suitable to get high quality Thus, analyzing the financial management: basis for efficient resources allocation is very necessary

1.2 Statement of objectives

In recent years, many principals have errors in financial management, leading to serious disunity, even corruption cases occur, adversely affecting the reputation of the school as well as the professional subject.(Thanh Binh, 2012)

Danger of falling behind can make the gap of economics, knowledge and education between Vietnam and other countries increased International integration and market development raises new problems, such as risk of cultural intrusion and unhealthy lifestyles to erode national identity, poor quality of education services may cause greater the risks to education posed requires innovation in both theory and practical solutions relevant to the development of education (The decision No 711/Qð-TTg June 13, 2012)

Training quality, effectiveness of VN higher education are low, don’t meet the increasing requirements for human resources Maybe that's getting is uniformly high

in the nearly 1,000 delegates attended the conference "Innovation VN higher education: Opportunities and Challenges" by the Ministry of Education and Training

held in Hanoi Such remarks are mentioned in almost every speech, ideas, sketches of

a situation not so optimistic of higher education in Vietnam (Thanh Hà, 2004) The decision No 711/Qð-TTg June 13, 2012 about approval education development strategy 2011 – 2020 of Prime Minister points out the inadequacies and weaknesses: The quality of education is low compared with the requirements of the country's development in the new period and compared with the level of countries with advanced education in the region, around the world Don’t solve the relationship between the development of number and requirement of improving the quality ; professional capacity of students graduated did not meet the requirements of the job; have expressed deviant behavior and lifestyle in a division students Management education is subsidized, embraced, and overlapping incident and scattered, responsibilities and powers of professional managers is not parallel with responsibility, authority for personnel management and finance The legal system and education policy is inconsistent, is amended and supplemented slowly The coordination between education and other ministries, branches and localities has not been close Policy to mobilize and allocate human resources to finance education is not reasonable; efficient use of resources is not high State investment in education is not highly concentrated for the priority objectives; the expenditures for professional activities is low Autonomy and social responsibility of educational institutions is not stipulated fully and truly

This study focuses on financial management of ULSA, so that we can allocate suitably resources because ULSA today are still subsidized so it is not interested much in financial efficiency The research uses knowledge mainly on the criteria to assess the effects of capital investment and quality standards in education

The specific objectives of this dissertation are:

1 To determine the profile of the respondents in terms of the following

1.1 gender

1.2 age

1.3 highest educational attainment

1.4 monthly average income

2.2 equipment and infrastructure

2.3 course program

2.4 service provision

3 To propose a basis for resources allocation for ULSA

From the reality of management systems in public universities in general and the university of Labor and Social Affairs in particular, the allocation of resources is important in the financial management of the university Appropriate resources allocation will help financial managers to achieve better efficiency and improve the quality of training, to be the basis for implementing of strategic objectives most effectively, to avoid waste and inefficient in the use of resources So this dissertation

is necessary to contribute to strengthen financial management: the basis for efficient resources allocation

1.4 Significance of the study

Before the general reality is lack of resources to develop the education and training of university, ULSA also need to have the financial resources to meet the expenditure needs to ensure the survival and development However, the mobilization

of resources ULSA is not a urgent issue due to it is financed by the state budget ULSA, tuition revenue sources is collected by state regulation So the question here is how to exploit and utilize financial resources efficient at the University of Labor – Social, this is now emerged problems, financial management mechanisms are inappropriate, even more wasteful and embarrassing, not proactive and highly creative yet The university has not really considered to the efficiency of the exploitation and the usage of financial resources It is also a major cause of reduced quality of training

Currently, ULSA is lack of facilities and equipment, only temporary teaching facilities meet minimum learning needs Specially, equipment for laboratory and

practices are lack of synchronization and backward So the motto “the study go together with practice” is not basically done

The quality of the teaching staff is week Teaching and learning methods are mostly traditional methods, which students are mainly based on learning following lecture and lesson, acquiring knowledge processes are passive so students do not expand the vision Salary for teachers are low, wage payment method on rank and seniority has lost its leverage Base salary is considered for a raise every 3 years do not reflect the true quality of teachers Teachers still have to do extra working so as to reduce time to prepare lecture and update additional knowledge, so lectures quality is not improved to directly affect the quality of training

Training program for the university was recently built, it should be gradually improved Compared to other countries in the region and the world, the program is relatively backward, so it is needed to continue to research, add and upgrade urgently

So how and where to invest the resources of ULSA to get a high quality are current issues Thus the study of the subject “analysis financial management of ULSA: basis for efficient resource allocation” is essential and important today

Before this needs and seeing the financial management of the University of Labor – Social Affairs, the dissertation “ analysis financial management: the basis for efficient resources allocation” is necessary From that, the financial manager of ULSA could use better resources, provide higher education quality The dissertation will present the method of distribution of financial resources that is consistent with the situation of ULSA, to help its financial manager to plan for allocating resources for specific items

The beneficiaries of this dissertation research is firstly managers of ULSA, especially financial managers; managerial staff; faculty of ULSA; students of ULSA; the other public university and the budget allocation planner

For the managers, this dissertation will give them the way to use resources reasonably, they will know to prioritize resources for which items and what items should be adjusted to achieve high efficiency Since then , the university will have a way of appropriate financial management and resources allocation to ensure the survival and sustainable development The school will have a good future development and create increasing prestige

For the teachers, when the resources allocated reasonably, wages are paid according to the quantity and quality of labor, not the average salary Thus, teachers will invest more in teaching quality hours so they are paid higher salary In addition, they will be invested more in professional development because ULSA will invest adequate resources for this item

For the staffs, the rational allocation of resources will help them to be more motivative to work better because their labor will be estimated rightly, the university will not increase the salary 3 years 1 times that be paid by effective working Therefore, they will invest to improve the quality and efficiency of work, so that the quality of service increased They will focus on making the work more effective instead of doing unnecessary work When rational allocation of resources, ULSA will increase prestige, the staff will have the opportunity to develop their work more professional and provide better service to receive higher wages

For students, the rational allocation of resources, they will be entitled to the investment needed to develop the quality of learning Teachers will provide them with hours of teaching quality, suitable equipment investment and better quality of service

will create opportunity for students to learn and practice more Therefore, students will feel more satisfied with the university and they are the best advertiser for the brand of the university Their parents will be more satisfied and willing to contribute

to a higher payment in order to received the better training quality of the university

Then the other public universities can learn ULSA model of resources allocation In addition, the Budget allocation planner for education also can refer to have more reasonable basis for budget allocations for public higher education

In the future, before the training needs of the society increasing, financial management solution of ULSA will effectively improve the quality of training, investment efficiency and raise the responsibilities of the education and training facilities to meet the demand of high quality human resources of the country, protect the legitimate interests of learners and require continual innovation knowledge to serve society So the research on financial management of ULSA is very meaningful

in this context This will be the basic for allocating resources This study is expected

to help improve the financial management of ULSA effectively

1.5 Scope and limitation of the study

But the main difficulty affecting research results is the quality criteria are not specific, relative and difficult to assess objectively However, in this study reseacher selected criteria: quality of education measured by the worth of money This concept balance quality with and value, in particular as value for money, "quality product with economic price" Although often referred to quality as value for money, it is be evaluated through a number of criteria such as standards, specific level or reliability The core concept of quality measured by the worth for money is the concept of responsibility The public service is expected to be responsible for the investment and the "customer" (Department of Testing and quality control of education, 2008)

The critical variable in the study are:

+ Evaluate the criteria in the use of finance: capital investment in innovation teaching method, examination, tests and assessment, the percentage spent on teachers and administrative costs

+ Indicators to assess the effects of using labors: income statement, the average salary per teacher and per administrative staff

+ The evaluative criteria in the use of efficient equipment and facilities: learning area per one student, dormitory area per one student, the amount of money for equipment of teaching and learning per one student

+ Indicators of quality education: the satisfaction of teacher and student construction and equipment for physical training and sport of student…

Limitations of the study is to assess financial management of ULSA, the basic for resources allocation Other elements of financial management are also assessed as important as the security of capital and debt, revenue and profitability of financial investment in education, but for the ULSA - a public university, the safety of capital

is relatively stable, almost no debt, revenue and profit are not their interest because the money is mainly provided by state budget They only care how to use and allocate money effectively This is illustrated by the following diagram:

Figure 1.1 Limitation of study

financial management: resources

serving

1.6 Definition of terms

To perform this study, the authors used a number of concepts, definitions as a basis for the study These concepts, definitions are throughout the dissertation, as a basis for the understanding and applications of research findings into practice

- The Higher Education Law 2012 defines financial management of higher

education institutions to ensure the quality of higher education, including four conditions: labor (faculty, administrators, staff), equipment and infrastructure (Study room, office, library, information technology systems, laboratories, practice facilities), course program (training programs, curriculum, teaching materials and learning) and service provision

- Finance is the economic categories, reflecting the distribution relations of

wealth in the form of social value Incurred in the process of forming, creating, allocating monetary funds of entities in the economy in order to achieve the objectives

of each subject in certain conditions

(http://vi.wikipedia.org/wiki/Tài_chính)

- Resource allocation is used to assign the available resources in an economic

way It is part of resource management In project management, resource allocation is the scheduling of activities and the resources required by those activities while taking into consideration both the resource availability and the project time (http://en.wikipedia.org/wiki/Resource_allocation)

Thus, to get high quality education, the researcher study financial management in terms of resources allocation under four aspects: Labour (teachers and staff), course program, facilities and infrastructure, services provision

- Effectiveness is the capability of producing a desired result When something is

deemed effective, it means it has an intended or expected outcome, or produces a deep, vivid impression.[1] (http://en.wikipedia.org/wiki/Effectiveness)

[1]

Dictionary.com, LLC "Effectiveness | Define Effectiveness at Dictionary.com." Dictionary.com | Find the Meanings and Definitions of Words at Dictionary.com

2011 Web 28 Sept 2011 <http://dictionary.reference.com/browse/effectiveness>

- Labor resources is known as the most revolutionary and the most important

resources to decide social and economic growth, in narrower sense, it includes the population of working age that have working capacity Labor resources are considered

on two angles of quantity and quality Labor quantity is expressed through criteria such as size and growth rate of labor resources Labor quality is considered on the following aspects: health, education level, qualifications, capability and quality (http://old.voer.edu.vn/module/kinh-te/cac-khai-niem-co-ban-ve-lao-dong-va-viec-lam.html)

- Human resource development (labour) is understood as the activity of

(investment) development education and scientific - technological training to create professional development, quality, career development and reasonable structure to meet the needs of economic – social development of the country, while ensuring the development of each individual to promote health, mentality, morality, professional capacity, professional skills to increase productivity, increase incomes, improve living standards (Chu Van Cap, 2012)

- Salary is the price of labor, was formed through an agreement between the

employer and the employee in accordance with supply and demand relationship in the labor market Thus, from salary was considered as only element of distribution, it is now considered one of production factors Salary is not only cost to reproduce labor

power, but also the investment for employees niem-ban-chat-va-vai-tro-cua-tien-luong)

(http://www.voer.edu.vn/module/khai-From the above definitions and concepts, to develop labour resource, the study considered three aspects of labor: Salary, professional development and quality, career development

CHAPTER II REVIEW OF RELATED LITERATURE AND STUDIES

This chapter gives readers the previous studies of financial management at universities and opens a further part of this study It starts from the reality of financial management weaknesses in the public universities and the allocation of resources is not justified The studies points out the general causes and overall proposes Since then, this dissertation continues to develop the previous researches to study the financial management and allocation resources of ULSA and finally propose a model

to allocate resources for each specific item

2.1 Literature and studies review

2.1.1 Foreign literature

2.1.1.1 Gene Siciliano 2008 Finance for managers

The book supplies basic financial knowledge for managers and help them to use finance as instrument of administration “Finance for managers” is not only concerned with basic financial knowledge but also lead to make an accounting cost sheet, business plan, mobilizing capital… and many necessary tools to help managers to run business actively For example: Coefficient to assess the effectiveness of importance activities, make a plan: step by step to set up a future, annual budget: supply finance for plans

Thus, it is possibly said that “finance for managers” is a useful and practical book for everyone who want to become effective and comprehensive managers

The book provides basic knowledge of financial management, including the planning and usage of the financial resources that is applied in this study

2.1.1.2 David Parmenter (2009) KPI – indexes measuring efficiency

Establishing the norm to assess the effectiveness of performing and reward is always “thorny” problem of every organization To set up a good system not only helps business achieve the goal but also to maximize organization capability, especially to attract, maintain and develop human resources

This book includes 6 chapter: chapter 1: Introduction, chapter 2: Basic ground of applying essential efficiency index, chapter 3: Development and application of essential efficiency index: 12 steps – model., chapter 4: A set of source instrument to perform essential efficiency index, chapter 5: Sample report of efficiency index, chapter 6: A set of source instrument of consultant

Especially, the chapter 4 mention successful essential factor for finance: maximize profit from potential customers; reduce cost and increase productivity, utilize maximum of assets and resources, increase market share, responsible management of finance…

The book provides elements related to the development of human resources, this

is one of the factors in dissertation research about the impact of resource allocation for labor

2.1.1.3 Arthur M.Hauptman (2006) Higher Education Finance: Trends and

Issues”

This article focuses specifically on one of the most outstanding problems of finance of higher education in both the developed and less developed world in the past decade, known as the gaps between the growth of admission of students and the ability of public and private budget in meeting financial resources for growth

This article covers five key themes:

The first is a macroeconomic concept and the main things to consider;

Overall level of resources for higher education is the main factor deciding the size and overall quality of educational career In general, the more money for education, the more and more opportunities to access for many people (because there are more seats offered) Quality can also be better with more resources, because there will be additional financial resources to pay for staff, expenses for services and equipment

One method commonly used to compare the level of financial commitment is the total amount spent on each student This calculation has the advantage of putting the total amount spent on education in relation to the number of students that the

budget are supporting

A different approach is to combine the above two ways to look at the amount spent per student compared to GDP per capita ratio

The second is survey of public and private financial resources of higher

education; The level of investment and participation: to measure the level of participation probably reflects the fact less accurate but computationally simpler, is divided by the total number of students studying for the total population of a country Countries more money for higher education tend to have higher number of people to learn

The support of public and private sector for schools, These resources support from the state Payments for regular activities offered like:

Allocation of the historicity / politicalization

Financing based on a formula

Provide financial oriented policies

Financial allocation based on activity Budget allocation is unconditional and competitive

The upgrading of infrastructure, equipment financing is like:

Overall, better than the cost of facilities, infrastructure, equipment should not

be allocated to the same financial mechanisms such as teaching and often expenditure , because the payment for the short term needs can limit to pay for long-term needs and in accordance with regulations on upgrading facilities

The sources of private financing

The financial resources includes: tuition, gifts in various forms of charity, income from service activities, commercialization of research is performed by the organization and business support private

Who construct the tuition? For private schools, of course it’s school though in some countries, government has regulations or even guidelines specific intervention in the process of building fees in the private non-profit

leaders-State construct fees based on what?

- Percentage one student per cost – the school fees of the same type, the same level is collecting

- The general economic indicators such as GDP per capita or average income of people in the region

The third is to discuss the development of financial aid programs for students The fourth is considered the importance of bridging between the different

financial policies: Advanced combination of Budget, Funding and Student Support Policy

The fifth is to identify the most critical issues currently related to the

inadequacies between the growth of student numbers and resources to respond The book gave the general trend of the state budget allocated for education, resources can be mobilized for the development of education, the impact of the

quality of education However, the author did not mention the specific allocation of resources to achieve good results that this dissertation are referring to

Moreover, the authors have stated the importance of the position salary: “salary and wages in terms of the schools hold a significant position in the payments, and account for a large proportion of regular expenditures of school so analysis of fund using for labor have a significant position in the financial analysis of the school.” (Ngo The Chi and Nguyen Manh Thieu Page 475)

For the analysis of the receipt and using of funds, the authors write: “Based on the current report of the budget that we know the situation of receiving and using funds in each period and reflected in each kind of resource Simultaneously, based on detailed reports for each type of fund that is funding the budget and expenditure for each specific activity Using the comparative method to compare the proportion of each type of resources” (Ngo The Chi and Nguyen Manh Thieu Page 477)

“The goal of structure analysis of expenditures is considered structure in the distribution of spending in school reasonable or not and the situation of spending

activities in schools To analyze the criteria we use the proportion of expenditures and

it is determined by considering the proportion of each expenditure in the general scale (the general scale is defined as the sum of frequent expenditures or operating expenses, irregular expenditure, depending on the purpose of analysis).” (Ngo The Chi and Nguyen Manh Thieu Page 482)

The authors also describe the common causes that affect the changes of the operating expenses of the school:

- Causes of the number of employees working in schools will impact expenditures for humans and other expenses

- Causes of the results of operations and other activities

- Causes of the financial management mode and internal spending regulations that is built by organization

- Causes of the qualifications of the management

- Causes of the scale of operation of the unit, due to management requirements

Through the document, the authors showed the importance of labor resources, the purpose of ratio analysis, common cause leading to changes in the proportion of funding This is one of the platforms to serve for the analysis of the allocation of resources in this dissertation

2.1.2.2 Pham Minh (2005) “Methods of financial management and

reach the target Thanks to high-wage, employees are satisfied with their work, they will take the time to find ways to achieve the targets, by long time, they demonstrate their abilities better

The author concludes, minimizing cost to increase profits is not necessarily good

in the long run Moreover, the authors also said that the company should take añvantage of the experience from older employees So the company should have deserved reward for the older workers for their contribution to their reported experiences

This dissertation applies this theory that should be paid to encourage employers and take advantage of the experience of employees This effect on the allocation of

resources for labour in university

2.1.3 Foreign studies

2.1.3.1 H.T Ekindayo* and I.A.Ajayi (2009) “Towards effective

management of university education in Nigeria”

H.T Ekindayo* and I.A.Ajayi indicated that Higher education plays a crucial role in the supply of high level manpower for the socio-political and economic development of a nation The effective management of this educational sector becomes necessary This paper examines the myriads of problems militating against the effective management of the Nigeria university education system Therefore, it is recommended that government should re-address the issue of funding of university, review upward the pay-package of academics, grant the university autonomy and make plans and projections on the nation’s manpower needs in a bid to integrate this into the university programs

It therefore becomes necessary to suggest ways of making the system more effective and efficient in relation to contemporary Nigerian society: Adequate

funding; need to improve the infrastructure base; upward review of pay-package for academics; granting of autonomy to varsities; re-appraisal of the role of university education and the world of work; volatile and militant students’ unionism; combating secret cults; depoliticisation of the university system

The author concluded that the need for university education stems from the fact, the system is responsible for the development and production of high-level manpower within the context of the needs of the nation It has been seen that the university system, which is the foundation of development in the country is bisected with myriads of problems

However, for meaningful development in the university system, the government must be ready to address the issue of funding the system adequately Adequate finance will help solve the problem of infrastructure The government should review upward the pay-package for academics as a matter of national importance; the academics clamor consent to the university autonomy

So this study points out only aspect of financial management that is to provide adequate funds for higher education in Nigeria This study shows that investing resources to increase salary of teachers and infrastructure is crucial to education in Nigeria

From these points, I found that investment resources for salary of teachers and infrastructure are necessary items that should be considered when allocating resources

of ULSA

2.1.3.2 Lee Little Soldier (2008) The global issues in management and

finance of higher education: The case of Vietnam

Globalization is affecting all societies worldwide As a result of many changes that globalization brings, higher education in many countries is taking a very

important reform Five issues raised in this article are the result of a survey of higher education in Vietnam

First, background knowledge of the world has expanded dramatically and should have the capacity and more sophisticated skills to compete in global markets The result is a growing trend in the diversification of secondary education, including community colleges, polytechnics, courses for adult and distance learning

Second, increasing the pressure for admission of the university cause the pressure to provide sufficient financial resources needed for training program quality Thirdly, there is a tendency for the transfer of power from central government

to localities with greater autonomy for each school In addition, market-oriented focus

on cost/ achieved benefits issues and encourage the contracted activities for faculty and for the school

Fourth, the trend of assessing responsibility through the target can be measured of courses, the training program, as well as through the collection of assessment data to improve efficiency and control costs and use resources in a positive way

Finally, attention to quality and effectiveness of training programs for the need for an executive effectively management structure to implement the school’s mission

The authors point out the general trend of higher education in Vietnam the problems need to solve in finance such as diversification of revenue sources, linking training to practice, more autonomy for universities, using equipment effectively, building a program system, use resources in a positive way, but the authors did not specify how to use resources, how to allocate in the suitable way This is an issue that need further research that this dissertation will mention However this dissertation is

done only within the scope of ULSA, not for the entire higher education units in Vietnam

2.1.3.3 Giti Ashraf (2012) A Review on the Models of Organizational Effectiveness: A Look at Cameron’s Model in Higher Education

The article research Organizational effectiveness is the main concern of all higher education institutes Over the years there have been many different models of effectiveness along with the criteria for measuring organizational effectiveness In this paper, four main models of organizational effectiveness namely the goal approach, the system resource approach, the process approach and the strategic constituency approach are reviewed Moreover, this paper introduces several models of organizational effectiveness in higher education Then, a brief review is made on some empirical studies that used the Cameron’s (1978) model of organizational effectiveness In the end, the paper suggests that Cameron’s (1978) model seems the most appropriate for studying organizational effectiveness in higher education

The author recommend main Models of Organizational Effectiveness:

- The Goal Approach: The first extensively used approach in organizational effectiveness is the goal approach Its focus is on the output to figure out the essential operating objectives like profit, innovation and finally product quality

- The System Resource Approach: However, this is not usually applicable for the educational research organizations specifically in conditions where they are responsible to the goals and there must be justifications for their large-scale social functions

- The second approach is named the system resource approach which pays attention to the input of the figure It explains the effectiveness from the point of view

of the ability to obtain necessary resources from the environments outside the

organization (Schermerhorn et Al., 2004) The application of system resource can be effective if a vivid relation exists between the resources which an organization receives and the goods or services it produces (Cameron, 1981) This approach invites managers to consider the organization not only as a whole but as a part of a larger group as well It is also possible that the academic and research organizations will not give out outstanding results even after a long period of funding Considering the prospect of making remarkable contributions in the future, and even though there may

be no adequate evidence of effectiveness, founders may go on offering support

- The Process Approach: the third approach is known as the process approach which pays attention to the transformation process and is dedicated to seeing to what extent the resources are officially used to give services or produce goods

By effectiveness, it is meant that the organization is internally healthy and efficient and the internal processes and procedures in that place are quite well-oiled The trend of this approach in higher educational institutions is to fulfill the objectives

by providing timely and sufficient information to the students, and the academicians

- The Strategic Constituency Approach : The fourth approach is the strategic constituency approach It deals with the effect of the organization on the main stakeholders and their interests Based on this approach, effectiveness refers to the minimal satisfaction of all of the strategic constituencies of the organization Strategic constituency involves all the people that are somehow connected to the organization These people may have different roles such as the users of the services or products of the organization, the resource providers, the facilitators of the organization’s output, the main supporters and the dependents of the organization

The author said about Organizational Effectiveness Models at Higher Education and expressed the Cameron’s Model of Organizational Effectiveness:

The following describes these nine dimensions:

1) Student educational satisfaction

2) Student academic development

3) Student career development It indicates the range of the students’ occupational and vocational progress as well as the opportunities which are given to them by the institutions

4) Student personal development It refers to the extent of the students’ progress in non-career, non-academic areas; in fact, they are on the social, cultural, and emotional basis The opportunities which are offered by the institutions are also within this dimension

5) Faculty and administrator employment satisfaction This refers to the satisfaction that the administrators and the faculty members have with their jobs

6) Professional development and quality of the faculty This dimension talks about the range of work achievement and improvement of the faculty members as well as the extent of motives toward work progress which the organization provides

7) System openness and community interaction It displays the attention which is given to interaction with the external environment of the institution, the adaptation to it and the service given in that place

8) Ability to acquire resources This refers to the range of resources the organization can earn from the outside They can include faculty members and students with high-quality, political recognition and financial aid

9) Organizational health

The study indicated that the dimensions related to students were not as significant as those dealing with faculty employment and satisfaction Based on the research findings, Cameron’s instrument was generally an efficient tool for the assessment of organizational effectiveness In short, regarding the main models of effectiveness, the Cameron’s (1978) model has a close relationship with three main models, namely goal, system resource, and process Cameron (1981) noted out that, it pays attention to the fact that the organization is effective as long as it can achieve the goals intended It can obtain the resources from the environment, and it can get along with all of its system processes in terms of the performance of the organization Based

on this model, it should be taken into consideration that there is not one single suitable model for the assessment of the organizational effectiveness Even though the organizations fulfill the criteria of each approach, they may be judged ineffective This can reflect the ability of Cameron’s multi-dimensional model for a deeper study

of organizational effectiveness in higher education

Through Cameron’s model, this study can be applied the The Process Approach that pays attention to the transformation process and is dedicated to seeing to what extent the resources are officially used to give services or produce goods Furthermore, the model also shows that some factors closely related to the allocation

of resources, those are student educational satisfaction, student academic development, student career development, faculty and administrator employment satisfaction, professional development and quality of the faculty, organizational health Here are some important factors to be applied in this dissertation However, this article concluded that there is no single consistent model Thus, this dissertation needs to find a suitable and specific model for the allocation of resources in the current period for ULSA

2.1.3.4 Mzwanele Mfunwa et (2005) Assessing Public Financial

Management and Accountability in the Context of Budget Transparency in Africa

The policy goal behind the pursuit of fiscal transparency is to ensure that the objectives of fiscal policy, its legal, institutional, and economic framework, policy decisions and their rationale, data and information related to monetary and financial policies, and the terms of agencies’ accountability, are provided to the public on an understandable, accessible, and timely basis Fiscal transparency is propagated as part

of a larger policy goal of good economic governance It is also aimed at addressing corruption and theft of State resources and money laundering, among many Against this background, this survey assesses the fiscal transparency practices in 15 African countries The study looks at critical areas of transparency, namely: clarity of roles and responsibilities; public availability of information; open budget preparation, execution and reporting; independent assurances of integrity; and the extent to which these are practiced in Africa

In this regard, some general recommendations are outlined in the next few paragraphs

1 Recommendations: short-term: The short-term recommendations pertain to those aspects of fiscal transparency that can be effected with ease and little cost These include:

- Clarity of roles and responsibilities

+ Expedite the enactment of and strengthen existing fiscal laws to, among other things, ensure clear rules of responsibility, the autonomy and professional independence of data – collecting bodies Ensure clarity in defining government’s role vis-à-vis the rest of the economy The legal framework should be accompanied by clear financial regulations and accounting instructions The legal framework for

management of minerals should be clearly defined The rule of law and regulations should be enforced

+ Adopt additional provisions clarifying and formalizing the responsibilities and modalities for an independent compilation and regular dissemination of government financial statistics

+ Monitor the execution of program budgets

+ Strengthen leadership campaigns against corruption; whistle-blowers should be protected and prosecution of infringements strengthened

- Public availability of information: Improve public access to fiscal information, including of contingent liabilities and debt In the interest of credibility, government should commit to publishing information regularly

- Open budget preparation, execution, and reporting

+ Include all extra budgetary activities of the central and provincial governments in their respect budgets, especially their own revenues from government agencies and entities, and the proceeds of external grants and of the autonomous institutions that depend on budgetary y resources

+ Improve the information provided to Parliament and the public, overhaul budget documents and disseminate more broadly the fiscal data currently at the disposal of the Executive; Improve the timeliness of availability both to Parliament and to the general public, including through the government websites, and speed up the production of Treasury accounts and reports

+ Strengthen fiscal management, first and foremost by modernizing the budget classification system, the accounting framework, and fiscal audits

+ Ensure consistency between the macroeconomic framework, the budget objectives, and the annual budget law

+ Strengthen procurement operations

+ Provide fuller and more timely information to Parliaments

+ Improve transparency of the privatization process; reduce the quasi-fiscal activities of parastatals and make the cost of the remaining activities transparent

- Assurance of integrity: Set up an aggregating body to oversee company/government reconciliation of data

2 Recommendations in long-term

- Public availability of information include:

+ Improve the quality of data for publication, in particular Open budget preparation, execution, and reporting

+ Promote training in statistical methodologies, through staff courses and training; ensure that staff resources are available to undertake improvements and developmental work

+ Emphasize automation in the compilation of government financial statistics, while introducing computerization of the accounting and budget system

+ Prepare or improve the medium-term budget framework, covering revenue, expenditure, and the financing options and policies underlying the choices and priorities

+ Expend more effort in meeting the fiscal transparency codes of treaties and initiatives acceded to

- Assurances of integrity: Strengthen the Offices of the Auditor General and Parliamentary Committees

This study offers the necessary measures to manage financial in a macro level, in which a number of important recommendations should be taken to carry out research

in this dissertation is: necessary to be clear for responsibility of management and to

promote the training of human resources available to implement improvements and development of work However, the writer emphasized the financial management in general but no specific research in the field of higher education But this is also a good reference material for this dissertation

2.1.3.5 F N Anijaobi-Idem, I U Berezi, B A Akuegwu (2012) Research Culture and Effective University Management in South-South Zone of Nigeria

Concerns about the quality of research and effectiveness of the university system in terms of goal attainment of higher education institutions in Nigeria abound This paper aimed at determining the extent to which the prevailing research culture in universities influences the effective management of the university system The result indicated that a significant influence exist of research culture on effective management of university system in terms of goal attainment and management of staff, and a no significant influence of research culture on effective management of university system in terms of management of facilities and management of students It was therefore concluded that research culture exert a partial influence on effective management of the university system From this conclusion, a number of recommendations were made:

1 Research activities should be accorded a top priority in the scheme of affairs

in the universities Apart from research being one of the tripartite functions of the universities, it helps in breaking new frontiers in the quest for knowledge acquisition and dissemination This will enable the universities live up to the expectation of producing high level manpower as well as ensure effective management of university system

2 The government at the federal level and internal managers of the universities should place high premium on the findings of research As such, lecturers should be encouraged through funding to embark on research activities regularly This will not only help them, to keep abreast with the new and latest techniques and skills

in their various areas of expertise, but also enable them discharge their responsibilities creditably This will prove in no small measure as a veritable tool in the effective management of university system

3 The university administration should invest massively on research by commissioning their lecturers to focus on research bothering on effective management

of university system The findings from such research can serve as a tonic for ensuring that effective management of universities is sustained at all times Akin to this is that the findings will have the tendency of equipping the authorities with result oriented management skills that promotes the survival of the university education

4 Facilities should be provided in universities to give research activities a pride of place Where there are facilities, especially in the science and technology areas, research in these fields of study will not suffer terrible setbacks as is the case presently in the universities studied Provision of facilities will not only boost research activities, but will also place the universities on sound footing to contribute immensely towards national development

Thus, the authors have given the new direction in improving the quality of training of university Nigeria Direction that is investment in scientific research and insurance results Investment for research of lecturers and they will research innovation to improve the quality of training This created the engine, while improving the reputation of the school This paper focuses on scientific research issues that are not mentioned much in training of Nigeria University However, this is