2005 Financial Report

2005 Financial Report ABOUT the UNIVERSITY anderbilt University is a privately endowed, coedu- cational, not-for-profit, nonsectarian institution located in Nashville, Tennessee. Founded in 1873, the University operated under the auspices of the VMethodist Episcopal Church South until 1914. Since that time, it has been governed by an independent, self-perpetuating Board of Trust. The University is named for the shipping and railway magnate Commodore Cornelius Vanderbilt, who gave one mil- lion dollars to build and endow a university that would “con- tribute to strengthening the ties which should exist between all sections of our common country.” Today, Vanderbilt University is internationally recognized as one of the premier research and teaching universities. Vanderbilt’s undergraduate, graduate, and professional programs rank among the finest in the world. The University’s students— approximately 6,300 undergraduates and more than 5,000 graduate and professional students—and its 2,500 full-time faculty and 16,800 staff members work together to support multidisci- plinary study, academic research, and public service. The University also provides health care services through its medical center, which includes Vanderbilt University Hospital, The Vanderbilt Clinic, and the Monroe Carell Jr. Children’s Hospital at Vanderbilt. The University maintains state-of-the-art facilities on its 330- acre campus. Vanderbilt’s academic enterprise comprises inter- disciplinary programs and centers, as well as ten schools and col- leges—the College of Arts and Science, the Graduate School, the Blair School of Music, the Divinity School, the School of Engineering, the Law School, the School of Medicine, the School of Nursing, the Owen Graduate School of Management, and Peabody College of education and human development. For more information, please visit the Vanderbilt University Web site at www.vanderbilt.edu. A link to the 2005 Financial Report can be found on the Web at www.vanderbilt.edu/divadm/finrprt. Table of CONTENTS 2 Letter from the Chairman of the Board of Trust 3 Letter from the Chancellor 4 The Year at a Glance 12 Vanderbilt University Statistics 14 2005 Financial Report Overview 22 Financial Ratios 24 Endowment Review 27 Benefactions of the Vanderbilt Family Consolidated Financial Statements 28 Independent Auditors’ Report 29 Consolidated Statements of Financial Position 30 Consolidated Statements of Activities 31 Consolidated Statements of Cash Flows 32 Notes to the Consolidated Financial Statements Supplemental Information 44 Vanderbilt University Hospital and Clinic Results of Operations 45 Vanderbilt University Board of Trust 46 Vanderbilt University Administration Letter from THE CHAIRMAN of the Board of Trust s chairman of Vanderbilt’s Board of Trust, I am intimately familiar with the University’s plans and objectives, with its bottom line and sky-high plans. I under- stand and appreciate our future endeavors and know well the administrators, facul- A ty, staff, and students who will make our current ambitions a reality. This year has been especially fine. Our past efforts provide a solid foundation upon which we build. Our present engagements continue to distinguish us nationally and internationally in the fields of teaching, research, and medical care. Our future plans are our boldest, most innovative MARTHA R. INGRAM yet and when complete will truly herald a new era at Vanderbilt. Chairman of the Board of Trust The success of 2005 is due in no small part to the realization of a number of initiatives, including Shape the Future–a Campaign for Vanderbilt, the launching of our College Halls program, and the continued leadership of Chancellor Gordon Gee and his administrators. Though years from its conclusion, monies raised thus far as part of Shape the Future have already made a difference in the number of scholarships we are able to offer our most deserving students and in the number of named chairs Vanderbilt fills with world-renowned faculty. Academic strategic initiatives move rap- idly from the drawing board to full implementation because friends and supporters willingly demonstrate their belief in this institution with most generous gifts. No initiative will be more transformative than our College Halls program, on which ground was broken this summer. A residential college system designed to create the most vibrant living and learning environment in higher education, College Halls—and specifically our first project, the Commons—will be a cohesive, nurturing, challenging community for the tal- ented women and men who come to Vanderbilt. It is our highest priority and will certainly be the perfect residential and community setting for the University’s increasingly outstanding students. Standing at the forefront of Vanderbilt’s stellar year is Chancellor Gordon Gee. An outstanding leader and a higher education visionary, Gordon is popular with and respected by the University’s alumni, faculty, staff, students, and friends. In fact, polling by the Hustler, Vanderbilt’s student newspaper, has reported his student approval rating at nearly 90 percent or higher since his arrival in 2000. Working in partnership with the University’s vice chancellors, an engaged Board of Trust, and leaders among faculty, staff, and students, Gordon and I are confident in the future success of Vanderbilt University. Momentum steadily builds, plans are made, and the time for confident execution is now. Our sights are firmly set on the horizon, and we are sure of our success. 2 Letter from THE CHANCELLOR ince arriving at Vanderbilt, I have sworn off categorizing a particular year as our “best ever” because of the constant forward momentum of this place. As a result of our efforts and energy, each year truly outshines the previous, indicating that our potential for excel- S lence is fairly limitless. In 2005 alone, the quality of our faculty, our staff and, in particular, our students has made yet another categorical leap for the better. Vanderbilt’s reputation as one of the finest institutions of higher education in the United States is based upon several tenets, including our commitment to undergraduate education, our integra- tion of our graduate and professional schools into the life of the University, and our encourage- GORDON GEE ment of an atmosphere of collaboration and civility. Drawn by these and the appealing aspects of Chancellor life at Vanderbilt and in Nashville, Tennessee, the University is a highly sought-after destination by both faculty and staff. It is our responsibility to take that desire, that interest, and harness it in order to gather together the most talent in the country. At this, we are succeeding. All of our students—from first year undergraduates to graduate and professional students in their final year of study—are also aware of what an incredibly unique environment Vanderbilt offers in which to learn and study. In addition to growing our number of applications, no small feat in and of itself, the quality of our applicants continues to increase as well. The world’s finest students are committed to the fact that Vanderbilt University is the place they want to be. The quality of the medical care we provide and the level of our research findings continue to break records and refine expec- tations. Vanderbilt has long been a leader in providing world-class health care to Middle Tennessee and beyond, but we are never satisfied to rest on our laurels. We strive to make ourselves ever better, to determine how we may serve our commu- nities more fully. We expect that our faculty and researchers will continue to make life-changing, life-saving discoveries. This refusal to be satisfied with the status quo, with only what we can accomplish today, contributes largely to our success. Vanderbilt University is an institution with a proud legacy to uphold. We have an even more promising place in higher education and medical care and research to realize. Our trajectory has been set, and I could not be more proud of our progress. I know that for years to come, each annual milestone will be better than the last, and I look forward to seeing just how far we will go. 3 THE YEAR at a Glance July 2004 August 2004 I The Vanderbilt University School of Nursing (VUSN) M Demonstrating the importance that Vanderbilt places on signs an agreement with the newly established nursing pro- creating and strengthening partnerships in the entire region, gram within Scheer Memorial Hospital in Kathmandu, Chancellor Gordon Gee leads more than 40 Vanderbilt fac- Nepal. Vanderbilt’s Linda D. Norman, senior associate dean of academics, states that VUSN will provide the new program with textbooks, faculty development opportunities, and consultation services. The agreement, which aims to favorably impact Nepal’s nursing shortage, will help create what is reported to be Nepal’s first nursing curriculum that meets the requirements of regulatory bodies in both Nepal and the United States. I Vanderbilt’s Robert Penn Warren Center for the Human- ities hosts the Eastern Region Summer Institute on Teach- ing the Constitution, in which a select group of elementary, middle, and high school teachers from 24 states gather to learn how to better educate students in the basics of the U.S. Constitution. The institute is funded by a grant from ulty, students, and staff on an event-filled bus tour through the Center for Civic Education in western and central Kentucky as a part of the third annual Calabasas, California. Roads Scholars Tour. The group visits Fort Campbell, Bowl- ing Green’s National Corvette Museum, the University of M U.S. News & World Report names Kentucky, and Dollar General Corporation’s original distri- Vanderbilt University Medical Cen- bution center in Scottsville. ter (VUMC) as one of the nation’s 50 best hospitals based upon sev- I Vanderbilt’s first medicine/law joint-degree student David eral factors including reputation Chooljian completes a visit to Universidad de Concepción in among board-certified physicians, Chile, where he investigates student exchange ideas and mortality statistics, nursing care, helps set up a center for clinical investigations as part of a and medical technology.

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