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Mechanism of Financial Risk Prevention in Local Universities

机译：地方大学财务风险预防机制

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Some practical measures were proposed to prevent financial risks in local universities on the basis of an analysis of their forms and possible causes in view of actual performance of these schools in the field. To meet the demands over high quality talents of social and economic development, 198 local universities were set up from 1999 to 2005 upon the approval by the Ministry of Education of China, resulting in subsequent prosperity of local higher education and local economic and social development. On the one hand, these universities were founded to serve local economic development; on the other hand, some of them are either out of the combination of several schools or upgraded from 2 or 3-year colleges to 4-year universities. Since the purpose of such a practice is to assist local economic growth, a majority of the expenses of these universities comes from local financial funds. However, it has to be admitted that financial investment from local government is only about 20% of total expenditure for routine operation, and the proportion is even lower, especially in some underdeveloped regions. Additionally, some of the universities based on the combination of several schools or upgraded from junior colleges may be challenged by more serious economic difficulties, e.g. a series of jobs like campus expansion, equipment procurement and high-level teachers introduction for improvement of teaching quality, etc. require more financial support, which as a result leads to more and more severe conflicts between investment and demands in local universities. To solve the problem, local universities tend to apply for bank loans to raise educational funds. Although bank loans can resolve capital problems in a short term, due principal plus interest in high amounts also brings forth huge pressure and financial risks to these universities. Besides, such risks will become even more serious owing to the defects in their administrative mechanism. Therefore, how to avoid financial risks successfully has become an important factor in the healthy sustainable development of local universities.
机译：有人提出了一些实际措施，以防止当地大学的金融风险，了解他们的形式和可能的原因，鉴于该学校在该领域的实际表现。为满足对社会经济发展的高质量人才的要求，1999年，1999年至2005年，由中国教育部批准，导致当地高等教育和地方经济和社会发展的随后繁荣。一方面，这些大学成立为地方经济发展;另一方面，其中一些是从几所学校的组合或从2岁或3年的学院升级到4年的大学。由于这种做法的目的是协助当地经济增长，这些大学的大部分费用来自当地的金融基金。但是，必须承认，当地政府的金融投资仅占常规行动总额的20％左右，比例甚至更低，特别是在一些欠发达地区。此外，一些基于几所学校的组合或从初级学院升级的大学可能受到更严重的经济困难，例如，可能受到更严重的经济困难的挑战。一系列职位，如校园扩张，设备采购和高级教师提高教学质量等介绍需要更多的财务支持，这导致了当地大学的投资和需求之间的越来越严重的冲突。为了解决问题，当地大学倾向于申请银行贷款来提高教育资金。虽然银行贷款可以在短期内解决资本问题，但对大量的兴趣也是对这些大学的巨额压力和金融风险。此外，由于行政机制的缺陷，这种风险将变得更加严重。因此，如何避免财务风险成功已成为当地大学健康可持续发展的重要因素。

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