In Victoria, there are eight public universities, which control a further 50 entities that we audit. Each year, we conduct the financial audits of these 58 entities.

This report outlines the results of these financial audits and our observations for the year ended 31 December 2017. We also discuss asset maintenance and management, and comment on the financial sustainability of the sector.

Overall, the university sector’s financial reports are reliable, except for those of Deakin University and the University of Melbourne. The sector overall continues to be financially and operationally sustainable, and its assets are being managed well to meet future demand.

In contrast to the rest of the sector, Victoria University and Federation University Australia have had declining financial results and student numbers. Federation University Australia should still be sustainable in the medium term, as it has significant financial assets and relatively low liabilities. Victoria University needs to address its short‐term liquidity. Both universities should review key aspects of their operations to ensure their viability in the long term.