The financial uncertainty wrought by the pandemic left a UK university forecasting that it?could be left with cash reserves to cover just five days of operations.

In its?, the University of Kent says that it is?now in a much better position after strong domestic recruitment last autumn and other mitigating actions?such as deferring some spending.

But its initial forecast on cash reserves for the end of 2020-21 would have been at the ¡°absolute limits of acceptability¡±, the report says.

Without the Covid crisis Kent recorded an underlying deficit ¨C not including pension adjustments ¨C of ?5.5 million last year. Due to high staff costs Kent launched a voluntary severance scheme two years ago that has so far resulted in more than 300 staff agreeing to leave.

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But the effects of the pandemic pushed last year¡¯s underlying deficit to ?12 million.

For the end of this academic year, the statement says that the Covid crisis had caused it to initially forecast a ?31 million underlying deficit for 2020-21 and ¡°year-end cash reserves equivalent to just 5 days expenditure; this would, ordinarily, be at the absolute limits of acceptability¡±.

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However, student recruitment in the autumn ¨C as well as further action taken to stabilise finances ¨C had helped to improve the situation; at the time of publishing the statement it was looking at reserves in July 2021 equivalent to 29 days¡¯ worth of spending.

A Kent spokesman said that the initial forecasts for 2020-21 ¡°were prepared on a highly cautious basis and included some extremely prudent assumptions around recruitment¡±.

¡°This was subsequently revised with an improved position at the end of December to reflect confirmed student admissions figures,¡± he added, saying that the latest forecasts showed a ¡°further improvement¡± to 38 days¡¯ cash reserves for the end of this year.

The English regulator, the Office for Students, says that a university must report a situation where it ¡°considers it to be reasonably likely that its liquidity will drop below 30 days¡±.

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Kent¡¯s statement says that its liquidity fell to about 21 days at the end of April 2020 before recovering to 40 days by July. The spokesman said that Kent had ¡°complied with all our regulatory reporting requirements¡±.

Other universities to have published their financial accounts in recent weeks include the University of Leicester, which said that it had it had with lenders to ensure it had enough ¡°financial headroom¡± if ¡°downside¡± financial scenarios materialised.

simon.baker@timeshighereducation.com