The University of Wollongong is reeling in close to $100 million a year from international student fees, the latest Auditor-General report reveals.
Overseas student numbers at UOW increased by roughly 4.5 per cent to 7414 in 2010, or almost 40 per cent of the university's overall population.
Last year, international student fee revenue increased to $97.4 million.
In his annual report to Parliament on the state's 10 public universities, Auditor-General Peter Achterstraat noted that Wollongong's large increase in fees and charges revenue in recent years was largely due to a spike in international student numbers.
Around the state, revenue from overseas students has increased 75 per cent in the past five years, contributing nearly 20 per cent, or $1.25 billion, of total revenue.
But in the wake of Australia's soaring dollar, recent changes to visa requirements and increased foreign competition, the university is likely to experience a decline in international numbers in the next two years, according to the report.
UOW Vice-Chancellor Professor Gerard Sutton insisted Wollongong's budget took into account variations in international numbers and would not expose the university to financial risk.
"The Auditor-General's report includes students studying at the University of Wollongong in Dubai, which operates independently and at a profit, as well as students enrolled in offshore courses in Singapore," he said.
"Nevertheless, we do have a strong student international presence of around 25 per cent ... We always budget conservatively on our international student numbers to allow for variations from year to year.
"Having said that, UOW is working hard to minimise the impact of factors outside of our control on overseas student numbers, such as the current strength of the Australian dollar."
In his report, the Auditor-General was critical of Wollongong's handling of leave owed to employees, after the university recorded an 18 per cent increase in the number of staff entitled to at least 40 days off.
That trend, combined with UOW's ageing workforce, produced a $39.7 million liability in long-service leave in 2010, at a rate more than double the sector average over the past five years.
More than 25 per cent of staff are now aged over 55.
UOW was heavily targeted in the Auditor-General's recommendations to reduce the amount of leave accrued.
"The university has not changed its annual leave policies and continues to experience an unfavourable upward trend in these balances," the report said.
"Excess leave balances result in additional expense to the university as the financial liability grows over time due to salary increases."
Prof Sutton said recent changes to leave accrual would help reduce the number of days owed to staff.
"Last year we negotiated with our 1000 non-academic staff a reduction in that accrual from 50 days to 40 days," he said.
"That negotiated reduction will be reflected in future years but does not show in these figures."
