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External research funding removed from calculation of contribution to joint costs

Revenue is one of the parameters on which the calculation of the academic units’ contribution to financing the administration is based. Starting in January 2017, external research funding will be subtracted from revenue in order to strengthen incentives to attract external grants.

The senior management team has adopted a new cost-sharing principle for calculating the amount the academic units are to contribute to financing the administration and the university’s joint costs on the basis of revenue and other parameters, the so-called ‘debiting formula’.

The university’s potential for growth lies in external financing. In light of this development, the previous model has certain drawbacks. According to this model, increased revenue as a consequence of growth in external funding leads to an increase in the amount to be contributed to financing joint costs.

In order to provide incentives for attracting external funding, the senior management team has decided to break with this principle. Therefore, external research funding will no longer be included in the calculation of the contribution to joint costs starting in January 2017. In addition, the new debiting formula guarantees that no faculty will be required to contribute more to joint costs in 2017 than in 2016.

Sample calculations

In order to free up resources for academic purposes, the total contribution to joint costs will be reduced by 2 per cent annually. The contribution for 2016 is approximately DKK 650 million, which corresponds to approx. 10 per cent of the university’s total revenue. These funds are used to finance:

The central administration

Operations, salaries and other personnel-related expenses

 Approx. DKK 325 million

The university’s joint costs

IT systems, licenses, recruitment activities, etc.

 Approx. DKK 160 million

Rent and operations and maintenance of shared facilities

Lecture halls, common areas, canteens, etc.

 Approx. DKK 180 million

The faculties finance their own administrative centres.


  • Contribution to joint costs (debiting): The amount that the academic units are charged as a contribution to financing the central administration and the university’s joint costs.
  • Debiting formula: The debiting formula used to calculate the contribution to joint costs.
  • Overhead (administration contribution): Proportion of a grant earmarked to cover indirect administrative costs associated with a project but which cannot be directly attributed to the concrete project.