COVENTRY UNIVERSITY

27

SCHOOL OF BUSINESS ANDENVIRONMENT

102 – STATISTICALANALYSIS FOR ACCOUNTING AND FINANCE

ASSIGNMENT – 2013-15

ASSIGNMENT TITLE: SURVEYANALYSIS

Tableof Contents

Executive Summary 3

1.0. Introduction 4

1.1. Aims and Objectives of the Survey 4

1.2. Hypothesis of the study 5

2.0. Background To SIES 6

2.1. Establishment and Objectives of SIES 6

2.2. Major changes to Student Finance 7

2.3. Source of Student Finance 7

3.0. Sampling 8

4.0. Data Collection 9

4.0. Results 9

4.1. Descriptive Analysis 9

4.1.1. Summary of Family Situation 9

4.1.2. Trends in Total Yearly Living Costs 10

4.1.3. Domicile Rates 12

4.1.4. Scatter and Historical 14

4.1.5 Distribution of Total Income 15

4.1.6 Distribution of Total Expenditure (Q and D) 17

4.2. Hypotheses Testing 18

4.2.1. Hypothesis 1 18

4.2.2. Hypothesis 2 19

4.2.3. Hypothesis 3 20

Conclusion 21

References 23

ExecutiveSummary

The commissioning of the2007/08 Student Income and Expenditure Survey (SIES) by Welshgovernment and Department of Business Innovation and Skills (BIS) wascritical to providing comprehensive information regarding thespending and income situations amongst the students in UK.

The current paper investigatesthe SIES in UK and the factors affecting the student fraternity ininstitutions of higher learning in areas of income generation and therelated expenditure. Various factors have been investigated such asthe family and support to students, the full time, and part timeprograms based on domicile country, the income, expenditure andrelated correlation between the two. It was determined that parentshave been instrumental in supporting their children. This wasbacked-up by the information regarding the income and expenditurecorrelation where most students seemed to spend much more than theirincomes. Hence, a reflection that parents provided any otheradditional support to students. The average annual values for livingcosts, income, and expenditure, are £6000, £11,000 and £12,000respectively.

Two out of the threehypotheses formulated in the current paper were fulfilled while theone null hypothesis was fulfilled. According to the hypotheses tests,parents play a major role in supporting their children ininstitutions of higher learning, many students are on full-timeprogram, and that many students are not financially independent.

1.0.INTRODUCTION

In the recent past, manystudents have been taking the initiative of joining institutions ofhigher learning by themselves. Therefore, the students require tocontrol their mode of spending money sustainably. To facilitateacquisition of the information regarding students` income andexpenditure, the Student Income and Expenditure Survey (SIES) havebeen instrumental in providing detailed and up-to-date assessment,taking into consideration the changes taking place in students`funding and any other financial support. The target population forthe study was full the time and part time students in HigherEducation Institutions (HEI) and the Further Education Colleges(FEC), inclusive of Open University (OU).

The sample targeted theundergraduate students undertaking their first degree, higher diplomaof certificates, as well as post-graduate university-based trainingcourses. The 2007-2008 survey is the most recent among the series ofSIES surveys carried at 3-year intervals. Therefore, the currentpaper, a survey analysis of the income and expenditure amongst thestudents has been carried out, and the results presented in thispaper. The major sources of income will be evaluated and described,and the major expenditure avenues examined. The major sectionscovered include market background that evaluates the size, social andethnic status of the student population in UK, sampling and relatedissues in getting the most appropriate representative sample due tolarge students` population in UK, descriptive statistics of theresults, hypotheses tests and conclusions based on the results.

    1. Aims and Objectives of the Survey

Below are the objectives ofthe current paper

  1. Do determine the rate of dependence on students

  2. To evaluate the distribution of total annual living costs among the students

  3. To calculate the domicile rates for Welsh and English students

  4. To find out the correlation between income and expenditure among the students

  5. To analyze the distribution of annual income and expenditure among the students

    1. Hypothesis of the study

A hypothesis is an exclusiveprediction of a statement, and it provides a detailed concretedescription of terms that are expected to happen in a study.Therefore, a hypothesis has a prediction or alternative hypothesessuch as H1 or HA, and the null hypothesis, HO or H0. The currentstudy aimed at determining the correlation between students’expenditure, income and their source of funds. The three hypothesesare as follows

H1:Most students are financially independent in terms of their careerand education

HO1:Most students are not financially independent in terms of theircareer and education

H2:Most students get funds from their parents

HO2:Most of the students do not get funding from their parents

H3:Many students England and Wales are in a full-time program, and theywork to pay for their fees

HO3:Many students England and Wales are in the part-time program and donot they work to pay for their fees

2.0.BACKGROUND TO sies2.1.Establishment and Objectives of SIES

The SIES was designed withthe intention of providing detailed information regarding the incomeand expenditure amongst the students in United Kingdom. The SIESpresents an objective and authoritative report pertaining thecircumstances of students` education in UK. The survey involves theuse of a representative sample of the eligible students. The datacollected covers the debt, income, expenditure and any experience offinancial hardship[ CITATION Cal01 l 1033 ].Also, SIES examines how the experience of the students in highereducation is affected by finances. The information from the surveysis used as evidence through which student support system policies areformulated.

The SIES have regularly beenconducted in line with the government requirement since 1980s thoughthis has changed recently as the studies are conducted in theintervals of three to four years hence the latest survey wasconducted in 2007-2008. This survey used a sample of approximately3,500 full-time and part-time students within the higher education.The surveys involved face-to-face interviews, as well as expenditurediaries. The survey has traditionally relied solely on randomprobability sampling, hence issues with breach of students`confidentiality and data protection, especially during the periodsbetween 1980s to late 1990s[ CITATION Fin06 l 1033 ].However, the most recent surveys have adopted quota and randomsampling that has enhanced data protection and confidentiality.

Overtime, the SIES, just likeany other survey, has suffered from the reduction in response rates.As results, plans are underway for review of sampling methodology andstrategy. The 2007-2008 survey recommended continued use of theprobability sampling over face-to-face interviews and quotasampling[ CITATION Low09 l 1033 ].

2.2.Major changes to Student Finance

Many changes in the waystudents fund their higher education have taken place. Amongst themost significant is the shift in public funding system to studentloans from student grants, as well as an introduction of tuition fee.Other changes include the repayment of loans, and financial helpaccorded to some students[ CITATION Har12 l 1033 ].

Since the 1980s devolution inUK, various countries have introduced different funding systems forstudents. Also, Acts have been enacted on tuition regime and studentsupport. This reflects the various trends in the past one decade onhow the students have been financing their studies to supplementloans and grants. For instance earnings have become significantsource of income amongst many full-time students, have enhancedgrowth for part-time students, and have resulted in many studentsgoing leaving education due to lack of earnings[ CITATION Cal01 l 1033 ].

2.3.Source of Student Finance

The undergraduate students inUK have, since 1998, been contributing their tuition £1,000annually, after which it rose to £1,150 from 2004. This was mostlydependent on the ability of the parent or guardian. The threshold ofparental contribution has been increased since 1998 to exclude manystudents from contributing in payment of their fees[ CITATION Cal01 l 1033 ].Also, since 1998, the maintenance grants were phased out forstudents, and student loans become the major form of funding forfull-time students. This also saw the changes in repayment systemfrom mortgage style toincome contingent mode that was linked to the income of the studentafter graduation. However, since 1999, the student loans havesubstantially improved, with bursaries for disadvantaged studentsbeing introduced since 2000s[ CITATION Low09 l 1033 ].Also, the part-time students on low income have been able to accessfinancial help through loans, student support and remission fees.

3.0.Sampling

Sampling is the process oftaking a part of a large population to act as a representative fromwhich the inferences are drawn. The current study used the two-stagestratified and random sampling methods. The first stage entailedselection of institutions of higher learning. The second stageentailed getting random samples of participant students andrequesting for their consent through sending to them forms to filland send them back. A sample of students was chosen from those whofilled and returned the forms. Out of the all the students contacted,only 3,430 were chosen to participate in the survey.

One major drawback in choosingthe sample was the difficult-to-reach students, especially those whowere in part-time programs. This implied vulnerability of bias tofull-time students as opposed to taking a representative sample thatcloser to if not 50-50 percent basis. Zhang and Mingfang (2014)noted that random may be misleading in representation of the overallpopulation. Their argued that this is particularly disadvantageouswhere the area of study is large. Hence, the current research may bevulnerable to these challenges since it covers extensive studentpopulation across UK.

4.0.Data Collection

Data was collected throughface-to-face interviews supplemented by 14-day spending diary thatprovided estimates for the selected expenditure items. This was doneon papers and collected by the interviewer. The participant studentswere also given the option of filling their spending diary online.This was followed by the extensive survey of family resources.

4.0.Results4.1.Descriptive Analysis

SPSS was used to conduct theanalysis. The sample comprised of 3430 students. In this paper, bothqualitative and quantitative data was used in the analysis and theresults presented in the graphs below.

4.1.1.Summary of Family Situation

The analysis of familysituation sought to determine whether a student was living with thefamily parents during term time.

Table 4.1:Family Situation

If lives with parents during term-time

Yes

No

Count

Count

Family situation summary

1

4

454

2

7

190

3

20

425

4

680

1650

It can be seen from the Table4.1 that the number of students living with their parents varied,where the SPSS value 1 had 458 students, 4 lived with their parentsand 454 do not live with their parents, 2 had 197 students, 7 livedwith their parent while 190 did not, 3 had 445 20 lived with theirparents while 425 did not and 4 had 2330, 680 lived with theirparents while 1650 did not students.

Figure 4.1: FamilySituation

The figure 4.1 shows that thegreatest number of students were living with independently free oftheir parents.

4.1.2.Trends in Total Yearly Living Costs

Theresponses to trends yearly living costs were analyzed and frequencydistribution chart showing the distribution ranges is presented inFigure 2 below.

Figure 4.2: FrequencyDistribution Graph for Estimated Yearly Living Costs

It can be observed from Figure2 that more than half of the students have their annual expenditurebelow 6000. Also, it can be deduced that averagely, the total livingcosts for each student is £6620.17. From the value of standarddeviation, £5773.65, we can conclude that the greatest percentage ofthe students fall between £5773.65 less the mean and £5773.65 afterthe mean, which is between £1046.52 and £12293.82.

Table 2 below presents thedescriptive statistics obtained

Table4.2:Descriptive Statistics

Range

Frequency

Descriptive Statistics

0

332

Mean

6620.175121

2000

291

Standard Error

98.58336081

4000

554

Median

5538.06

6000

678

Mode

0

8000

527

Standard Deviation

5773.653009

10000

370

Sample Variance

33335069.07

12000

237

Kurtosis

14.8691058

14000

146

Skewness

2.482153698

16000

99

Range

76919

18000

60

Minimum

0

20000

36

Maximum

76919

22000

27

Sum

22707200.66

24000

18

Count

3430

26000

14

28000

9

30000

11

32000

2

34000

6

36000

5

38000

2

40000

1

42000

1

&gt42000

3

It can be seen that the 332students out of the 3430 respondents have their annual expenditureless than £2000, 291 students have their annual expenditure between£2,000 and £4,000, 554 students spend between £4,000 and £6,000,678 between £6000 and £8,000, 527 between £8,000 and £10,000, 37between £10,000 and £12,000, 237 between £22,000 and £14,000, 146between £14,000 and £16000, 99 between £16,000 and £18,000, 60between £18,000 and £20,000, 36 between £20,000 and £22,000, 27between £22,000 and £24,000, 18 between £24000 and £26,000, 14between £26,000 and £28,000, and the rest, 40students have theiryearly expenditure more than £28,000.

The highest spender amongstthe students spends approximately well above £70,000. From the 3430student sample, 332 cannot account for their spending. This impliesthat there must be someone who provides for their expenses.

4.1.3.Domicile Rates

The study covered bothpart-time and full-time Welsh and English-domiciled students. Theresults are presented in figure 4.3 below.

Figure 4.3: PartTime and Full TimeRates for English and Welsh Domiciled Students

It can be observed that thehighest number of students, 59.62 percent are English Domiciled andare on full-time program. This is followed by English-Domiciledpart-time students at 18.69 percent. The Welsh-domiciled students ona full-time program are 16.03 percent while those on the part-timeprogram are 5.66 percent.

4.1.4.Scatter and Historical

The regression analysis forincome versus expenditure was sought, and the results are presentedin figure 4.4 below

Figure 4.4:Regression of total income versus estimated total annual expenditure

It can be seen the correlationcoefficient, R2is 0.1471, which is considerably lower than one. This implies thatthe income for the students and expenditure cannot be correlated. Thegraph exhibits substantial scatter and this is indicative ofmismanagement of finances or many students are funded from sourcesother than their income.

4.1.5Distribution of Total Income

Table 4.5:Frequency Distribution of Total Income and Total Expenditure

Range

Frequency (Income)

Expenditure Frequency

0

4

0

2000

41

24

4000

119

126

6000

290

289

8000

536

441

10000

673

545

12000

550

528

14000

406

403

16000

269

289

18000

198

211

20000

113

155

22000

78

127

24000

42

72

26000

28

48

28000

21

54

30000

22

29

32000

12

31

34000

3

10

36000

3

8

38000

7

11

40000

5

6

42000

3

4

44000

3

4

46000

1

3

48000

0

4

50000

0

3

52000

1

0

54000

1

0

56000

1

0

58000

0

1

60000

0

1

62000

0

0

64000

0

0

66000

0

1

68000

0

0

It can be noted from Table 4.5above that most spenders are not necessary under income. The expensesappear to be higher than the income. The figures 4.5 and 4.6 belowpresents the frequency distribution of total income and totalexpenditure.

Figure 4.5:Income distribution

The average income of perstudent is £11,237.87 while the standard deviation is £5,741.23.FromFigure 4.5, very few students have an income of more than £30,000.

4.1.6Distribution of Total Expenditure (Q and D)

The figure 4.6 below presentsthe distribution of total expenditure.

Figure 4.6:Distribution of Total Expenditure

From Figure 4.6, each studentspends an average of £12,529.88, and the standard deviation is£7090.19. When compared to the income distribution, we can concludethat averagely, students spends much more than they generate.

    1. Hypotheses Testing

TheChi-square tests and cross tabulation tables were used in theanalysis to test the hypotheses.

Firsthypothesis

      1. Hypothesis 1

Socio-Economic Class * Student Status Cross tabulation

Student Status

Total

Dependent

Independent

Socio-Economic Class

Managerial or Professional

Count

970

641

1611

Expected Count

825.0

786.0

1611.0

Intermediate

Count

284

303

587

Expected Count

300.6

286.4

587.0

Routine and Manual + Unemployed

Count

307

479

786

Expected Count

402.5

383.5

786.0

No paid work prior to course

Count

91

151

242

Expected Count

123.9

118.1

242.0

Total

Count

1652

1574

3226

Expected Count

1652.0

1574.0

3226.0

Chi-Square Tests

Value

df

Asymp. Sig. (2-sided)

Pearson Chi-Square

118.502a

3

.000

Likelihood Ratio

119.370

3

.000

Linear-by-Linear Association

22.256

1

.000

N of Valid Cases

3226

a. 0 cells (0.0%) have expected count less than 5. The minimum expected count is 118.07.

Directional Measures

Value

Asymp. Std. Error

Approx. Tb

Approx. Sig.

Nominal by Nominal

Uncertainty Coefficient

Symmetric

.020

.004

5.520

.000c

Socio-Economic Class Dependent

.015

.003

5.520

.000c

Student Status Dependent

.027

.005

5.520

.000c

a. Not assuming the null hypothesis.

b. Using the asymptotic standard error assuming the null hypothesis.

c. Likelihood ratio chi-square probability.

From thecross-tabulation and chi-square test carried out, 0 cells haveexpected count of less than 5%. This is far much less than the 20%that is the minimum required significance.

Therefore,the most students are financially dependent on loans and grantsamongst others.This fulfills the first hypothesis that hypothesized that manystudents are dependent financially to fund their education.

      1. Hypothesis 2

The secondhypothesis aimed at determining whether most of the students get thefunding from their parents. The Chi-square tests and thecross-tabulation results are presented below

Family situation summary * If lives with parents during term time Cross tabulation

If lives with parents during term time

Total

Yes

No

Family situation summary

1

Count

4

454

458

Expected Count

94.9

363.1

458.0

2

Count

7

190

197

Expected Count

40.8

156.2

197.0

3

Count

20

425

445

Expected Count

92.2

352.8

445.0

4

Count

680

1650

2330

Expected Count

483.0

1847.0

2330.0

Total

Count

711

2719

3430

Expected Count

711.0

2719.0

3430.0

Symmetric Measures

Value

Approx. Sig.

Nominal by Nominal

Phi

.304

.000

Cramer`s V

.304

.000

N of Valid Cases

3430

a. Not assuming the null hypothesis.

b. Using the asymptotic standard error assuming the null hypothesis.

Chi-Square Tests

Value

df

Asymp. Sig. (2-sided)

Pearson Chi-Square

318.009a

3

.000

Likelihood Ratio

417.717

3

.000

Linear-by-Linear Association

263.895

1

.000

N of Valid Cases

3430

a. 0 cells (0.0%) have expected count less than 5. The minimum expected count is 40.84.

Thechi-square test results showed that a significant relationship existsbetween the family situation and the rate at which students spendwith their parents during the course of the term. Therefore,the 2ndhypothesis is fulfilled most of the students get funds from theirparents.

      1. Hypothesis 3

Thissought to determine that education program taken by the students fromEngland and Wales. The results and chi-square tests are as presentedbelow.

Is your course Full time or Part time? * FT/PT by domicile Cross tabulation

FT/PT by domicile

Total

EDFT

EDPT

WDFT

EDPT

Is your course Full time or Part time?

Full-time

Count

2007

0

513

0

2520

Expected Count

1543.9

416.7

415.2

144.2

2520.0

Part time

Count

38

552

37

191

818

Expected Count

501.1

135.3

134.8

46.8

818.0

Total

Count

2045

552

550

191

3338

Expected Count

2045.0

552.0

550.0

191.0

3338.0

Chi-Square Tests

Value

df

Asymp. Sig. (2-sided)

Pearson Chi-Square

2949.874a

3

.000

Likelihood Ratio

3068.087

3

.000

Linear-by-Linear Association

772.939

1

.000

N of Valid Cases

3338

a. 0 cells (0.0%) have expected count less than 5. The minimum expected count is 46.81.

The aboveresults show that most students are in a full-time program, withEngland having more students than Wales. The chi-square tests showsthat a significant relationship exists between the domicile countryand the kind of the program undertaken by the student, eitherfull-time or part-time., hence fulfilling the third objective.

Conclusion

The current study aimed atidentifying the financial position in terms of expenditure and incomefor the students is institutions of higher learning in UK. The targetpopulation was the students from higher learning institution. Gettingan effective representative sample was, therefore, a major concerndue to the large population of the students in UK. As a result,random and stratified sampling methods were used in getting arepresentative sample. The data was collected through face-to-faceinterviews.

The three major hypotheses ofthe study sought for the financial independence of students,relationship between family situation and the assistance from theparents, and the fulltime and part-time for the English andWelsh-domiciled students.

In the data analysis, SPSSsoftware was used and the study sample comprised of 3430 students.Based on the family situation, most of the students do not live withtheir parents during term time. This implies that many students areindependent financially. It was determined that on average, theannual living cost for a student is approximately £6,000 income is£11,000 and expenditure are £12,000. These imply that studentsspend more than they can get from their incomes.

As such, other sources offunding should be provided, such as loans and grants, to support themfinancially. Finally, from the hypotheses testing, hypothesis 1 and 3were fulfilled, while null hypothesis 2 was fulfilled. Therefore, itcan be concluded that parents contribute significantly in terms offinances to the studies of their children in higher learninginstitutions, many students are financially dependent and onfull-time programs, hence need for more funding for loans and grants.

The results of this paper are,therefore, critical to the establishment of support programs andfunding policies to the students within the higher institutions oflearning.

References

Callender, C., &amp Martin, K. (2001). Students in Wales: An Analysis of Data from the Student Income and Expenditure Survey 1998/99. Cardiff: Independent Investigation Group on Student Hardship and Funding in Wales.

Finch, S. (2006). Student Income and Expenditure Survey 2004/05: Technical Report. London: National Centre for Social Research.

Harper, J. R. (2012). Student Income And Expenditure In The Universities Of Glasgow And Birmingham: A Comparative Survey. Scottish Journal of Political Economy 4(3), pp. 194-206.

Low, N. (2009). Student Income and Expenditure Survey 2007/08. UK: National Centre for Social Research.

Zhang, H., &amp Mingfang, L. (2014). RWO-Sampling: A Random Walk Over-sampling Approach to Imbalanced Data Classification. Information Fusion, pp. 12-20.