Financial Risk Management and Financial Sustainability of a Private Educational Institution: Basis for a School Financial Transformation Roadmap

Private educational institutions operate in an increasingly volatile financial landscape characterized by shifting enrollment patterns, rising operational expenses, and economic uncertainty. This study examines the relationship between financial risk management practices and financial sustainability within a private educational institution—Systems Plus Computer College of Kaloocan, Inc.—to provide an empirical foundation for a proposed School Financial Transformation Roadmap. Employing a quantitative, cross-sectional, descriptive-correlational research design, data were gathered using a structured 4-point Likert-scale instrument administered to key institutional stakeholders (n = 80, comprising primary internal decision-makers and secondary validation respondents). Results show that primary respondents assessed overall financial risk management as High (X̄ = 3.076) and financial sustainability as High (X̄ = 3.193), whereas secondary respondents rated both constructs as Very High (X̄ = 3.395 and X̄ = 3.361, respectively). The Pearson product-moment correlation analysis revealed a moderate, positive, and statistically significant relationship between financial risk management and financial sustainability (r = +0.4850, p < 0.05), with financial risk management explaining approximately 23.52% of the variance in financial sustainability (r² = 0.2352). While risk identification (X̄ = 3.231) and revenue stability (X̄ = 3.331) emerged as key strengths, critical vulnerabilities were identified in cash-availability monitoring (X̄ = 2.375), transaction authorization reviews (X̄ = 2.400), supplier payment performance (X̄ = 2.950), investment capacity (X̄ = 2.950), and reserve planning (X̄ = 3.075). The findings underscore the necessity of moving beyond risk identification toward rigorous control execution, leading to the formulation of a structured Financial Transformation Roadmap.