An essential task of university administration is to monitor the financial position of its auxiliary enterprises. This is an ill-defined and complex task which often requires more administrative time and information than is available. In order to perform this task in an adequate manner a large amount of expertise is required to: (1) determine what constitutes reasonable performance, (2) define unacceptable levels of performance, and (3) suggest courses of action which will alleviate an unacceptable situation. Thorough analysis requires a substantial amount of an expert’s time. The purpose of this research is to explore the opportunities for the enhancement of the financial analysis of auxiliary enterprises through the use of expert systems. The research has included: (1) a comprehensive review of analytical techniques that can be used in financial position analysis, (2) a determination of the the applicability of such techniques to auxiliary enterprises, and (3) an assessment of their amenability to expert system development. As a part of the above described research, an expert system prototype was developed which addresses several of the above issues for one auxiliary enterprise at Virginia Polytechnic Institute and State University. It integrates the knowledge of an expert with both accounting data from the VPI & SU accounting system and other types of data from the auxiliary enterprise operation. The system provides a comprehensive, systematic analysis of the financial position of the Tailor Shop at VPI & SU. This analysis is performed in much less time than would be required by an expert. As a result of the research conducted, it has been concluded that building such a system is possible and it can provide significant benefits to a user. However, financial position analysis requires a substantial amount of data and numerical calculations, both of which require large amounts of computer memory and computations. Therefore, designing an expert system to efficiently perform this task requires the use of a package or a language that efficiently utilizes computer memory and CPU. / Ph. D.