Harvard Treasurer George Putnam Jr. '49 and Financial Vice President Hale Champion happily presented the annual financial report last week, showing a $900,000 surplus in the budget and an 11.8 per cent increase in the market value of Harvard's endowment.

The $106 billion increase in the $1.42 billion endowment helped create the first surplus since fiscal 1973.

A more prosperous stock market and decreased inflation helped the University's finances, the officials said.

The energy shortage and high fuel prices are less of a problem now than they were a few years ago, Champion said yesterday.

"We've adjusted to energy costs, it won't be one of the two or three most important factors," though it will still affect the budget, he said. Harvard is still as "reliant on what OPEC does as any small, hard-put country."

However, several branches of the University still wallow in financial misery. The Faculty showed a $249,000 deficit last year. Both the Kennedy School of Government and the Divinity School must increase their fund raising efforts if they are to balance their budgets in the future, deans of the respective schools said this week.