Universities Scotland director Claire McPherson said the report shone a light on the steps that institutions were taking to improve their financial situations.
“However, the missing context from the report is the systematic and significant reduction in funding the sector has received from the Scottish government over the last decade,” she said.
“Universities have had to make difficult decisions in a challenging financial climate, but they have done that whilst also facing real-time funding cuts to their central financial settlement from the Scottish government.
“The evidence is now clear. Without action, the financial pressures facing universities will continue to intensify.”
Gavin Donoghue, chief executive of Colleges Scotland, said the report highlighted that funding for colleges was 7.5% lower in real terms now than in 2021.
He said colleges had done everything possible to balance their budgets, but they could not continue to absorb current rising costs, or adapt for the future, without additional support.
The Scottish government’s Tertiary Education minister Alyn Smith said he recognised the challenges highlighted in both reports.
He said many of the issues were outside the government’s control and not unique to Scotland, such as visa restrictions, Brexit, inflation and National Insurance rises.
Smith said ministers were working closely with universities and colleges to develop a more sustainable and resilient model.