How to improve competitiveness is a vital issue for each university in the global academic competition, but funding is crucial to the competitive advantage and the future of universities. After the implementation of the national university funds in 1999, the last decade has seen many debates and challenges about funding elasticity and financial autonomy of national universities. In order to understand the funding regulations of national university, this paper fully analyzes the twelve funding regulations by documentary analysis. In addition, this paper interviews the government department, presidents of universities and university scholars to understand their experience and opinions about the use of funds. The three main results are as follows: 1. Government cannot entirely trust the university's funding behavior, and therefore exhibits many corruption-proof monitor mechanisms in the funding regulations; 2. Funding regulations emphasize the procedure monitor rather than university's performance; 3. Funding regulations emphasize monitor mechanism instead of incentive mechanism; The main argument of this study is that government should adopt monitor mechanisms and incentive mechanisms simultaneously, and furthermore universities should emphasize financial information disclosure, and accordingly improve the competitiveness of universities based on mutual trust between government and national universities.