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2020-07-31-accounts

Charity Number: 1001127 Company Number: 2517018

Annual

report and consolidated financial statements Year ended 31 July 2020

Contents

Section Page
Trustees’ report 1
Independent auditor’s report to the members of Universities UK 18
Consolidated statement of financial activities 21
Balance sheets 22
Consolidated cash flow statement 23
Notes to the financial statements 24
Legal and administrative information 47

Universities UK

Trustees’ report

The trustees present their report and the financial statements for Universities UK for the year ended 31 July 2020.

Name and membership

The name of the charity and company is Universities UK. Universities UK is the representative organisation for the UK’s universities. Its members are the executive heads of UK university institutions who have met the criteria for membership agreed by the Board of the company. It currently has 140 members. Membership is voluntary and members are represented both at the UK level and through Universities Scotland and Universities Wales.

The objectives of Universities UK as set out in its Articles of Association are:

Mission and main activities

The mission of Universities UK is to create the conditions for UK universities to be the best in the world, maximising their positive impact locally, nationally and globally. Services and activities include research and policy development, lobbying of government and influential stakeholders, dissemination of information to members and the wider public using all forms of media, conferences and events, and national and international networking activity.

Public benefit

All of Universities UK’s activities are ultimately carried out for the wider public benefit of creating and maintaining a world-class higher education sector that benefits students, the UK economy, the UK’s educational and research standing in the world and the wider social good. Collectively, the institutions led by the members of Universities UK demonstrate their wide social and economic contribution through the delivery of research, teaching, expertise and training. Higher education is available to all with the ability to benefit, regardless of their economic circumstances. The benefits of this activity to the UK are considerable. UK Universities played a significant role in the research, medical and civic response to the Covid-19 pandemic.

The trustees confirm that they have complied with the duty in Section 17 of the Charities Act 2011 to have due regard to the Charity Commission’s guidance on public benefit. In delivery of its services and activities, Universities UK has fully supported its members, and assisted them to achieve their public benefit goals.

Universities UK 1

Trustees’ report (continued)

Trustees

The Board comprises up to 24 (reduced to 22 in the year) directors of the company and trustees of the charity, elected or appointed from among its members. Those appointed for the year to 31 July 2020 were as follows:

Professor Julia Buckingham CBE President
Baroness Valerie Amos CH*
Professor Colin Bailey**
Professor Dame JanetBeer DBE
Professor Paul Boyle CBE
Mr Nigel Carrington*
Professor Chris Day
Professor Alistair Fitt*
ProfessorGrahamGalbraith
Professor Jenny Higham
Professor Debra Humphris
Professor Sir Chris Husbands
Professor Paul Layzell Treasurer
ProfessorJulieLydonOBE Chair, UniversitiesWales &Vice-PresidentWales
Professor Sally Mapstone
ProfessorQuintin McKellarCBE Vice-PresidentEngland andNorthern Irelandfrom 1 March 2020
Professor Patrick Nixon**** Vice-President England and Northern Ireland until 29 February 2020
Professor Andrea Nolan OBE* Convener, Universities Scotland & Vice-President Scotland
Professor Edward Peck
Professor David Phoenix OBE
Mr Bill Rammell ***
Professor Sir Steve Smith*
Professor Rama Thirunamachandran
Professor Adam Tickell
Professor Shearer West
Term of office ended 31 July 2020
 Appointed 1 April 2020
 Resigned 31 December 2019
** Resigned 29 February 2020
The following were also members of the UK Board on the date this report was approved:
Professor Liz Barnes CBE Appointed1 August2020
Professor Gerry McCormac Appointed 1 August 2020
Dr Paul Thompson Appointed 1 August 2020
Professor Wendy Thomson CBE Appointed 1 August 2020

No member of the UK Board had a beneficial interest in any contract with the company. Board members are elected by the vice-chancellors of the member universities or nominated by the Governance and Nominations Committee.

Chief Executive Alistair Jarvis

2 Universities UK

Structure, governance and management

Organisational structure of the company

Universities UK

Universities UK is a company limited by guarantee with the registered number 2517018, governed by its Articles of Association adopted in May 2013. It is a charity with the registered number 1001127. Its principal offices are in Bloomsbury, London.

Universities Scotland

In Scotland (where it operates from its Edinburgh office under the name Universities Scotland), Universities UK is registered as a charity with the registered number SC029163.

Universities Wales

In Wales (where it operates from its Cardiff office under the name Universities Wales), Universities UK is part of the charity with the registered number 1001127.

Structure of subsidiary companies

Woburn House Conference Centre Ltd

Universities UK owns 100% of the share capital of Woburn House Conference Centre Limited (company number 3031467) whose business is the operation of the conference facilities at Woburn House. Income generated from the activity of the centre is covenanted to Universities UK.

Medical Schools Council

Universities UK is the holding member of the Medical Schools Council, a company limited by guarantee (company number 8817383) and registered with the Charity Commission (number 1155370). The objects of the Medical Schools Council are to promote, encourage and develop medical schools in the UK and thereby advance education for the public benefit, in particular medical education, research and training. Its Board of Directors is elected from its own members.

MSC Assessment

The Medical Schools Council is the holding member of MSC Assessment, a company limited by guarantee (company number 8578576) and registered with the Charity Commission (number 1153045). The objects of MSC Assessment are to advance medical education for the benefit of the public including by the preparation, validation, accreditation, conduct and administration of any tests, examinations or other systems of assessing, evaluating and recording any aspect of medical education and training. Its Board of Directors is elected from members of the Medical Schools Council.

The results and financial position of Woburn House Conference Centre Limited, the Medical Schools Council and MSC Assessment are consolidated with those of Universities UK in preparing its consolidated financial statements. Separate results are shown in note 22 to the financial statements.

CVCP Properties plc

CVCP Properties plc is not a subsidiary of Universities UK but is considered to be a related party. Universities UK owns all 550,000 preference shares in CVCP Properties plc and 50,000 (1%) of its ordinary shares. Universities UK is a major tenant of CVCP Properties plc in Woburn House.

Universities UK 3

Trustees’ report (continued)

Governance and decision-making

Non-executive directors/trustees

The Board of Trustees comprises up to 24 (reduced to 22 in the year following a governance review) members and meets five times a year as a minimum. The President, elected by the members, serves a term of two years. The Chairs of Universities Scotland and Universities Wales are members of the Universities UK Board, serving as Vice-Presidents alongside an elected Vice-President for England and Northern Ireland.

Universities UK has six standing committees: Board Advisory, Resources, Audit and Risk, Governance and Nominations, Membership and Remuneration. Seven (reduced to five in the year) Policy Networks cover the key policy issues of the UK higher education agenda in line with the organisation’s strategic priorities. Following a governance review, the seven Policy Networks are going to be retired as Board terms come to an end, replaced with four Policy Leads resulting in a reduction to Board size.

Induction and training of trustees

New trustees receive information supporting their induction, which includes relevant Charity Commission documents on the role of a trustee, a copy of the Universities UK Articles of Association and the Strategic Plan. It is the aim of the organisation to update trustees and members on any new legislation that may affect the governance of the charity and to offer on-going support through additional training when required.

Charity Governance Code

Our governance has been reviewed against the Charity Governance Code. Universities UK is committed to applying good practice where possible and explaining where it is not aligned, and the reasons for this or changes that are being planned. The Code is applied in the context of Universities UK being a relatively small membership organisation of 140 members, with most of the Board elected by and from its membership. This prompts challenges in achieving the full recommendations of principle 6 (diversity) and the composition recommendations in principle 5 (Board effectiveness).

Our recent review of our Governance Effectiveness found that “... Universities UK is considered to be operating effectively in challenging circumstances given the headwinds facing higher education”. Through the 2019–20 period several recommendations from the review have been implemented including:

– Principle 1 organisational purpose

2019–20 was the second year of the strategic plan for 2018-23: World Leading Impact. The review of Governance Effectiveness concluded that Universities UK’s objects as set out in its Articles of Association are fit for purpose and are consistent with the mission, vision and strategy. Board has oversight of the management of resources ensuring that the allocation is linked to operational plans in pursuit of strategic objectives and therefore overall organisational purpose.

– Principle 2 leadership

The Board is led by the President, supported by a Board Advisory Committee. Across the Board and Committee there are robust debates leading to an agreed direction for the officers and staff to follow. 2019–20 was the first year of the President’s two-year term, and elections took place in the year for vacant Board posts as members come to the end of their terms. The President has oversight of CEO performance.

4 Universities UK

- Principle 3 integrity

Board and Board Advisory Committee members declare all conflicts of interest at every meeting and will absent themselves from discussions as required. Through its sub-committee structures the Board has oversight of issues such as finances, HR practices, procurement, data security and integrity, safeguarding and remuneration to make sure that the charity operates responsibly in line with its own ethics and values.

– Principle 4 decision making, risk and control

The Board have oversight of finance, performance and risk through its sub-committee structure and Board meeting agendas. The Resources and Audit and Risk Committees consider risk at each meeting. The Board are presented with the strategic risk registers at every meeting and have a full discussion on risk once a year, or more often if significant changes occur. All sub-committees have Terms of Reference established which are approved by the Board. The Audit and Risk Committee is presented with an annual safeguarding report in line with the Universities UK Safeguarding Policy. As a result of the Covid-19 crisis, the Board has met more frequently through the year as required and established several subgroups to work on specific issues.

Principle 5 – Board effectiveness

Most Board members are elected from the membership by the membership. There are agreed lengths of time for Board members to serve, and they are subject to re-election when those terms expire. It is unusual for terms to exceed nine years, but possible if members are elected to different roles on the Board or they have specific expertise or responsibilities relevant to the Board’s deliberations and the organisation’s strategic priorities.

At 31 July 2020, Professor Dame Janet Beer (President and chair of the Board from 2017-19) had served 11 years in a number of different elected roles and has been selected by the Governance and Nominations Committee to serve a further term as a nominated member and during the year the membership elected Professor Beer for a further 3-year term starting 1 August 2020 as Policy Lead for International.

In the year the Board has reduced from 24 to 22 members as part of a plan to reduce the size of the Board through retiring the elected Policy Lead Board member role as they come to the end of the term. The Innovation Policy and Health lead roles were removed in this year. The Board is considered large under the Code, however the Governance Effectiveness review found that “ … in general they consider the Board to work well and would be concerned if a reduction in size led to less diversity or a less representative Board”.

– Principle 6 diversity

Much of the Board (16 members) are elected from and by the membership, therefore there is a limit to the number and diversity of potential candidates. The Governance Effectiveness review found that “… as far as it can within the constraints of an elected Board, Universities UK takes reasonable steps to ensure that diversity in its widest sense is prioritised and implemented”.

Arrangements for setting pay and remuneration

Member input and support to the work of Universities UK is on a non-remunerated basis.

The pay and remuneration of executive management is set by a Remuneration Committee, which comprises Universities UK members chaired by the Treasurer. The pay and remuneration levels for all other grades is negotiated with the recognised union, Prospect, as part of the recognition agreement.

Benchmarking reports are used as a measure for the Directors’ pay, comparing ourselves to similar size organisations in terms of headcount or income in not-for-profit and membership organisations.

Executive management

The Chief Executive leads a Senior Leadership Team comprising the Directors of Policy, Member Services, Universities UK International, Communications and External Affairs, Operations, Universities Scotland and Universities Wales.

Universities UK 5

Trustees’ report (continued)

Strategic report

Strategic aims

2019–20 represented the second year of Universities UK’s five-year-strategic plan for the period 2018–23, World Leading Impact. The long-term, strategic objectives are:

These aims are achieved through the delivery of activities to members in the UK, International, Scotland and Wales, medical and health and exam delivery. Our work is organised through annual programme plans, detailing our short-term objectives.

2019–20 has been a year of two distinctly different halves. From August until late February, Universities UK’s focus was on securing and maximising the opportunities from visa reforms, developing policy priorities through the post-Augar review workstreams focused on post-18 educational reforms and funding, progressing our major review of fair admissions, beginning to shape the future international relationships in the post-Brexit context and establishing a new relationship with the Westminster government following the December 2019 general election.

As we entered the second half of the operational year, we had to adapt rapidly and substantially to refocus and re-prioritise our activities to support members to respond to the Covid-19 crisis. New priorities included seeking to mitigate the impact on international student recruitment, home admissions, securing government financial support, progressing work to clarify regulatory requirements, ensuring testing capacity for university populations and providing guidance on operating a university under socially-distanced health restrictions.

Activities for members – England, Northern Ireland, UK wide and International

Our work includes policy research, analysis and development, relationship building, lobbying and advocacy, communications with the media, public and stakeholders and development and delivery of services to our members.

Members are at the heart of our work and keeping members informed, connected with their peers and stakeholders and to campaign and lobby on behalf of the sector are priorities. This year there were 320 attendees at the September annual conference, and 245 attendees across three members meetings in the year. In addition to the opportunities for all our members to come together, regional Vice-Chancellor dinner discussions were held across the UK until lockdown along with institutional visits by the CEO and other members of staff.

6 Universities UK

Engagement with members stepped up significantly to support them with the implications of Covid-19. This included daily emails from the CEO to members, emails to senior institutional teams with a roundup of developments and over 60 group calls (via Microsoft Teams) led by the CEO with ViceChancellors (typically in groups of c20) to update and seek feedback on developing issues. On an individual basis we matched Vice-Chancellors in mentoring relationships and supported mid-term and new Vice-Chancellors coming into role during the year through peer-to-peer learning and support.

Following the Governance Review in 2018–19, the recommendations from the review have been implemented. Change to the Articles will be considered at the December AGM, otherwise the new subcommittee structure and other governance effectiveness enhancements are in place. Throughout the Covid-19 crisis the Board and Board Advisory Committee has met more frequently to respond effectively to the volatile situation. The senior Executive team has also met more frequently to consider rapidly developing issues.

The work supporting the small and specialist institutions continues with the Specialist Institutions Forum and Conservatoires UK continuing to meet and tailoring policy responses and the Covid-19 response to their specific needs.

It has been an unusual year in terms of engagement and parliamentarians as there were 45 fewer sitting days in parliament due to the general election, prorogation of parliament and an overwhelming political focus on coping with the challenges of Covid-19. Despite that Universities UK secured 45 oral questions in parliament, 74 parliamentary questions, 42 meetings and events with UK government and shadow ministers and 62 positive references to Universities UK from parliamentarians and government. This has been achieved despite the challenge of three changes of (Westminster) Universities Minister in the year and Higher Education and Research/Innovation responsibility now split across two (Westminster) government departments.

Following the General Election, Universities UK was re-engaged to run the All-Party Parliamentary University Group with a new chair and increased and more representative membership of the sector. This puts the group in a good place to be a high impact forum for VCs and parliamentarians to discuss and influence key higher education priorities and become a valuable channel for higher education policy making in parliament.

The outcome of the Augar Review on post-18 funding was significant for the sector in the early part of the year. We established four member-led working groups to shape the sector’s response to the report and to prepare for the Spending Review 2020 focussing on efficiency, value, flexible learning, and level 4 and 5 provision.

Using print, broadcast and social media, we disseminated information to members and the wider public, the reach of the Universities UK social media channels was 46 million, there were 750,000 unique visitors to the Universities UK website and 25,000 unique visitors to the USS employers website.

Until March, we developed and ran in person conferences and events on topical issues including university access and retention, tackling racial harassment, student success and experience, marketing and communications, graduate employability, research and innovation, transnational education, degree apprenticeships, staff to student misconduct and tackling violence, harassment and hate crime. The lockdown in March meant a very quick transition to move the International Higher Education Forum to a series of online events. We continued to offer online events for the rest of the year covering safety, health and wellbeing and mental health, responding to Covid-19, developing virtual career and student support services, racism and racial equality and student retention.

Universities UK International (UUKi) continue to source and administer international opportunities for students and researchers via the UKIERI Mobility Programme: Study in India, the Mitacs-UK Globalink Research Internship Programme and the Newton Fund.

There were outbound delegations to India, Indonesia, Brussels, Ireland, China, Israel and OTPs, and Cuba organised by UUKi and a wide variety of member institutions participating.

Universities UK 7

Trustees’ report (continued)

A full report on our international activities can be found in the Universities UK International Annual Report 2019/20.

In 2019–20 our work included production of evidence-based outputs on the most significant issues facing the higher education sector, to influence policy making, support universities to enhance positive impact and improve their practices, share effective approaches to common challenges and to support our members to achieve their overall missions and objectives. These outputs included:

8 Universities UK

Key outcomes in 2019–20

In September 2019 the UK Government announced the introduction of the Graduate Route, a post study work visa for international students attending higher education institutions in the UK. This adopts many of the features of Universities UK’s global graduate talent proposal and follows concerted effort from across the sector calling for this change, including considerable work by Universities UK over the last nine years to improve immigration policies for university staff and students.

We have taken the initiative and a leadership role on behalf of the sector to tackle a range of difficult issues where improvement is needed. This includes ensuring the value of degrees, addressing grade inflation, ensuring fair admissions, tackling staff to student sexual misconduct and enhancing universities approaches to preventing and addressing racial harassment.

In October 2019 the EHRC published its reporting examining racial harassment in higher education. The outcomes of the inquiry demonstrate the seriousness and prevalence of the issue within and outside the universities’ campuses. We worked closely with the EHRC throughout the inquiry to help

Universities UK 9

Trustees’ report (continued)

shape the recommendations and ensure that they aligned with existing sector frameworks. The report welcomed our advisory group to tackle racial harassment which will progress many of the recommendations. The report’s recommendations will also inform other activities including work in the #StepChange programme.

Universities UK also led on developing and launched guidance to help institutions deal with staff to student sexual misconduct, all forms of online harassment and student initiations to raise awareness of the dangers of such activities and excessive alcohol consumption among students.

Universities UK informed the debate of the wider value of a university degree via new student-centred opinion polling and a framework to consider measures of value beyond salary outcomes. To support the perceptions of value, new guidance was published to explain to students more clearly how their fee income is spent.

In our work to support the sector on grade inflation, we launched a survey on degree algorithms and through UKSCQA we published new guidance for providers in England along with a statement of intent. This means that despite the sector being diverse and autonomous so that innovation, specialism, and creativity can flourish, the system as a whole can benefit from common principles and arrangements to protect the value of degrees providers offer and award. Therefore, students are able to understand how their achievement compares to others, feel confident that their classification is an accurate and fair reflection of their performance.

Progress was made with a sector-led Fair Admissions Review to tackle emerging challenges and issues with the undergraduate admissions system including a call for evidence from students, parents and schools and new national polling of students on the current admissions system. Our work in this area was quickly pivoted to support universities and students to find a solution for admissions following the A-level results. The Fair Admissions Review will report in late 2020.

In the year Universities UK developed and launched two concordats on Research Integrity and Supporting the Career Development of Researchers which are being widely used and recognised across the sector.

With the UK leaving the EU at the end of January 2020, negotiations on a future partnership arrangement continued throughout the year. UUK International created no deal guidance for members, along with influencing stakeholders and decision makers for the best possible outcome for the sector through direct engagement with governments and use of partner organisations across Europe. Funding was successfully secured through the Brexit Readiness Fund enabling UUK International to deliver a Brexit Readiness Roadshow and a series of webinars supporting institutions to prepare for Brexit, deal and no-deal. There were 420 registrations for the Brexit Roadshow across 5 locations, and the Brexit Webinar series was viewed 1485 times.

Responding to Covid-19

With the lockdown and instruction to work from home in March 2020, all Universities UK employed staff left our offices and moved to working at home. Staff were supported to make sure they had all the equipment they needed to work safely; internal communications activities were stepped up and staff were given flexibility to meet the demands of home schooling, caring responsibilities and the challenges of home working. Despite the challenges the pandemic and forced changes to working practices, Universities UK staff have adapted well and continued to produce significant output to support the higher education sector through the crisis.

The Coronavirus Job Retention Scheme was used to furlough five members of staff. Three of those have roles directly linked to office and building services and could not work from home, and two staff who had personal circumstances that restricted their ability to work from home.

Many workstreams were paused, streamlined or re-purposed to respond to the issues from the Covid19 pandemic. In Spring and Summer 2020 our work on Covid-19 included:

10 Universities UK

Activities for members - Universities Scotland

Universities Scotland represents the Principals and Directors of Scotland’s 19 higher education institutions, developing higher education policy and campaigning on issues where members have a shared interest. Universities Scotland activities and achievements included:

Universities UK 11

Trustees’ report (continued)

Activities for members - Universities Wales

Universities Wales represents the interest of universities in Wales, supporting a university system which transforms lives through the work Welsh universities do with the people and places of Wales and the wider world. To achieve this ambition, in the year Universities Wales activities and achievements included:

Activities for members – Health

The Council of Deans of Health saw significant challenges but also notable achievements during the year. The Council has seen membership grow, welcoming Aberystwyth University, BPP University and Nottingham Trent University. Politically the Council successfully influenced the introduction of the student maintenance grant for healthcare students in England, as well as engaging with the Prime Minister’s Implementation Unit to influence the future of nursing education. In response to the Covid19 crisis, the Council played a vital role by working closely with regulators, chief professional officers and NHS organisations across the UK to create emergency arrangements to allow students to contribute to the Covid-19 response where appropriate while ensuring the sector can continue to educate the future healthcare workforce. The Council of Deans of Health Annual Report 2019-20 gives more detail on the achievements in the year.

The second half of the academic year 2019–20 for the Medical Schools Council was marked by the societal upheaval caused by the Covid-19 pandemic. The Medical Schools Council has been widely praised for the leadership it provided to the sector and the extremely effective guidance it provided to protect patients, students and staff. This included setting up a series of working groups, supporting medical schools to graduate students early allowing the NHS to access a new workforce early in the pandemic. The full detail of the Medical Schools Council response can be seen in the Medical Schools Council Annual Report and Financial Statements.

USS pensions reform

Universities UK has a legal responsibility to represent employers within the USS pensions scheme. This year saw the conclusion of the 2018 valuation and start of the 2020 valuation process. Following the establishment of the Joint Expert Panel on USS reform, the panel presented their second report and we have acted on a range of recommendations, including the establishment of a tri-partite group made up of employers, union and USS representatives and this group has been meeting regularly through the year.

Restricted funds

The restricted funds managed by Universities UK include the Council of Deans of Health and parts of Universities UK International funds (operating units of Universities UK). Medical Schools Council and its various funds (a subsidiary) and MSC Assessment (a sub-subsidiary) are also restricted funds in Universities UK’s consolidated financial statements. Further details on the objectives, activities and financial performance of all restricted funds are given in notes 20 and 22 to the financial statements.

12 Universities UK

Relationship with higher education sector agencies

Universities UK is the original subscribing member of various UK higher education sector agencies including Advance HE, Higher Education Careers Service Unit, Higher Education Statistics Agency, Office of the Independent Adjudicator, Quality Assurance Agency, UCAS, Universities and Colleges Employers Association and Jisc.

Members of Universities UK contribute to governance oversight of these bodies through Board membership and other involvement, alongside interaction between Universities UK staff and staff of the bodies concerned. Transactions between Universities UK and these sector agencies are disclosed in note 26 to the financial statements.

Financial review

Review of position at the end of the year

The statement of financial activities for the year is set out on page 21 and the balance sheet on page 22 of the financial statements.

Consolidated income and expenditure for the year and position at the end of the year are summarised in the table below.

Income
Expenditure
Deficit
Transfers
Net movement in funds
Funds brought forward
Funds carried forward		 Unrestricted
Activities
£’000
9,049
(8,138)
911
7
918
1,870
2,788		 Restricted
Activities
£’000
5,014
(5,569)
(555)
(7)
(562)
3,953
3,391		 Total
2020
£’000
14,063
(13,707)
356
—
356
5,823
6,179		 Total
2019
£’000
14,849
(17,043)
(2,194)
—
(2,194)
8,017
5,823

A consolidated surplus of £356,000 is reported for the financial year ended 31 July 2020. £1,213,000 of this related to a credit movement on the pension deficit recovery plan provision and £117,000 related to debit movements on the annual leave accrual (FRS 102 adjustments). Excluding these items, the deficit for the year ended 31 July 2020 stood at £740,000.

Unrestricted income in 2020 was down £638,000 year-on-year at £9,049,000 (2019: £9,687,000).

The unrestricted surplus in 2020 was £918,000 of which £1,096,000 related to the movements on the pension deficit recovery plan provision and the annual leave accrual. Excluding this movement, a deficit of £178,000 is reported on unrestricted activities.

Restricted income of £5,014,000 was broadly in line with the 2019 level of £5,162,000.

Universities UK 13

Trustees’ report (continued)

The organisation’s net assets were £6,179,000 at 31 July 2020 (2019: £5,823,000). A high proportion of these are represented by cash.

Principal funding sources

Membership subscriptions provides 68% of the unrestricted income, and the balance comes from covenant income (11%), sales of goods and services (10%), conference receipts (6%) and investment and other income (5%). This income is used principally to support charitable activities, but also the cost of charged-for goods and services. Universities UK does not fundraise from the public and is therefore not registered with the Fundraising Regulator.

Significant events affecting financial performance and position

Covid-19 had a significant impact on income in the year. Lockdown in March 2020 and The Health Protection (Coronavirus, Business Closure) (England) Regulations 2020 meant that Woburn House Conference Centre ceased trading from 23 March 2020 and the paid for conferences and events were cancelled. The impact on income for the year was £320,000 less than last year for the covenant from Woburn House Conference Centre to Universities UK and a £205,000 reduction in the contribution from Universities UK events compared to budget. While some operating costs were saved with the closure of offices, no business travel and using the Coronavirus Job Retention Scheme for posts directly associated with building operations between April and October, it has left a significant deficit for the year.

Impact of material pension liability

The deficit recovery plan for the USS pension scheme first agreed in 2017 has, as a result of Financial Reporting Standard (FRS) 102, required a provision for the extra employer pension contributions required over the life of the plan. This in turn has reduced reserves, though without any immediate impact on the cash position or on financial risk. The impact is dealt with in more detail in relation to the effect on performance against the reserves policy.

Fixed assets

The changes to intangible and tangible fixed assets during the year are shown in notes 12 and 13 to the financial statements.

Other interests

The long leasehold interest in Woburn House is owned by CVCP Properties plc, a business set up by the membership in 1995 for the purpose of acquiring the building. CVCP Properties plc also owns a central London residential flat which is let out at commercial rates with the revenue contributing to the annual covenant to Universities UK.

Investment policy

Universities UK plans strategically over a five-year time horizon and budgets annually to expend substantially all anticipated unrestricted income, subject to retaining a prudent amount in reserves. It has no permanent endowment and provides for capital expenditure from unrestricted reserves.

The Board of Trustees does not consider that it is necessary to accumulate and invest income for the longer term. Its investment policy is therefore to retain surplus funds as cash and place them on bank deposit and treasury reserve at the best rate consistent with a prudent treasury management policy. As a result, it is not appropriate for the organisation to adopt an ethical investment policy.

Principal risks and uncertainties

The UK Board, supported by the Audit and Risk Committee which carries responsibility for risk management, keeps under review the strategic and operational risks facing the organisation and its subsidiaries together with the programmes and activities that help manage those risks effectively.

As a membership organisation, Universities UK’s principal risk is failing to respond adequately to developments in higher education policy and funding or to its members’ needs, which would risk damage to its reputation and influence and a possible loss of members and subscription revenue. Horizon scanning and member feedback mechanisms are in place to minimise and mitigate this risk and other external financial and operational risks and uncertainties.

14 Universities UK

Specifically, potential policy divisions within the membership and Universities UK’s response to those are monitored via the Board, members’ meetings and the Policy Networks. Operational risks include IT systems and the infrastructure of Woburn House, and strategies are in place to identify and mitigate those risks. Our statutory role as the employers’ representative in the USS pension scheme brings with it risks to our reputation and resources. In the coming year there will be significant financial risk if there are delays rebuilding the commercial income generating activities.

Reserves policy

The trustees have reviewed the requirements for free reserves (unrestricted reserves less any amounts designated or otherwise committed) in the light of the principal strategic and operating risks to the organisation, as outlined above. Despite uncertainty as a result of Covid-19, the nature and likely timing and financial impact of these risks are not considered to be either sufficiently immediate or material to warrant carrying higher reserves. Accordingly, the current target of four to six months of unrestricted expenditure is deemed appropriate as this would ensure sufficient funds are available to meet current commitments if income streams were erratic or exceptional expenditure was incurred.

Universities UK reports its results under the Charity SORP, based on revised UK Generally Accepted Accounting Practice (GAAP): FRS 102. This has a significant impact on free reserves as Universities UK has to provide for the present value of employer contributions to past service deficits in multiemployer defined benefit pension schemes previously accounted for solely as defined contribution schemes, and the cost of untaken staff leave. The trustees have considered the impact of this and agreed to focus on cash liquidity of assets and risk, so levels of reserves would be stated before and after the provisions required under FRS 102 but using levels before for any provisions for operational and decisions making purposes.

The impact of the reporting regime has been to reduce reported unrestricted reserves by £2.2m (2019: £3.3m) and to cause Universities UK’s group free reserves to be less than the target range of months of unrestricted expenditure. The trustees do not believe the impact of FRS 102 to be significant as most of the provision is for extra pension payments that will be made over a number of years up to 2028. These will be budgeted for and accommodated as extra expenditure in each individual year. The remaining provision is for the cost of unused leave, higher this year due to delays in taking annual leave as a result of lockdown but we are confident that these balances will be used in the next six months.

The trustees have identified 2020–21 income as a risk and approved a budget based on assumptions which will end the year within the reserves policy. The trustees will monitor performance through the year and take appropriate measures to avoid a significant drop in reserves.

Performance against reserves policy
Total unrestricted reserves
Less: committed to fixed assets
Free reserves under SORP (A)
Add back: pension and annual leave liabilities
Reserves for Universities UK policy purposes (B)
Total unrestricted expenditure (C)
Exclude: pension and annual leave costs
Unrestricted expenditure for Universities UK policy purposes (D)
Months of expenditure expressed in reserves:
Under SORP (12 X A / C)
Under Universities UK policy (12 X B / D)
Months (target)		 2020
£’000
2,742
(955)		 2019
£’000
1,859
(1,005)
1,787
2,203		 854
3,298
3,990 4,152
8,138
1,096		 11,853
(2,086)
9,234 9,767
2.6
5.2
4.0 – 6.0		 0.9
5.1
4.0 – 6.0

Universities UK 15

Trustees’ report (continued)

Political and charitable donations

The company made no political donations in the year (2019: nil). During the year, charitable donations made in lieu of buying and sending hard copy Christmas cards were £320 (2019: £100)

Looking forward – our aspirations for 2020 –21

2020–21 will be the third year of Universities UK’s Strategic Plan 2018-23: World Leading Impact. The long term, strategic objectives for the next five years are as outlined on in the strategic report. These focus on six thematic areas:

With the uncertainty around the Covid-19 crisis, operational programmes have been refocussed to respond to the crisis or paused. At an appropriate time, Universities UK members will be surveyed to understand priorities for a post-Covid, post-Brexit world.

The following workstreams were in place in July 2020 but are very likely to evolve, be added to and refocus as new priorities and challenges emerge through 2020–21.

In addition to these workstreams, Universities UK has supported members to ensure access to testing capacity and to consider the challenges of operating a university under Covid-19 restrictions.

16 Universities UK

Statement of Trustees’ responsibilities

The trustees (who are also directors of Universities UK for the purposes of company law) are responsible for preparing the Trustees’ report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law requires trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charitable company and the group and of the incoming resources and application of resources, including the income and expenditure, of the charitable company and group for that period. In preparing these financial statements, the trustees are required to:

The trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Audit information

So far as each of the trustees at the time the Trustees' report is approved is aware:

Auditor

Haysmacintyre LLP has indicated its willingness to continue as auditor, subject to re-appointment at the next annual general meeting.

The Trustees’ report is approved by the trustees of the charity. The Strategic report, which forms part of the Trustees’ report, is approved by the trustees in their capacity as directors in company law of the Charity.

Alistair Jarvis Chief Executive 6 November 2020

Professor Paul Layzell Treasurer

Universities UK 17

Independent auditor’s report to the members of Universities UK

Opinion

We have audited the financial statements of Universities UK for the year ended 31 July 2020 which comprise the Group Statement of Financial Activities, the Group Balance Sheet, Group Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion, the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Responsibilities of trustees for the financial statements

As explained more fully in the trustees’ responsibilities statement, the trustees (who are also the directors of the charitable company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the trustees are responsible for assessing the group and parent charitable company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the group and parent charitable company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

18 Universities UK

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

Other information

The trustees are responsible for the other information. The other information comprises the information included in the Trustees’ report (incorporating the Strategic report). Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and parent charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Report of the Board (which incorporates the Strategic report and the Directors’ report).

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Universities UK 19

Independent auditor’s report to the members of Universities UK

Use of our report

This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members those matters we are required to state to them in an Auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Thomas Wilson, Senior Statutory Auditor For and on behalf of Haysmacintyre LLP, Statutory Auditor

10 Queen Street Place London EC4R 1AG

06 November 2020

20 Universities UK

Consolidated statement of financial activities – year ended 31 July 2020

Income and expenditure
Notes
Income from:
. Donations
2
. Charitable activities
3
. Other trading activities
4
. Investments
. Other income
Total
Expenditure on:
. Raising funds
. Charitable activities
Total
7
Net expenditure
Transfers between funds
20
Net movements in funds
Total funds at 1 August 2019
Total funds at 31 July 2020
20		 Unrestricted
Funds
£’000
982
7,080
915
56
16		 Restricted
Funds
£’000
—
4,975
30
9
—		 Total
Funds
2020
£’000
982
12,055
945
65
16
14,063
591
13,116
13,707
356
—
356
5,823
6,179		 Total
Funds
2019
£’000
886
12,507
1,343
79
34
9,049 5,014 14,849
564
7,574		 27
5,542		 687
16,356
8,138 5,569 17,043
911
7		 (555)
(7)		 (2,194)
—
918
1,870		 (562)
3,953		 (2,194)
8,017
2,788 3,391 5,823

All activities are continuing. There are no gains or losses other than those disclosed in the consolidated statement of financial activities.

The notes on pages 24 to 46 form part of these financial statements.

Universities UK 21

Balance sheets – 31 July 2020

Notes
Fixed assets
Intangible fixed assets
12
Tangible fixed assets
13
Investments
14
Current assets
Debtors
- due within one year
- due after more than one year
15
Investments – short term deposits
Cash at bank and in hand
Liabilities
Creditors: amounts falling due within
one year
16
Net current assets
Total assets less current liabilities
Creditors: amounts falling due after
one year
18
Total net assets
Funds and reserves
Restricted funds
Unrestricted funds
Non-charitable trading funds
Total funds
20		 The Group
2020
£’000
2019
£’000
26
48
394
413
600
600		 The Group
2020
£’000
2019
£’000
26
48
394
413
600
600		 Universities UK
2020
£’000
2019
£’000
9
8
346
397
600
600		 Universities UK
2020
£’000
2019
£’000
9
8
346
397
600
600
1,020 1,061 955 1,005
1,868
750		 2,664
750		 2,086
750		 2,497
750
2,618
5,152
2,332		 3,414
5,885
1,800		 2,836
3,552
897		 3,247
3,785
911
10,102
(3,038)		 11,099
(3,201)		 7,285
(2,672)		 7,943
(2,944)
7,064
8,084
(1,905)		 7,898
8,959
(3,136)		 4,613
5,568
(1,905)		 4,999
6,004
(3,136)
6,179 5,823 3,663 2,868
3,391
2,742
46		 3,953
1,859
11		 921
2,742
—		 1,009
1,859
—
6,179 5,823 3,663 2,868

Gross income for the parent charity was £11,925,000 and gross expenditure was £11,130,000, resulting in a surplus of £795,000 (2019: deficit of £2,070,000).

Approved by the Board of Directors and authorised for issue on 6 November 2020

Signed on their behalf:

Alistair Jarvis Chief Executive

Paul Layzell Treasurer

Company Number: 2517018

The notes on pages 24 to 46 form part of these financial statements.

22 Universities UK

Consolidated cash flow statement – year ended 31 July 2020

(a) Reconciliation of net expenditure to net cash flow from operating
activities
Net income/(expenditure) for the year
Interest income
Depreciation and amortisation charges
Decrease/(increase) in debtors
(Decrease)/increase in creditors
Net cash used in operating activities
(b) Statement of cash flows
Cash flows from operating activities
Cash flows for investing activities
Purchase of fixed assets
Interest income
Net cash used in investing activities
Change in cash and cash equivalents in the year
Cash and cash equivalents at 1 August
Cash and cash equivalents at 31 July
Cash and cash equivalents at 31 July is made up of:
Investments – short term deposits
Cash at bank and in hand
Total cash and cash equivalents		 2020
£’000
356
(65)
135
796
(1,394)
(172)
(172)
(94)
65
(29)
(201)
7,685
7,484
5,152
2,332
7,484		 2019
£’000
(2,194)
(79)
149
(91)
1,680
(535)
(535)
(69)
79
10
(525)
8,210
7,685
5,885
1,800
7,685

Universities UK 23

Notes to the financial statements – year ended 31 July 2020

1. Principal accounting policies

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2015) – Charities SORP (FRS 102), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006.

Universities UK meets the definition of a public benefit entity under FRS 102. It is a company limited by guarantee and is incorporated in the UK. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note(s).

The consolidated financial statements incorporate the results of Universities UK and its subsidiaries, Woburn House Conference Centre Limited, Medical Schools Council and MSC Assessment. No separate Universities UK statement of financial activities has been prepared, as permitted by Section 408 of the Companies Act 2006.

a. Critical accounting judgements and estimates

In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of the charity’s accounting policies and the reported assets, liabilities, income and expenditure and the disclosures made in the financial statements. Estimates and judgements are continually evaluated and are based on historic experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The liability in respect of the pension deficit recovery plan has been calculated using key assumptions concerning future payroll growth and the discount rate (see note 24).

b. Preparation of the accounts on a going concern basis

The trustees consider that there are no material uncertainties about the charity’s ability to continue as a going concern. The trustees have considered the impact of the Covid-19 pandemic, reviewed financial position, reserves levels and future plans and this has given the trustees confidence that the charity remains a going concern into the future.

c.

Income

Income from donations and grants (including government grants) is recognised when there is evidence of entitlement, receipt is probable and its amount can be measured reliably.

Subscriptions are recognised over the period to which they relate.

Conference fee and other trading income is recognised on an accruals basis.

Investment income is credited in the period in which it is earned.

d.

Expenditure

All expenditure is accounted for on an accruals basis and has been classified under headings that aggregate all costs relating to that category. Where costs cannot be directly attributable to a particular heading, they have been allocated to activities on a basis consistent with the use of the resource.

Direct costs, including directly attributable salaries, are allocated on the basis of time to the key strategic areas of activity.

Overheads and other salaries are allocated between activities on the bases of usage, ie the same basis as expenditure incurred directly in undertaking the activity.

24 Universities UK

d. Expenditure (continued)

Governance costs are those incurred in connection with the management of Universities UK’s assets, the organisation’s administration and compliance with constitutional and statutory requirements.

Unconditional grants payable are charged to the statement of financial activities in the year in which they are communicated to the recipient as at that time a valid expectation has been created that the grants will be paid. Conditional grants are charged on a similar basis when conditions fall outside the control of the charity. Any unpaid amounts are shown as liabilities at the balance sheet date.

e.

Intangible and tangible fixed assets and depreciation

Tangible fixed assets are stated at cost less depreciation. A full year’s depreciation is charged in the year of acquisition and none in the year of disposal.

Leasehold improvements assets are stated at cost less depreciation. A full year’s depreciation is charged in the year the asset is brought into use and none in the year of disposal.

Depreciation has been calculated at the following annual rates, in order to write off each asset over its estimated useful life.

Furniture and equipment - over four years Office technology (including website development) - over three years Leasehold improvements - over the life of the lease

Universities UK capitalisation policy is to capitalise individual assets costing over £2,500.

f.

Investments

Investments held as fixed assets are stated at cost, as permitted by FRS 102. In the opinion of the trustees the estimated fair value of the investment is not materially different from the cost as there is no active market for these shares.

g.

Cash and cash equivalents

Surplus cash funds are held on deposit for up to a year in order to achieve a better rate of interest.

h. Financial instruments

The charity only has financial assets and liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value. Liabilities are recognised on an accruals basis. Loans receivable are measured initially at fair value and are measured subsequently at amortised cost using the effective interest method.

i.

Creditors and provisions

Creditors and provisions are recognised where the charity has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.

j.

Debtors

Short term debtors are measured at transaction price, less any impairment.

k. Operating leases

Rental costs under operating leases are charged to the statement of financial activities in equal amounts over the period of the lease.

Universities UK 25

Notes to the financial statements (continued)

l. Employee benefits

Short term benefits

Short term benefits including holiday pay are recognised as an expense in the period in which the service is received.

Employee termination benefits

Termination benefits are accounted for on an accruals basis and in line with FRS 102.

m.

Pensions

Universities UK participates in the Universities Superannuation Scheme (USS) and Superannuation Arrangements of the University of London (SAUL).

Both these pension schemes are defined benefit, multi-employer schemes (contracted out of the State Second Pension [S2P] up until 31 March 2016), with the assets held in separate trusteeadministered funds. The funds are valued every three years by a professionally qualified independent actuary using the projected unit method, the rates of contribution payable being determined by the trustees on the advice of the actuary. In the intervening years the actuary reviews the progress of the scheme.

Because of the mutual nature of the schemes, the schemes’ assets are not hypothecated to individual institutions and scheme-wide contribution rates are set. Universities UK is therefore exposed to actuarial risks associated with members employed at other participating employers in the schemes and is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis and therefore, as required by Section 28 of FRS 102 “Employee benefits”, accounts for the schemes as if they were defined contribution schemes.

As a result, the amount charged to income and expenditure through the Statement of Financial Activities represents the contributions payable to the schemes in respect of the accounting period.

Given the mutual nature of the schemes, participating employers are not expected to be liable for any other current participating employer’s obligations, but in the event of an insolvency of any participating employer within each scheme, an amount of any pension shortfall which cannot otherwise be recovered in respect of that employer, may be spread across the remaining participating employers and reflected in the next actuarial valuation.

Since Universities UK has entered into an agreement to participate in a deficit recovery plan for USS, it now also recognises a liability under FRS 102 for the future contributions payable that arise from this agreement to the extent that they relate to the deficit and the resulting expense in the statement of financial activities.

As SAUL had a Technical Provisions surplus at 31 March 2017 there is no defined benefit liability to be recognised by Universities UK.

n. Universities Scotland and Universities Wales

The funds of these National Councils are included within the designated unrestricted funds of Universities UK. Universities Scotland is a recognised body in Scotland and separate accounts for it are prepared and filed with the Office of the Scottish Charity Regulator.

26 Universities UK

2. Donations

CVCP Properties plc is a company owned by 100 higher education institutions, whose executive heads are members of Universities UK. The company owns two leasehold properties and the net profits from its activities are covenanted annually to Universities UK.

Covenanted income receivable during the year from CVCP Properties plc was £981,888 (2019: £885,837). Other transactions with CVCP Properties plc are included in note 26.

3. Income from charitable activities

Subscriptions from
membership
Grants and contracts
Conference income		 Unrestricted
Funds
£’000
6,148
382
550		 Restricted
Funds
£’000
2,250
2,584
141		 Total
2020
£’000
8,398
2,966
691		 Unrestricted
Funds
£’000
6,024
340
1,037		 Restricted
Funds
£’000
2,047
2,886
173		 Total
2019
£’000
8,071
3,226
1,210
7,080 4,975 12,055 7,401 5,106 12,507

See notes 5 and 6 for further analysis.

4. Other trading activities

Trading activities relate principally to Woburn House Conference Centre Ltd, a subsidiary. They are stated net of intra-group trading.

5. Subscriptions from membership

Unrestricted
Funds
£’000
Universities UK
5,063
Universities Scotland
631
Universities Wales
454
Medical Schools Council
—
MSC Assessment
—
Council of Deans of Health
—
6,148		 Unrestricted
Funds
£’000
Universities UK
5,063
Universities Scotland
631
Universities Wales
454
Medical Schools Council
—
MSC Assessment
—
Council of Deans of Health
—
6,148		 Restricted
Funds
£’000
402
—
—
854
301
693		 Total
2020
£’000
5,465
631
454
854
301
693		 Unrestricted
Funds
£’000
4,938
625
461
—
—
—		 Restricted
Funds
£’000
315
—
—
1,070
—
662		 Total
2019
£’000
5,253
625
461
1,070
—
662
6,148 2,250 8,398 6,024 2,047 8,071

Universities UK 27

Notes to the financial statements (continued)

6. Grants and contracts

Higher Education Funding
Council for Wales
Health Education England
Research England
British Council
Department for Business,
Energy & Industrial Strategy
Scottish Funding Council
Office for Students
Burdett
Department of Health & Social
Care
All Party Parliamentary
University Group
Scottish Government
HMRC
Conservatoires UK
NCUK
UPP Foundation
European Commission
Department for Education
HEFCE
Health Foundation
NIHR CLAHRC
UK Research and Innovation *
Other organisations		 Unrestricted
Funds
£’000
—
—
—
198
63
—
—
—
42
—
38
12
—
—
—
—
—
—
—
—
29		 Restricted
Funds
£’000
1,046
441
370
100
166
123
71
62
49
6
42
—
23
25
24
21
—
—
—
—
—
15		 Total
2020
£’000
1,046
441
370
298
229
123
71
62
49
48
42
38
35
25
24
21
—
—
—
—
—
44		 Unrestricted
Funds
£’000
—
—
—
128
122
—
—
—
—
43
—
—
14
—
—
—
—
—
—
—
20
13		 Restricted
Funds
£’000
766
1,130
300
131
59
121
—
62
28
16
53
—
28
—
24
—
47
43
33
29
—
16		 Total
2019
£’000
766
1,130
300
259
181
121
—
62
28
59
53
—
42
—
24
—
47
43
33
29
20
29
382 2,584 2,966 340 2,886 3,226

* Grants from government and government agencies.

7. Total resources expended

Cost of raising funds
Charitable activities
Activities for members
Core (see split below)
Conferences
Medical & health
Exam delivery
Total activities for members
Total resources expended		 Direct
costs
£’000
567
7,209
466
1,567
958		 Support
costs
£’000
24
2,437
93
250
136		 Total
2020
£’000
591
9,646
559
1,817
1,094		 Direct
costs
£’000
668
9,800
791
1,792
1,117		 Support
costs
£’000
19
2,320
82
340
114		 Total
2019
£’000
687
12,120
873
2,132
1,231
10,200 2,916 13,116 13,500 2,856 16,356
10,767 2,940 13,707 14,168 2,875 17,043

28 Universities UK

7. Total resources expended (continued)

Split of core activities
England, NI and UK-wide
International
Universities Wales
Universities Scotland
Total resources expended		 Direct
costs
£’000
3,402
2,595
527
685		 Support
costs
£’000
1,954
124
100
259		 Total
2020
£’000
5,356
2,719
627
944		 Direct
costs
£’000
6,762
1,861
496
681		 Support
costs
£’000
1,876
138
56
250		 Total
2019
£’000
8,638
1,999
552
931
7,209 2,437 9,646 9,800 2,320 12,120

8. Support costs allocations

Trading activities: costs of
goods sold and other costs
Charitable activities
Core
Conferences
Medical and health
Exam delivery
Total resources
Trading activities: costs of
goods sold and other costs
Charitable activities
Core
Conferences
Medical and health
Exam delivery
Total resources		 Premises
£'000
11
1,021
39
80
33		 Governance
£000
2
159
6
31
5		 Depreciation
£000
1
80
3
16
—		 Finance, HR
IT £000
7
748
29
85
30		 Other
£000
3
429
16
38
68		 Total
2020
£’000
24
2,437
93
250
136
1,184 203 100 899 554 2,940
Premises
£000
9
1,034
37
98
15		 Governance
£000
1
156
6
70
13		 Depreciation
£000
1
90
3
36
—		 Finance, HR
IT £000
5
669
24
74
56		 Other
£000
3
371
12
62
30		 Total
2019
£’000
19
2,320
82
340
114
1,193 246 130 828 478 2,875

Universities UK 29

Notes to the financial statements (continued)

8. Support costs allocations (continued)

Governance costs are made up of the following:
Staff costs
External audit
Other professional fees
Meeting costs and expenses
Other direct costs include:
Auditor’s remuneration:
. For audit services
. For other services
. Prior year fees: other services
Operating lease rentals:
. Land and buildings
. Office and equipment
9.
Analysis of staff costs
Total staff costs including full and part-time employees were:
Wages and salaries
Social security costs
Other pension costs		 Total
2020
£’000
149
23
29
2
203
Total
2020
£’000
26
6
—
1,033
10
Total
2020
£’000
6,246
669
332		 Total
2019
£’000
141
21
78
6
246


Total
2019
£’000
24
15
1
1,011
12
Total
2019
£’000
6,030
641
3,406
7,247 10,077

‘Other pension costs’ includes a £1,264,000 credit relating to the movement on the USS pension deficit funding liability (2019: debit of £2,026,000).

The average number of employees throughout the year was:
Charitable activities
Support staff
Trading activities – Woburn House Conference Centre Limited		 2020
No.
121
20
4		 2019
No_._
115
22
4
145 141

30 Universities UK

9. Analysis of staff costs (continued)

The number of employees whose emoluments exceeded £60,000 (excluding employer’s pension contributions) was 28 (2019: 25).

2020 2019
No. No.
£60,001 - £70,000 9 12
£70,001 - £80,000 10 5
£80,001 - £90,000 3 4
£90,001 - £100,000 4 2
£120,001 - £130,000 1 1
£150,001 - £160,000 — 1
£160,001 - £170,000 1 —

The total employer pension contributions for these staff were £453,998 (2019: £353,571).

10. Trustees’ emoluments and emoluments of other key management personnel

No trustees received any remuneration for their services.

During the year, travel and accommodation expenses were reimbursed to one trustee amounting to £120 (2019: one trustee - £4,171).

The total employee benefits of the Senior Leadership Team who are considered to be key management personnel (in addition to trustees) was:

Wages and salaries
Social security costs
Other pension costs		 2020
£’000
750
85
155		 2019
£’000
715
82
132
990 929

The Senior Leadership comprises the Chief Executive and Directors of Policy, Member Services, Universities UK International, Communications and External Affairs, Operations, Universities Scotland and Universities Wales.

11. Taxation

The charity is exempt from corporation tax under Sections 466-497 of the Corporation Taxes Act 2010 as all its income is applied to charitable purposes.

Universities UK 31

Notes to the financial statements (continued)

12. Intangible fixed assets

Website development and software
Cost
At 1 August 2019
Additions
Written off
At 31 July 2020
Depreciation
At 1 August 2019
Charge for year
Written off
At 31 July 2020
Net book value
At 31 July 2020
At 31 July 2019
Tangible fixed assets
Group
Cost
At 1 August 2019
Additions
Written off
At 31 July 2020
Depreciation
At 1 August 2019
Charge for year
Written off
At 31 July 2020
Net book value
At 31 July 2020
At 31 July 2019		 Leasehold
Improvements
£’000
687
—
—
687
298
64
—
362
325
389		 Group
£’000
534
12
(170)
376
486
34
(170)
350
26
48
Furniture
&
Equipment
£’000
539
72
(13)
598
520
33
(13)
540
58
19		 Universities
UK
£’000
337
12

(100)
249
329
11

(100)
240
9
8
Office
Technology
£’000
Total
£’000
157
1,383
10
82
(62)
(75)
105
1,390
152
970
4
101
(62)
(75)
94
996
11
394
5
413		 Universities
UK
£’000
337
12

(100)
249
329
11

(100)
240
9
8
Office
Technology
£’000
Total
£’000
157
1,383
10
82
(62)
(75)
105
1,390
152
970
4
101
(62)
(75)
94
996
11
394
5
413
1,390
970
101
(75)
996
394
413

13. Tangible fixed assets

32 Universities UK

13. Tangible fixed assets (continued)

Universities UK
Cost
At 1 August 2019
Additions
Written off
At 31 July 2020
Depreciation
At 1 August 2019
Charge for year
Written off
At 31 July 2020
Net book value
At 31 July 2020
At 31 July 2019		 Leasehold
Improvements
£’000
687
—
—		 Furniture
&
Equipment
£’000
395
12
(13)		 Office
Technology
£’000
135
10
(58)		 Total
£’000
1,217
22
(71)
687 394 87 1,168
298
64
—		 392
5
(13)		 130
4
(58)		 820
73
(71)
362 384 76 822
325 10 11 346
389 3 5 397
14.
Investments held as fixed assets
Group and Universities UK
CVCP Properties plc ordinary shares of £1 each
CVCP Properties plc preference shares of £1 each		 Total
2020
£’000
50
550
600		 Total
2019
£’000
50
550
600

CVCP Properties plc is an unquoted company and the shares are stated at cost. In the trustees’ opinion, the fair value of the investment is not materially different from the cost at the balance sheet date as there is no active market for these shares.

15. Debtors

Trade debtors
Amounts due from subsidiary undertakings
Other debtors
Prepayments and accrued income
Loan		 Group
2020
£’000
2019
£’000
380
1,300
—
—
1,002
923
486
441
750
750		 Group
2020
£’000
2019
£’000
380
1,300
—
—
1,002
923
486
441
750
750		 Universities UK
2020
£’000
2019
£’000
213
305
441
880
1,002
923
430
389
750
750		 Universities UK
2020
£’000
2019
£’000
213
305
441
880
1,002
923
430
389
750
750
2,618 3,414 2,836 3,247

The £750,000 loan is repayable after more than one year (2019: £750,000).

Universities UK 33

Notes to the financial statements (continued)

16. Creditors: amounts falling due within one year

Trade creditors
Amounts due to subsidiary undertakings
Taxation and social security
Other creditors
Accruals
Deferred income		 Group
2020
£’000
2019
£’000
583
586
—
—
235
273
153
133
893
699
1,174
1,510		 Group
2020
£’000
2019
£’000
583
586
—
—
235
273
153
133
893
699
1,174
1,510		 Universities UK
2020
£’000
2019
£’000
468
386
—
13
235
273
153
133
656
640
1,160
1,499		 Universities UK
2020
£’000
2019
£’000
468
386
—
13
235
273
153
133
656
640
1,160
1,499
3,038 3,201 2,672 2,944

At the year end outstanding pension contributions amounted to £149,948 (2019: £134,695).

17. Deferred income

Brought forward
Released in the year
Deferred in the year
Carried forward		 Group
2020
£’000
2019
£’000
1,510
2,012
(1,503)
(2,008)
1,167
1,506		 Group
2020
£’000
2019
£’000
1,510
2,012
(1,503)
(2,008)
1,167
1,506		 Universities UK
2020
£’000
2019
£’000
1,449
1,992
(1,442)
(1,988)
1,153
1,445		 Universities UK
2020
£’000
2019
£’000
1,449
1,992
(1,442)
(1,988)
1,153
1,445
1,174 1,510 1,160 1,449

18. Creditors: amounts falling due after more than one year

Group and Universities UK
Pension deficit funding payments in relation to USS		 Total
2020
£’000
1,905		 Total
2019
£’000
3,136

See note 24 for further details regarding these liabilities.

19. Operating lease commitments

The group and company have the following future minimum lease payments under non-cancellable operating leases for each of the following periods:

Group and Universities UK
Land and buildings:
. Within one year
. Between one and five years
. After five years
Office equipment:
. Within one year
. Between one and five years		 Total
2020
£’000
1,056
475
27
7
13
1,578		 Total
2019
£’000
1,053
1,508
47
6
1
2,615

34 Universities UK

20. Movement in funds

Unrestricted funds
Investment fund
Universities Scotland / Universities
Wales
General funds
Restricted funds
Medical Schools Council
MSC Assessment
MSC Assessment Alliance
University Hospital Association
Dental Schools Council
Pharmacy Schools Council
Association of Dental Hospitals
Summer School
Council of Deans of Health
Universities UK International
(UUKi)
Outward mobility
SIEM
Short-term mobility
BEIS ODA
Global Wales II
Vietnam Partnership
South Africa
Universities Wales International
US International
Pensions reform
Business Readiness Fund
Welsh Governance
Civic Mission
Algorithms
KE Concordat
Student MH partnerships
OFS – Analytics
Other
Non-charitable trading funds
Group – total funds		 At 1 August
2019
£
600

543
716		 Incoming
resources
£
—
1,178
7,385		 Resources
expended
£
—
(1,580)
(6,107)		 Transfers
£
—
438
(431)		 At 31 July
2020
£
600
579
1,563
1,859
1,192
857
407
268
125
65
19
11
412
—
56
—
—
18
267
5
56
70
109
—
—
—
—
—
—
—
—
16		 8,563
549
36
397
123
80
102
21
360
912
395
24
21
65
85
909
60
(32)
—
116
385
110
59
43
33
70
28
16
47		 (7,687)
(510)
(699)
(406)
(123)
(82)
(83)
(18)
(207)
(891)
(395)
(80)
(21)
(12)
(96)
(1,020)
(62)
(24)
—
(120)
(385)
(110)
(59)
(21)
(20)
(29)
(28)
(16)
(52)		 7
(4)
(4)
(7)
(1)
—
—
—
—
(6)
—
—
—
—
—
—
—
—
15
—
—
—
—
—
—
—
—
—
—		 2,742
1,227
190
391
267
123
84
22
164
427
—
—
—
53
7
156
3
—
85
105
—
—
—
22
13
41
—
—
11
3,953
11		 5,014
486		 (5,569)
(451)		 (7)
—		 3,391
46
5,823 14,063 (13,707) — 6,179

Universities UK 35

Notes to the financial statements (continued)

20. Movement in funds (continued)

Unrestricted funds
Investment fund
Universities Scotland / Universities
Wales
General funds
Restricted funds
Medical Schools Council
MSC Assessment
MSC Assessment Alliance
University Hospital Association
Dental Schools Council
Pharmacy Schools Council
Council of H’care Science in HE
Association of Dental Hospitals
Summer School
Council of Deans of Health
Health Services Research N’work
CLAHRC
Mental Health in Higher Education
Universities UK International
(UUKi)
Outward mobility
UUKi programmes
Newton
Global Wales II
Vietnam Partnership
BEC.AR
South Africa
Universities Wales International
US International
Pensions reform
Open Access
Degree Algorithms
Other
Non-charitable trading funds
Group – total funds		 At 1 August
2018
£
600

437
2,974		 Incoming
resources
£
—
1,169
7,968		 Resources
expended
£
—
(1,503)
(9,791)		 Transfers
£
—
440
(435)		 At 31July
2019
£
600
543
716
4,011
1,294
835
451
246
112
65
39
19
(4)
435
—
22
29
—
139
44
19
—
—
—
—
45
85
—
23
10
78		 9,137
444
851
369
134
80
75
(37)
21
260
911
76
29
42
398
24
—
82
736
55
16
58
15
126
282
—
5
110		 (11,294)
(545)
(808)
(423)
(111)
(67)
(75)
—
(21)
(245)
(929)
(76)
(51)
(71)
(398)
(107)
(44)
(83)
(469)
(50)
(16)
(2)
(5)
(102)
(282)
(15)
(15)
(180)		 5
(1)
(21)
10
(1)
—
—
(2)
—
—
(5)
—
—
—
—
—
—
—
—
—
—
—
15
—
—
—
—
—		 1,859
1,192
857
407
268
125
65
—
19
11
412
—
—
—
—
56
—
18
267
5
—
56
70
109
—
8
—
8
3,986
20		 5,162
550		 (5,190)
(559)		 (5)
—		 3,953
11
8,017 14,849 (17,043) — 5,823

Transfers during the year between funds relate to contributions made from unrestricted monies to restricted funds for specific projects, where there are insufficient restricted funds available to meet expenditure or where the charity is committed to contributing towards projects from its own resources.

Background information on each of the restricted funds is set out below:

The Medical Schools Council represents the interests and ambitions of UK Medical Schools as they relate to the generation of national health, wealth and knowledge through biomedical research and the profession of medicine

MSC Assessment is a subsidiary of the Medical Schools Council set up to run medical assessment activities.

36 Universities UK

20. Movement in funds (continued)

The MSC Assessment Alliance helps ensure the confidence of the public, employers and the regulator in the quality of UK medical school graduates by developing the highest quality assessments for undergraduate medical students and by seeking to demonstrate the equivalency of passing standards.

The University Hospital Association promotes the unique interests of university hospitals across the UK. Its role is to represent the unique tripartite – service, teaching and research – interests of UK University Hospital Trusts in partnership with other national bodies.

The Dental Schools Council represents the interests and ambitions of the UK’s Dental Schools as they relate to the generation of national health, wealth and knowledge acquisition through research and the profession of dentistry.

The Pharmacy Schools Council is building on the work of the Council of UK Head of Pharmacy and has benefited from being able to access increased resources through being hosted by a secretariat which also supports equivalent groups for other healthcare professionals.

The Council of Healthcare Science in Higher Education brings together the collective interests of the sector to increase awareness of healthcare science.

The Association of Dental Hospitals represents the voices of dental hospitals across the UK and Ireland.

The Summer School programme is HEE funding to deliver summer schools for students from a widening participation background.

The Council of Deans of Health represents the UK’s university faculties engaged in education and research for nurses, midwives and allied health professionals. The Council is the voice of nursing, midwifery and AHP higher education and research.

The Health Services Research UK is a membership network that convenes and represents the producers and users of health services research.

The CLAHRC Partnership Programme is the national network of the 13 NIHR Collaborations for Leadership in Applied Health and Research Care (CLAHRC), supporting them in their mission to deliver world class applied research and to translate health research into practice for the benefit of patients and populations.

Mental health in Higher Education aims to improve mental health in higher education, developing and implementing a framework for university leaders to adopt a whole university approach to mental health alongside a mental health audit and knowledge exchange

UUKi is the international arm of Universities UK, representing UK universities and acting in their collective interests globally. It actively promotes universities abroad, provides trusted information for and about them, and creates new opportunities for the sector.

The Outward mobility programme works with UK universities to increase the number of UK-domiciled students who enjoy an international experience as part of their education.

SIEM – Social Inclusion and Engagement in Mobility project relates to research into the barriers and enablers of mobility for the next Erasmus programme.

Universities UK 37

Notes to the financial statements (continued)

20. Movement in funds (continued)

This project is aimed at identifying and sharing good practice in short-term mobility programmes and will produce research to understand the impact and benefits, and identify models of good practice that will inform a digital toolkit to support universities.

The Newton and Global Challenges Research Fund aims to use UK research expertise to solve developmental and global challenges through fostering research and institutional partnerships between UK universities and emerging-market countries.

Universities Wales is the lead partner of Global Wales II . Funding will be received over a three-year period from HEFCW to develop existing target markets, expand into new markets and invest in the ‘Study in Wales’ brand domestically and internationally.

The Vietnam partnership resulted in Global Wales II being matched with five partner universities in Vietnam and running training programmes in Leadership and Governance and University Industry Links.

UUKi is working with the Argentinian Ministry of Education to support the BEC.AR scholarship programme, which provides training and development opportunities to Argentine professionals in science and technology fields and will further develop UK-Argentina bilateral relations and scientific collaboration.

South Africa is funding from BEIS towards the establishment of UK-South Africa postdoctoral fellowship scheme.

Universities Wales International covers funding for Universities Wales’ international and European activities and includes funding from Visit Britain, the British Council and the Welsh Government.

The Universities Scotland International Unit develops and implements policy and research on international issues on behalf of the Scottish higher education sector. This supports the ‘Connected Scotland’ initiative with Scottish Government, Scottish Funding Council and others for targeted international promotion of Scottish higher education.

A restricted subscription was raised from members towards the pensions reform programme following from our statutory role as the employers’ representative in the USS pension scheme.

The Brexit Readiness Fund provided a grant to assist UUK in helping universities understand the implications of, and prepare for, a potential no-deal Brexit in October 2019.

The Review of Governance in Welsh Universities was funding to support an independent review of governance in Welsh universities, to critically examine the current arrangements, and to assist the development of a charter and revised guidance for governors.

Civic Mission & Community Engagement in Wales is a one year programme (running between January 2020 and December 2020) funded by HEFCW, to identify and develop key success factors in civic mission and community engagement work in Universities in Wales and support promotion of this work to stakeholders.

Algorithms covers match-funding agreed through the UK Standing Committee for Quality Assessment from the UK funders and regulators (OfS, SFC, HEFCW and DfE-NI) to undertake work on effective practice in algorithm design and a progress review of sector action on degree algorithms and wider grade inflation activity.

The Knowledge Exchange Concordat is supporting the development, improvement and promotion of good practice across the UK with a development year in England involving institutional self-assessment, submission of action plans and peer evaluation.

38 Universities UK

20. Movement in funds (continued)

Student MH partnerships - exploring models of partnership between universities and NHS mental health services via five local hubs - Bristol, N London, Sheffield, Liverpool, Manchester - and a national learning collaborative. OfS funded project led by UWE [Bristol].

OFS - analytics - project involving universities, sector bodies and digital business to apply digital analytics to improve student mental health & wellbeing.

21. Allocation of net assets between funds

The net assets held for various funds are as follows:

Fixed assets
Investments
Current assets
Current liabilities
Net assets
Long-term liabilities
Group total		 Restricted
funds
£’000
16
—		 Unrestricted
funds
£’000
355
600
Non-
charitable
trading
funds
£’000
49
—		 2020
Total
£’000
420
600
16
3,774
(399)		 955
5,977

(2,285)		 49
351

(354)		 1,020
10,102

(3,038)
3,391
—		 4,647
(1,905)		 46

—		 8,084
(1,905)
3,391 2,742 46 6,179
Fixed assets
Investments
Current assets
Current liabilities
Net assets
Long-term liabilities
Group total		 Restricted
funds
£’000
37
—		 Unrestricted
funds
£’000
405
600
Non-
charitable
trading
funds
£’000
19
—		 2019
Total
£’000
461
600
37
4,259
(343)		 1,005
5,981

(1,991)		 19
859

(867)		 1,061
11,099

(3,201)
3,953
—		 4,995
(3,136)		 11

—		 8,959
(3,136)
3,953 1,859 11 5,823

Universities UK 39

Notes to the financial statements (continued)

22. Subsidiaries

Woburn House Conference Centre Limited

The charity owns 100% of the share capital of Woburn House Conference Centre Limited, a company limited by shares (company number 03031467). The company is incorporated in the UK and registered at Woburn House, 20 Tavistock Square, London, WC1H 9HQ.

The £2 cost of the investment has been written down to zero in the accounts of the parent company. The trading activity of Woburn House Conference Centre Limited is the management of the conference centre and meeting rooms at Woburn House. The results and financial position of Woburn House Conference Centre Limited are consolidated with those of Universities UK in preparing the consolidated accounts.

A summary of the trading results for the year ended 31 July 2020 and 2019, and the aggregate amount of the assets, liabilities, share capital and reserves as at 31 July of each year are shown. Audited accounts have been filed with the Registrar of Companies.

Profit and loss account:
Turnover
Cost of sales
Gross profit
Administration costs
Staff costs
Operating profit
Interest receivable
Profit on ordinary activities before taxation
Taxation
Profit on ordinary activities after taxation
Gift aid payment to Universities UK
Retained earnings carried forward		 Total
2020
£
995,894
(422,103)
573,791
(53,804)
(186,588)
333,399
1,331
334,730
—
334,730
(299,419)
(35,311)		 Total
2019
£
1,432,499
(576,938)
855,561
(43,466)
(202,131)
609,964
1,093
611,057
—
611,057
(619,798)
(8,741)
Balance sheet:
Fixed assets
Current assets
Creditors: amounts falling due within one year
Net current liabilities
Total net assets
Represented by:
Share capital
Profit and loss account		 Total
2020
£
48,896
350,970
(353,643)
(2,673)
46,233
2
46,221
46,223		 Total
2019
£
19,014
858,757
(866,859)
(8,102)
10,912
2
10,910
10,912

40 Universities UK

22. Subsidiaries (continued)

Medical Schools Council

Universities UK is also the holding member of the Medical Schools Council, a company limited by guarantee (company number 8817383) and registered with the Charity Commission (number 1155370). The company is incorporated in the UK and registered at Woburn House, 20 Tavistock Square, London, WC1H 9HD.

The objects of the Medical Schools Council are to promote, encourage and develop medical schools in the UK and thereby advance education for the public benefit, in particular (but without limitation) medical education, research and training.

A summary of income and expenditure for the year to 31 July 2020 and 2019, and the aggregate amount of the assets, liabilities, share capital and reserves as at 31 July of each year are shown below. Audited accounts have been filed with the Registrar of Companies.

Unrestricted funds and free reserves at 31 July 2020 were £1.2m (2019 free reserves: £1.2m) which is equal to 29 months of unrestricted expenditure (2019: 26 months). This is deemed appropriate given the significant change required as a result of the pandemic.

Income and expenditure account:
Income
Expenditure
Deficit
Balance sheet:
Assets
Liabilities
Net assets		 Total
2020
£
1,235,290
(1,434,529)
(199,239)
Total
2020
£
2,183,121
(295,229)
1,887,892		 Total
2019
£
1,381,641
(1,518,746)
(137,105)
Total
2019
£
2,264,761
(177,630)
2,087,131

Universities UK 41

Notes to the financial statements (continued)

22. Subsidiaries (continued)

MSC Assessment

The Medical Schools Council is the parent of MSC Assessment, a company limited by guarantee (company number 8578576) and registered with the Charity Commission (number 1153045). The company is incorporated in the UK and registered at Woburn House, 20 Tavistock Square, London, WC1H 9HD.

The objects of MSC Assessment are to advance medical education for the benefit of the public including, without limitation, by the preparation, validation, accreditation, conduct and administration of any tests, examinations or other systems of assessing, evaluating and recording any aspect of medical education and training.

A summary of the income and expenditure for the year to 31 July 2020 and 2019, and the aggregate amount of the assets, liabilities, share capital and reserves as at 31 July of each year is shown below. Audited accounts have been filed with the Registrar of Companies.

Income and expenditure account:
Income
Expenditure
(Deficit) / Surplus
Balance sheet:
Assets
Liabilities
Net assets
Conduit funding
Funds received in advance b/fwd
Amount received
Amount paid out
Funds received in advance c/fwd		 Total
2020
£
840,290
(1,115,300)		 Total
2019
£
876,047
(854,394)
(275,010) 21,653
Total
2020
£
758,849
(177,278)		 Total
2019
£
968,028
(111,447)
581,571 856,581
2020
£
3,269
—
—
3,269		 2019
£
1,121,282
1,225,063
(2,343,076)
3,269

23. Conduit funding

Amounts received and dispersed to universities on behalf of the Argentinian Ministry of Education for the scholarship programme BEC.AR, and on behalf of the Department for Business, Energy & Industrial Strategy for the Rutherford Fund scholarship programme.

Certain trustees are Vice Chancellors of institutions in receipt of grants.

42 Universities UK

24. Pension

Universities Superannuation Scheme

The appointment of directors to the Board of USS is determined by USS's Articles of Association. Four of the directors are appointed by Universities UK; three are appointed by the University and College Union, of whom at least one must be a USS pensioner member; and a minimum of three and a maximum of five (or between 1 September 2019 and 1 February 2021, six) are independent directors appointed by the Board. Under the scheme trust deed and rules, the employer contribution rate is determined by the trustee, acting on actuarial advice.

The latest available complete actuarial valuation of the Retirement Income Builder is at 31 March 2018 (the valuation date), which was carried out using the projected unit method. A valuation as at 31 March 2020 is underway but not yet complete.

The 2018 valuation was the fifth valuation for the scheme under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to adopt a statutory funding objective, which is to have sufficient and appropriate assets to cover their technical provisions. At the valuation date, the value of the assets of the scheme was £63.7 billion and the value of the scheme’s technical provisions was £67.3 billion indicating a shortfall of £3.6 billion and a funding ratio of 95%.

At 31 March 2020, USS had 204,753 (2019: 202,165) members.

Superannuation Scheme of the University of London (SAUL)

SAUL’s statutory funding objective is to have sufficient and appropriate assets to meet the costs incurred by the Trustee in paying SAUL’s benefits as they fall due (the “Technical Provisions”). The Trustee adopts assumptions which, taken as a whole, are intended to be sufficiently prudent for pensions and benefits already in payment to continue to be paid and for the commitments which arise from Members’ accrued pension rights to be met.

The Technical Provisions assumptions include appropriate margins to allow for the possibility of events turning out worse than expected. However, the funding method and assumptions do not completely remove the risk that the Technical Provisions could be insufficient to provide benefits in the future.

A formal actuarial valuation of SAUL is carried out every three years by a professionally qualified and independent actuary. The last actuarial valuation was carried out with an effective date of 31 March 2017. Informal reviews of SAUL’s position, reflecting changes in market conditions, cash flow information and new accrual of benefits, are carried out between formal valuations.

The funding principles were agreed by the Trustee and employers in June 2018 and are due to be reviewed at SAUL’s next formal valuation in 2020.

At the 31 March 2017 valuation SAUL was fully funded on its Technical Provisions basis so no deficit contributions were required. As a whole, the market value of SAUL’s assets was £3,205 million representing 102% of the liabilities for benefits accrued up to 31 March 2017. The Trustee and the Employers have agreed that the ongoing Employers’ contributions will continue at a rate of 16% of CARE Salaries.

At 31 March 2020, SAUL had 65,202 (2019: 58,822) members.

Universities UK 43

Notes to the financial statements (continued)

24. Pension (continued)

Summary USS SAUL
Group contributions for the year to 31 July 2020 £1,277,942 £325,581
Active members at 31 July 2020 81 52
Group contributions for the year to 31 July 2019 £1,067,104 £298,156
Active members at 31 July 2019 80 54

A new deficit recovery plan was put in place as part of the 2018 valuation, which requires payment of 2% of salaries over the period 1 October 2019 to 30 September 2021 at which point the rate will increase to 6%. In accordance with FRS 102, Universities UK has made a provision for this contractual commitment to fund the past deficit. In the prior year, the deficit payments were 5% of salaries up to 30 June 2034. The USS liability is based on staff salary inflation of 2%, and a discount rate of 0.73% (2019: 2%, 1.6%).

The 2018 valuation was the fifth valuation for the scheme under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to adopt a statutory funding objective, which is to have sufficient and appropriate assets to cover their technical provisions. At the valuation date, the value of the assets of the scheme was £63.7 billion and the value of the scheme’s technical provisions was £67.3 billion indicating a shortfall of £3.6 billion and a funding ratio of 95%.

25. Financial instruments

Financial assets measured at amortised cost:
Trade debtors
Cash
Financial liabilities measured at amortised cost		 2020
£’000
380
7,484
7,864
3,534		 2019
£’000
1,300
7,685
8,985
4,554

Financial assets measured at amortised cost comprise trade debtors and cash.

Financial liabilities measured at amortised cost are creditors.

44 Universities UK

26. Related party transactions

Related party transactions are disclosed for CVCP Properties plc, Advance HE, Higher Education Statistics Agency, Universities and Colleges Admissions Service and Quality Assurance Agency.

Universities UK owns all 550,000 preference shares in CVCP Properties plc and 50,000 (1%) of its ordinary shares. Universities UK is the original subscribing member of the other organisations and members of Universities UK contribute to governance oversight through Board membership and other involvement.

CVCP Properties plc
Advance HE
HESA
Quality Assurance Agency
CVCP Properties plc
Advance HE
Universities and Colleges Admissions Service
Quality Assurance Agency		 Year ended 31 July 2020
Purchases
from /
payments
to related
parties
£
Income from
related
parties
£
913,248
1,008,376
12,075
55,529
—
336
5,177
3,549
930,500
1,067,790
Year ended 31 July 2019
Purchases
from /
payments
to related
parties
£
Income from
related
parties
£
853,308
913,945
12,340
42,002
—
59
—
11,279
865,648
967,285		 As at 31
Amounts
due from
related
parties
£
1,773,391
—
—
—
1,773,391
As at 31
Amounts
due from
related
parties
£
1,679,522
35
—
—
1,679,557		 July 2020
Amounts
due to
related
parties
£
694
—
—
—
694
July 2019
Amounts
due to
related
parties
£
367
—
—
—
367

27. Members

The charity is incorporated as a private company limited by guarantee having no share capital and, in accordance with the Memorandum of Association, every member is liable to contribute a sum of £1 in the event of the company being wound up. At 31 July 2020 there were 137 members (2019: 136).

Universities UK 45

Notes to the financial statements 31 July 2020

28. Income and expenditure by fund

Income and expenditure
Notes
Income from:
. Donations
2
. Charitable activities
3
. Other trading activities
4
. Investments
. Other income
Total
Expenditure on:
. Raising funds
. Charitable activities
Total
7
Net income/(expenditure)
Transfers between funds
Net movements in funds
Total funds at 1 August
Total funds at 31 July
Unrestricted
Funds
2020
£’000
982
7,080
915
56
16		 Unrestricted
Funds
2019
£’000
886
7,401
1,309
63
28		 Restricted
Funds
2020
£’000
—
4,975
30
9
—		 Restricted
Funds
2019
£’000
—
5,106
34
16
6		 Total
Funds
2020
£’000
982
12,055
945
65
16		 Total
Funds
2019
£’000
886
12,507
1,343
79
34
9,049 9,687 5,014 5,162 14,063 14,849
564
7,574		 660
11,193		 27
5,542		 27
5,163		 591
13,116		 687
16,356
8,138 11,853 5,569 5,190 13,707 17,043
911
7		 (2,166)
5
(555)
(7)		 (28)
(5)		 356
—		 (2,194)
—
918
1,870		 (2,161)
4,031
(562)
3,953		 (33)
3,986		 356
5,823		 (2,194)
8,017
2,788 1,870 3,391 3,953 6,179 5,823

46 Universities UK

Reference and administrative details

Principal and Registered Office

Woburn House 20 Tavistock Square London WC1H 9HQ

Bankers

National Westminster Bank plc PO Box 83 Tavistock House Tavistock Square London WC1H 9XA

Solicitors

Bates Wells & Braithwaite 10 Queen Street Place London EC4R 1AG

Auditors

Haysmacintyre LLP 10 Queen Street Place London EC4R 1AG

Universities UK also has two regional offices:

Universities Scotland

Holyrood Park 106 Holyrood Road Edinburgh EH8 8AS

Universities Wales

2 Caspian Point Caspian Way Cardiff Bay Cardiff CF10 4DQ

Universities UK 47

Universities UK is the collective voice of 140 universities in England, Scotland, Wales and Northern Ireland. Our mission is to create the conditions for UK universities to be the best in the world; maximising their positive impact locally, nationally and globally. Universities UK acts on behalf of universities, represented by their heads of institution.

Woburn House 20 Tavistock Square London, WC1H 9HQ

T: +44 (0)20 7419 4111 E: info@universitiesuk.ac.uk W: universitiesuk.ac.uk

Twitter, Facebook, Instagram: @UniversitiesUK

November 2020

ISBN: 978-1-84036-458-3