Company Number.. 02732244 Registered Charity Number.. 1042175 Southern Universities Management Services DIRECTORS REPORT AND FINANCIAL STATEMENTS for the year ended 31 July 2021 Southern Universities Management Services CONTENTS Page Legal and Administrative Infomiation Report of the Directors 2to8 Strategic Report Statement of Directors. Responsibilities Independent AUdI￿S Report 91011 staternnt of Finanrial Activities 12 Balance Sheet 13 Cash Flow Statemnt 14 Notes to the Financial Statements 15to30 Company Numter. 02732244 Registered Charty Number.. 1042175 Southern Universities Management Services REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 JULY 2021 Company Name.. &wlhem Universits'es Management ServKes Registered Company Number. 02732244 (Registered in England and Wales) Registered Charity Number. 1042175 Registered Office and OperatK>nal Address: Universty of Reading Reading Enterprise Centre Eariey Gale Vthileknights Road Reading RG6 6BU Dlr•ctorn of the Charftabl• Cornpany. C Campbell S Harrison-Barker L Jeffries K O'connell {resigned 119120201 Z Radnor {resigned 11712021) H Wain M Williams Newcastle University University of Hertfordshire Universty of Reading UnNersrty of Hull City. University of London UnNersty of Cambridge UnNersty of Bath These directors of the eharilabie company are also trustees of the charity for the purpose of charity law and are referred lo as Membefs of the Management Committee in the Artides of Association. Senlor Monagement Team.. M-B Hyde J Arbor R Johnson C Tudor-morgan Group Chief Executive Group Managing Director Head of Pro¢uremenl Services Head of Finance and Operations Company Secretary: C Tudor-morgan Head of Finance and operat￿n$ Auditors: Jaff*s Cowper Kreston Reading Bridge House George Street Reading RG18LS Legal Advisors.. Field Seymur Parkos LLP 1 London Street Reading RG14PN Company Number.. 02732244 Registered Charity Number. 1042175 Southern Universities Management Services REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 JULY 2021 The Direciors present their annual report together with the audited financial statements of the charrtable company forthe year ended 31 July 2021. The Rep)rt ofthe Directors is the Dire¢lors' Report as required by S.417 of Ihe Companies Act 2006 and the Directors. Report as required by the Charities Act 2011. The financial slalements compty with the requirements of the Companies Act 20C6. the Chariltes Act 2011. the charitable company's Men*)randum and Articles of Association and Accounting and Reporting by Charities.. Statement of Recommended PraCt￿e applicable to charities preparing their a¢counts in accordance with the Financial Reporting Standard applKable in the UK and Republ￿ of Ireland {FRS 1021. Structurn. Goveman¢o and PAanagement min The organisation Is a Charitable company limited by guarantee, incorporated on 17 July 1992 and registered as a charty on 18 November 1994. The charttable company was established under Memorandum of Association, whth established the objects and powers of the charitable Company and is governed under ils Articles of Associats'on. The current Memorandum and Articles of Association were adopted on 16 November 2021. Members of the charitable company guarantee to contribute an amount not exceeding £1 to the assets of the ¢haritabte cornpany in the evenl of winding up. As at 31 July 2021 there were 28 Members and the total number of such guarantees was 28 {2020.' 27). in Oir Under the provision5 01 the ArtKles of Ass￿181￿1n the directors are appointed for an initial tenn not exceeding four years by the Members of the Charilable ¢ompany by ordinary resolution. Oirectors may be elected for a second term not exceeding four years. but may not serve more than tsvo terms of office unless they are appointed as Chair of the Management Commtttee during their Second term of office. Directors retire in rotation. Tr inin SUMS directors include member representatives both from the institutions that comprise the charitable company's memtership and those that represent the institutions that subscribe to SUPC. As such they have a good understanding of how the charitable company is structured and operates and will have already worked with the various business units of SUMS in their capacity as member representative. As part of the induct￿n process new directots participate in discussions with the CEO. The Charity Commission publication 'The Essential Trustee, along with the Memorandum and Articles of Asswialion and a role profilè are distributed to new diwlors. The charitable company is organised into Ihree dNisN)ns'. SUMS Consulting. Southern Universllles Purchasing Con$ortium ISUPCI and Procurement Shared serv￿ {PSSI. In 2019 the Company underwent changes to its Articles of Association to create an equal balance of representation from the different business units of SUMS within its Management Committee. The Management Committee now comprises a Minimum of six directors: three representatNe$ appointed from the Members of the charitable company and th￿e appointed to represent Soulhem Universities Purchasing Consorb'um ISUPCI. The Group Chief Executive carries out day-to-day management of the Charitab￿ company under the direction of the members of th& Management Committee. The company has 17 fv114ime employees. 5 part-time employees and a pool of associate consultants. SUMS Consulting provides management consultancy senitis. Its principal activity is to prornte the effi¢iency of the administration ofeducational charities in direct pu￿￿1¢ oftheir objects through the conduct of management consultancy ass￿nrnents at the request of beneficianes. Company Number. 02732244 Registered Charity Number 1042175 Southern Universities Management Services REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 JULY 2021 Icontlnued) SUPC provKJes servus to hNJher eduCat￿rt Institutions and further education colleges that are ils subscribers. Its principal aciNity is the C￿Ordination of purchasing athiity beknn ils beneficiaries in order to share expertise and lo achieve efficiency in purchasing. PSS provides specialist procurement SUPFQrt to higher education institutp)ns and further education colleges to help them secure value for money from their kwrement act￿rt￿$. This includes the delivery ofthe Procurement Maturity Assessnwt Piogtamrro ￿ Engltsh HEI'S. The salary policy, which includes the fraMew￿k for setb'ng pay for all slaff including key management personnel is reviewed by the Managen￿nI Committee every hvo years. The basis of the annual salary review is lo give an annual cost of living increase. and consKler any further increases related to FerfomBnce and changes lo each role across the year. The cost of living increase is set having regard lo the award applied to the HE sector. whilst the review of perlomunce and roles are undertaken against th the banding Structure in place, with benchma￿Ing against simikr roles both within and outside the sector considered every ￿ to three years. The University of Reading is a memterofthe Charitab￿ company forwhich il pays the annual Subscription fee. The University of Reading also wovides payroll, supplier payments, banking services, pensions facilities, IT infrastructure and IT suprM)rt to the charitable ￿rnpany. The charitable company makes payment lo the University of Reading for the 8er¥bces w0v￿ed and I￿ rentals for the premises occupied under lease by the charitable Company. Maior risks to which the tharItab￿ company 15 exposed 8T• revithyed regularty, dc¢umented in a Risk Register and calegorBed according lo their severity based on Iheir likelihood and impact. Actions and procedures have beèn established lo klentty and mitvJate these risks. The Risk Register is Teviewed by the Management Commrttee annualty, wth dynambc risks being reviewed at each meeting of the Manageffonl Committee and the Executsve Group. The current key risks are.. Rlsk Universil¢es ceasing membership due lo financial pressures from Covid-19 pJJitS •tlon Focus on efficienc*s and t8rgel operating model seNices to generate savings for members Memter relationship managemenl wlth increased remte en emenl Investing in develowenl I￿lL￿1ng the ￿uft¢h of r*w products Strengthening of CO￿ staff capabilities, supplemented by a Fool of ass￿late consultants Close rwniloring ol financial Ferfomiance and ¢8shflow ainst bud ets and fofecasts Deficit recovery plans in place at scheme level Ensuring pension scheme provisions remain appropriatè TargeliThJ a 5% annual surplus lo maintain appropriate vel ol resep The potential failuré lo meet planned financ￿[ targets The polentsal impact of final salary pension scheme defi￿ts Company Number. 02732244 Registered Charity Number. 1042175 Southern Universities Management Services REPORT OF ThE DIRECTORS FOR THE YEAR ENDED 31 JULY 2021 Icontlnuedl ObJKtlves and Actlvltl•s, A¢hlevemeThts and Perlorniance In setting the objectives and pJannKw the actsvitjes of Ihetharitable company the Managemèntcommittee has given consideration lo the Chanty Commi55ion's general guidance on public benefiL and in particular to its supplementary publ￿ benefit guidance on the advancemenl of educatson. The objects forwhich the charitable company is estsblished a￿ to pronKlte the efficwy of the admintstration of educational charities in direct purnuit of their objecls by.. la) advice. training and information about financial planning, effective man•3emenl prc*edures, and the best use of available resources, an(1 {bl any other asslstance apmpriate to the Provision of financial planning. procedural advice and resource management. The sep4kes provided promote the efficienw and effecbveness of educational charities. The directors have access lo the Charity Commission's websiie which they review regulaty. lo help ensure Ihal thg aims of the charitable company meet the publK benefil requiremenL The directors confimi that they have omplied with the duty in section 17ISI ol the Charit￿¥ Acl 201 I to have due regard lo the Charity Commisslon's general guSdance on puts1￿ beMfiL SUMS Consu¢ts'n9 this yeaf has continued lo fe¢u$ on delNering consulting asswnments, seminars and workshop events to help Members ensure their organisalions are efficient and effective given the challènges face(1 by the Higher EdutsI￿n sector. and partKukty in lfvaht of the Covid-19 pandemic. SUPC conllnues to ￿u8 on providing comaborative p￿￿are￿nt solutions to its meM￿r5. Tho Pro¢ur•ment Shared Servu IPSSI diw8ion has focused on the dèlr4èry of a pro¢ur¢ment maturty assessment programme and procuremenl consutsncy support lo English Hpaher Education in$lilulions with the aim of suppo￿.ng Institut￿￿8 to wnprove PTo¢urernnL Iheir effKi8ncy and effectiveness. and the value for money they deliver. The obie¢bv¢s. 8¢tivit*s. outy)ul and vxhthemenls of SUMS ConsultirwJ and SUPC art sol ¢)ut in detall in their separate annual reviews that fc¢us on their operating xlivrt*s. These reports are available either from their respective websites and oi upon request lo the charitable company at ils registered office. Copies of Ihe annual reviews a￿ distn'buted w￿tty within the HE sector and beyond. Company NumÈer 02732244 Registered Charity Number 1042175 Southern Universities Management Services REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 JULY 2021 Icontonued) STrATEGIC REPORT Fin*ncial R￿leW The financial year lo 31 Juty 2021 saw an overall surplus for the charitable company of £28Ok12020.' £233k surplus). signif￿nt growth in fe&paid consullancy. from £261k in 2019120 to £551k in 2020r21, plus savings in travd and aCcOm￿￿n 4>3sts versus prfrcovid levels. &counted for the majority of the surplus. Overall income for the year is £2.459k. an increase of 15% on prioryear{2020'. £2,145k), with the maiority {61%1 obtained from SUMS and SUPC subscripkn'on income. SEX Overall expenditure for the year is £2,199k. an irKrease of £287k115%1 vusus prioryear12020.' £1,912k) and in line with the increased overall income. As wtth prior years. the largest prOport￿rt of expenditure 167%) relates to professlonal staff and consultants, Costs in place lo deliver eonsultancy and support activities lo our Mernbers. The dlrectors review and consider the charitaNe company's reserves in the context of risks and fundlng. In setting a reseNes policy the diwlors aim lo establish reasonable, bLrt not absolute protection against risks and to balance this ￿th the need lo deploy resources in pursuit of the company's Gharitsbl8 objectives. SUMS maintsins finan¢ial reserves lo provKle fiexibility to Th￿et.. Future inveslff£nts for nthv andlor grcwing areas of acbvty Annual fluclual¢ons in operating ineome andlor expendrture The liability that is to arise from SUMS defined benefit pension s¢heIr￿, frJr which re8erv85 are lo be held within a desjgnated frjr An element ol financial risk. to whKh tho ¢ompany is exposed Mosl potenlhql unexpected costs. The Management Committee sel a larget for the 2020121 financial year for free reseryes-working capital - to be maintained in a range of 6 and 9 Tr￿thS of operating cosls. Free reseryes held at 31 July 2021 were wilhin this largel range. The Universty of ReadirKJ Employees, Pension Fund {UREPF) VAS closed to nthy entrants on 31 August 2011 and ￿nce then the number of athe membefs of the scheme has been in decline. Al the point the charitable cornpany ceases lo have any &ts"ve membets of the scheme a cessation eventwill be triggered. The potential liability arising from Ihis was estimated by the stherrE's actuaries as al 31 July 2020 to be £184k. This amount is being held in a designated fund in acc(Ydance the reseNes poli¢y. Reserves at the erKI of the financial year were £1,538k12020'. £1.278k}. a 20% increase on prior year. These reserves include designateil reserves of £184k12020'. £182kl, hela in relation to UREPF pensKsn scheme liability detsiled in note 18. The penS￿)n ￿herr￿ designated reserye will stay in place until a s75 ession event Is trKJgered. Company Number.. 02732244 Registered Charity Number 1042175 Southern Universities Management Services REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 JULY 2021 (continued) Pnnci 81 Fundi Sources The majorbty of the ¢haritable eampany's funding i8 from its membership subscriptKsns and Subscribers. As at 31 July 2021 there We￿ 28 Members of the charitable company12020.. 27} and 61 Subscribe￿ to SUPC.. 46 lull subscribers and 15 ass(xiates12020." 61 subscribefs", 47 full and 14 associates). Additional funding comes from consulting work over and atove core membwship work, relent￿ of some markets'ng rebates for contrxl 5UPP)rt thities. and fees fry events. SUMS key inveslmenl objectwe is lo preserve the ￿PIla1 value ol ts investwents with a low level of risk. whilst ensuring that an adequate level of assets are readity available lo meet all expected cash flow requirements. In this regard. all investments are held within cash or near cash inveslrr*nls and are spread across 8 number of inslituti(>ns who fvlfil the criteria set out wthin the SUMS inveS￿nI policy. Having reviewed the Strateg￿ risks, the Cu￿nI finan¢iaJ [#)Sit￿n of SUMS and the financial projections whKh sil alongside the overarching strategy, the directors conshler that adequate resources continue lo be available to fund frJture plans lor the foreseeable luture. Accordingty. the dire¢tors are of the view that the Charity is a going concem. Company Number. 02732244 Regrslered Charity Number. 1042175 Southern Universities Management Servlces REPORT OF THE DIRECTORS FOR THE YEAR ENDEO 31 JULY 2021 Icontinuedl Future Plans The chantable wmpany plans to Continue simrlar activities into future periods. tsiloftng the eonlent of these activities lo meet specific rr*mber needs alongside focusing on the issues. Challenges and opportunities emerging for the H*Jher Éducation sector. SUMS Consulting will conlinue to offer mem￿[$ access lo specialist HE expertise through the provision of consultin9 seryices and access lo its knovAedge hub. along with a range of member events and publications. SUMS Consulting will ensure its capabilities conts.nue lo meet the evolving requirements of Members in areas such as digital transfomiation. eIr￿lenCY and effectiveness. and student wellbeing. SUMS Consulting has developed a mcrtjular efficien¢* and Target Operating Model offering that will help universities fealise efficiencies. This includes a P￿￿urernent module that leverages the expertise within SUPC and PSS. SUMS will also support the wider HE sector through the Pfovision ol fee pai¢J consulting services to non-members. as required. SUPC will continue to deliverval￿ for nwey to nkmt¢rs through the provisi¢)n olcomplhint frameworks and value adding services. Value adding serv￿eS enhance the core offering and allow members lo lailor their membèrship package lo meet their specsfie requirements. In addition, SUPC is to continue its successful Strateg￿ partnership with sister cons0￿￿M. LUPC and membèrship of UK Universilies Purchasing Consortia {UKUPCI. with the aim ofoffering greatervalue to members through aligned activity and driving up collaborative prcturement aeross the HE sector. The procu￿rneAt Shared Seryice division IPSS) r& offering an wnproved Procurement Maturity Assessment product IPMA+l that is delivered virtualty and Meets the needs of universities seeking to benchmark their procurement. as recommended by g¢)vemmenl ui the recent Procurerr*nl Greèn Paper. PSS will continue lo provide speualisl procurement consutbng and other resouT¢es lo the sector with the aim of improving seclor procurew*nL Company Number. 02732244 Registered Charity Number 1042175 Southem Universities Management Services REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31 JULY 2021 Icontlnuedl Dlre¢tor&' Responslbllities Statement The directors are res￿nSible for preparing the Strategic Report, the Direclorn. Annual Report and the financial stateffÉnls in accordarKe with appluble k2wand Uniled lQngdom Accounting Stsndartls (United Klngdom Generalty Accepted Accwnling Practice). Company law requires the dire￿r$ to prepare financial statements for each finandal year wh￿h give true an¢J fair view of the state of affairs of the chantable company and of the in￿ming resource5 and applutKsn of resources. including the ineome and expenditure. of the charitable company for that peri¢xl. In preparing these ftnancial ststements. the dir¥tots are required to: select suilable I￿nting wlicY&s and then apply them consistenty; observe the meihods and prirKiples in the Charit￿ SORP.. rrkike judgements and accounting ests'mates that are reasonable and prudenL stale whether applicable UK Acc￿nting StarKlard$ have been for1￿￿ed, subject to any material departures dls¢losed an ex￿Ined in thè fin#n¢k?l $lalements.' prepare the financial ststements ¢)n the going concem basi% unless il 15 inappropriate to prnsume that the charitable company w¢ll continue in busin￿$. The directors are responsible tor keeping proper and adequatè accounting records that disclose with re050nable accuracy al any time Ihe financial position of the charrtabse company and enable them lo ensure that the financial slatem8nts eompty with the COrnpan￿$ Acl 20C6. They are also Tesponsible lor safeguarding the as$eis ol the charitable company and hence for tsknng reasonable $tep$ for the prevention and delectKJn ol fraud and other irwularibes. In so far as the directors are aware.. there Is no relevant audit 1nf0mwl￿n ofwhich the charitable company'$ audttor ts unaware: and the difeclor8 have laken all steps that Ihey 0￿h1 to have tsken to make themsefves aware of any re￿vanI audrt inf0m*￿n and to estsblish that the audbtor is aware of that information. The directors are resFon$ible lorthe manilenance and integrity olthe corp)ratg and financial information Sncluded on the charitsble company's website. Legislation in the Unrted Kingdom goveming the preParat￿n and dissemination of the financial stalements may drfer from legislation in olherjurisdiclions. Audltorn The auditors, James Cowper Kreston. have induled therwlllingness to stay in office. The financial statements were apwoved by the directOfS on ..2s.kn*L.go%.... their beh8M by". and siqned on M. Wllliams DlrKtor Company Number 02732244 Registered Chanty Number. 1042175 Southern Universities Management Services STATEMENT OF FINANCIAL ACTMTIES FOR THE YEAR ENDED 31 JULY 2021 OPINION We have audited the financia stslerr*nts of Southem Universities Managemenl Servus Ilhe'charitable company.) for the year ended 31 Juty 2021 sel out on pages 12 10 30. The financial reporting framework Ihal has been applied in their preparat￿n is appl￿ble law and United Kingdom Accounting Standard$, including Financial Reporting SlarKbard 102 Yhe Financial Reporting Stsndard appl￿ble in the UK and Republic of IreLand' (United lthngdom Genernlty Accepted ACC￿￿n￿.ng Prath'cel. In our opinh)n the financial statements.. • give a true and fair view of the stsle of the eharitable company's affairs as al 31 July 2021 and of its ncoming resources and application of resources. includin9 its Inc0Th￿ and expenditure for the year then • have been propety prepared ￿ accordance wilh Unrted Kingdom Generalty Accepted A¢¢ounting Practice.. and • have been prepared in accordance wilh the requirements of Ihe Companies Act 20CI8. BASIS FOR OPINION We ¢onducted our audil In accordar¢ce with Intemath)nal Standards on ALhJiling IUKI IISA¥ IUKII and applicable law. Our responsibiliues (tnder those stsndards are further described in the Audilorfs responsibilities for th6 audit of the financial statements of our report. We are independent of the charitable company in accordance with the ethul fequireftxnts that are Televant lo our audil of the financial slalerr*nts in the Unile(l Kingdom, including the Financial Reporting Council's Ethical Standard, and we have lulfilled our other ethical responsibilthes in acCordar￿e with these requirem&nts. We believe that the audit evh4ence we have oblained is sufficient and appropriate to p¥ovhle a basis for our opinion. GONCLUSIONS RELATING TO GOING CONCERN W8 have nothlng to report in r6SF*Ct of the foll￿n9 matters in reLglion lo whKh the1&4s IUKI requiro U$ to repM lo you whero: • the dlrectorJ' use ofth6 going CO￿ basis of accounting in the preparatK)n ol the financlal ststemenls Is not appropriate: or • the directors. have not disclosed in the financial Stste￿nts any thnlified malenal uncertainties that may ¢asl significant doubl at￿￿1 the charitable company's abilty lo continue lo adopt the going concem basis ofaccounling for a period ofat *sl twelve months from the dale when tho financial stslements are authori8ed for issue. OTHER INFORMATION The directors are responsible for the other information. The other informatKJn ccthprises the information included in the Annual rerp)rt. other Ihan the financial stslements and our Auditorfs report Ihereon. Our opinion on the financial statements does not cover the other inf0M￿tKIn and. except lo the extent othe￿1¥8 expl￿1￿ staled in our repo¢ we do nol express any form of assurance concluslon ther80n. In connection with our audit of Ihe financial ststeThnts. our resw)nsibilty is to read the other inforniation and, in doing so, consider whether the other inforMat￿n is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appea￿ lo be materially misstated. 11 we identty such material Inconsistenc￿ or apparent material misstslements. we are reqUI￿d lo delemiine whether there is a material misstatement in the finanrAal Slater￿lS or 8 material misstslemenl of the other infofmab"on. If. based on the work we have perforn￿, we CO￿lude that there i8 a rnaterial misstslemenl of this other infomlation. we are required lo reFQrt that facL Company Number 02732244 Registered Charity Number.. 1042175 Southern Universities Management Services STATEMENT OF FINANCIAL ACTNMES FOR THE YEAR ENDED 31 JULY 2021 We have nothing to report in this regard. OPINION ON OTHER MArrERS PRESCRIBED BY THE COMPANIES ACT 2006 In our opinK>n. based on the work undertaken in the c￿[se of the aLbJit. . the information given in the Diwtor5' Report fythe financial year forwhith the fina￿101 statements are prepared is consistent with the financial stslemenls. • the Directors. Re￿rt has t*en prepared in ￿e0rdance wth applicable legal requirements. MATfERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION In the light of our knowledge and underslanding of the charitable company and ils environment obtsined In the course of the audit. we have not identsfied material misstalen*nis in the Directors. Report. We have nothing lo report in resFrtt of th¢ folbwing matters in relati￿ to whkh the Companies Act 2006 requires us lo rewrt lo you if, in our opinKJn'. • adequate accountlng recor¢ls have not been kept. or retums adequate for our audit have not been received from branches not visited by us: or • the finan¢ial state￿nts are not in agrnemenl with the &counting recorfs and returns; or • certaln di8closuw ol Directors. remunera1[￿ are Th)t made; or • we have not received all the inlormatv)n and explanations we requlre for audlt.. or •the Directors were not entiued to prepare the financial $talemenis in accordance with the small companies iegime and take advant&ae of the small conwanles. exemplp)ns in preparing the Directors. Report and frc¥n the requirement to prepare a Strategic Report. RE8PONS181LinES OF DIRECTORS As expLgined more frjlty In the Dire¢tsrn' resF¢n$ibilrties $tsteTh￿nl the Dlrectm (who are atso the directors of Ihe Chaiitat4e company tr*e purF#)ses of company Iwl are responsibk for Ihe preparation of the financial statements and ts being satisfied that they gNe a true and fair view, and lor such intemal ntrol as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstslen￿nl. whether due to fraud or error. In preparing the financial statements. the Directors are resp)nsible foras$essing the charitable company's ability to continue as a going wncem. disclosing, as applUb￿. matters related to going concem and using the going concem basi$ of aecounling unless the Directors ether inlend to lIqu￿ale the charitable mpany or to cease opwab'on$. or have no realistic alternalNe but to do so. AUDITOR'S RESPONSIBILMES FOR THE AUDIT OF THE FINANCIAL STATEMENTS Our objectives are to obtain reasonable assurdnce atout whether the financial slatemenls as a whole are free from material misstslement, whether due to fraLFd or etror, and to issue an Audilorfs report that includes our opinion. Reasonable assurance is a high level of a$surar￿e. bul is not a guarantee that an audit conducted in accordance with ISAS IUKI will ahvays delecl a material misstatement when il exists. Misslatemenls can artse from fraud orefrorarKI are considered material if. indNhlualty or in Ihe aggregate, they could reasonably be expected to intluence the econom￿ decisions of users lak&n on the basis of these financial slatemenls. Company Number.. 02732244 Registered Charity Number.. 1042175 10 Southern Universities Management Services STATEMENT OF FINANCIAL ACTlVtllES FOR THE YEAR ENDED 31 JULY 2021 Because of the inhgrenl limitations of an audi( there i% a risk that we will not delecl all irreguL8rities. including those ￿adIng to a material mTsstslement in the finanual statements or non-￿mPliance with regulation. This risk increases the more that compliance with a kiw or regulation is removed from the events and transacl¥)n$ reflec¢ed in the financial stslemènts. as we wll bè * likety to become aware of instances of nonr our audit work. for thls rewrt, or for the opinions we have fomed. AlexaTrJer Peal BSG (Hon$) DCA DChA (Senior sta￿lory Audilorl for and on behalf of Jame8 Cowper Kreston Chartered Accountsnts and Stslirtory Auditor Reading Bridge House George Street Reading Berkshire RGI 8LS Company Number. 02732244 Regi%tered Charity Number. 1042175 11 Southern Universities Management Services STATEMENT OF FINANCIAL ACTMTIES FOR THE YEAR ENDED 31 JULY 2021 Unrnstrict•d Restricted Totsl Funds Funds Funds 2021 Total Funds 2020 Note Incomtr." Income Charital)1g aclmbgs subscript￿ft incorn6 Consulting income Event inco Granl income Other income Marketing premium retained 1.497,676 550.788 24,449 1,497.676 550.788 24,449 2.520 6,875 373.256 1,492.438 260.652 31.142 4,322 3,595 340,￿)0 2.520 6.875 373,256 Investment Income 3.533 3.533 12,486 Total Incomè 2 459 097 2 144 63S Exp•ndlture on: Ex￿ndItUre on charitable acti￿ti*8.. Travel and meeting ¢O$ls Professional stsff and consuttants Pension provision Adminislralion cos18 Premises Governance 1,308 1,336.103 110.231} 675,376 69.287 124.695 1.308 1,336,103 {10,2311 677,896 69,287 124,695 74,515 1,187.362 1115,6981 584,402 79.319 101,683 2,520 T¢)tsl expendltur• 2 199 OS8 1911583 Net1oxpfrndlturellln¢¢)me •nd n•t movom¢nt In funds for thg year 260.038 260,038 233,052 RKonelll*tlon of fund• Total funds broughl forwa 1.278.342 1.278.342 1,045,290 Total funds ¢arTl•d forward 15 1538 380 1538 380 1278 342 The Stslemenl ol Financwl Activities inclth all galns ar￿ thses recognised In the year. All incoming resources and resources expended derive from continuing actNitie5. The notes on pages 15 to 30 fom part ofthese financial stslements. Comparry NUm￿r. 02732244 Registe￿ Charty Number. 1042175 12 Southern Universities Management Services BALANCE SHEEf AS AT 31 JULY 2021 2021 2020 Note FIX￿ asmts Tangible assets Current assets Debtors Investr￿nts.. short-lemi investments Cash at bank and in hand 1.519,610 868,957 793.563 957,425 374214 2,200,596 3.048,778 Cr•dltorn Amunts falling due within ¢)ne year 10 1233 870 635 495 Net current *$¥¢ts 1,814.908 1,$65,101 Crèdltorn Amounis falling due after one year 11 1276,528) 1286.759) Total n•t auets 18 1278 342 Tho fund• ol th• charlty: Unresliicted fund$ General fvnd$ Designated lurKI$ 1,354.380 184,000 1.096.342 182.000 Restncted funds Totsl charlty fund• 16 1278 342 The directors ackn¢￿edge their respon$ibilit*s lor comptying wilti the requirements of the Act with respect lo accounting recoids and the preparation of accounts. The financial statements have been prepared in accordance with the proV￿￿n9 applicable to companies subject lo the small eompanies, regime. The di￿lOrS have eleeted for the financial ststements lo be audrted in 0￿rd8ft¢e with the Companies Act 20Cfj. These financial statew*nts were approved by the directors and authNised fc* issue on .A/fyJfi¢4•t.W. I , and are signed on theK behalf by.. M. Williams Director Company Number. 02732244 Registered Charity Numter 1042175 13 Southern Universities Management Services CASH FLOW STATEMENT FOR THE YEAR ENDED 31 JULY 2021 2021 2020 Operatlng Actlvltles Cash used in operations 19 176.322 22,446 Investlng Acllvltles Interest received Nol calh u8frd In Inv¢sllng Actl¥ltle* Flnanclng Actlvlti Movement$ in investments Movements In monies held by UnNer5ity of Reading 163,882 {4,42SI N•t cash u¥•d In Flnanclng Acllvltle• Change in cash ond Cash equNaknts In the year Cash and cash equivalents al btyinning of the year 361.391 43.882 374 214 330 332 Cash and cash equivalents at end of the year 735 605 374 214 The rKJles on pag¢$ 15 to 30 fomi part ofthese financial stateffents c￿panY Numter 02732244 Registered Charity Numbèr. 1042175 14 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMEKfs YEAR ENDED 31 JULY 2021 General inf0m￿tIOn & Prln¢lpal Accountlng Pollcles Southem UnNersities Man8gemenl Services I'the charttable company'l is a Publ￿ benefit entity limited by guarantee doM￿lled and incorporated in EThJland and Wales (registered company number027322441. The address of the charilabk company's registered office and principal plw of business is UnNeryJity of Reading, Reading Enterprise Centre, Earfey Gate. thitekni9hts Road, Reading. RG6 6BU. A summary ofthe rmfe important ￿nting p)I￿les. including those affectirvJ the nN)st signifKant items in these financial stslements. is sel out bek)w'. al B•sh of accountlng The acceunts have téen prepared under the compan￿ Act 2006 and in accordance with the Financial Reporting Standard applicable in the UK and Republtc ol Ireland IFRS 1021 and the Charth'es.. Statement of Recommended PraCt￿e applicable lo charities preparing their accounts in accordanee wlh FRS 102 (effective 1 January 2015}~ (Charities SORP IFRS 1021). The accounts are drawn up on Ihe histortsl co$1 basls of accouniing. Monetary arrthnts in these arxounts are rounded to the nearest £ ex¢¢pt where Othe￿Is0 indicated. bl Golng conc•rn After making enquiries, the diwlors have a feasonable expectafion that th6 charitable ompany has adequale ￿oUr¢e$ to ¢￿tinue its aclivities for the foreseeable future. Aceordingly, they contsnue lo adopt the going concem basis in preparing the financial stalen*nts as outlined in the slalement of difectors, responsibililw. The directors hw¢ consthred the effect of the COV￿ pandemic on the operations ol the entsty and based on Iheir analysis and the perfc¥mance since March 2020 they have concluded that the entity has not been swnificanlty affected and remains a going concgm. cl Fund• 11 Ihere is a ￿StrIction on the purFose lo which a fund may k pul, the fund is classified as a reStr￿ted income fund. In in$tanees where restn¢l￿n$ on the use ofgranls are set, the grant is spent according to these requ1￿Ments. Designated funds COMp￿rnI￿O unrestricted fund8, where are earmarked for paitular purposes by the di￿torS. d) Inct)m• Incorro attribulable to the financial year 15 re¢￿]nISed as folknvs.. subscriptK>n fee$ are xcounted lor in the year in whKh the memtership benefit Is provided consullancy Incor￿ is ac￿nted foron an accruals basis. In the Perh￿ In which the work is undertaken event income is accounted for as at the date the event ctturred grant income is aeeounted al the point chanty is enlilled to th8 in¢ome and perf0M￿nCe rekqled condrtions are marketing premium income ￿nted for in the perv)d it is earned inVes￿nI income is accounted in the period il is eamed. Income is all￿ated to the appropriate actNty within SUMS. SUPC. PSS, Markets'ng and Comun￿l0ns (M&CI and Central by way of indNKlual eost centres. Company Nurrthr. 02732244 Registered Charity Number 1042175 15 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 (condnued) G￿eTaI Infomiatlon & Prlnclpal Accounting Pollcles l¢ontinuodJ e) Funds rnc•1V￿ as agenl The charitable company weNes rebate income from the suppl*ts of the SUPC memb8r unNerstt*s under the purchasing consortium agreements. The income recognised in the accounts B the amount retained by SUMS to furthertheircharitable obje¢tNe5. All olherfunds recewed and disFersed to the member unpietsilies are not rectrjnised as income and expenditure in accordance with the Charths SORP 'Aetounting for Funds received as Agenv. fj Exp•ndltur• Expen¢Jilure is rectsjnised on an accruaL8 basis in the wiod in wh￿h the1Sabilty is irbcurred. All costs are albcaled be￿een the expenditu￿ categories ol the SOFA on a basis designed to refl￿tthe use oflhe resource. Costs are allocated to the appropriate activity within SUMS, SUPC, PSS, M&C or Central ty way ol indNidual cost Cenlres. Costs relabng lo a particular activity are albcaled directly: others *8 apportioned on an apwopriale basis. g) Gov•rnanc• colts Governaneè costs include costs asscKiated with providing the governance infrastructure and generaknng required Statutory information. The costs indude audil. legal and accounting fees and an apport*)nmenl of saLary costs lo approximate time spent on strategic management and governance of the charitabk company. h) Tanglbh fix￿ Capital items with a cost eX￿dIng £1.CW are capitalised and dep￿lated. Depreclath)n 1$ provided al rates ¢akulated to wnte off the ¢osl of e¥h assel over its exFeCted useful life. wh￿h in all cases is estimated at 4 years. I) VAT Irrecoverable VAT is charge(l against admini8tratk)n costs. 11 Inv•stmenl8 The charitsble company has elected to hohj fvntjs in deposrt accounts with banking institutions. The funds are on deposrt and interest has been re¢ognised on an accTuals basis. Company Number. 02732244 Registered Charity Nunknr. 1042175 16 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 {¢ontlnu8d) Goneral Information & Prfncipal Accounling Pollcltrs (contlnued) kl R￿trement ben¢frts The charitable company participates in the both the UniveT5ities Superannuation Scheme IUSSI and the Universty of Reading Employees, PensK)n Fund {UREPFI. The USS scheme is a hybrkl pension scheme provKiin9 defined benefits (for all members}. as well as defined contribution benefts. The UREPF scheme is a defined benefit scheme. The assets of the schemes are held in separate truslee-adminislered funds. Because of the Ir￿tUal r￿re of the USS sctr*ff*. the assels are r￿1 attributed to indiv*Jual instslutsons and a scheme4wde eonlribuli¢)n rate is sel. SUMS is therefore exposed to actuarial risks assocwtef1 with other institutions, employees and is unable to identify ils share of the undedying assets and liabilities of the scheffÉ on a consislenl and reasonable basis. As required by Sectson 28 of FRS 102"EmpWee benefits.. SUMS therefore a¢¢ounts for the scheme as rf il were a wholly defined Contribut￿ scheme. As a resull. the amount charged lo the profil and bss account represents the contributions payable lo Ihe scheme. SUMS has entefed into an agreement (the Recovery Plan) that delemines h¢)w each employer within the scheme will fun¢J the overall def￿11. and so recogntses a liability for the contributions payable that anse from Ihe agreement {lo the exlent that ty relate to the defirill and Iherefore an expense is recognised. 8ecaus¢ of the nature ofthe UREPF scheme. the charitsble company 1$ unable lo identlfy Its Sha￿ of the undertying assets and liabilit￿8 of the schemes on a consistent and reasonable basis and the￿fore. as required by FRS 102 Section 28. accounts forthe scheme as il il wer6 defined eonth"bulion scheme. As a resutt, the arrK)unl charged to the Income and expenditure account rerKesents the contritrArtions payable to the scheme In respect of the accounting period. The ¢harilable ttjmpany also participated in the Univernty ol Reading Pension Scheme IURPSI untsl 31 March 2019, and from 1 April 2019 a new scheme.. the SUMS Pension Scheme {SUMSPPI, both definod ttinlribution schemes. For defined contribution ￿heMeS the amunl charged lo expenditure is the contn"bulK?ns payable in the year. Oifferences befv￿en contribLrtions payable in the year and contrit4Jtions aC￿alty paid are shown as either accruals or prepayments. 11 Op•rntlng le•8e• Rentals paid under op¢rating leases are charged lo the SOFA on a straight-lino basis over the lease lemi. ml Fln4nclal Instruments The challtable company has applied the provisions of Sec￿￿ 11 'Bask Financial Instruments, ol FRS 102. in lull. to all of its financial instruments. Financial assets and financial liabilrties are recognised when the charitable company becomes a party to the contraclual provisions olthe in51rumenl. and are offset only when the group has a Wl enforceable nghl lo set off the recognised amounts and intend5 either to seitle on a net basis, or lo realise and settle the Irdbility simultaneousty. F￿an¢￿18$Sets Trade and other debtots (including ￿TUed ir￿me) which are receivable within one year and which do not constilule a financing transactK)n are inittalty measured al the transaction price and subsequentty rrEasured at ar￿rtised cosL being the transaction price less any amounts settled and any impaim*nt bsses. Company Number. 02732244 Registered Charty Number. 1042175 17 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMEPmS YEAR ENDED 31 JULY 2021 (continued) General Infornmtlon & Prfneip•l Accountlng Pollcles (conrfnued) ml Flnanclal Instruments (contlnued) 7we the arrangely￿ts with a debtrff constilutes a financing transact￿. thè debtor is inilially measured al the present value of futu￿ paynEnl$ diswunled al a market rate of interest for a siThMlar debl instrument and subsequenuy n￿aS￿red at am0￿Sed cost. A Provision for impairment of Irade debtors is established when there is objective evidence that the am￿Trts dLTre will not ￿ collected according lo the or￿JInal terms of the contract Impairment losses a￿ rewnised according lo Ihe onginal tems of the contract. Impairment losses are recc•Jnised in the SOFA for the e￿e$S of the carrying value of the trade deblor over the present value of the frjture cash llows diseounled using the original effective interest rate. Subsequent reversals of an impaimlent loss that objeclively relate lo an event occurring after the impairment loss was ree¢gni5ed. and are recognised immediately in the SOFA. Financial liabilit￿S Financial instruments are classthed as liabilities according lo the substsnce of the conlra¢lual agreements entered into. Trade and othei credith lincluding accruals) payabJ8 within one year Ihal do not constitute a financing Iransacb'on are initially measured al the transaction price and subsequentty rnasured at amrtised cost. being transacl*)n prSce less any amounts setued. Imiere the arrangeThEnts vthh a ￿ed11¢Y constitute5 a financing transa¢tion. the creditor Is Initially rneasu￿ 8t the present value of fviv￿ payments tjtscounled at a market rate of interest fLY a similar instrUn￿ts and $ubsequ8ntry measured at amort¢$¢d ¢osl. Derecognising financial assets and I￿￿11t￿S A financ￿[ asset is dere￿anised onty when the contractual rights to cash flows expire or are Settled, or subsequently all the risks and fewards of CV•vnership are transferred to anolher paty. ¢x is svJnificanl risks or rewards of ownership are retsined but conlrol of the assel has transferred to another party that is able to sell the asset in its entirety to an unrelated third paty. A fJnancBI liability lor part thereofj is derecognised when the obligation speclned In th8 conlracl is discharged. cancelled or eX￿'re5. n) Crttl¢•l accounllng •stlm•l¢• and av•as of Judgem•nt Eslim8les and judgeft*nts are conlinualty evaluated and are based on histoital experience and other factors. including exFeCtalions of future events that are believed to te reasonable under the circumstances. The charitawe company makes estimates and assumptK>ns conceming the future. The resulb'ng accounting estimates and assumptions will. by definitw)n, seldom equal the related actual results. The e$timates and assuwions that have a significant risk of causing 8 material adjuslmenl to the earrying amunts ol assets and liabilities wilhln the next financlal year are disGussed below. The only accounting estimates whth the direcloTS believe that the charitable company has is the reliance on the Unde￿yIng assumptions which have been used by the actuary in the valuation of the pension sthme def￿1( o) Tax•tlon The charitable company is a registered charity, and a5 such enlilled lo lax exemptions on ome and gains. property applied for it5 Char[tab￿ purpose5. Company Number. 02732244 Regrslered Charity Numkr 1042175 18 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 (￿l¢lnued) N•t Incomd(exp•nditure) for the year is 8tat•d after charylng: 2021 2020 Dep￿￿til￿ oftsngible assets Operating lease costs Trustee Ik4bility insurarKe' Auditorfs remunerab'on for. - Extemal audrt . Taxation . ¢omplian¢e s•rvw to the Charitab￿ company 84.399 75.457 500 7.500 ' The cosl ol liability cover is nol separately •Jentified bul has a d￿lared value 01 £500 following advice from the insufers. Income by •ctlvlty 2021 sums svpc pss M&C Total 2021 In¢oming resources chaniable aclivities Subscription income 875.909 Consulting income 447,913 Event income Grant income Other income Marketing premium ￿tsified Investment incorn• 621.767 1,497.676 $50,788 24,449 2,520 6,875 373,256 102.875 24,449 2,520 6.075 373.256 3.533 TOTAL INCOME 1323 822 102 875 33 044 2 459 097 2020 SUMS supc pss M&C Total 2020 Incoffling resources from choiyt8ble xlwities Subscription income 879,138 Consulting income 209,657 Event Income Grant income Other income Marketing Pre￿￿urn retslned Inveslmenl income 613.300 1,492,438 260,651 31,142 4,322 3,595 340,000 50.994 31,142 4,322 2.C65 1.400 340.000 130 12,486 TOTAL INCOME 37 529 2 144 634 Company Number 02732244 Registered Chafty Number. 1042175 19 Southem Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 {continu•d) Expendlluro Analy¥b of unrestrlcted exp•ndlturn Stsff costs Othèr D•pr¢clatlon Tolal 2021 Total 2020 ExpendiTure on chantable a¢tNibes Tiavel and meeting costs Professional stsff & consultants PensKJn provision Adrninislralion costs Premises Governan¢e 1.308 391.531 110.231) 224.005 69.287 15.591 1.308 74.515 1,336,103 1.187,362 110,2311 1115.69BI 675.376 580.080 69.287 79,319 124,69S 101,683 944.572 451.371 109.104 1505 047 691491 2 196 $38 1907 261 Anatysls oflot41 •xp•ndfturè by •ctfvlty Acttvlty bas•d 2021 sums supc pss M&c Central Total 2021 Expendilure on chori18ble acliwbes Travel & meeting costs Profess¢onal staff & consultsnls Pension provtsion Administration costs Premises Governance 101 (1721 1270) 1,649 1.308 844.939 405.046 72.795 13,323 1.336,103 {10,231) 677.896 69.287 124,695 110,2311 122.786 343,392 69,287 64,404 15.207 195.679 833 35,403 24.889 TOTAL EXPENOITURE 895 650 625 442 137 758 486 851 2 199 058 A¢tlvlty bas•d 2020 SUMS supc pss M& Centrnl Total 2020 Expenditur8 on charitable 8ciMtses Travel & meeting costs ProfeSs￿al slaff & consultants Pension provision Adrninislralic￿ costs Premises Govefnance 31.754 11,863 1.277 27,839 1.782 74.515 782.9e6 359.086 41.996 3,314 1,187,362 111S,6981 (115.698} 266,233 584,402 79,319 79.319 43,190 101,683 11.614 145,517 18,194 142,845 35,572 22,920 TOTAL EXPENDITURE 881 9t0 539 386 274 826 1911583 Company Numbèr.. 02732244 Registered Charity Number 1042175 20 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 (continuod) Analysls of restricted fund Income and expvnditure Two grants were ieceNed from The Unrversty of Reading to cover the salary costs of Inlemship placements for Universty of Re&ling students at SUMS. 2021 2020 Incomlng r•sources Grant income Totsl In¢ornlng mourte* 2,520 2.520 4,322 4.322 Outgolng resou￿•1 Administration costs Total outgolng r¢source8 2,520 2,520 4,322 4,322 Net movem•nt In funds In the y•ar St•ff costs •nd numbern 2021 2020 Staff co81s were as lolltr•YS'. Salaries and wages Employerfs national insurance costs Employerfs pension wsts 1.210,463 1.11S.419 124,903 116,729 172 201 1507 567 1408 197 The average number of staff employed during the year was 22 12020.. 211; various a$S￿lateS were engaged to provide servKes. The average number of fvll-tim equNalents of persons employed during the year was 21 12020.. 20}. The total ol employee benefits {including salary. employers pension contribution and employers national insurance contributions) paid to the senior management team. as disdosed on page 1. in the year lotalled £419,41312020.' £461,348). The number of stsff who received emoluments (excluding empbyers Pen￿On contribubon and employers national insurance contributions} in the followirKJ ranges was.. 2021 2020 £60,001 to £70,000 £70.001 to £80.O¢JO £80.00110 É90.¢)JO £90,00110 £100,000 £100,001 to £110,000 £110.001 to £120,000 £120.001 to £130.OC £130.00110 £140.0 Company Number. 02732244 Registered Charity Number.. 1042175 21 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMEpifs YEAR ENDED 31 JULY 2021 {¢ontinuedJ Flxed a88ets IT Equlpmenl Flxtur¢$ a Fittings Totsl At 1 August 2020 Disposals 4.833 5,833 Al 31 July 2021 800 Accumulated DeprecialvJn: Al 1 August 2020 Charge for tho year Disposals 4.833 5,633 At 31 Juty 2021 800 833 Nèt book value al 31 Juty 2021 Net book value at 31 Juty 2020 btorn 2021 2020 Trade debtors 721.414 240.481 557 715 220,963 72.605 575 389 Other debtors Money hekl on trust ty the Unbverslty ol Readirvj 1519610 Short t•m) Investment Investment funds were held wth Lknyds BanK Nationwide Building Sc¢iety and Charty Bank totalling £793,563. Inlerest gener*d was recorded against incoTh and expendilure. 2021 2020 Cash deposits 793 536 957 425 Company Number. 02732244 Regi8tered Charlty Number. 1042175 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMEKfs YEAR ENDED 31 JULY 2021 {contlnu8dJ 10. Cr•dhor8: amounts falllng due within one year 2021 2020 Trade creditors Accruals Deferred incoff Other creditors IVAT due to HMRCI Fun¢Js received as agent 137,744 33,719 103,689 83,529 372,887 41,964 205,246 41,749 414,304 434,534 1.233.870 635.495 11. ¢r•d5torn: amounts falllng du• •ft•r one yoar 2021 2020 Provlslon bl 286,759 402,457 Employer contrtbullons relating lo the recovery p￿n 113,3121 {11.4201 Urwinding of the ¢Jiscount rats 2,093 13.281 Impa¢l ol the change Sn assumptws 117559 Nel m0ver￿nt (10.2311 1115,6981 Provi$lon rj￿d 276 528 286 759 The above provision relates to the requiiemenl under charity SORP that charities musl re¢ognise as a liability the present value of luture contribulNJns relats'ng lo the furKling of a pensic*n deficiL 12. Oeferred Income Deferred income ￿MpriseS advance membership, ¢onsullan¢y. PMA and grant irKomè. Balance as at 1 August 2020 Amount released to income eamed from charilable &tivitie$ All￿unt deferred in year BalarK¢ as at 31 Juty 2021 41.964 141.964} 372 887 372 887 Company Number.. 02732244 Regislered Charity Number. 1042175 23 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 (conflnued) 13. Funds rnc8ived as agent The charitable company acts as an intermediary agent for volume rebates payable under contract by suppliers to subscribers lo SUPC. SUPC collects the rebates. retains an ag￿ed proptsrti¢Jn and then distributes the balance to subscribers. The charitable company has no legal ownership ofthedi8tn"butable resources and no responsibility for their v￿Mate applicatwjn. The a￿K)unIS coll￿ted and due to te ollected are thereftye not reccsnbsed in the Stslemenl of Financial AetNrt￿S. 2021 2020 Openin9 balance 1 Augu$t Received during the year Rebate income retained Paid out during the year Total fund held as agent at 31 Ju 434,534 455,￿9 1,123,337 1,093,500 {373.2561 1340.0001 770311 774 035 14. Operatlng lea••8 The total of future rrinimum kase payments under non4n¢e11ab￿ operatin9 leases for the foll¢)wing periods are.. 2021 2020 Under 1 year Later than 1 year and nol18ler than 5 yea(s Later than 5 yea 31,580 31,827 Lease payments 01£64.39912020.. £75.457) were recognmd as ￿ expense in t?￿ accounts. 15. Mov•mtnt In lund• Unrnstrf¢t•d funds 2021 2021 2021 General Deslgnated Total Balance at 1 August 2020 In￿mIng resources Oulgoing resources Balance 31 July 2021 1.096,342 2.456.576 2 198 538 1.354.380 182.0(J) 1,278.342 2.456.576 2 196 538 1.538,380 184.000 The desh3nated fvnds hdd as at 31 Juty 2021 i￿lUde pensic￿ provisions for the UREPF of £184,000 {2020'. £182.000). Corryany Number.. 02732244 Registered Chanty Number 1042175 24 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMEpifs YEAR ENDED 31 JULY 2021 (¢ontinued) 15. Movemenl In funds (¢ontlnu8d) Vnrostrkt•d funds 2020 2020 2020 General D¢slgn•ted Total Balance at 1 August 2019 Incoming resources Outgoing resources Balance 31 July 2020 863.ul 2.140,313 182.¢MJ 1,045.290 2,140.313 1907 261 1,278.342 1,096.342 182.000 Re8trlct•d fundi 2021 2020 Balance at 1 AugU$t Incomlng resources Outgoing resources Balance 31 Juty 2,520 4,322 16. Anaty•h of n•t ••vts b•lw••n lund• 2021 Credltor&: Amounts due after one y•ar Flx•d Net currnnl •¥•8ts Total Unrestricted Restricted Total nel assets 1.814.908 (276,5281 1,538,380 1.814,908 276 528 1,538.380 2020 CreditoY•: Amounts du• after one yvr Flxed Net current assgts Tot*1 Unrestr￿le(I Reslrieted Totsl nel assets 1.565.101 {286,7591 1,278.342 1.565.101 1.278.342 Company Number. 02732244 Registered Charity Numtrer 1042175 25 Southern Universities Management Services NOTES TQ THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 (continu•dJ 17. Related party transactk•ns No director of the charitable company or any persons connected with them have received any remuneratson during the year. No (2020: directors received reimburserr*niof travel expenses during Ihe year12020. £267). Southem UnNersitss Manageff*nt sery￿s has a seryice agreement with The Unfversity of Reading. During the year the Charilable company received the followirKJ value of goods and seNices from The Univefsity ol Reading.. 2021 2020 Ro)m hire and catering IT and 1elecommunK8l￿n$ Printing and postage services Rent and maintenance Professional lee$ 3.274 3,412 1,181 76,961 3.650 66,624 106700 117 080 The Unfversity ol Reading is also a member ol the chantable and a 5ub$Griber lo SUPC. Subscriptions and lees are paKI by them whth are consistent with all other Members. The subscription fees and other thcome received from the University of Reading are sel out below.. 2021 2020 SUMS membership fo? SUPC membership fee Consulting income Grant irKorne 35.400 11.750 25,870 34,700 11,SOO 10,560 4.322 The grants received from the UnNersity related to salary costs for short-lerm intemship placements of UnNersity of Reajing student$ at SUMS. Al 31 July 2021. The UnNersty of Reading hekj invesln*nl fvnds of £557,71512020: £57S.3891 on trust for the charitable company. Company Numkr.. 02732244 Regtslered Charity Number. 1042175 Southern Universities Management Services NOTES TO THE FINANCIAL STATEIIENTS YEAR ENDED 31 JULY 2021 [￿ntInUed) 18. Ponslons Unlv•rsltl•s Super•nnuatlon S¢h•mè institution partKipates in the UnNetsities Superannuation Scherr* {USSI, a defined benefit scheme. At 31 March 2021, USS had 203.995 active membws and the instibjtion h•J 9 active members participating in the scherre. The assets of the scheme are held in a separate frJrTrd ad￿Nn1Stered by the Trustee. UnNersilies Superannuation Scheme Limited. Apw'ntments to the board ofthe Tnjstee are delemiined by the Trustee Company's Articles of As$c¢ialion. There are currenlty tr*lve Membe￿ of the Trustee board, of which three are appointed by Unsversities UK. lour are apwnled by the UnNersity and College Union lofwhorn at teasl one must be a USS pensioner ffember} and the remaining are independent directors appointed by the board. Part of the Trustees. role is lo set fisk and return paramelers wh￿h rofiecl the strength of the sponsoring employers and the nature of the scheff*'s Ikqbilf(ies. These parameters. laken together wllh the anticipated retums fom) the basis of the Iruslee's fvnding strategy. These parameters are infoin￿d by advice from its inlemal investff*nt team. its inveslThnl ￿nSultant and the scheme acluary, as well as an independent asses$n￿l of the supp¢yt avaikble from ts sponsoring empbyer8. The fund is invested in a wid8 range of a53ets dasses. both publ￿ty traded lirtluding equi￿e8 and fixed in¢omel and private lincluding private equffji. inlrastrueture. proFerty and limberfandl. A dNersified portfolio helps lo spread investrnent risk xross differenl assel classes and to boost the level of confidence in maintaining sufficient investment fetums fr(xn the fvnd as a whoL*. This investrnenl approach Is innovative and r•S￿nSible. and ts tsrgèted at ach*vin9 retums required to meet the scheme'8 liabililwJ. USS is in the process of finalising the lasl valualion dale, 1$ calculated as at 31 March 2020. Thls is the e￿hth valuat￿n for USS under the scheme-speth (undin9 regime introduced by the Pensions Act 2004, which requires schemes lo ad¢)pt a statutory lunding obiectNe to ensure sufficient and appropriatè assets to cover Iheir tschnical provisions. The actuary also carries regular revithvs of the tur￿1n9 levels. including interim valuations in years wherg there nol a full valuation. Under the Scheme's Trust Deed aNJ Rules. the emKAoyer ¢Ontribut￿n rate is detenrmned by the TNstee, acting on actuarial advKe. USS is a 'last man $tsnding' scheme. so that in the event of the insofvency of any of the partieipating employers in USS, the amount of any pension lunding shortfall (which cannot otherwtse be recovered) in respect of that employer will be spread acn)53 the remaining participant ern￿¢￿erS and reflected in the nexl actuarial valuation ol Ihe According to the latest Report and Accounts, the asset value ol the DB seelion al 31 March 2021 was £80.6 billion and is the market value of the Schen*'s DB assets based on the audited assel value in the Scheme's accounts. Thts was an increase of£14.6 billion from 31 PAarch 2020. The estimated Technical PThisions def￿1t is £15.2 blif￿n. meaning that the scheme is 84% funded on this basis. As part of the 2020 valuation. some changes to the Sctrth)e will take effect from 1 April 2022. subject lo a statutory employer4d consuttati¢)n with affe¢ted empbyee$ and their represenlatives. These changes as follows.. Company Number. 02732244 Registered Charity Number. 1042175 27 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 (Continued) 18. Penslons (¢ontlnued) Sal8ry Cap (in118tthèry incrnèse$) The Retirement Income Builder (CRB s￿tiOn) ￿rU01 occurs for sa￿rIeS up to a cap. Thi8 cap was £59,585.72 for 202012021 and will be reduce(I to £40.000. Purual over the salary cap will contribute to the Investment Buikler (DC seclion). Accrnèlrnte The annual rale al whth defined beneffts will t¢ I￿1[t up will be redu¢ed from 1ns of salary lup to the 88lary cap) 10 1185. Bonefft increases The exlenl lo which members. ￿neffits are protected from inllation, based on CPI. will be limited by capping the annual U￿1ft applie(I lo luture benefits al 2.5%. Any defir*d benefits members have already earned will still increase every year in line whth previous increases. For benefits eamed before Oelober 2011. this is inflation in full. For benefitg eamed sin¢e then it b inflalbjn in fvll up to 5%, and then by half if inflation Is befvleen 5% and 15%. Unlvernlty of R••dlng Employee•, P•n•lon Fund {iIREPF) SUMS participates in the University ol Reading Employees, PenS￿n Fund IUREPF). a defined benefit scheTh govemed by a board ofTruslees. The UnNersity ofReading has Ihe power lo appoint and removo trustees. There are currentty six members of the Trustee board. of wh￿h three are nominated by the University of Reading and threè are memt*fanornlrwted Trustees. Thern is currnnlty a vacancy for fvrth6r emp1oyer-no￿nated Trustee. As at 31 July 2021. UREPF 190 actNe members and SUMS had 1 actNo member participating in the scheme. This member will reach Nonnal Retirement Age in 2022. This scheme was closed lo new enlranls on 31 Juty 2011. Accrual of final salary benefits ceased on 31 July 2011 and from 1 August 2011 benefit acml has been on a Career Average basis. However. the losure of the scheme n￿anS that 8 Seclth 75 debt will arise ¢)nce the remaining active member leaves the scheme. The actuary's estimate of thi5 debt as ot 31 Juty 2020 was £164,000. The assets of the scheme are held in a separale tund administered by the Trustees and are managed by Blackiock Investrnenl Management (UK) Limited. L&G Investment Mana9ors, Invesco. S¢hrod¢rs and Insight. The Fund continues to broadty foltow the investment strategy *J)pted in 2017r2018, ensuring that suffi¢ient income 1$ provided to address the cashllow negative position of the Fund. Quarterty income of approximately £750.000 is currenuy provided by a buy-and•maintain corForale bond holdlng, an Index- linked gilts holding and a High Lease to Value IHLVI propety fund. Thi5 quarterly income 1$ sufficient to cover the regular oulgoings ol the Fund with further fvnds drawn dwi on an ad hoc basis lo cover irregular exFenses. A re¢enl inVeStn￿nt in Secured Finance assets is exF*Cted to reduce the need lor these ad hoc withdrawals. Company Number 02732244 Regi51ered Charty Number. 1042175 28 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 31 JULY 2021 (c¢>ntlnuedJ 18. Penslons (contlnued) The agreed funding obFclive is to mainlain assets equal to the technical provisions. assessed on an ongoing basis allowing for lulure saLqry increases for active members. The18test fijll actuarial valuation, dated 31 Juty 2020. Confirmed that Fund showed a leehnical provisions surplus of £6 million. This is equNalenl lo a fund of 103%. The latest acluartal update las al January 20211 showed that this had increased lo 104%, largety due to irKreases in fixed interest gilt yields placing a lower value on liabilitie$. In contrac( the Fund's assets decreased SI￿hty amhough this is expected lo be a short tem trend. The contributhin rale (ignoring Salary SxTif¢cel currenlty payable by SUMS was 23.80% of pensionable salaries for UREPF. Pens￿Tr contribution$ are usually deducled via salary sacrifice. Membèrs conlfibut8 6.25%. Additional monthly employer contributions of one Iwfrlflh 01 £500.000 are also paid into the Fund, a portion of which is charged to SUMS. Southorn Unlv*rnltl•8 M•nagem•nt Str¥lcts Group p•l￿nI1 P•n8lon Pl•n lth• Plan) A trusl-based defined ¢onlributKJn scheme Iuniversity of Reading Pension Schem&- URPSI was sel up to replace UREPF for new entrants from 1 August 2011. SUMS participated in URPS. which is adminiSte￿d by Aviva. untsl 31 March 2019. From 1 April 2019, the SUMS Group Personal Pension Plan was set up. The Scheme was sel up due to the Master Trust Regulation introduced in the Penslon Schemes Act 2017. Memt*rs of URPS ompbyed by SUMS were transferred lo the nthv arrangement but retain their accrued benefits in URPS. The Plan 1$ a contract based Grtyjp Pernonal PènsN)n affangement with membèrs hohjing an individual contract with the Plan Provider, AvNa. dirg¢tty. The Scheme is a Qualifying Scheme autwnrolmenl purp)ses. The lalest Rfrenrolment date was 1 January 2020. As at 31 Juty 2021, the Ptan has 11 actNe ¢r*mbers. The contribution rate (ignoring Salary SxrifKel payatrle by SUMS is S% of ponsI￿able salaries for members who have been empbyed less than 5 years and 7% for members who have been employed 5 years and ovér. Members musl contribute a minimum 4% of their ￿N$￿)nable salaries to thè Schemts. Pension Contributions are usually deducted via sabry sacnfice. The pension costs 1r￿Ulred in relation to the fespeclive schemes are set out betsi: 2021 2020 P•n3lon ¢o¥ts Employer contrlbutlon Activè m•M￿r4 Employer contrlbutlon A¢tlv• m•mbern uss UREPF URPS SUMSPP 140.442 7,699 147,C67 7,699 21.618 11 19.282 11 169 759 21 174.048 21 Company Number. 02732244 Registered Charty Number. 1042175 29 Southern Universities Management Services NOTES TO THE FINANCIAL STATEMEKfs YEAR ENDED 31 JULY 2021 {witlnued) 19. R•conclllatloTr of net 1ncomellexpend1￿rej to nèt cash flow tmm op•rntlng actfvltlei 2021 2020 N•t1oxpendliur•Vln¢om• 260.038 233,052 AdJu8tments for. Oeyecialion of langible fixed assets Investrrenl Income Movement on debtors Movement on creditors {3.5331 1668,3271 588,144 (12,4861 35.096 1233.2161 Cash used in operations 176 322 20. Post Balanu Sheet Event The Universiknes SuFerannuation sc￿me {USS} 2020 valuation has now been signed and filed wth Th Pensions Regulator with an effective date of 1 October 2021. The future service cost of funding the current benefits has chan9ed and con51iiule¥ a non4djusting balance sheel evenL The additional cost to SUMS Is currently estimated al up to £468k. C￿npanY Number. 02732244 Registered Charity Number. 1042175