2024-07-31-accounts - Addysg Oedolion Cymru / Adult Learning Wales

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Report and Financial Statements Year ended 31st July 2024

Addysg Oedolion Cymru | Adult Learning Wales Company Number: 3109524

Page number

CONTENTS

Strategic Report of Governing Body	2
Statement of Corporate Governance and Internal Control	16
Governing Body’s statement on the Organisation’s regularity, propriety and	20
compliance with Funding body terms and conditions of funding
Statement of Responsibilities of the Members of the Council of the Organisation	21
Independent Auditors’ Report to the Council	23
Statement of Comprehensive Income	26
Statement of Changes in Reserves	27
Balance Sheet as at 31 July 2024	28
Statement of Cash Flows	29
Notes to the Accounts and Accounting Policies	30

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Strategic Report

1. NATURE, OBJECTIVES AND STRATEGIES

The Council is pleased to present this report alongside the audited financial statements for the year ending 31 July 2024.

With over a century of experience delivering quality education, Adult Learning Wales (ALW), as the National Adult Community Learning Provider, continues to empower adult learners across Wales with opportunities for personal, professional, and social transformation.

In 2023-24, we reaffirmed our commitment to driving lifelong learning, prioritising accessible education for those most underserved, promoting inclusivity in Welsh-medium provision, and strengthening pathways to health and well-being. Our vision is to build resilient communities by equipping individuals with essential skills and fostering active civic engagement and democratic participation.

After navigating the challenges of the Covid-19 pandemic, we saw a robust return to in-person learning, with 80% of our delivery now based in local community venues. This year, we have expanded our digital learning opportunities to ensure flexible, remote access for all, offering a more resilient, blended model for the future.

The broader economic landscape remains challenging, with global conflicts, the Cost-of-Living Crisis, and an evolving Welsh labour market necessitating new skills, especially in digital technologies. Relying solely on public funding presents uncertainties, but our strategic partnerships and operational efficiencies position us to adapt effectively and to serve Wales’ diverse communities. ALW is particularly committed to upskilling the “working poor” and addressing socioeconomic issues such as unemployment and homelessness.

We are resolute in our mission to promote lifelong learning as a tool for economic, social, and civic progress across Wales. Our learners’ skills and adaptability are essential to Wales’ resilience, economic vitality, and democratic vibrancy.

As part of the 2023-2026 strategic plan, we are dedicated to expanding access and impact, fostering stronger partnerships, and advancing ALW’s position as Wales’ leading adult community learning provider and the Adult Community Learning provider of choice.

1.1 Legal status

Adult Learning Wales (ALW), formerly known as WEA YMCA CC Cymru, is a charity registered in England and Wales (number 1071234) and a company limited by guarantee registered in England and Wales (number 3109524). The Organisation was formed from a merger of WEA Cymru and YMCA Wales CC on 1[st] August 2015.

1.2 Purpose

The Articles of Association state that the Organisation’s object is ‘to promote education, in particular for young people and adults, within Wales’ and it carries out its purpose with public benefit in mind.

1.3 Vision and Mission Statement

Our Vision:

Creating healthy and prosperous societies through adult community learning.

Our Mission:

Providing inspiring and accessible learning opportunities for adult across Wales and supporting our learners to achieve successful outcomes, both directly and through relationships with others.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Our Goals:

1. Support and enable the widest possible range of learners to achieve success.

1.1 Delivering the highest quality lifelong learning programmes, ensuring an inclusive offer that recognises a diverse range of abilities and circumstances
1.2 Evolving our dynamic curriculum to meet the needs of more learners, ensuring a holistic approach and recognising the changing needs in relation to social, employment and political developments
1.3 Ensuring learners have the support and direction they need for completion of courses and further progression.
1.4 Gathering feedback from and listening to our learners, acting on what they tell us, ensuring we address any areas where we have not achieved our high expected standards and involving them in shaping the learning we deliver.
1.5 Raising awareness of ALW, our varied offer, the support available and the benefits of learning with us.
1.6 Valuing our staff, recognising talent, and investing in their CPD.
1.7 Continuing our commitment to the Digital 2030 framework by using enhanced technology practices to be more efficient and effective, facilitating more innovative teaching and learning experiences and freeing ourselves up from unnecessary paperwork.
1.8 Working with communities, by supporting the setting up of or working with existing bodies, to establish needs and issues which impact individuals’ learning, sharing this information as appropriate with other bodies.

2. Develop and sustain our network of positive and effective working relationships, establishing new relationships that align with our curriculum plan and national priorities.

2.1 Identifying and building professional working relationships that enable us to deliver or support learning to organisations and employers who have clients, customers, or staff who could benefit from our offer.
2.2 Standardising our approach to gathering feedback from those organisations we work with, during and after delivery.
2.3 Acting on feedback from all organisations we work with to address any issues identified and evolving our offer appropriately.
2.4 Continuing to strengthen our relationship with Welsh Government, the Commission for Tertiary Education and Research (CTER), and other stakeholders to develop a national programme for lifelong learning and advance the role of adult community learning in Wales.
2.5 Recognising global issues and working with organisations which focus on citizens’ rights and entitlement to advance economic and social change in Wales.
2.6 Reviewing and revising our membership scheme, our approach to volunteering, and the work of Branches to ensure we are delivering mutual value and activity which is aligned to our goals.

3. Develop and sustain our network of positive and effective relationships, establishing new relationships that align with our curriculum plan and national priorities.

3.1 Having active leadership and governance which promotes adult community learning and challenges us to continuously improve.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

3.2 Promoting understanding amongst commissioning bodies of our role in delivering the largest portion of adult community learning in Wales, both directly and on behalf of other providers such as local authorities.
3.3 Assessing and communicating the impact of adult community learning and demonstrating its value in order to influence policy making.
3.4 Sharing relevant information, which we gather through our networks and connections with policy makers.
3.5 Reviewing and developing our ways of working and the materials we use, to ensure we show professionalism in everything we do.
3.6 Being financially sound and using the core funding creatively to maximise the breadth of the learning offered and its value to our learners.
3.7 Pursuing additional sources of funding to generate investment in learning and resources and growth in our curriculum.
3.8 Operating a culture of openness and transparency, where we empower and encourage our people to make a positive contribution and raise any concerns.
3.9 Listening to, investing in, supporting, and developing our staff to ensure we have the skills and experience needed at every level within ALW.

1.4 Policy Context

Following the appointment of a new Minister for Education and Welsh Language in May 2021, the adult learning sector continues to receive significant attention. With a bold vision to create a “second chance nation,” the Minister has established an External Reference Group to drive a national Co-ordination for Lifelong Learning agenda. Adult Learning Wales (ALW) chairs this group, which is charged with implementing this commitment, guided by the Wales Centre for Public Policy (WCPP) review, Supporting the Welsh Lifelong Learning System (December 2021).

ALW plays a leading role within the group, ensuring strong advocacy for adult community learning. Members include key stakeholders such as local authority adult community learning leads, further and higher education representatives, Wales TUC, the Learning and Work Institute (Wales), the National Centre for Learning Welsh, and the Bevan Foundation.

The Tertiary Education and Research (Wales) Act 2022, passed by the Senedd on 28 June 2022 and receiving Royal Assent on 8 September 2022, establishes the Commission for Tertiary Education and Research (CTER). This new Welsh Government-sponsored body replaces the Higher Education Funding Council for Wales (HEFCW) and will take full operational responsibility by April 2024. CTER will oversee strategy, funding, and governance across the Post-16 Education and Training Sector (PCET), including adult education and community learning.

A PCET Strategy Board has been formed to support the Minister, the Senior Responsible Officer (SRO) for the CTER programme, and government officials. ALW serves as a member of this Board, which provides strategic oversight and expert guidance to ensure the effective delivery of the PCET vision, transition, and implementation of the CTER programme.

Under the UK Government’s Levelling Up agenda, the Shared Prosperity Fund (SPF) supports three key investment priorities: communities and place, supporting local business, and people and skills. These priorities align with the objectives of the Levelling Up White Paper. Within this framework, £103 million has been allocated to Wales for the Multiply Scheme, which aims to enhance adult numeracy skills. ALW has successfully secured contracts to deliver components of this programme across Wales, with completion expected by Spring 2025. This initiative represents a significant investment in skills development, delivered in collaboration with local authority leads.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

1.5 Governance and Management

The Organisation’s governing body, its Council, plays a full part in approving the Strategic Plan and in monitoring its delivery. All members of Council are also members of at least one Committee, each of which has the remit of monitoring a part of the Strategy relating to that Committee. Members of Senior Management Team attend Council and Committee meetings to provide detailed information for scrutiny by volunteer Council members. A skills audit is undertaken annually to assess gaps in skills levels within the Council and Committees, and co-opted members are brought on to some Committees to address these gaps as far as possible.

1.6 Financial objectives

The Organisation’s financial objectives are:

to achieve an annual operating surplus prior to FRS 102
to pursue alternative sources of funding, on a selective basis, consistent with the Organisation’s aims and objectives, and the need for a financial contribution to the Organisation’s overall finances
to generate sufficient levels of income to support the asset base of the Organisation
to further improve the Organisation’s shorter-term liquidity
to retain an average cash level of £500,000
• to maintain category “B” Welsh Government financial status.

Meeting the above targets requires the retention of tight staffing levels whilst taking all reasonable opportunities to make efficiency gains. In addition, meeting student growth is imperative in order to ensure the projected income streams.

1.7 Quality controls

The Organisation’s Self-Assessment Report (SAR) measures performance throughout the year as part of the Quality cycle. The SAR is written in accordance with guidance from the Welsh Government. Judgements are made using the format of the Estyn Common Inspection Framework which focuses on 5 key questions relating to Standards, Wellbeing and Attitudes to Learning, Teaching and Learning Experiences, Care, Support and Guidance, and Leadership and Management.

The Organisation is continually working to improve and develop processes to ensure that data used to inform planning is produced in a timely fashion, is robust and used effectively across the Organisation to inform the SelfAssessment process. The SAR is located on the Organisation’s intranet and can be accessed by all staff. Any areas for development that are identified within the SAR are incorporated into the Quality Development Plan (QDP) which is produced by the Senior Management Team. Monitoring of the QDP is embedded in the Quality cycle and is reviewed at operational, senior management and governance level.

Throughout the year, a range of professional learning and development events have been run to support tutors and core staff on quality related issues to ensure standards are maintained and awarding organisation's requirements are met. These events form part of the learning and development plan. A range of standardisation activities and events were held with opportunities for all staff to engage in assessment and internal quality assurance activities to develop their practices. Reports from Awarding Organisations state that our Internal Quality Assurance processes are in a positive and strong position. The internal quality assessment (IQA) policy is monitored and reviewed for effectiveness and impact of use. Scrutiny of quality control measures is undertaken by the Senior Management Team and by Council, through the Learner Experience Committee.

The Organisation’s major plans are its Strategic Plan, the Provision Development Plan, the SAR/QDP and the Risk Register. Council and its Committees scrutinise the actions and targets set within these plans.

2. CURRENT AND FUTURE DEVELOPMENT AND PERFORMANCE

2.1 Student numbers

In 2023/24 the Organisation recruited 8,948 learners, 65.7% female and 34.3% male (all provision). Completion* rates for Welsh Government funded provision only are at 96% overall (1% point above the National Comparator),

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Attainment rates are at 88% (1% point below the National Comparator) with Successful Completion at 85% (nearly 1% point above the National Comparators and on par with the 22/23 academic year).

*Completion includes accredited and non-accredited provision. National Comparators (NCs) are 22/23 Benchmark data available via WG LLWR Inform reporting.

2.2 Student achievements

The table below gives the current performance data available grouped by learning areas.

Subject Sector Area	Subject Sector Area Description	Learning Activities	Guided Learner Contact Hours	Comp %	Attain %	Success %
	Total	21,407	436,477	96%	88%	85%
14d	English for Speakers of Other Languages	6,329	171,272	94%	80%	76%
14c	Foundation for Work	4,162	60,842	95%	88%	87%
13	Education & Training	821	32,965	94%	80%	75%
15	Business, Administration and Law	1,981	32,891	99%	97%	95%
9b	Art & Design	1,640	31,898	94%	88%	83%
1	Health, Public Services & Care	1,860	26,571	98%	91%	89%
14b	Adult Basic Education	1,362	19,383	95%	84%	79%
14a	Independent Living Skills	173	14,277	94%	86%	86%
5	Construction, Planning & Built Environment	954	9,288	97%	91%	91%
7c	Hospitality & Catering	610	7,585	96%	93%	89%
9a	Performing Arts	311	7,483	99%	100%	100%
3	Agriculture, Horticulture & Animal Care	332	7,207	95%	98%	97%
4	Engineering & ManufacturingTechnology	204	3,594	99%	94%	92%
10	History, Philosophy & Theology	173	2,908	91%	100%	100%
6	Information & Communication Technology	145	2,567	92%	86%	79%
12	Languages, Literature & Culture	154	2,440	93%	86%	76%
7b	Hair & Beauty	83	1,545	98%	84%	82%
7a	Retailing & Customer Care	69	882	99%	90%	88%
2	Science & Mathematics	19	345	100%	95%	95%
12b	Welsh, English and Other Languages	12	270	83%	60%	50%
12a	Welsh for Adults	12	264	92%	82%	75%

Completion percentages include both accredited and non-accredited provision whereas Attainment and Success percentages include only accredited provision. Achievements for learners on non-accredited courses are more difficult to measure, although the use of individual learning plans allows for ‘distance travelled’ to be evidenced.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

2.3 Student Profile

The most popular courses are: English for Speakers of Other Languages (ESOL), Foundation for Work, Education & Training, Trade Union Studies (categorised as Business, Administration and Law), Art & Design, Health, Public Services & Care, Adult Basic Education, and Independent Living Skills.

We have continued our work with asylum seekers and with ethnic minority groups. 16% of our learners in 2023/24 were from minority ethnic communities. We continue to target the most disadvantaged areas and 49.8% of our learners live in areas of deprivation. Virtually two thirds of our learners are female at 65.7% in 23/24 compared to 68% in the 22/23 academic year and 77%* of our learners are aged between 20 and 60 which is just below 21/22 data of 79.5%.

(*WG provision only)

2.4 Curriculum developments

Provision for 2023/24 continued to be an aggregate of workplace/trade union studies, regional, national and Asylum, Migration and Integration Fund (AMIF) Project curricula, administered from organisational offices and the homes of staff who are dedicated home workers/have agile working practices agreed. The AMIF Project ended at the end of December 2023, having successfully met its outcomes in terms of learner numbers, engaging with over 800 refugees and Third Country Nationals during the timescale of the Project.

2023/24 saw a combination of both face-to-face and online/blended delivery continuing, as appropriate to learners’ needs, with the majority (approximately 80%) being face-to-face.

Learning delivered in community settings continued to engage adult learners who were furthest away from employment, particularly from areas of deprivation and those with the lowest skills levels, through strong collaborative working with the Organisation’s Branch structure, national, regional, and local partners, and networks. Feedback from learners also indicated that learning supported their mental health positively, as well as employability. Learning delivered in the workplace was offered in response to demand from the trade union movement and employers, working closely with TUC Cymru and single unions such as Unite and Unison. Some of the Workplace Learning provision was supported through the Wales Union Learning Fund (WULF) and some of the Trade Union education was supported by funding from TUC Cymru. In addition to core funded programmes of learning, full cost recovery / income generation either through delivery or accreditation services remained a focus.

Throughout 2023/24, ALW continued to offer a broad range of provision, spanning from pre-Entry to Level 2 in the majority of programme areas, with Youth Work and Counselling programmes delivering up to Levels 3 and 4. This was consistent with Welsh Government policy priorities for Adult Learning in Wales, with a continued emphasis on essential skills (including Digital Literacy), ESOL and employability skills. ESOL continued to be the largest programme area, in terms of number of delivery hours.

The 2023/24 academic year saw the completion of 6 pilot projects as part of a Citizens’ Curriculum for Wales. These were supported by funding from Welsh Government, with Learning and Work Institute as the commissioning body. ALW is led on 2 of the 6 pilots and was also involved in a third. A total of £54k was awarded to ALW to support its Health and Well-being and Global Learning pilots.

For Welsh Government and Estyn purposes, all learning continues to be badged as Adult Community Learning and not Further Education or Work-based Learning.

2.5 Future developments

We are navigating a complex landscape shaped by the lasting impact of the global pandemic, the war in Ukraine, and a Cost-of-Living Crisis that has disrupted our economy and placed increased strain on public spending. This environment adds further pressure on our resources, creating funding uncertainties and emphasising the need for innovative, cost-effective approaches to meet adult learning demands in Wales.

Wales faces significant challenges within this evolving economic landscape, particularly in adult education. Alongside issues posed by an ageing population, rapid technological advancements, and shifting employment patterns, the private sector’s slow recovery adds further complexity. Against this backdrop, we are committed to finding efficient and impactful ways of working within a constrained budget.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

ALW is confident in its capacity and readiness to meet these challenges. Building on the legacy of our founding organisations, we will continue to champion broad, liberal education that fosters social justice and community engagement, alongside targeted education and training for employability, enterprise, and skill development.

Moving forward, we will regularly review and refine our curriculum to ensure that resources are effectively allocated to enhance our digital framework, expand our programme offering, strengthen partnerships -particularly within the voluntary sector - and consolidate our position as Wales’s recognised national provider of Adult Community Learning. Flexibility will remain central to our approach, with a broad range of learning options designed to boost learner engagement and meet diverse needs across Wales.

3. RESOURCES

The Organisation has limited physical resources that it can deploy in pursuit of its strategic objectives. Its tangible resources include the Bryn Menai in Bangor and Coopers Yard sites in Cardiff. The Organisation still holds some tangible resources in Harlech.

3.1 Financial

Financial objectives

The Organisation’s financial objectives are:

to achieve an annual operating surplus prior to FRS 102 – this was achieved with a surplus of £299k.
• to pursue alternative sources of funding, on a selective basis, consistent with the Organisation’s aims and objectives, and the need for a financial contribution to the Organisation’s overall finances – this was achieved with several sources of alternative funding being applied for and secured.
to generate sufficient levels of income to support the asset base of the Organisation – achieved, as during the year the Organisation was awarded several large grants in order to improve the assets across the organisation.
to further improve the Organisation’s shorter-term liquidity – this was achieved with yearend cash balances being £7.335m including short-term investments.
to retain an average cash level of £500,000 – this was achieved.
to maintain category “B” Welsh Government financial status – achieved.

Meeting the above targets requires the retention of tight staffing levels whilst taking all reasonable opportunities to make efficiency gains .

Financial results

The following table summarises performance for 2023/24 against 2022/23:

	2023/24	2022/23
Operating surplus/(deficit) prior to FRS 102 (28) pension adjustments and net proceeds of sales Operating surplus/(deficit) after FRS 102 (28) pension adjustments and net proceeds of sales Current ratio (current assets/current liabilities) Staff costs as % of income Welsh Government income as a % of total income Total unrestricted reserves Cash balances excluding investments Net assets	£299K £1,275k 2 : 1 73% 80% £11.611m £5.721m £12.827m	£35K £92k 2 : 1 83% 87% £9.077m £5.064m £10.209m

Tangible fixed asset additions during the year amounted to £35k for equipment and £4k fixture and fittings.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Treasury policies and objectives

Treasury management is the management of the Organisation’s cash flows, its banking, money market and capital market transactions; the effective control of the risks associated with those activities; and the pursuit of optimum performance consistent with those risks.

This responsibility is absorbed within the finance function and is overseen by the Head of Curriculum and Performance.

There have been no short-term borrowings during the year. If the Organisation were to make any short-term borrowings for temporary revenue purposes this would be authorised by the Chief Executive and approved by the Resources Committee. Such arrangements are restricted by limits in the Financial Memorandum with the WG. All other borrowing requires the authorisation of Council and shall comply with the requirements of the Financial Memorandum of the WG.

Investments

The Organisation has previously developed an ethical investment policy which is used to support its investments. At year end the Organisation held £1.367m within two separate non-current investment funds and £1.614m in a current investment fund, all managed by Brewin Dolphin (note 17).

Cash flows and Liquidity

At £261k (2022/23: £620k) the operating cash flow is again positive for the period.

There was an increase in net funds for the year of £720k compared to 2022/23 £672k.

The current ratio remains at a satisfactory level of 2:1 (22/23 2:1). The financial position continues to be stable which highlights the Organisation’s continuing progress in its objective of maintaining financial health through improved liquidity.

Reserves

Levels of reserves depend upon operational needs, but the Organisation aims to have a minimum of three months’ running costs, including salaries, held in General (unrestricted) reserves. These stood at £11.61m (2022/23: £9.08m) at 31 July 2024, thus the target of £1.6m was met. There has been an increase to the pension surplus in the year of £1.829m resulting in a £6.789m surplus at 31 July 2024. The target of £1.6m is in line with Charity Commission guidance and Welsh Government’s suggested good practice for Further Education Institutions. All reserves are reported to and reviewed regularly at Resources Committee meetings, and expenditure from reserves is approved by the Council.

A three-year budget is usually developed but due to uncertainty and volatility in funding only a one-year budget has been produced for the 2024/25 year which is intended to increase the levels of reserves. However, it is recognised that there are significant challenges in financial forecasting due to the current situation and the impact this has on the Organisation’s ability to plan.

Payment performance

The Late Payment of Commercial Debts (Interest) Act 1998, which came into force on 1 November 1998, requires ALW, in the absence of agreement to the contrary, to make payments to suppliers within 30 days of either the provision of goods or services or the date on which the invoice was received.

Supplier terms are set within the accounting system and may range from zero days (for employee/voluntary member expense claims) to 30 days for large suppliers. Where payment is required to be made more frequently e.g. suppliers of utilities etc., terms are set and wherever possible, payment is made within the required timeframe.

Where invoices are contested, suppliers are notified immediately and they are settled as soon as possible if monies are owed. When suppliers query non-payment for whatever reason, the situation is investigated immediately and copy invoices requested where required.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Wherever possible the Organisation complies with the Better Payments Practice Code.

Late receipt of authorised invoices into the Finance Department can result in late payment.

Field offices are aware of the need to authorise invoices and return them to the Finance Section for payment as quickly as possible.

During the period 1 August 2023 to 31 July 2024 the Organisation incurred no interest charges in respect of late payment.

Post-balance sheet events

There are no post-balance sheet events to report.

3.2 Staffing

As at 31st July 2024 there were 239 active hourly paid teaching staff, including support workers, and 112 salaried support staff, 71 full time and 41 part time. The figure of 239 includes those who hold a tutor contract alongside their salaried support contract – this applies to 14 people in total.

A Learning and Development Plan, based on the training needs recognised by the Organisation and individuals, is implemented on an annual basis and updated throughout the year.

Teaching observations enable the monitoring of teaching quality and the provision of support to teaching staff while identifying training and development needs. Regular catch-up meetings between staff and line managers provide a proactive approach to self-assessment and target setting, with an emphasis on the individual’s Continuing Professional Development (CPD) needs and aspirations for improvement to deliver targets.

4. PRINCIPAL RISKS AND UNCERTAINTIES

ALW has undertaken further work during the year to develop and embed the system of internal control, including financial, operational and risk management which is designed to protect ALW’s assets and reputation.

The Senior Management Team undertakes a comprehensive review of the risks to which the Organisation is exposed which are documented in a risk register with clear plans of action. They identify systems and procedures, including specific preventable actions which should mitigate any potential impact on the Organisation. The internal controls are then implemented and the subsequent year’s appraisal will review their effectiveness and progress against risk mitigation actions. In addition to the annual review, the Senior Management Team also considers any risks which may arise as a result of a new area of work being undertaken by the Organisation.

The main risks identified have been compounded by the impact of the legacy pandemic issues coupled with the ongoing cost of living challenges. The situation has decreased the ability to forecast accurately due to the volatility and uncertainty of the current position. In order to mitigate the risks, the Senior Officers of the Organisation are in regular contact with the Welsh Government in order to identify and manage key challenges.

A Risk Register is maintained and is reviewed on a termly basis by the Audit Committee. The Risk Register identifies the key risks, the likelihood of those risks occurring, their potential impact on the Organisation and the actions being taken to reduce and mitigate the risks. Risks are prioritised using a consistent scoring system.

Outlined below is a description of the principal risk factors that may affect ALW along with mitigating actions. Not all the factors are within the Organisation’s control: other factors besides those listed below may also adversely affect it.

Funding Uncertainty and Public Spending Constraints

Risk: ALW relies significantly on public funding, and with current economic pressures, public spending is under strain. Uncertainty around future funding allocations poses a risk to programme sustainability, growth, and our ability to respond to increased demand for adult learning across Wales.

Controls: ALW actively engages with Welsh Government and other funding bodies to secure funding stability. Our finance team closely monitors budgets and adjusts spending proactively in response to changes in funding.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Additionally, we are developing diversified funding streams, including income generation through delivery and accreditation services, to reduce reliance on any single funding source.

Economic Instability and Cost Pressures

Risk: Rising inflation and general economic instability have increased operational costs. This environment creates challenges for maintaining cost-effective service delivery and may impact ALW’s ability to expand or sustain some services without additional funding.

Controls: ALW employs strict budget monitoring and cost-control measures to manage rising costs. We also implement a rolling review of resource allocation to identify efficiencies. Contingency plans are in place to manage unexpected cost increases, and our agile working policy helps to minimise overhead expenses.

Changing Labour Market and Skills Demands

Risk: Rapid changes in technology and employment patterns, coupled with an ageing population, continue to reshape skills needs across Wales. A misalignment between our curriculum and the labour market's evolving requirements could impact learner outcomes and satisfaction.

Controls: Our curriculum team works closely with Regional Skills Partnerships, employers, and industry experts to ensure our offerings align with current market needs. Regular curriculum reviews, with input from stakeholders, allow us to update programmes in response to labour market trends. A robust professional development framework ensures that staff are equipped with up-to-date skills to deliver relevant training.

Digital Divide and Access to Learning

Risk: As ALW expands its digital offerings, some learners may lack the resources or digital skills needed to participate fully in online learning.

Controls: ALW provides targeted digital literacy training and resources to learners, helping them develop the necessary skills to engage with online platforms. We also offer hybrid learning models that combine in-person support with digital learning. In partnership with local organisations, we work to provide access to devices and internet connectivity for learners in need.

Dependence on Partnerships and Collaborations

Risk: ALW’s success relies heavily on strong partnerships with regional, national, and local entities. Changes in partnership arrangements, priorities, or funding among these entities could disrupt service delivery and impact learner recruitment and retention.

Controls: ALW has a dedicated Partnerships Team to maintain strong, proactive relationships with key stakeholders. Regular communication, formalised agreements, and collaborative planning sessions help mitigate disruptions. Additionally, we monitor partnership performance and establish contingency plans with alternative partners where possible to ensure continuity.

Recruitment and Retention of Skilled Staff

Risk: Attracting and retaining skilled educators and support staff is critical. The competitive labour market may lead to staff turnover and recruitment challenges.

Controls: ALW offers competitive salary packages, professional development opportunities, and flexible working arrangements to attract and retain talent. We have established a robust recruitment process to identify and onboard qualified professionals efficiently and have a succession planning strategy to minimise the impact of turnover.

Compliance and Regulatory Risks

Risk: Changes in regulatory requirements or shifts in Welsh Government priorities could introduce compliance challenges or necessitate curriculum adjustments, impacting operational continuity and financial planning.

Controls: ALW has a dedicated Compliance and Quality Assurance team that closely monitors regulatory updates and ensures ongoing alignment with Estyn and Welsh Government standards. Regular audits, staff training on compliance matters, and structured quality checks are conducted to mitigate regulatory risks.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

AMIF Project Completion and Transition

Risk: The AMIF Project closed in December 2023 and there is a risk of service gaps for the refugee and migrant populations served by this project, which may affect our inclusivity commitments.

Controls: ALW is working with stakeholders to explore alternative funding and project transition opportunities. We are also identifying potential partnerships to continue offering support to refugees and Third Country Nationals where feasible. An exit strategy is in place to ensure that services are not abruptly discontinued.

Cybersecurity Threats

Risk: As ALW expands its digital framework and relies more on technology for operational and educational purposes, it faces a heightened risk of cyber threats, including data breaches, ransomware attacks, and phishing. A successful cyber-attack could disrupt service delivery, compromise sensitive learner and staff data, and damage ALW’s reputation.

Controls: ALW has implemented a comprehensive cybersecurity strategy that includes regular vulnerability assessments, firewalls, and multi-factor authentication to protect systems and data. Staff are provided with mandatory cybersecurity training to recognise and report phishing and other cyber threats. We also maintain a dedicated IT security team that monitors and responds to emerging threats. A robust incident response plan is in place to ensure quick and effective action in the event of a cyber incident, including data backup protocols and communication procedures to minimise disruptions .

5. STAKEHOLDER RELATIONSHIPS

The Organisation has many stakeholders. These include:

Welsh Government
Staff
Other FE Institutions
Trade Unions
Accrediting bodies
HE Institutions
Other third sector organisations and partners
Learners
Funders
Branches
Members
Volunteers
The local community
Local employers (with specific links)
Local Authorities
ACL Partnerships, regional and local

The Organisation recognises the importance of these relationships and engages in regular communication and collaboration with stakeholders. It is particularly appreciative of the voluntary efforts of its Branch officers and Regional Forum chairpersons in extending the democratic nature of the Organisation’s structures.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

5.1 Equality and Diversity

The Organisation recognises that discrimination, prejudice and disadvantage exist in society, and that groups and individuals have been treated unfairly for reasons relating to gender, ethnic origin, race, nationality, disability status, marital or family status, sexual orientation, age and religion. We are committed to making our contribution to help eliminate this by working positively to promote a more inclusive society. It is our aim and commitment to provide all of our services and employment opportunities on a fair and equitable basis.

ALW’s values emphasise the principle of equity, aimed at extending education opportunities to all learners and potential learners, regardless of class, age, disability or learning difficulty, gender, sexual orientation, race, colour, language and culture, religious beliefs, economic or marital status. The commitment at all times is to meet the needs and aspirations, and enhance the skills, of individuals both within the learning experience and at work. The Organisation further recognises that education enables the progress not only of individuals but of communities through the contribution of aware and committed individuals and sees its recognition of the social purpose of education as integral to its commitment to equal opportunities.

It is the policy of the Organisation to take all reasonable steps to employ and promote employees on the basis of their skills. Ongoing monitoring and regular analysis of data collected as a result of diversity monitoring provide the basis for appropriate action to eliminate unlawful direct and indirect discrimination and promote equality of opportunity. As a Disability Confident employer, the Organisation considers all applications for employment from disabled persons, bearing in mind the aptitudes of the individuals concerned. Where an existing employee becomes disabled, every effort is made to ensure that employment with ALW continues. The Organisation’s policy is to provide training, career development and opportunities for promotion which are, as far as possible, identical to those for all employees. The Organisation makes every effort to ensure that any problems encountered by disabled employees or potential disabled employees are minimised.

The Learner Services and Human Resources team has responsibility for coordinating the development, implementation and review of all matters and progress relating to safeguarding, equality and diversity, in accordance with legislation and statutory duties. Monitoring and scrutiny of safeguarding, equality and diversity matters at Committee level is within the remit of the Learner Experience Committee.

5.2 Anti-Racism at ALW

ALW fully supports the Welsh Government’s vision of ‘A Wales which is anti-racist’. We are committed to becoming an anti-racist organisation, creating a culture with zero tolerance and changing our systems, policies and procedures to eradicate racism in all that we do. Our Anti-Racist Action Plan will ensure that we play our part in making a measurable change to the lives of Black, Asian and Minority Ethnic people by tackling racism.

Along with our own organisational values, the values underpinning our anti-racist action plan are in line with those set out in the Anti-racist Wales Action Plan. These values are:

Open and transparent
Rights-based
Putting lived experience at the heart of all we do

At ALW, we view our identity as closely aligned to the traditional inclusive impulses of the adult learning movement. We strive to integrate inclusivity into all activities and to empower staff to take action to ensure equality via a focus on positive attitudes, supported by policies and plans.

Our Commitments

We recognise that racism exists in society, and that this is extremely harmful. We acknowledge the impacts of racism and we will support our Black, Asian and Minority Ethnic staff, learners and members who may experience these impacts.
We will encourage people to speak up about racism, giving people the time and space to talk about their experiences, with confidence that they will be listened to and supported.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

As a learning provider and a membership organisation we have both an opportunity and a responsibility to make a positive difference to anti-racism both within ALW and in the wider community. We will embed anti-racism in our curriculum, through our networks, events and communications and will influence and advocate for anti-racism at all opportunities, challenging racism where we see it.
At present, our management team does not reflect the diversity within either our organisation or wider society. As we work to address this, we will develop the skills of our management team along with our wider staff to give them the support they need to be effective allies. Our team is committed to supporting our Black, Asian and Minority Ethnic people to ensure the burden of tackling racism does not fall on those who already experience its injustices.
We will be open and honest about our progress on anti-racism, and via our Anti-Racist Action Plan we will set clear goals against which our progress can be measured.
We want to move beyond compliance to seek opportunities to promote anti-racism in everything that we do. We strongly believe this is the right thing to do, in the interest of our learners, staff, volunteers, members and the wider community.

5.3 Disability statement

As part of our commitment to Equality and Diversity the Organisation seeks to secure full access to its courses and meetings for those with disabilities. As far as reasonably practicable arrangements are made to ensure that students with disabilities can engage fully with its activities, by ensuring that necessary media and support are provided and that physical access to courses is possible. However, courses are usually provided in premises that are not owned by ALW. In these situations, the Organisation will work with the providers of premises to ensure equal access wherever possible. If equal access is not available at a community venue, alternative arrangements will be explored as required.

5.4 ALW and the Welsh Language

ALW is committed to the Welsh Government’s vision of a truly bilingual Wales, as set out in the document Cymraeg 2050 , the Welsh Government’s Welsh language strategy (2018). This sets out its vision to increase the number of Welsh speakers and the use of Welsh by the year 2050. It is a vision to which ALW is fully committed. ALW will work to ensure that the Welsh language is treated as equal to the English language. Standards set will be clear and consistent in terms of the services to be provided in both languages and will strive to be reasonable and proportionate, to reflect an all-Wales educational Organisation. Compliance with Welsh Language Standards will be ensured through regular monitoring.

In addition to advancing learning and knowledge through participation in education and training, ALW is committed to promoting awareness and understanding of the Welsh language, Welsh heritage and culture in all aspects of its business and services. ALW fully supports the principle of a bilingual workplace and has put in place the mechanisms necessary to encourage the promotion, use and improvement of the Welsh language skills of its workforce.

The Learner Services and Human Resources team continues to co-ordinate, develop and implement the wide range of activities required to achieve the organisation’s strategic aims and meet statutory requirements in respect of Welsh and Bilingualism. Welsh and Bilingualism is monitored and scrutinised at Committee level by the Learner Experience Committee.

5.5 Disclosure of information to auditors

The members who held office at the date of approval of this report confirm that, so far as they are each aware, there is no relevant audit information of which ALW’s auditors are unaware; and each member has taken all the steps that he or she ought to have taken to be aware of any relevant audit information and to establish that the Organisation’s auditors are aware of that information.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Approved by order of the members of the Council on 30 January 2025 and signed on its behalf by:

John Graystone Chair of Governors

……………………………………………………..

Professional advisers External auditors: Internal auditors: Baker Knoyle Statutory Auditors, Merthyr Tydfil TIAA, Cardiff Bankers: Solicitors: Handelsbanken, Cardiff Eversheds Sutherland, Cardiff

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Corporate Governance and Internal Control

The Organisation is committed to exhibiting best practice in all aspects of corporate governance.

This summary describes the way the Organisation has applied the principles set out in the UK Corporate Governance Code issued by the Financial Reporting Council in July 2018. Its purpose is to help the reader of the accounts understand how the principles have been applied.

In the opinion of the Council, the Organisation complies with all the provisions of the Code in so far as they apply to the Further Education sector, and it has complied throughout the year ended 31 July 2024.

THE COUNCIL

The members who served on the Council during the year are as listed below:-

Name	Status and Category	Accession date (if after 1 Aug. 2023) or Resignation date	Committe e Membersh ip	Council meetings attended (out of 5 in total)
John Graystone	Chair; Appointed		Search (Chair)	5
Stephen Nicholls	Appointed; Vice Chair		Resources (Chair); Search	5
Salamatu Fada	Appointed; Vice Chair		Learner Experience (Chair); Search	4
Chris Franks	Elected Members’ Governor		Audit (Chair)	5
Marion Burke	Appointed	Resigned 31 October 2023	Learner Experience	1 (out of 1)
Cathy Clark	Elected Learner Governor		Learner Experience	5
Victory Ezeofor	Elected Regional Governor	Re-elected on 14 June 2024	Audit	3
Jan Tiley	Elected Learner Governor		Resources	5
Sam Emmett	Elected Staff Governor		Learner Experience	3
Judith Evans	Appointed		Resources	4
Nicole Kinnaird	Elected Staff Governor		Resources	2
Sion Aled Owen	Elected Regional Governor		Learner Experience	3
Jenni Jones-Annetts	Elected Learner Governor	Resigned on 12 July 2024	Learner Experience	4
Dona Lewis	Appointed		Resources	4
Timothy Palazon	Appointed		Learner Experience	5
Lisa O’Connor	Appointed	Appointed on 11 March 2024	Resources	1 (out of 2)

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Corporate Governance and Internal Control (continued)

The Council is provided with regular and timely information on the overall financial performance of the Organisation together with other information such as performance against funding targets, proposed capital expenditure, quality matters and personnel-related matters such as health and safety and environmental issues. The Council meets a minimum of three times a year, and during 2023-24 met on five occasions.

The Council conducts much of its business through four committees: Audit, Learner Experience, Resources and Search. Each committee has terms of reference which have been approved by the Council. Full minutes of all Council meetings, except those deemed to be confidential by the Council, are available on the organisation’s web-site or from the Clerk to the Council at:

Stephen Thomas Clerk to the Council ALW 7 Coopers Yard Curran Road Cardiff CF10 5NB

The Clerk to the Council maintains a register of financial and personal interests of Council members. The register is available for inspection at the above address.

Members of the Council can take independent professional advice in furtherance of their duties at the Organisation’s expense and have access to the Clerk to the Council, who is responsible to the Council for ensuring that all applicable procedures and regulations are complied with. The appointment, evaluation and removal of the Clerk are matters for the Council as a whole. Formal agendas, papers and reports are supplied to the Council and Committee members in a timely manner, prior to meetings. Briefings are also provided on an ad hoc basis.

The Council has a strong and independent non-executive element and no individual or group dominates its decision-making process: there is no person with significant control registered for it at Companies House. The Council considers that each of its members is independent of management and free from any business or other relationship which could materially interfere with the exercise of their independent judgement. The Committees comprise members of the Council, one of whom is Committee Chair, and co-opted individuals. Co-opted members who served during 2023-24 were: Paul Charlton, Graham Price and Guy Wallace Smith (Audit Committee); Zaina Aljumma, Ashok Chopra and Sharon Clancy (Learner Experience Committee); Patience Bentu and Susan Roberts (Resources Committee). In addition, other task and finish groups may be convened at the discretion of the Council.

There is a clear division of responsibility in that the roles of Chair of the Council and that of Chief Executive are separate.

Composition of the Council

The adoption of revised Articles of Association at the time of the re-naming of the Organisation in late 2016 also saw the formation of a new Council. Most Council members up to 31 March 2017 were appointed to their roles. From 1 April 2017 there have been up to 12 elected members (variously nominated by Regional Forums, individual members, learners and staff) and up to 8 appointed members. The Council is responsible for ensuring that appropriate training is provided for its members as required. The Council adheres to the 2016 Code of Good Governance for Colleges in Wales.

Audit Committee

The Audit Committee comprises up to four members of the Council (and excludes the Chair, staff governors and Resources Committee members). The Committee operates in accordance with written terms of reference approved by the Council.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Corporate Governance and Internal Control (continued)

The Audit Committee meets on a termly basis and provides a forum for reporting by ALW’s internal and external auditors, who have access to the Committee for independent discussion, without the presence of ALW management if necessary. The Committee can also receive and consider reports from the Charity Commission and the Welsh Government as they affect ALW’s business.

The Organisation’s internal auditors monitor the systems of internal control, risk management controls and governance processes in accordance with an agreed plan of input and report their findings to management and to the Audit Committee.

Management is responsible for the implementation of agreed audit recommendations and internal auditors undertake periodic follow-up reviews to ensure such recommendations have been implemented.

The Audit Committee also advises the Council on the appointment of internal, regularity and financial statements auditors and their remuneration for both audit and non-audit work.

The Search Committee is responsible for overseeing the appointment of Council members, making recommendations to the full Council to fill the vacancies that exist. The Diversity Categories and Skills Matrix for Governors, forming part of the Organisation’s Standing Orders, inform the Search Committee’s recruitment practices. All appointed governors have come through application of these norms.

INTERNAL CONTROL

Scope of responsibility

The Council is ultimately responsible for the Organisation’s system of internal control and for reviewing its effectiveness. However, such a system is designed to manage rather than eliminate the risk of failure to achieve business objectives and can provide only reasonable and not absolute assurance against material misstatement or loss.

The Council has delegated the day-to-day responsibility to the Chief Executive, as Accounting Officer, for maintaining a sound system of internal control that supports the achievement of the Organisation’s policies, aims and objectives, whilst safeguarding the public funds and assets for which s/he is personally responsible, in accordance with the responsibilities assigned to her or him in the Financial Memorandum between the Organisation and the Welsh Government. S/he is also responsible for reporting to the Council any material ALW weaknesses or breakdowns in internal control.

The purpose of the system of internal control

The system of internal control provides reasonable, not absolute, assurance of effectiveness and is based on an ongoing process designed to identify and prioritise the risks to the achievement of the Organisation’s policies, aims and objectives, to evaluate the likelihood of those risks being realised and the impact should they be realised, and to manage them efficiently, effectively and economically. The system of internal control has been in place for the year ended 31 July 2024 and up to the date of approval of the annual report and accounts.

Capacity to handle risk

The Council has reviewed the key risks to which the Organisation is exposed together with the operating, financial and compliance controls that have been implemented to mitigate those risks. The Council is of the view that there is a formal ongoing process for identifying, evaluating and managing the Organisation's significant risks. This process is regularly reviewed by the Organisation.

The risk and control framework

The system of internal control is based on a framework of regular management information, administrative procedures including the segregation of duties, and a system of delegation and accountability. In particular, it includes:

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Corporate Governance and Internal Control (continued)

Comprehensive budgeting systems with an annual budget, which is reviewed and agreed by the governing body
Regular reviews by the governing body of periodic and annual financial reports which indicate financial performance against forecasts
Setting targets to measure financial and other performance
Clearly defined capital investment control guidelines
The adoption of formal project management disciplines, where appropriate.

The Organisation has an internal audit service, which operates in accordance with the requirements of the Welsh Government. The work of the internal audit service is informed by an analysis of the risks to which the Organisation is exposed, and annual internal audit plans are based on this analysis. The analysis of risks and the internal audit plans are endorsed by the Council on the recommendation of the Audit Committee. At minimum annually, the Chair of Audit Committee provides Council with a report on internal audit activity in the Organisation. The report includes the Internal Auditor’s independent opinion on the adequacy and effectiveness of the Organisation’s system of risk management, controls and governance processes.

Review of effectiveness

As Accounting Officer, the Chief Executive has responsibility for reviewing the effectiveness of the system of internal control. That review of the effectiveness of the system of internal control is informed by:

The work of the internal auditors
The work of the executive managers in the Organisation who have responsibility for the development and maintenance of the internal control framework
Comments made by the Organisation’s external auditors and the Welsh Government auditors in their management letters and other reports.

The Chief Executive has been advised on the implications of the result of the review of the effectiveness of the system of internal control by the Audit Committee which oversees the work of the internal auditor, and a plan to address weaknesses and ensure continuous improvement of the system is in place.

The Senior Management Team receives reports setting out key performance and risk indicators and considers possible control issues brought to their attention by early warning mechanisms, which are embedded within the regions and reinforced by risk awareness training. The Senior Management Team and the Audit Committee also receive regular reports from internal audit, which include recommendations for improvement. The Audit Committee's role in this area is confined to a high-level review of the arrangements for internal control. The Council’s agenda includes a regular item for consideration of risk and control, and it receives reports thereon from the Senior Management Team and the Audit Committee. The emphasis is on obtaining the relevant degree of assurance and not merely reporting by exception.

GOING CONCERN

After making appropriate enquiries, the Council considers that the Organisation has adequate resources to continue in operational existence for the foreseeable future. For this reason, it continues to adopt the going concern basis in preparing the financial statements.

Approved by order of the members of the Organisation on 3rd April 2025 and signed on its behalf by:

John Graystone Chair of Governors

Kathryn Robson Chief Executive

………………………………….

………………………………

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Governing Body’s statement on the Organisation’s regularity, propriety and compliance with Funding body terms and conditions of funding

The Organisation has considered its responsibility to notify the Welsh Government of material irregularity, impropriety and non-compliance with Welsh Government terms and conditions of funding, under the Financial Memorandum in place between the Organisation and the Welsh Government. As part of our consideration, we have had due regard to the requirements of the Financial Memorandum.

We confirm, on behalf of the Organisation, that after due enquiry, and to the best of our knowledge, we are able to identify any material irregular or improper use of funds by the Organisation, or material non-compliance with the Welsh Government’s terms and conditions of funding under the Organisation’s Financial Memorandum.

We confirm that no instances of material irregularity, impropriety or funding non-compliance have been discovered to date. If any instances are identified after the date of this statement, these will be notified to the Welsh Government.

John Graystone Chair of Governors

Kathryn Robson Chief Executive

…………………………………….

..………………………………

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Responsibilities of the Members of the Council of the Organisation

The Members of the Council of the Organisation are required to present audited financial statements for each financial year.

Within the terms and conditions of the Financial Memorandum agreed between the Welsh Government and the Organisation, the Organisation, through its Chief Executive, is required to prepare financial statements for each financial year in accordance with the 2019 Statement of Recommended Practice – Accounting for Further and Higher Education Institutions, Company Law and with the Accounts Direction issued by the Welsh Government, which give a true and fair view of the state of affairs of the Organisation and the result for that year.

In preparing the financial statements, the Organisation is required to:

select suitable accounting policies and apply them consistently
make sound judgements and estimates that are reasonable and prudent
state whether applicable Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements
prepare financial statements on the going concern basis, unless it is inappropriate to assume that the Organisation will continue in operation.

The Organisation is responsible for maintaining proper accounting records which disclose with reasonable accuracy, at any time, the financial position of the Organisation, and which enable it to ensure that the financial statements comply with the Companies Act 2006. It is responsible for taking steps that are reasonably open to it in order to safeguard the assets of the Organisation and to prevent and detect fraud and other irregularities.

The maintenance and integrity of the Organisation website is the responsibility of the Organisation. The work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

The Members of the Council are responsible for ensuring that expenditure and income are applied for the purposes intended by the funders and that the financial transactions conform to the authorities that govern them. In addition, they are responsible for ensuring that funds from the Welsh Government are used only in accordance with the Financial Memorandum with the Welsh Government and any other conditions that the Welsh Government may prescribe from time to time. The Members of the Council must ensure that there are appropriate financial and management controls in place in order to safeguard public and other funds and to ensure they are used properly. In addition, the Members of the Council are responsible for securing economical, efficient and effective management of the Organisation’s resources and expenditure, so that the benefits that should be derived from the application of public funds by the Welsh Government are not put at risk.

In accordance with Company Law, as the Members of the Council, we certify that:

so far as we are aware, there is no relevant audit information of which the company’s auditors are unaware; and
as the Members of the Council of the Organisation we have taken all the steps necessary in order to make ourselves aware of any relevant audit information and to establish that the Organisation’s auditors are aware of that information.

The Members of the Council are aware that the Organisation has a responsibility under the Charities Act to demonstrate that it has charitable aims that meet the public benefit requirement and are therefore charitable. The Members of the Council confirm that they have had due regard to the Charity Commission’s guidance on public benefit when considering, planning and implementing the activities of the charity and when exercising their powers and duties to which the guidance is relevant, and that they have complied with the duty under Section 4 of the Charities Act 2006 in this regard. As Council, we believe that the objects of the Organisation to promote education, in particular for young people and adults, within Wales are charitable and for public benefit. Furthermore, in our view, no detriment or harm arises from the Organisation carrying out its work and we are not aware of any widespread views among others that such detriment or harm might arise.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Responsibilities of the Members of the Council of the Organisation (continued)

This report is prepared in accordance with the 2019 Statement of Recommended Practice – Accounting for Further and Higher Education Institutions, and the Companies Act 2006.

Approved by order of the Members of the Council of the Organisation on 30 January 2025 and signed on its behalf by:

John Graystone Chair of Governors

.........................................................

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Independent Auditors’ Report to the Governing Body (Council) of Adult Learning Wales

A COMPANY LIMITED BY GUARANTEE - 3109524

Report on the audit of the financial statements

Opinion

In our opinion, Adult Learning Wales financial statements:

give a true and fair view of the state of the organisation's affairs as at 31 July 2024, and of the organisation's income and expenditure and cash flows for the year then ended;
have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland", and applicable law);
have been properly prepared in accordance with the requirements of the Statement of Recommended Practice -Accounting for Further and Higher Education; and
have been properly prepared in accordance with the Accounts Direction issued by the Welsh Government.

We have audited the financial statements, included within the Annual Report and Financial Statements for the year ended 31 July 2024 (the "Annual Report"), which comprise the Balance Sheet as at 31 July 2024; the Statement of Comprehensive Income for the year then ended; the Statement of Changes in Reserves for the year then ended; the Statement of Cash Flows for the year then ended; and the notes to the financial statements, which include a summary of significant accounting policies and other explanatory information.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We remained independent of the organisation in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which include the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Conclusions relating to going concern

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

the Governing Body's use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
The Governing Body has not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the organisation's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Independent Auditors’ Report to the Governing Body (Council) of Adult Learning Wales (continued)

However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the organisation's ability to continue as a going concern.

Reporting on other information

The other information comprises all of the information in the Annual Report other than the financial statements and our auditors' report thereon. The Governing Body is responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance 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 an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of 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 based on these responsibilities.

Responsibilities for the financial statements and the audit

Responsibilities of the Governing Body for the financial statements

As explained more fully in the Statement of the Governing Body's responsibilities set out on pages 21 to 23, the Governing Body (who are also the directors of the organisation for the purposes of company law) is responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The Governing Body is also responsible for such internal controls as are determined to be 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 Governing Body is responsible for assessing the organisation'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 Governing Body either intends to liquidate the organisation or to cease operations, or has no realistic alternative but to do so.

Auditors' 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 auditors' 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 auditors' report.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Independent Auditors’ Report to the Governing Body (Council) of Adult Learning Wales (continued)

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience through discussion with the Officers and other management (as required by auditing standards).
We had regard to laws and regulations in areas that directly affect the financial statements including financial reporting (including related trade union legislation) and taxation legislation. We considered that extent of compliance with those laws and regulations as part of our procedures on the related financial statement items.
With the exception of any known or possible non-compliance, and as required by auditing standards, our work in respect of these was limited to enquiry of the Officers.
We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.
We addressed the risk of fraud through management override of controls, by testing the appropriateness of journal entries and other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.

Use of this report

This report, including the opinions, has been prepared for and only for the organisation's Governing Body as a body in accordance with the organisation's articles of Government and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Other required reporting

Opinions on other matters prescribed in the Further Education Audit Code of Practice 2016 issued by the Welsh Government

In our opinion, in all material respects:

monies expended out of Welsh Government grants and other funds from whatever source administered by the organisation for specific purposes have been properly applied to those purposes and, if appropriate, managed in compliance with all relevant legislation; and
income has been applied in accordance with the financial memorandum of the Welsh Government.

Richard Phillips FCCA Senior Statutory Auditor For and behalf of: Baker Knoyle Audit Limited Statutory Auditors Orbit Business Centre, Merthyr Tydfil, CF48 1DL

Date:

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Comprehensive Income

INCOME Notes Welsh Government Grants 2 Tuition fees and education contracts 3 Other grants and contracts 4 Other Income 5 Branch Income 6 Investment Income 7 Pension Finance Income 8 Donations and Endowments 9 Total Income EXPENDITURE Staff costs 10 Other operating expenses 12 Depreciation 16 Interest and other finance costs 13 Branch Expenditure 12 Total Expenditure (Deficit)/Surplus before other gains and losses 15 Gain/(loss) on disposal of assets 27 (Deficit)/Surplus before tax Taxation 14 (Deficit)/Surplus for the year General Reserve movement 26 Gain/(loss) on Endowments 17 Gain/(loss) on Investments 17 Actuarial gain/(loss) in respect of pensions schemes 33 Total Comprehensive Income for the year Represented by: Restricted comprehensive income Unrestricted comprehensive income Investment comprehensive income 26 Endowment comprehensive income	2024 £'000 8,311 437 1,221 24 2 107 264 - 10,366 7,549 1,730 119 - 14 9,412 954 321 1,275 - 1,275 7 64 90 1,182 2,618 - 2,464 90 64 2,618	2023 £'000 8,327 559 544 18 10 64 93 -
		9,615
		8,001 1,400 113 - 9
		9,523
		92 -
		92 -
		92 0 (33) 24 2,493
		2,576
		- 2,585 24 (33)
		2,576

The statement of comprehensive income is in respect of continuing activities.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of Changes in Reserves

Balance at 1st August 2022 Surplus/(deficit) from the income and expenditure account Other comprehensive income Total comprehensive income for the year Balance at 31st July 2023 Surplus/(deficit) from the income and expenditure account Other comprehensive income Transfers between general and endowment reserves Total comprehensive income for the year Balance at 31st July 2024 expenditure reserves Transfers between revaluation and income and expenditure	Endowment £'000 495 - (26) - (26) 469 - (20) - (20) 449 Income and	Investment Other £'000 £'000 0 6,143 - 92 24 2,493 - - 24 2,585 24 8,728 1,275 90 1,182 - 7 90 2,464 114 11,192 Expenditure Reserve	Endowment Other £'000 £'000 985 10 - - (7) - - - (7) - 978 10 - - 84 - - - 84 - 1,062 10 Restricted Reserve	Total £'000 7,633 92 2,484 -
				2,576
				10,209 1,275 1,336 7
				2,618
				12,827

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Balance Sheet as at 31 July

Notes Non current assets Tangible Fixed Assets 16 Endowment Assets 17 Defined benefit obligations 21 Current Assets Trade and other receivables 18 Investments 17 Cash and cash equivalents 25 Creditors - amounts falling due within one year 19 Net Current assets Total assets less current liabilities Creditors - amounts falling due after more than one year 20 Provisions Other provisions 21 Total net assets Restricted Reserves Endowments 23 Other 26 Total restricted reserves Unrestricted Reserves Endowments 23 Income and expenditure account 26 Revaluation Reserve Total unrestricted reserves Total Reserves	2024 £'000 592 1,510 6,789 8,891 228 1,614 5,721 7,563 (3,566) 3,997 12,888 (52) (9) 12,827 1,206 10 1,216 304 11,307 - 11,611 12,827	2023 £'000 672 1,446 4,960
		7,078
		425 1,524 5,064
		7,013 (3,766)
		3,247
		10,325 (102) (14)
		10,209
		1,122 10
		1,132
		324 8,753 -
		9,077

		10,209

The financial statements on pages 26 - 54 were approved and authorised for issue by the Governing Body on 3rd April 2025 and were signed on its behalf on that date by:-

John Graystone Chair of Governors

Kathryn Robson Chief Executive

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

STATEMENT OF CASH FLOWS

Notes Cash flow from operating activities Surplus/(Deficit) for the year Adjustment for non-cash items Depreciation 16 (Increase)/decrease in debtors 18 Increase/(decrease) in creditors due within one year 19 Increase/(decrease) in creditors due after one year 20 Increase/(decrease) in provisions 21 Pension costs less contributions payable 33 Adjustment for investing or financing activities Interest receivable Interest payable Net cash flow from operating activities Cash flows from investing activities Proceeds from sale of fixed assets 27 Interest receivable Income from endowments 23 Income from investments 17 Payments made to acquire fixed assets 16 Payments made to acquire endowment assets 17 Proceeds from sale of endowment assets 17 Drawdown from endowments 23 Cash flows from financing activities Interest paid New secured loans Repayments of amounts borrowed Increase / (decrease) in cash and cash equivalents in the year Cash and cash equivalents at beginning of the year 24 Cash and cash equivalents at end of the year 24	2024 £'000 954 119 197 (200) (50) (5) (647) (107) - 261 321 107 - 90 (39) (335) 336 (21) 459 - - - - 720 6,641 7,361	2023 £'000 92 113 (51) 660 (68) (5) (57) (64) -
		620
		- 64 (8) 24 (24) (377) 373 -
		52
		- - -
		-
		672
		5,969 6,641

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the Accounts

1. Statement of accounting policies and estimation techniques

The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the financial statements.

Basis of Preparation

These financial statements have been prepared in accordance with the Statement of Recommended Practice: Accounting for Further & Higher Education 2019 (the 2019 FE HE SORP), the College Accounts Direction for 2023 to 2024 and in accordance with Financial Reporting Standard 102 – “The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland” (FRS 102) and Companies Act 2006. The Organisation is a public benefit entity and has therefore applied the relevant public benefit requirements of FRS 102.

The preparation of financial statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise judgement in applying the Organisation’s accounting policies.

Basis of accounting

The financial statements are prepared in accordance with the historical cost convention modified by the revaluation of certain fixed assets.

Basis of Consolidation

The consolidated financial statements include the Organisation and its Branches for the financial year to 31 July 2024. Intra-group transactions have been eliminated and uniform accounting policies are applied across the group for the purposes of the consolidated financial statements.

Going Concern

The activities of the Organisation, together with the factors likely to affect its future development and performance, are set out in the Strategic Report. The financial position of the Organisation, its cash flow, liquidity and borrowings are presented in the Financial Statements and accompanying Notes.

After reviewing the Organisation’s forecasts and financial projections, the Trustees are of the opinion that the Organisation will have sufficient funds to meet its liabilities as they fall due over the period of 12 months from the date of approval of the financial statements (the going concern assessment period). Consequently, the Trustees have prepared the financial statements on a going concern basis.

Recognition of income

Revenue grant funding

Government revenue grants include funding body recurrent grants and other grants and are accounted for under the accrual model as permitted by FRS 102. Funding body recurrent grants are measured in line with best estimates for the period of what is receivable and depend on the particular income stream involved. Any under achievement for the Adult Education Budget is adjusted for and reflected in the level of recurrent grant recognised in the income and expenditure account. The final grant income is normally determined with the conclusion of the year end reconciliation process with the funding body following the year end, and the results of any funding audits.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of accounting policies (continued)

The recurrent grant from the Welsh Government (WG) represents the funding allocations attributable to the current financial year and is credited direct to the Statement of Comprehensive Income.

Where part of a government grant is deferred, the deferred element is recognised as deferred income within creditors and allocated between creditors due within one year and creditors due after more than one year as appropriate.

Grants from non-government sources are recognised in income when the Organisation is entitled to the income and performance related conditions have been met. Income received in advance of performance related conditions being met is recognised as deferred income within creditors on the balance sheet and released to income as the conditions are met.

Capital grant funding

Government capital grants are capitalised, held as deferred income and recognised in income over the expected useful life of the asset, under the accrual model as permitted by FRS 102. Other, nongovernmental, capital grants are recognised in income when the Organisation is entitled to the funds subject to any performance related conditions being met. Income received in advance of performance related conditions being met is recognised as deferred income within creditors on the Balance Sheet and released to income as conditions are met.

Fee income

Income from tuition fees is stated gross of any expenditure which is not a discount and is recognised in the period for which it is received.

Investment income

All income from short-term deposits is credited to the income and expenditure account in the period in which it is earned on a receivable basis. Income from restricted purpose endowment funds not expended in accordance with the restrictions of the endowment in the period is transferred from the income and expenditure account to accumulated income within endowment funds or held within creditors on the Balance Sheet and released to income as restricted purpose met.

Agency arrangements

The Organisation in some cases acts as an agent in the collection and payment of the discretionary support fund, Financial Contingency Fund (FCF). Related payments received from the WG and subsequent disbursements to students totalling £1k (2023: £5k) are excluded from the income and expenditure of the Organisation where the Organisation is exposed to minimal risk or enjoys minimal economic benefit related to the transaction (note 32).

Where the Organisation has paid a third party direct, the related income and expenditure has been included within the income and expenditure of the Organisation (note 32).

Accounting for post-employment benefits

Post-employment benefits to employees of the Organisation are provided by the Teachers’ Pension Scheme (TPS) and the Local Government Pension Scheme (LGPS). The TPS and LGPS are defined benefit plans, which are externally funded and contracted out of the State Second Pension.

Teachers’ Pension Scheme (TPS)

The TPS is an unfunded scheme. Contributions to the TPS are calculated so as to spread the cost of pensions over employees’ working lives with the Organisation in such a way that the pension cost is a

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of accounting policies (continued)

substantially level percentage of current and future pensionable payroll. The contributions are determined by qualified actuaries on the basis of valuations using a prospective benefit method.

The TPS is a multi-employer scheme and there is insufficient information available to use defined benefit accounting. The TPS is therefore treated as a defined contribution plan and the contributions recognised as an expense in the income statement in the periods during which services are rendered by employees.

Cardiff & Vale of Glamorgan and Gwynedd Local Government Pension Scheme (LGPS)

The LGPS is a funded scheme. The assets of the LGPS are measured using closing fair values. LGPS liabilities are measured using the projected unit credit method and discounted at the current rate of return on a high quality corporate bond of equivalent term and currency to the liabilities. The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The amounts charged to operating surplus are the current service costs and the costs of scheme introductions, benefit changes, settlements and curtailments. They are included as part of staff costs as incurred.

Net interest on the net defined benefit liability/asset is also recognised in the Statement of Comprehensive Income and comprises the interest cost on the defined benefit obligation and interest income on the scheme assets, calculated by multiplying the fair value of the scheme assets at the beginning of the period by the rate used to discount the benefit obligations. The difference between the interest income on the scheme assets and the actual return on the scheme assets is recognised in interest and other finance costs.

Actuarial gains and losses are recognised immediately in actuarial gains and losses.

Short term employment benefits

Short term employment benefits such as salaries and compensated absences (holiday pay) are recognised as an expense in the year in which the employees render service to the Organisation. Any unused benefits are accrued and measured as the additional amount the Organisation expects to pay as a result of the unused entitlement.

Enhanced Pensions

The Organisation incurred enhanced pension costs during the year of £5k relating to 2 former members of Coleg Harlech staff that left its employment, by arrangement, prior to the merger with the WEA (North Wales) in 2001. Due to uncertainty over life expectancy it is not possible to profile the enhanced pension provision. These costs have been charged against the enhanced pension provision in the balance sheet.

Tangible fixed assets

Tangible fixed assets are stated at cost less accumulated depreciation and impairment losses. Certain items of fixed assets that have been revalued to fair value on or prior to the date of transition to the FE HE SORP are measured on the basis of deemed cost, being the revalued amount at the date of that revaluation.

Where parts of a fixed asset have different useful lives, they are accounted for as separate items of fixed assets.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of accounting policies (continued)

Where tangible fixed assets are acquired with the aid of specific Government grants, they are capitalised and depreciated as above. The related Government grants are credited to a deferred income account within creditors and are released to the income and expenditure account over the expected useful economic life of the related asset on a systematic basis consistent with the depreciation policy. The deferred income is allocated between creditors due within one year and those due after more than one year.

Land & Buildings

Freehold and long leasehold buildings are depreciated on a straight line basis over their expected useful lives as follows:-

•	Freehold	20-50 years / 2%-5% per annum
•	Leasehold	50 years / 2% per annum
•	Property Improvements	5 years / 20% per annum

Freehold land is not depreciated as it is considered to have an infinite useful life.

Land, buildings and property improvements are stated in the balance sheet at either purchase cost or revaluation cost less depreciation costs. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use.

Freehold and long leasehold buildings are depreciated over their expected useful economic life to the Organisation of between 20 and 50 years. The Organisation has a policy of depreciating major adaptations to buildings over the period of their useful economic life of between 20 and 50 years.

A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that the carrying amount of any fixed asset may not be recoverable.

On adoption of FRS 102, the Organisation followed the transitional provision to retain the book value of land and buildings.

Subsequent expenditure on existing tangible fixed assets

Where significant expenditure is incurred on tangible fixed assets after initial purchase it is charged to income in the period it is incurred, unless it increases the future benefits to the Organisation, in which case it is capitalised and depreciated on the relevant basis.

Equipment

Equipment costing less than £2,000 per individual item is recognised as expenditure in the period of acquisition. All other equipment is capitalised at cost.

Inherited equipment and other capitalised equipment is depreciated on a straight-line basis over its remaining useful economic life as follows:

•	General Equipment	5 years / 20% per annum
•	Computer Equipment	4 years / 25% per annum
•	Motor Vehicles	5 years / 20% per annum
•	Furniture, fixtures and fittings	5 years / 20% per annum

A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that the carrying value of any fixed asset may not be recoverable. Shortfalls between the carrying

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of accounting policies (continued)

value of fixed assets and their recoverable amounts are recognised as impairments. Impairment losses are recognised in the Statement of Comprehensive Income.

Borrowing costs

Borrowing costs are recognised as expenditure in the period in which they are incurred.

Leased assets

Costs in respect of operating leases are charged on a straight-line basis over the lease term to the Statement of Comprehensive Income and Expenditure. Any lease premiums or incentives relating to leases signed after 1[st] August 2014 are spread over the minimum lease term

The Organisation does not have any finance leases.

Investments and Endowments

Listed investments held as current asset investments including endowment assets are stated at fair value, with movements recognised in the Statement of Comprehensive Income.

The general purpose endowments are classified as an investment in the balance sheet in line with the Statement of Recommended Practice: Accounting for Further & Higher Education 2019 (the 2019 FE&HE SORP).

Inventories

The Organisation does not hold inventories.

Cash and cash equivalents

Cash includes cash in hand, deposits repayable on demand, and overdrafts. Deposits are repayable on demand if they are in practice available within 24 hours without penalty.

Cash equivalents are short term, highly liquid investments that are readily convertible to known amounts of cash with insignificant risk of change in value. An investment qualifies as a cash equivalent when it has maturity of 3 months or less from the date of acquisition. The Organisation at year end held cash equivalents of £1.6m.

Financial liabilities and equity

Financial liabilities and equity are classified according to the substance of the financial instrument’s contractual obligations, rather than the financial instrument’s legal form.

All loans, investments and short-term deposits held by the Organisation are classified as basic financial instruments in accordance with FRS 102. These instruments are initially recorded at the transaction price less any transaction costs (historical cost). FRS 102 requires that basic financial instruments are subsequently measured at amortised cost, however the Organisation has calculated that the difference between the historical cost and amortised cost basis is not material and so these financial instruments are stated on the balance sheet at historical cost.

Foreign currency translation

Transactions denominated in foreign currencies are recorded using the rate of exchange ruling at the date of the transaction. There were no monetary assets and liabilities denominated in foreign currencies at year end.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of accounting policies (continued)

Taxation

The Organisation is considered to pass the tests set out in Paragraph 1 Schedule 6 Finance Act 2010 and therefore it meets the definition of a charitable company for UK corporation tax purposes. Accordingly, the Organisation is potentially exempt from taxation in respect of income or capital gains received within categories covered by sections 478-488 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied exclusively to charitable purposes.

The Organisation is also exempt in respect of Value Added Tax on all services it provides and therefore unable to recover input VAT it suffers on goods and services purchased. Irrecoverable VAT on inputs is included in the costs of such inputs and added to the cost of tangible fixed assets as appropriate, where the inputs themselves are tangible fixed assets by nature.

Provisions and contingent liabilities

Provisions are recognised when

the Organisation has a present legal or constructive obligation as a result of a past event,
it is probable that a transfer of economic benefit will be required to settle the obligation, and
a reliable estimate can be made of the amount of the obligation.

Where the effect of the time value of money is material, the amount expected to be required to settle the obligation is recognised at present value using a pre-tax discount rate. The unwinding of the discount is recognised as a finance cost in the statement of comprehensive income in the period it arises.

A contingent liability arises from a past event that gives the Organisation a possible obligation whose existence will only be confirmed by the occurrence or otherwise of uncertain future events not wholly within the control of the Organisation. Contingent liabilities also arise in circumstances where a provision would otherwise be made but either it is not probable that an outflow of resources will be required or the amount of the obligation cannot be measured reliably.

Contingent liabilities are not recognised in the balance sheet but are disclosed in the notes to the financial statements.

Judgements in applying accounting policies and key sources of estimation uncertainty

In preparing these financial statements, management have made the following judgements:

Determine whether leases entered into by the Organisation either as a lessor or a lessee are operating or finance leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee on a lease by lease basis.
Determine whether there are indicators of impairment of the Organisation’s tangible assets, including goodwill. Factors taken into consideration in reaching such a decision include the economic viability and expected future financial performance of the asset and where it is a component of a larger cash-generating unit, the viability and expected future performance of that unit.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Statement of accounting policies (continued)

Other key sources of estimation uncertainty

Tangible fixed assets - Tangible fixed assets, other than investment properties, are depreciated over their useful lives taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In re-assessing asset lives, factors such as technological innovation and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values.
Local Government Pension Scheme - The present value of the Local Government Pension Scheme defined benefit liability depends on a number of factors that are determined on an actuarial basis using a variety of assumptions. The assumptions used in determining the net cost (income) for pensions include the discount rate. Any changes in these assumptions, which are disclosed in Note 33, will impact on the carrying amount of the pension liability. Furthermore, a roll forward approach which projects results from the latest full actuarial valuation performed at 31 March 2022 has been used by the actuary in valuing the pensions liability at 31 July 2024. Any differences between the figures derived from the roll forward approach and a full actuarial valuation would impact on the carrying amount of the pension liability.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

			2024	2023
		Note	£'000	£'000
2	Welsh Government (WG) Grants
	WG Mainstream Recurrent grant		6,607	5,864
	WG Other Recurrent		283	217
	WG release of capital grants	22	101	96
	WG Maintenance, Digital, SOP & Capital funding		98	134
	WG non recurrent grants		1,222	2,016
	Total		8,311	8,327
3	Tuition Fees and Education Contracts
	Education Contracts		42	142
	Tuition Fees		392	413
	Other fees including exam fees		3	4
	Total		437	559
4	Other Grants and Contracts
	Other Grants and Contracts		1,221	544
	Total		1,221	544
5	Other Income
	Release of other government capital grants	22	-	-
	Individual Subscriptions, Affiliations, Donations		1	2
	Room rental		19	12
	Other miscellaneous		4	4
	Total		24	18
6	Branch income		2	10
7	Investment Income
	Interest receivable		107	64
	Total		107	64
8	Net return on pension scheme	33	264	93
9	Donations		-	-

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

10 Staff numbers and costs

The average number of persons (including key management personnel) employed by the Organisation during the year, described as full-time equivalents were:

		Year ended	Year ended
	Note	31 July 2024	31 July 2023
Teaching & Learning departments		210	218
Teaching & Learning support services		22	14
Other support services		52	34
Administration and central services		38	36
General Education		2	1
Premises		2	3
Total average staff numbers		326	306
		2024	2023
Staff Costs for the above persons		£'000	£'000
Wages and Salaries		4,999	4,828
Social security costs		423	427
Other pension costs	33	927	1,278
Payroll sub total		6,348	6,533
Contracted out staffing services		1,196	1,356
		7,544	7,889
Restructuring costs	Contractual	5	22
	Non-Contractual	-	90

Total Staff costs		7,549	8,001

The organisation has salary sacrifice arrangements in place for a Cycle Scheme, Childcare Vouchers and from 1st July 2023 Shared Cost Additional Voluntary Contributions

11 Key management personnel

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Organisation and are represented by the Senior Management Team (SMT) which comprises the Chief Executive (Accounting Officer), Head of Curriculum and Performance, and Head of Learner Services and Resources for the period ending 31 July 2024.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

11 Key management personnel (continued)

Emoluments of Key management personnel, Accounting Officer and other higher paid staff

	2024	2023
	No.	No.
The number of key management personnel
including Accounting Officer was:	3	3

The number of key management personnel and other staff who received annual emoluments, excluding employer contributions to national insurance and pensions but including benefits in kind, in the following ranges was:

			Key management	personnel
			2024	2023	2024	2023
			No.	No.	No.	No.
£55,001	to £60,000	p.a.	-	-	-	-
£60,001	to £65,000	p.a.	2	2	-	-
£65,001	to £70,000	p.a.	-	-	-	-
£70,001	to £75,000	p.a.	-	-	-	-
£75,001	to £80,000	p.a.	-	-	-	-
£80,001	to £85,000	p.a.	-	-	-	-
£85,001	to £90,000	p.a.	-	-	-	-
£90,001	to £95,000	p.a.	1	1	-	-
			3	3	-	-

Key management personnel compensation is made up as follows:

Basic salary Benefits in kind Pension Contributions Total key management personnel compensation	2024 2023 £'000 £'000 224 216 - - 224 216 75 71 299 288

The above compensation includes amounts paid to the Chief Executive who is the Accounting Officer and who is also the highest paid member of staff. Their pay and remuneration is as follows:

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

11 Key management personnel (continued)

Basic Salary Benefits in kind Pension Contributions	2024 2023 £'000 £'000 94 91 - - 32 30 126 121

The Council is aware of its obligations under the Welsh Government’s 2017 publication ‘Transparency of Senior Remuneration in the Devolved Welsh Public Sector’. The Chief Executive reports to the Chair and Vice Chairs of the Council, who undertook an annual appraisal of performance against the Organisation’s goals in 2023-24, using qualitative and quantitative measures of performance. The remuneration of the Chief Executive, as a senior post-holder, is subject to annual consideration by the Search Committee, which decides whether Cost of Living settlements or other increments are applied to it.

Relationship of Chief Executive pay and remuneration expressed as a multiple:

Relationship of Chief Executive pay and remuneration expressed as a multiple:
	2024	2023
	£'000	£'000
Chief Executive basic salary as a multiple of the median of all AOC	ALW staff	2.9
Chief Executive total emoluments as a multiple of the median of all AOC	ALW staff	3.9

The above has been calculated based on full time equivalent salaries for all salaried and hourly paid staff. Total emoluments for the Chief Executive are formed of basic salary and pension contributions.

Compensation for loss of office paid to former key management personnel

Compensation for loss of office paid to former key management personnel
	2024	2023
	£'000	£'000
Compensation paid to former post-holders - contractual	-	-
Compensation paid to former post-holders - non contractual	-	-
Estimated value of other benefits, including provisions for pension benefits	-	-
Number of post-holders	-	-

Of the Governing Body, two staff members were the only Governors paid as employees of the Organisation during the year. All other Governors have the right only to receive payment for reimbursement of travel and subsistence expenses incurred in the course of their duties.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

Note 12 Other operating expenses Teaching costs Non teaching costs: Teaching support services Other support services Administration and central services General Education including Marketing & Promotional Premises Costs Consultancy Branch Expenditure Miscellaneous Total Other operating expenses included above: Auditors' Remuneration: External audit Financial Other Internal audit 13 Interest and other finance costs Net interest on defined pension liability 33 Interest on bank loans, overdrafts and other loans Finance Leases Total	£'000 144 84 121 564 162 626 9 14 20 1,744 £'000 £'000 12 5 17 12 2024 £'000 - - - 0 2024	£'000 122 181 67 426 68 514 22 9 - 1,409 £'000 £'000 12 5 17 9 2023 £'000 - - - 0 2023	£'000 122 181 67 426 68 514 22 9 - 2023
			1,409

			9
			2023 £'000 - - -
			0

14 Taxation

The trustees do not believe that the Organisation, as a registered charity, was liable for any corporation tax arising out of its activities during either year.

15 Surplus/(deficit) on Continuing Operations for the period

Surplus/(deficit) on Continuing Operations for the period
	2024	2023
	£'000	£'000
The Organisation's surplus / (deficit) for the year	954	92

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

16 Tangible Fixed Assets Cost or valuation At 1 August 2023 Additions Disposals/adjustments At 31 July 2024 Depreciation At 1 August 2023 Charge for the year Disposals/adjustments At 31 July 2024 Net Book Value at 31 July 24 Net Book Value at 31 July 2023	Freehold Land & Buildings Long Leasehold Land & Buildings Property Improve- ments Equip- ment Furniture, Fixtures & Fittings Motor Vehicles Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 1,304 - 143 297 67 - 1,811 - - - 35 4 - 39 - - - - - - -
	1,304 - 143 332 71 - 1,850
	777 - 92 219 51 - 1,139 35 - 26 52 6 - 119 - - - - - - -
	812 - 118 271 57 - 1,258
	492 - 25 61 14 - 592
	527 - 51 78 16 - 672

The Net Book Value of equipment does not include any amounts in respect of assets held under finance leases.

17 Investments

Investments
Non Current Investments Endowment Assets Balance at 1 August Purchases of assets Appreciation/(Depreciation) of endowment asset investments Current Investments Balance at 1st August Invested during the year Gain/(loss) on investment during year Equities, Bonds, Other Cash and deposits Land Sales of assets Balance at 31 July Represented by: Sale of endowment assets - Land Movement in cash balances	2024 £'000 1,446 342 (336) (7) 92 (27) 1,510 1,341 26 143 1,510 1,524 - 90 1,614	2023 £'000 1,479 377 (373) - (25) (12)
		1,446
		1,243 53 150
		1,446
		- 1,500 24
		1,524

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

18	Trade and other receivables		2024		2023
			£'000		£'000
	Amounts falling due within one year:
	Trade receivables		88		66
	Prepayments and accrued income		140		359
			228		425
19	Creditors: amounts falling due within one year		2024		2023
			£'000		£'000
		Notes
	Trade payables		-		84
	Other taxation and social security		110		156
	Accruals - annual leave		119		119
	Accruals - other		1,897		1,895
	Deferred income - government capital grants	22	68		86
	Deferred income - government revenue		290		456
	Deferred income - other		1,082		970
	Total		3,566		3,766
20	Creditors: amounts falling due after one year
	Deferred income - government capital grants	22	52		102
	Total		52		102
			Defined	Enhanced	Total
			benefit	pensions
21	Provisions		obligations
			£'000	£'000	£'000
	At 1 August 2023		(4,960)	14	(4,946)
	Expenditure in the period		(934)	(5)	(939)
	Additions in the period		(895)	-	(895)
	At 31 July 2024		(6,789)	9	(6,780)
	Defined benefit obligations relate to the liabilities under the Organisation's membership of the
	Local Government Pension Scheme. Further details are given in Note 33.
	The enhanced pension provision relates to the projected		costs of 3 former members of Coleg
	Harlech staff that left its employment by arrangement prior to the merger with the WEA (North
	Wales) in 2001. Due to uncertainty over life expectancy it is not possible			to profile the enhanced
	pension provision.
22	Deferred income - Government Capital Grants			£'000
	At 1 August 2023			188
	Additional funding received			33
	Released to income & expenditure account			(101)
	At 31 July 2024			120

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

23 Endowments

Endowments
	Period Ended 31 July 2024
	Restricted Books, Prizes & Learning Supp Materials Fund £’000	Bursaries & Scholar- ships Fund Books, Prizes & Learning Supp Materials Fund General Purposes Fund £’000 £’000 £’000 Unrestricted	Total £’000
At 1 August 2023 as previously stated Appreciation of Endowment Investments Investment Income for year Draw down from Endowments Sale of Fixed Assets - land Investment Management Expenses At 31 July 2024 *Split of Endowments* Endowments Investments Endowments Fixed Assets	1,122 85 14 - - (15)	219 72 33 3 3 1 1 1 1 (8) (9) (4) (7) - - (1) (1) -	1,446 92 17 (21) (7) (17)
	1,206	207 66 31	1,510
	1,206 -	64 66 31 143 - -	1,367 143
	1,206	207 66 31	1,510

The Fixed Asset Endowments of £143,000 (2023: £150,000) above refer to land owned at Astor Fields, Harlech. This was gifted for use as a general asset of the Organisation. During the year a small proportion of the land, previously used for grazing, was sold to a third-party buyer. A further £161,000 of the Endowments Investments (divided between all three of the defined Funds) are unrestricted in their application. The headings of the unrestricted funds reflect historical decisions of Coleg Harlech Workers' Educational Association North Wales (CHWEAN).

The majority of the Endowments total, however, is formed of the Tudor Bowen Jones Fund: this is a restricted fund of £1,206,000 included within the Books, Prizes and Learning Support Materials Fund above. Under the terms of the benefactor’s will, the original capital amount that established this Fund is to be retained intact by the Organisation until 2091. The income on that initial capital endowment can be drawn down in order to provide educational resources and materials for the Tudor Bowen Jones Library. In 2023/24: none (2022/23: none) of this income was used to purchase such materials.

	Period Ended 31 July 2023	Period Ended 31 July 2023	Period Ended 31 July 2023
	Restricted Books, Prizes and Learning Support Materials Fund £’000	Bursaries & Scholar- ships Fund Books, Prizes and Learning Support Materials Fund General Purposes Fund £’000 £’000 £’000 Unrestricted	Total £’000
At 1 August 2022 as previously stated Depreciation of Endowment Investments Investment Income for year Draw down from Endowments Investment Management Expenses At 31 July 2023 *Split of Endowments* Endowments Investments Endowments Fixed Assets	1,148 (17) 16 - (25)	221 75 35 (3) (3) (2) 1 1 - - - - -(1) -	1,479 (25) 18 - (26)
	1,122	219 72 33	1,446
	1,122 -	69 72 33 150 - -	1,296 150
	1,122	219 72 33	1,446

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

24 Cash and Cash Equivalents 1 August 2023 £'000 Cash and cash equivalents 5,054 Restricted Funds 10 Investment 1,524 Endowment Asset investments 53 Total 6,641 25 Cash and Cash Equivalents Note Cash Handelsbanken bank accounts Branch Bank accounts Barclays Bank accounts Nationwide Building Society Restricted Fund Accounts: Keith Evans Fund Account Alwyn Evans Fund Account Dil Llewellyn Fund Account Total cash & cash equivalents 26 Movement on General Reserves Income & Expenditure Account Reserve At 1 August Transfer from/(to) branch reserves Transfer from/(to) General reserves Gain/(loss) on sale of assets Gain/(loss) on investments 33 Branch reserves At 1 August Movement for year Total general reserve Balance Represented by: Pension Reserve (FRS 102 (28)) 33 As at 31 July Income and expenditure account reserve excluding pension reserve Surplus for the year on continuing operations Actuarial gain/ (loss) in respect of pension scheme	Cash flows £'000 657 - 90 (27) 720 2024 £'000 1 4,107 13 - 1,590 5,711 5 5 - 5,721 2024 £'000 8,728 954 12 7 321 90 1,182 11,294 25 (12) 13 11,307 6,789 4,518 11,307	31 July 2024 £'000 5,711 10 1,614 26
		7,361
		2023 £'000 1 3,487 25 1 1,540
		5,054 5 5 -
		5,064
		2023 £'000 6,119 92 - - - 24 2,493
		8,728
		25 -
		25
		8,753
		4,960 3,793
		8,753

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

26 Restricted Reserves Keith Evans Fund Account (Summer School/Scholarships) Alwyn Evans Fund Account (Residential/Scholarships) Dil Llewellyn Fund Account As at 31 July	2024 £'000 5 5 - 10	2023 £'000 5 5 -
		10

27 Gain on sale of assets

Land, Harlech

During the year the Organisation completed the sale of a parcel of land located in Harlech to a third-party buyer. The land which was gifted as part of an endowment was previously used for grazing. The sale of the land was £293k resulting in a gain after fees of £282k over the book value of £7k.

The land was recognised at it's book value of £150k prior to the sale. Net proceeds from the sale were used to support the financial health of the Organisation. As at 31st July 2024 the remaining endowment land is valued at £143k.

Garage workshop & store, Harlech

During the year the Organisation completed the sale of garage workshop and store located in Harlech to a thirdparty buyer. The asset prior to sale had been valued and a nil book value. The sale of the asset was £40k resulting in a gain after fees of £39k. Net proceeds from the sale were used to support the financial health of the Organisation.

28 Capital Commitments, Contingencies & Exceptional Items

There were no capital commitments and contingencies at year end or exceptional items during the year.

29 Lease Obligations

At 31 July the Organisation had minimum lease payments under non-cancellable operating leases as follows:

Future minimum lease payments due Land and buildings Not later than one year Later than one year and not later than five years Later than five years Other Not later than one year Later than one year and not later than five years Later than five years	2024 £'000 41 64 - 105 10 14 - 24	2023 £'000 39 7 -
		46
		3 7 -
		10

30 Events after the reporting period

There are no events after the reporting period.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

31 Related Party Transactions

Due to the nature of the Organisation's operations and the composition of the Governing Body being drawn from local public and private sector organisations, it is inevitable that transactions will take place with organisations in which a member of the Governing Body may have an interest. All transactions involving such organisations are conducted at arm's length and in accordance with the Organisation's financial regulations and normal procurement procedures.

The total of expenses paid to Governors during the year was £713; 16 Governors (2023: £1,183; 17 Governors). This represents travel and subsistence expenses and other out of pocket expenses incurred in attending Governor meetings and charity events in their official capacity.

During the year 2 staff Governors received remuneration from the Organisation to the value of £34,316 (2023: £26,863). No other Governor has received remuneration or waived payments from the Organisation during the year (2023: nil).

Wales TUC Cymru - Marion Burke (Policy Officer, Wales TUC Education) was a Governor of the Organisation to 31st October 2023 and employed by Wales TUC Cymru. Sales transactions in the year amounted to £146,367 (2023: £154,928). There were balances outstanding at the year end of £34,262 (2023: nil). There were no Purchase transactions during the year or balances outstanding at year end (2023: nil).

Coleg Cymraeg Cenedlaethol - Lisa O'Connor was a Governor of the Organisation from 11th March 2024 and employed by Coleg Cymraeg Cenedlaethol. Sales transactions in the year amounted to £38,400 (2023: £38,400). There were no balances outstanding at the year end (2023: nil). There were no Purchase transactions during the year or balances outstanding at year end (2023: nil).

Geirda - Siôn Aled Owen was a Governor of the Organisation during the year and owner of Geirda translation and interpretation services. There were no Sales or Purchase transactions during the year or balances outstanding at the year end (2023: nil).

Vale of Glamorgan Council - Councillor Chris Franks (Dinas Powys ward) was a Governor of the Organisation during the year. Sales transactions in the year amounted to £2,080 (2023: £2,661). There were balances oustanding at the year end of £250 (2023: nil). There were no Purchase transactions during the year or balances outstanding at year ned (2023: nil).

Bangor University - Salamatu Fada & Victory Ezeofor were Governors of the Organisation and employed by Bangor University. There were no Sales or Purchase transactions during the year or balances outstanding at the year end (2023: nil).

Canolfan Dysgu Cymraeg Cenedlaethol - Dona Lewis was a Governor of the Organisatin during the year and employed by Canolfan Dysgu Cymraeg Cenedlaethol. There were no Sales or Purchase transactions during the year or balances outstanding at the year end (2023: nil).

Welsh Government (WG) - Salamatu Fada (Anti-racism Fellow in support of Climate Change & Rural Affairs (CCRA)) was a Governor of the Organisation during the year and employed by WG from 1st March 2024. Welsh Government funding received in the year amounted to £8,312,349 (2023: £8,694,285). There were outstanding balances at year end of £14,987 (2023: £107,989). There were no Sales or Purchase transactions during the year or balances outstanding at the year end (2023: nil).

32 AMOUNTS DISBURSED AS AGENT

Learner Support Fund - Financial Contingency Fund (FCF)

WG Grant for year Interest earned Paid to third party Disbursed to students Other including administration costs Balances unspent/(overspent and funded by ALW ) as at 31 July*	Year Ended 31 July 2024 £'000 70 - 70 87 1 2 (20)	Year Ended 31 July 2023 £'000 76 -
		76 56 5 2
		13

Welsh Government FCF grants are available solely for eligible students.

Where the Organisation has paid a third party, the related Income and Expenditure has been included within the Statement of Comprehensive Income.

** Where the Organisation acts as a paying agent the grants and related disbursements are excluded from the Statement of Comprehensive Income.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

33 Pension and Similar Obligations

The Organisation's employees belong to two principal post-employment benefit plans: The Teachers' Pension Scheme England and Wales (TPS) for academic and related staff; and The Local Government Pension Scheme (LGPS) for nonteaching staff, which is managed by City and County of Cardiff and Gwynedd Council. Both are multi-employer definedbenefit plans.

The pension costs are assessed in accordance with the advice of independent qualified actuaries. The latest formal actuarial valuation of the TPS was 31 March 2020 and of the LGPS 31 March 2022.

Total pension cost for the year Teachers' Pension Scheme (TPS): contributions paid Local Government Pension Scheme: Contributions paid Cardiff & Vale of Glamorgan (CVG) Contributions paid Gwynedd (GC) FRS 102 (28) Cardiff & Vale FRS 102 (28) Gwynedd Charge to the Statement of Comprehensive Income Enhanced pension charge to Statement of Comprehensive Income Total Pension Cost for Year within staff costs	2023 £'000 373 772 165 (405) 22 554 - 927	2022 £'000 326 664 252 (71) 107 952 - 1,278	2022 £'000 326 664 252 (71) 107 952 - 1,278

			1,278

There were no outstanding or prepaid contributions at either the beginning or the end of the financial year (2022/23: nil) included within creditors.

Teachers' Pension Scheme

The Teachers' Pension Scheme (TPS) is a statutory, contributory, defined benefit scheme, governed by the Teachers' Pension Scheme Regulations 2014. These regulations apply to teachers in schools, colleges and other educational establishments. Membership is automatic for teachers and lecturers at eligible institutions. Teachers and lecturers are able to opt out of the TPS.

The TPS is an unfunded scheme and members contribute on a 'pay as you go' basis - these contributions, along with those made by employers, are credited to the Exchequer under arrangements governed by the above Act. Retirement and other pension benefits are paid by public funds provided by Parliament.

Under the definition set out in FRS 102 (28.11), the TPS is a multi-employer pension plan. The Organisation is unable to identify its share of the underlying assets and liabilities of the plan.

Accordingly, the Organisation has taken advantage of the exemption in FRS 102 and has accounted for its contributions to the scheme as if it were a defined-contribution plan. The Organisation has set out above the information available on the plan and the implications for the Organisation in terms of the anticipated contribution rates.

The valuation of the TPS is carried out in line with regulations made under the Public Service Pension Act 2013. Valuations credit the teachers' pension account with a real rate of return assuming funds are invested in notional investments that produce that real rate of return.

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

33 Pension and Similar Obligations (continued)

The latest actuarial review of the TPS was carried out as at 31 March 2020. The valuation report was published by the Department for Education (DfE) in October 2023. The valuation reported total scheme liabilities (pensions currently in payment and the estimated cost of future benefits) for service to the effective date of £262 billion, and notional assets (estimated future contributions together with the notional investments held at the valuation date) of £222 billion, giving a notional past service deficit of £40 billion (compared to £22 billion in the 2016 valuation).

As a result of the valuation, new employer contribution rates will rise to 28.68% from April 2024 (compared to 23.68% from September 2019)

A full copy of the valuation report and supporting documentation can be found on the Teachers’ Pension Scheme website.

The pension costs paid to TPS in the year amounted to £373,191 (2023: £325,584).

Local Government Pension Scheme

The LGPS is a funded defined-benefit plan, with the assets held in separate funds administered by City and County of Cardiff (CCC) and Gwynedd Council (GC). The total contributions made for the year ended 31 July 2024 were £1,139,056 of which employer's contributions totalled £936,547 and employees' contributions totalled £202,508. The agreed contribution rates for future years are 33.6% from April 2023 for Cardiff & Vale of Glamorgan LGPS and 17.3% for Gwynedd LGPS for the Organisation and range from 5.5% to 12.5% for employees, depending on salary.

Local Government Pension Scheme - Cardiff & Vale of Glamorgan LGPS

Principal Actuarial Assumptions

The following information is based upon a full actuarial valuation of the fund at 31 March 2022 updated to 31 July 2024 by AON:

	At 31 July 2024	At 31 July 2023
	% pa	% pa
Discount rate	5.0	4.9
CPI Inflation	2.6	2.6
Pension Increase	2.6	2.6
Pension accounts revaluation rate	2.6	2.6
Salary increases	3.6	3.6

Mortality Assumptions

The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The assumed life expectations on retirement age 65 are:

life expectations on retirement age 65 are:
	At 31 July 2024	At 31 July 2023
	years	years
*Current Pensioners*
Male	21.8	22
Female	24.1	24.2
Future Pensioners*
Male	22.1	22.6
Female	24.9	25.3

figures assume members aged 45 as at the last formal valuation date

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

33 Pension and Similar Obligations (continued)

Local Government Pension Scheme - Cardiff & Vale of Glamorgan LGPS (continued) Asset allocation and expected return on assets

Equities Property Government bonds Corporate bonds Multi Asset Credit Cash Other Total	% £'000 68.1 8,248 6.0 727 7.9 957 7.0 848 5.2 630 4.1 497 1.7 206 100 12,113 Value at 31 July 2024	% £'000 68.1 7,053 7.0 725 8.8 911 7.5 777 5.3 549 3.3 342 0.0 0 Value at 31 July 2023
		100 10,357

Reconciliation of funded status to Balance Sheet

The amount included in the balance sheet in respect of the defined benefit pension plan is as follows:

Fair value of plan assets Present value of plan liabilities Net pensions (liability)/asset	2024 2023 £'000 £'000 12,113 10,357 (8,166) (7,674)
	3,947 2,683

The split of the liabilities at the last valuation between the various categories of members is as follows:

Active members	61%
Deferred Pensioners	13%
Pensioners	26%

Amounts recognised in the Statement of Comprehensive Income in respect of the plan are as follows:

follows:
Amounts included in staff costs Current service cost Past service cost Curtailment cost Total Amounts included in Finance costs (Note 13) Interest on net defined benefit liability / (asset) Total Amount recognised in Other Comprehensive Income Asset gains/(losses) arising during the period Liability gains/(losses) arising during the period Total amount recognised in Other Comprehensive Income	2024 £'000 365 - - 365 (150) 215 478 231 709	2023 £'000 575 - -
		575 (45)
		530
		(59) 1,625
		1,566

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

33 Pension and Similar Obligations (continued)

Local Government Pension Scheme - Cardiff & Vale of Glamorgan LGPS (continued)

Actual Return on Assets Interest income on plan assets Gain / (loss) on assets Actual return on assets Movement in net defined benefit (liability) / asset during year Net defined benefit (liability) / asset in scheme at 1 August Movement in year: Current service costs Past service costs Curtailment costs Employer contributions Net interest on the defined (liability) / asset Actuarial gain / (loss) Net defined benefit (liability) / asset in scheme at 31 July Changes to the present value of the defined benefit obligation Opening defined benefit obligation Current service cost Interest expense on defined benefit obligation Contributions by Scheme participants Experience (gains) / losses on defined benefit obligations Net Benefits paid out Past service cost Curtailment cost Closing defined benefit obligation Changes in the fair value of plan assets Opening fair value of plan assets Interest income on plan assets Remeasurement gains / (losses) on plan assets Contributions by employer Contributions by Scheme participants Net benefits paid out Closing fair value of plan assets	2024 £'000 526 478 1,004 2024 £'000 2,683 (365) - - 770 150 709 3,947 2024 £'000 7,674 365 376 139 (231) (157) - - 8,166 2024 £'000 10,357 526 478 770 139 (157) 12,113	2023 £'000 330 (59)
		271
		2023 £'000 1,001 (575) - - 646 45 1,566
		2,683
		2023 £'000 8,308 575 285 129 (1,625) 2 - -
		7,674
		2023 £'000 9,309 330 (59) 646 129 2
		10,357

Deficit contributions

After a triennial valuation in March 2022 the contribution rate from April 2023 to March 2026 was increased to 33.6% (from 32.7%) with deficit payments due of £60k (23/24), £62k (24/25) and £64k (25/26).

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

33 Pension and Similar Obligations (continued)

Local Government Pension Scheme - Gwynedd LGPS

Principal Actuarial Assumptions

The following information is based upon a full actuarial valuation of the fund at 31 March 2022 updated to 31 July 2024 by Hymans Robertson LLP:

	At 31 July 2024	At 31 July 2023
	% pa	% pa
Pension Increase Rate	2.75	3.00
Salary Increase Rate	3.25	3.50
Discount Rate	5.00	5.05

Mortality Assumptions

The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The assumed life expectations on retirement age 65 are:

	At 31 July 2024	At 31 July 2023
	years	years
*Current Pensioners*
Male	21.2	21.3
Female	23.4	23.4
Future Pensioners*
Male	22.2	22.3
Female	25.4	25.4
* figures assume members aged 45 as at the last formal valuation date
Asset allocation and expected return on assets	Value at	Value at
	At 31 July 2024	At 31 July 2023
	%	%
Equities	64	66
Bonds	15	5
Property	6	8
Cash	15	21
Total	100	100
Reconciliation of funded status to Balance Sheet
The amount included in the balance sheet in respect of the defined benefit		pension plan is as
follows:
	2024	2023
	£'000	£'000
Fair value of plan assets	10,221	9,330
Present value of plan liabilities	(7,379)	(7,053)
Net pensions (liability)/asset	2,842	2,277

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

33 Pension and Similar Obligations (continued)

Local Government Pension Scheme - Gwynedd LGPS (continued)

The split of the liabilities at the last valuation between the various categories of members is as follows:

Active members	26%
Deferred Pensioners	34%
Pensioners	40%

Amounts recognised in the Statement of Comprehensive Income in respect of the plan are as follows:

follows:
Amounts included in staff costs Current service cost Past service cost Total Amounts included in Finance costs (Note 13) Net interest on defined pension liability / (asset) Total Amount recognised in Other Comprehensive Income Asset gains/(losses) arising during the period Liability gains/(losses) arising during the period Total amount recognised in Other Comprehensive Income Actual Return on Assets Interest income on plan assets Gain / (loss) on assets Actual return on assets Movement in net defined benefit (liability) / asset during year Net defined benefit (liability) / asset in scheme at 1 August Movement in year: Current service cost Past service cost Employer contributions Net interest on the defined (liability) / asset Actuarial gain / (loss) Net defined benefit (liability) / asset in scheme at 31 July	2024 £'000 (186) - (186) 114 (72) 421 52 473 2024 £'000 471 421 892 2024 £'000 2,277 (186) - 164 114 473 2,842	2023 £'000 (313) (46)
		(359) 48
		(311)
		(62) 989
		927
		2023 £'000 318 (62)
		256
		2023 £'000 1,409 (313) (46) 252 48 927
		2,277

Adult Learning Wales Financial Statements for the Year Ended 31 July 2024

Notes to the accounts (continued)

33 Pension and Similar Obligations (continued)

Local Government Pension Scheme - Gwynedd LGPS (continued) Changes to the present value of the defined benefit obligation Opening defined benefit obligation Current Service Cost Past Service Cost Interest expense on defined benefit obligation Contributions by Scheme participants Experience (gains) / losses on defined benefit obligations Net Benefits paid out Closing defined benefit obligation Changes in the fair value of plan assets Opening fair value of plan assets Interest income on plan assets Remeasurement gains / (losses) on plan assets Contributions by employer Contributions by Scheme participants Net benefits paid out Closing fair value of plan assets	2024 £'000 7,053 186 - 357 63 (52) (228) 7,379 2024 £'000 9,330 471 421 164 63 (228) 10,221	2023 £'000 7,618 313 46 270 63 (1,048) (209)
		7,053
		2023 £'000 9,027 318 (121) 252 63 (209)
		9,330

Deficit contributions

After a triennial valuation in March 2022 the contribution rate from April 2023 to March 2026 was decreased to 17.3% (from 23.7%) with no deficit payments due.

Adult Learnln9 Wales