**QUEENS’ COLLEGE, CAMBRIDGE ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 30[th] JUNE 2023**
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
|**Contents**|**Page**|
|---|---|
|Reference and Administrative Details|3 - 6|
|Structure, Governance and Management|7 - 10|
|Aims and Objectives of the College|
10 - 11|
|Public Benefit|12 - 13|
|Review of Operations|14 - 19|
|Financial Review|20 - 29|
|Responsibilities of the Governing Body|30|
|Independent Auditors Report|31 - 34|
|Statement of Principal Accounting Policies|35 - 41|
|Consolidated Statement of Comprehensive Income &|42|
|Expenditure||
|Statement of Changes in Reserves|43|
|Consolidated Balance Sheet|44|
|Consolidated Cash Flow Statement|45|
|Notes to the Financial Statements|46 - 64|
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## **QUEENS’ COLLEGE, CAMBRIDGE**
## **REFERENCE AND ADMINISTRATIVE DETAILS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
The full name of the College is “The Queen’s College of St Margaret and St Bernard, commonly called Queens’ College in the University of Cambridge”. The College is a corporate body consisting of the President, Fellows and Scholars.
The Governing Body, which consists of the President and the Fellows, with four student observers, holds at least six meetings each year. The Governing Body met ten times in the year to which this report relates. The President, Professorial Fellows and Official Fellows are the voting members of the Governing Body and, since the Governing Body exercises general control and management of the College, its voting members are the trustees of the charity.
*President President Dr M A El-Erian
*President President Prof. J C Muldrew Bye-Fellows Dr M A El-Erian Prof. J W P Campbell Prof. A D Challinor Dr H R N Jones Prof. R R Weber[6 ] Life Fellows Prof. M J Dixon, FAcSS Prof. E A H Hall, CBE[6 ] Prof. A C Spearing Dr A C Thompson Prof. G H Treece Dr B A Callingham Prof. J R Gog, OBE Prof. A C Rice Prof. J Diggle, FBA Prof. A A Seshia Dr R M Faragher Prof. J E Carroll Prof. E M Terentjev Dr T Forster[5 ] Revd Dr B L Hebblethwaite Prof. I Sitaridou Dr J R Bellis Dr J T Green Dr A Zurcher Dr C Hill Dr W A Phillips Dr A M Rossi Dr A C Bonner Dr R D H Walker Mr J Spence, DL Dr P Bambrough Dr A D Cosh Dr G J McShane Dr C Clark Prof. A. N. Hayhurst Prof. M Edmonds Dr L Davies Prof J Jackson, CBE FRS[6] Prof. H J Stone Dr J Jahić Dr C J Pountain Dr J J Maguire Dr C Mishra Prof. Lord Oxburgh, KBE FRS FREng Dr G M Fraser Dr E Weir[6 ] Revd Dr J M Holmes Dr L S Tiley Mr N Morris[3] Dr H J Field Dr T S Butlin Dr K Hendry[6] Prof. R L Jones[6] Prof. R Nickl[5 ] Mr M Boase[6] Prof. A N Lasenby Prof. S J Price Mr J Perkins[6] Prof. K F Priestley Dr E Moyroud Dr J Mitchell[6] Dr C N Pitelis Dr D J Butterfield Dr D Orchard[6] Dr E G Kahrs Dr A Paterson Mr C Edsall[6 ] Prof. D R Ward Dr M E B Tait Dr M Fuchs[6 ] Prof. J L Scott Dr F I Paddeu Dr L Mullen[6 ] Prof. Lord Eatwell Mr R M C Kitt Dr I Kater[6 ] Dr M J Milgate Revd T C Harling Dr I K Patterson Research Fellows Dr S Haggarty *Professorial Fellows Prof. C J Bickerton Dr R Van Rosenberg[[7 ]] Dr E Noterman[[2 ]] Prof. D K Menon Dr C Brendon Dr H Symington[[6 ]] Prof. R W Prager, FREng Dr D J Parker Dr E O’Keeffe[[6 ]] Prof. E A H Hall, CBE[5] Prof. G Denyer Willis Prof. N D Lawrence Dr E McPherson Emeritus Fellows Prof. M Guillén[9 ] Dr C Warnick Dr A M W Glass Prof. L Reisch Prof. A Beresford Prof. J Russell Prof. J D Brenton[6 ] Dr G Atkins Prof. A M Gamble *Official Fellows Prof. A Marsham Dr J W Kelly Dr J Blundell Dr T Forster[[6 ]] Prof. R R Weber[5 ] Prof. J A Jackson, CBE FRS[5 ] Dr T Denmead 1 From 18 July 2022 From 18 July 2022 Dr P McMurray 2 To 31 August 2022 Prof. R G Fentiman QC Hon Causa To 31 August 2022 Mr A D Bainbridge 3 From 1 September 2022 Prof. P H Haynes, FRS From 1 September 2022 Dr T J Eggington 4 From 12 September 2022 Prof. D Cebon, FREng From 12 September 2022 Dr J Garrison 5 To 30 September 2022 Prof. R L Jones[5 ] To 30 September 2022 Revd M Bayliss[2 ] 6 From 1 October 2022 From 1 October 2022 Prof. A H Gee Dr C Peñasco Patón 7 To 31 December 2022 To 31 December 2022 Prof. J W F Allison Prof. B J Glover Dr S WilliamsDr E Webster[8 ] 8 9 To 31 January 2023 To 30 June 2023 9 To 31 January 2023 To 30 June 2023 To 31 January 2023 To 30 June 2023 To 30 June 2023 Prof. R A W Rex Dr S Haines[1 ] Prof. C E Bryant, FBPhS, FLSW Revd A H Jones[4 ] Prof. M P V Crowley
Research Fellows Dr R Van Rosenberg[[7 ]] Dr E Noterman[[2 ]] Dr H Symington[[6 ]] Dr E O’Keeffe[[6 ]] Emeritus Fellows Dr A M W Glass Prof. J Russell Prof. A M Gamble Dr J W Kelly Dr T Forster[[6 ]] 1 From 18 July 2022 From 18 July 2022 2 To 31 August 2022 3 From 1 September 2022 4 From 12 September 2022 5 To 30 September 2022 6 From 1 October 2022 From 1 October 2022 7 To 31 December 2022 To 31 December 2022 8 9 To 31 January 2023 To 30 June 2023 9 To 31 January 2023 To 30 June 2023 To 31 January 2023 To 30 June 2023 To 30 June 2023 * Charity Trustees
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## **QUEENS’ COLLEGE, CAMBRIDGE**
## **REFERENCE AND ADMINISTRATIVE DETAILS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Senior Officers**
President Dr M A El-Erian Vice-President Professor M Edmonds Senior Bursar Mr J Spence Senior Tutor Dr A C Thompson
## **PRINCIPAL COMMITTEES**
## **Bursarial Committee**
Dr M A El-Erian, President Professor M Edmonds, Vice-President Mr J Spence, Senior Bursar Mr A D Bainbridge, Domestic Bursar Dr A C Thompson, Senior Tutor Mr R M C Kitt, Development Director Professor A D Marsham Dr E McPherson Dr E Moyroud Dr F I Paddeu Professor R A W Rex Professor A C Rice Professor I Sitaridou Professor R R Weber
## **Fellowships Committee**
Dr M A El-Erian, President Dr A C Thompson, Senior Tutor Mr J Spence, Senior Bursar Professor P Haynes Professor R W Prager (until 1 March 2023) Professor E Terentjev Professor M P V Crowley Professor L Reisch Dr G Fraser Dr C Penasco Dr M E B Tait Dr A Zurcher
## **Investments Committee**
Dr M A El-Erian, President Professor M Edmonds, Vice-President Mr J Spence, Senior Bursar Professor M J Dixon, Dean of College Professor D Cebon Dr J R Garrison Professor A H Gee Professor R R Weber Mrs A Koerling (Queens’ Alumnus) Mr A Pomfret (Queens’ Alumnus)
## **Teaching and Learning Committee**
Dr A C Thompson, Senior Tutor Dr S Haines, Admissions Tutor All Directors of Studies of the College Tutors charged with Admissions Admissions Co-ordinator Graduate Administrator JCR President MCR President
## **Tutorial Committee**
Dr M A El-Erian, President Dr A C Thompson, Senior Tutor Professor M J Dixon, Dean of College All Tutors of the College Revd T Harling, Dean of Chapel Revd A H Jones, Chaplain Mr A D Bainbridge, Domestic Bursar Ms J Schiller (Health and Wellbeing) Ms K Fadero (Health and Wellbeing) Ms E Farrar (Health and Wellbeing)
## **Graduate Committee**
Professor A D Marsham Deputy Senior Tutor/Senior Tutor All Graduate Tutors of the College Mr A D Bainbridge, Domestic Bursar Student Support Team Representative Representative for Part-Time Courses MCR President MCR Secretary/Vice-President Post-Doctoral Research Associates Convenor MPhil Representative Graduate Administrator
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **REFERENCE AND ADMINISTRATIVE INFORMATION**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **GOVERNING BODY ATTENDANCE LIST 2022-2023**
## **ON LEAVE 2021-2022:**
Prof. Roderic Jones Dr Graham McShane Dr Tore Butlin Dr Charles Brendon Dr Ella McPherson Dr Tyler Denmead Prof. Beverley Glover Prof. Graham Denyer Willis Dr Peter McMurray Prof. Richard Nickl (Easter 2022)
## **ON LEAVE 2022-2023:**
Prof. Beverley Glover Prof. Alastair Beresford Dr Peter McMurray Prof. Graham Denyer Willis Dr Andrew Zurcher (Michaelmas 2022) Dr David Butterfield (Lent 2023) Prof. Richard Rex (Michaelmas 2022 and Lent 2023)
Ten Governing Body Meetings took place between 1 July 2022 – 30 June 2023. Fellows’ attendance was recorded as follows:
|Dr M A El-Erian
|8/10|Mr J Spence|9/10|Dr T J Eggington|10/10|
|---|---|---|---|---|---|
|Prof. R R Weber|1/1|Prof. H J Stone|4/10|Dr J Garrison|9/10|
|Prof. J A Jackson|0/1|Prof. M Edmonds|7/10|Revd M Bayliss|1/1|
|Prof. R G Fentiman|6/10|Dr J J Maguire|10/10|Dr C Peñasco Patón|6/10|
|Prof. P H Haynes
|9/10|Prof. S J Price|6/10|Prof. N D Lawrence|2/10|
|Prof. D Cebon
|4/10|Dr E Moyroud|7/10|Prof. L Reisch|10/10|
|Prof. E A H Hall|1/1|Dr D J Butterfield|5/7|Prof. M Guillén|7/10|
|Prof. R W Prager
|5/10|Dr A Paterson|8/10|Dr S Williams|3/3|
|Prof. A H Gee
|10/10|Dr M E B Tait|7/10|Dr G Fraser|3/10|
|Prof. J W F Allison
|8/10|Dr F I Paddeu|9/10|Dr E Webster|5/10|
|Prof. R A W Rex
|4/6|Mr R M C Kitt|9/10|Dr S Haines|9/10|
|Prof. C E Bryant
|6/10|Revd T C Harling|9/10|Revd A H Jones|9/9|
|Prof. M P V Crowley
|5/10|Dr S Haggarty|8/10|Prof. J D Brenton|4/9|
|Prof. J W P Campbell
|8/10|Prof. C J Bickerton|4/10|Prof. L Tiley|
9/10|
|Dr H R N Jones
|7/10|Dr D J Parker|7/10|Dr Tore Butlin|6/10|
|Prof. M J Dixon
|7/10|Dr E MacPherson|6/9|Prof. R L Jones|0/1|
|Prof. D K Menon
|7/10|Dr C Warnick|10/10|Prof. J C Muldrew|7/10|
|Dr A C Thompson
|10/10|Prof. A Beresford|1/1|Prof. J R Gog|9/10|
|Prof. A A Seshia
|9/10|Dr G Atkins|9/10|Prof. R Nickl|0/1|
|Prof. E M Terentjev
|8/10|Prof. A Marsham|10/10|Dr C Brendon|7/9|
|Prof. I Sitaridou
|9/10|Dr J Blundell|2/10|||
|Dr A Zurcher
|7/7|Dr T Denmead|8/9|||
|Dr A M Rossi
|8/10|Mr A D Bainbridge|10/10|||
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **REFERENCE AND ADMINISTRATIVE INFORMATION**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **PROFESSIONAL ADVISORS**
**Auditors Actuaries** Peters Elworthy & Moore Cartwright Group Ltd Salisbury House Suite 7, 2[nd] Floor, The Hub, IQ Farnborough Station Road Farnborough Cambridge Hampshire CB1 2LA GU14 7JP
## **Bankers**
National Westminster Bank plc 23 Market Street Cambridge CB2 3PA
## **Investment Fund Managers**
Rathbones Group Plc Sarasin & Partners LLP 8 Finsbury Circus Juxon House London 100 St Paul’s Churchyard EC2M 7AZ London EC4M 8BU
## **Property Advisors**
Bidwells LLP Carter Jonas LLP Trumpington Road 6 – 8 Hills Road Cambridge Cambridge CB2 9LD CB2 1NH
## **Solicitors**
Mills & Reeve LLP Francis House 112 Hills Road Cambridge CB2 1PH
## **CHARITY INFORMATION**
Charity Registration 1137495 Registered Address Silver Street, Cambridge CB3 9ET Website www.queens.cam.ac.uk
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **STRUCTURE, GOVERNANCE AND MANAGEMENT**
## **Organisation**
Queens’ College, Cambridge is a self-governing academic community and body corporate, comprising the President, Fellows and Scholars and is one of the thirty-one Colleges in the University of Cambridge. The provisions which regulate the purposes and administration of the College are to be found in its Royal Charter, dated 30[th] March 1448, and its Statutes, as made in 1955 and variously amended from time to time, most recently in 2017.
## **The Governing Body**
The Charity Trustees of the College are the voting members of the Governing Body, being its President, Professorial Fellows and Official Fellows, appointed by the Governing Body in accordance with the Statutes of the College. The membership of the Governing Body is given on page 3 to 5.
The Governing Body is responsible for maintaining a sound system of internal control that supports the achievement of policy, aims and objectives while safeguarding the public and other funds and assets for which the Governing Body is responsible, in accordance with the College’s Statutes.
Under the College Statutes, the Governing Body has the discretion to form committees to consider and to make recommendations to the Governing Body in accordance with the College’s Statutes. The Governing Body also has the discretion to delegate powers to committees. The Governing Body has formed a number of committees, the principal ones being:-
- **Bursarial Committee** – to oversee the financial management of the College in accordance with the College Statutes, under the overall direction of the Governing Body. In accordance with the College Statutes, the Senior Bursar, advised by the Bursarial Committee, is responsible for the financial management of the College, subject to the overall direction of the Governing Body. The Bursarial Committee, without the Bursars, acts as an Audit Committee;
- **Investments Committee** – to keep under continual review the investments of the College, against agreed benchmarks, to recommend [and implement] the investment policy approved by the Governing Body, to maintain consultation with the College’s financial advisors;
- **Fellowships Committee** – to consider and advise the Governing Body on the general needs of the College in relation to appointments to Fellowships, in all classes, in accordance with the Statutes of the College;
- **Teaching and Learning Committee** - to review all aspects of College teaching and its relationship to University teaching and to make recommendations accordingly to the Governing Body;
- **Tutorial Committee** – to review and consider general issues pertaining to the welfare of students of the College and to advise the Governing Body on all matters of policy pertaining to student welfare; and
- **Graduate Committee** – to review and consider general issues pertaining to all aspects of being a Graduate student within the College.
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
These Committees are a key component of the College’s system of internal control, which is designed to identify the principal risks to the achievement of policies, aims and objectives, to evaluate the extent and nature of those risks and to manage them efficiently, effectively and economically. These Committees undertake detailed scrutiny of the issues which the Governing Body has placed within their respective remits and this work informs the recommendations each Committee makes to the Governing Body. This process was in place for the year ended 30[th] June 2023 and up to the date of approval of the financial statements. The Governing Body is responsible for ensuring the effectiveness of the systems of internal control: all the above Committees make regular reports to the Governing Body through the medium of detailed minutes, as well as dedicated reports. During the year, all Governing Body meetings were held in a hybrid format.
The Governing Body’s review of the effectiveness of the system of internal control is informed by the work of the various Committees, the Senior College Officers and other College Officers, who have responsibility for the development and maintenance of the internal control framework, and by comments made by the external auditors in their management letter and other reports.
## **Induction and Training of Members of the Governing Body**
Upon admission to the Fellowship, new members of the Governing Body receive, inter alia:-
- A copy of the College Statutes
- A copy of the most recent Annual Report and Accounts
- A copy of procedures and policies relating to the College
- An up-to-date list of College Officers, Committees and their membership
- A copy of the Charity Commission’s guide to the responsibilities of a Charity Trustee (both the full and summary versions)
- A copy of Being a Trustee (the Charity Commission’s easy read guidance, which explains the main things that a Trustee needs to know)
- Copies of minutes of previous meetings of the Governing Body and its principal committees
- A declaration of qualifications to be a Trustee (to be signed and held by the College)
- A list of all diary dates relevant to membership of the Governing Body
- Information about the management of conflicts of interest
- The latest circulars from the Charity Commission
- A copy of the latest Corporate Risk Register
Each new member has an induction meeting with the Senior Bursar and the Senior Tutor, prior to attending a meeting of the Governing Body.
Attendance of Trustees at meeting of the Governing Body during the year is given on page 5.
## **Key Management**
As detailed in note 7 to the accounts, the key management personnel are the President, Senior Bursar and Senior Tutor. These Officers have the authority and responsibility for planning, directing and controlling the activities of the College. These Officers, together with the Vice-President, the Senior Fellow, Admissions Tutor, Deputy Senior Tutor, Domestic Bursar, Dean of College, Dean of Chapel, who is also the Head of Welfare, the Financial Tutor, the Development Director and the Chair of the Graduate Committee meet regularly to consider developing operational issues as they arise to assist in formulating the College’s response. During the year this group has met approximately fortnightly during Term.
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Risk Management**
The Governing Body is committed to an ongoing policy of identifying, monitoring and managing the risks that might adversely affect the operations, reputation and general well-being of the College. The Bursarial Committee, chaired by the President, usually reviews at least twice each year the operational, financial, regulatory and legal risks facing the College, (including reviewing the Corporate Risk Register) and reports accordingly to the Governing Body. The Governing Body keeps under review the structures to deal with risk and is satisfied that appropriate structures are in place to identify, manage and mitigate the risks faced by the College.
The principal areas of risk faced by the College, and the measures taken to manage them, have been identified by the Governing Body as follows and are covered in detail in the Corporate Risk Register mentioned above:
- Financial Performance: Risks to income, expenditure or investment performance as a result of external factors, e.g., a health emergency, change to fee regime, economic downturn, poor investment markets, persistently high inflation, a war with global disruption to supply chains and the impact of a health pandemic.
_The College has implemented a robust process of budgeting and forecasting to keep costs associated with the College’s core activities under constant review in the light of any changes in funding or other income sources. The College’s Investments Committee benefits from the expertise of two external members and aims to maintain a diversified portfolio of investment assets to try to minimise the incidence of correlation between asset classes._
- Academic Staff: Failure to attract and retain high quality academic staff to deliver the College’s teaching and other academic needs.
_The College has a strong Fellowship and an ethos of supportive inter-personal relationships within the Fellowship, service from welfare and other support staff and pastoral support arrangements allowing Directors of Study/Supervisors to retain focus on intellectual engagement. The College regularly reviews its stipend structures and benchmarks appropriately within the Collegiate University and is continually monitoring terms and benefits. There is a regular review of teaching needs and engagement in the University Teaching Officer (“UTO”) Scheme, where possible._
- Student Admissions: Adverse admissions outcomes in terms of potential, commitment, width of participation and/or compliance failures.
_The College has a transparent process with academic criteria uniformly applied across all fields and University-trained interviewers. The College runs an extensive outreach programme aimed at attracting the strongest candidates regardless of socio-economic background._
- Student Development: Failure to enable students to flourish academically.
_Academic reviews conducted by the students’ Directors of Studies, alongside analysis of students’ feedback by the Senior Tutor. Academic and pedagogical best practice encouraged by regular review, at the Teaching and Learning Committee. Benchmarking against other Colleges via the Senior Tutor’s Committee and direct liaison with both the JCR and MCR Committees, Cambridge University Student Union where necessary. Engagement with the Office for Students as PREVENT regulator._
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
- Student Welfare and well-being: Risk of failures of student welfare and/or pastoral support leading to mental health, safeguarding or monetary issues for students.
_The College has extensive in-house pastoral and welfare provision together with access to additional external expertise._
- Buildings, Infrastructure, Facilities and Security: Risk of compromised security (including cyberattack through physical or digital means), poor-quality accommodation and facilities due to lack of timely investment, unanticipated failures in infrastructure, persistently unset needs, or unexpected high building maintenance expenditure.
_The condition of the estate is regularly monitored by the Maintenance Department though a programme of planned preventative maintenance, along with the assessment of maintenance requests and complaints, ensuring a proactive approach to estates management. In addition to this, there is an ongoing maintenance capital program in place addressing the refurbishment and decarbonisation of the buildings. IT and other infrastructure, both physical and digital, undergo regular review and are supported by a continuous investment program, emphasising the importance of business continuity, staff training and awareness in relation to cyber security. Both the Domus Committee and the Bursarial Committee oversee and monitor these activities._
## **Scope of Financial Statements**
The financial statements are a consolidation of the results of Queens’ College and its subsidiaries, QC Enterprises Limited and Q College Property Limited, which are both wholly owned by the College. Q College Property Limited has continued to be non-trading during the year. QC Enterprises is the corporate vehicle through which the College undertakes its commercial conference and catering activities, while the College undertakes directly all other accommodation and catering activities. Any financial surplus made by QC Enterprises is donated to the College.
## **AIMS AND OBJECTIVES OF THE COLLEGE**
The College is an institution of higher education. Its purposes are the promotion of study and prayer.
The College has the following aims and objectives:
- to maintain the College’s emphasis on the individual in academic and pastoral provision; to deliver an excellent Undergraduate education by safeguarding the provision of small-group teaching through the College-based supervision system; and to achieve and maintain the highest standards in education at both Undergraduate and Postgraduate levels while maintaining welfare support through the dedicated student support team;
- to support a community of Fellows, students and staff, allowing the benefits of a large, internationally renowned University to be realised in a small and close-knit community;
- to promote academic research of the highest quality by Fellows and students; and
- to maintain and enhance the endowments and benefactions, historic buildings and grounds of the College for the benefit of future generations.
Remaining an independent foundation, while forming an integral part of a collegiate university, is fundamental to the College’s long-term strategy and well-being. The College endorses the University’s mission and core values and agrees that the partnership between the University and the Colleges is central to Cambridge’s future development. The College will continue to play an active role in University bodies and in contributing to the formulation of University policy.
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## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
In pursuit of its aims and objectives, as well as its charitable objects, the College admits (as junior members) Undergraduate and graduate students matriculated in the University of Cambridge. It provides financial and other support to those of its members who require it in order to achieve its aims and objects and it supports teaching and research in the University. In furtherance of its objects, the College maintains and manages an endowment of property and financial assets. Besides financial and tutorial support, the College also supplies accommodation, catering and other services to its members and others.
The Governing Body has considered how best to support delivery of the College’s aims and objectives and has adopted a strategic approach represented by the diagram below.
During the year the College adopted the review of its strategy and strategic imperatives under the “Five Pillars” approach as outlined in last year’s Report and Accounts. This is to build on and significantly enhance the College’s current position in all aspects of its activities.
The Five Pillars to which approaches have been developed with the diverse participation of Fellows are; 1) Fostering the intellectual society; 2) Strengthening financial resilience and long-term viability; 3) Removing obstacles to even broader access and participation; 4) Ensuring a coherent, enabling, and sustainable infrastructure (both physical and technological); 5) Enhancing efficient, representative and accountable governance. Working parties, comprising members of the Governing Body, were established to undertake detailed work on each of the pillars and consideration was given to the various options available to the College to take matters forward. Each working party held an open meeting via Zoom to discuss the possible options and approached and to which all members of the Governing Body were invited. After consideration at the Governing Body, detailed approaches to each are now in train with a five to ten year time horizon.
The Five Pillars approach reflects the interdependencies within the College’s activity and need to ensure they are aligned, coherent and consistent to strengthen the College for the future. They also allow for exploiting synergies and efficiencies.
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **PUBLIC BENEFIT STATEMENT**
In accordance with its Royal Charter of 1448, the College’s charitable objects are the promotion of study and prayer through the provision of a College in the University of Cambridge.
The Governing Body has complied with its duty regarding public benefit, showing regard to the Charity Commissions’ guidance.
The College provides, in conjunction with the University of Cambridge, an education for some 519 Undergraduate, 451 full-time and 138 part-time Postgraduate students (2021/22: 503, 427 and 133 respectively), which is recognised internationally as being of the highest standard. This education develops students academically and advances their leadership qualities and interpersonal skills, and so prepares them to play full and effective roles in society. In particular, the College provides:
- teaching facilities and individual or small-group supervision, as well as pastoral, administrative and academic support through its tutorial and graduate mentoring systems; and
- social, cultural, musical, recreational, and sporting facilities to enable each of its students to realise as much as possible of their academic and personal potential whilst studying at the College.
The College additionally advances study through:
- providing Research Fellowships to outstanding academics at the early stages of their careers, which enables them to develop and focus on their research in this formative period before they undertake the full teaching and administrative duties of an academic post;
- supporting research work pursued by its other Fellows through promoting interaction across disciplines, providing facilities and grants for national and international conferences,
- research trips and research materials;
- encouraging visits from outstanding academics from outside the University of Cambridge; and
- enhancing the dissemination of research undertaken by members of the College through the publication of papers in academic journals or other suitable means.
The College maintains an extensive Library (including important special collections), so providing a valuable resource for students and Fellows of the College, members of other Colleges and the University of Cambridge more widely, as well as external scholars and researchers.
The College carries forward the tradition, continuous since its foundation, of being a place of prayer. In particular, the College:
- Maintains and supports the Chapel as a place of prayer and holds a variety of religious services on weekdays and at weekends during term, which are open to the general public and visitors; and
- Supports, through the College Chaplaincy team, the emotional, mental and spiritual well-being of all members of the College community whatever their faith tradition, or none and provides an Inter-faith Centre in the Cripps Building to facilitate interactions within and between the different faiths within the College community.
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
The resident members of the College, both students and academic staff, are the primary beneficiaries and are directly engaged in study.
However, beneficiaries also include students and academic staff from other Colleges in Cambridge and the University of Cambridge more widely, visiting academics from other higher education institutions and visiting schoolchildren and alumni of the College who have an opportunity to attend educational events at the College or use its academic facilities. The services in the College Chapel are open to the public and are attended by local residents and visitors to Cambridge.
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**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **REVIEW OF OPERATIONS**
Queens’ admits students who have the greatest potential to benefit from the educational environment provided by the College and the University and it recruits academic staff who are able to contribute most to the academic excellence of the College, regardless of their financial, social, religious or ethnic background.
Undergraduate student applications are in the table below, showing the level of diversity of students attending Queens’. About one fifth of Undergraduate students are from overseas (including EU) backgrounds:
Applicants in Michaelmas Term 2022
- Number of applicants 894
- Arts 412 or 42%; Science 583 or 58%
- Male 51%, female 49%
- Home 65%; overseas 35%
- Office for Fair Access (OFFA ***) applicants – maintained sector 66.5%; independent sector 33.5%
Offers in 2021
- Number of offers 191 (21.4.% of applicants)
- State educated 69.7%, independent educated 30.3% (of home offers)
- Male 53%, female 47%
- 8 offers made through the pool and 52 of our applicants received offers through the pool
*** OFFA applicants are defined broadly as applicants normally resident within the UK.
The above outcomes are entirely consistent with the College’s objectives in respect of admissions. The College charges the following fees:
- Home Undergraduates are charged a combined University and College fee of £9,250, (2021-2022: £9,250), of which the College share is £4,625 (2021-2022: £4,625);
- Undergraduates from overseas are charged a College fee of £10,152 (2021-2022: £9,885);
- Postgraduates are charged a combined University and College fee which varies according to the course. The total fee income is then allocated across Colleges at an equal average rate per student which for 2022-2023 is £4,767 (2021-2022: £4,472); and
- Accommodation and meals are charged at reasonable rates.
14
**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Widening Participation**
The College’s extensive widening participation programmes help young people from backgrounds which are traditionally under-represented at Cambridge to have the confidence and information to apply to top universities, including Cambridge. We work hard to provide age-relevant information and guidance about higher education and, in particular, to demythologise the application process at Cambridge. Interactions with those in years 12 and 13 target the application process and supports super-curricular discovery. Key stage 4 students receive advice on A level selection and early preparation, while younger pupils are encouraged to think about the benefits of higher education more generally and to broaden their horizons.
We work with teachers and careers advisors to guide them in how our application process works and to identify the qualities that we look for in our students. Our programme includes events for schools and those, such as Open Days, with a focus on individual applicants.
Our Admissions team make visits to schools and colleges across the UK, and host groups in Cambridge. We have particularly deep links with Bradford, Kent and the borough of Havering. We update our events programme regularly and are always looking for ways to enhance our offering and to work effectively with external partners. Our programme typically includes visit days, open days, personal statement and interview workshops and residential events.
We welcome school groups back to Cambridge and our programme of in-person visits to schools has regained pace, as a new team settles in. Among the several ways in which we measure the impact of our outreach work, the growth in applications, and therefore admissions, from schools with which we work closely stands out. Within total admissions and access costs of £0.798 million shown on page 47, £0.256 million was spent on Access and Widening Participation activity in the year. The College continues to regard Widening Participation as an essential activity and will continue to support and enhance it further.
## **Student Support**
The Cambridge colleges collectively provide a bursary scheme for those of limited financial means. In 2022-23, 111 Undergraduates (out of our 449 Home Undergraduates) (2021-2: 115 and 471 respectively) received such bursaries with a total value of £310,315 (2021-2: £338,093). The scheme is approved by the Office for Students and provides benefits at a substantially higher level than the minimum OFS requirement. It is widely advertised on the University website, on the College websites and in the Admissions Prospectus. The College spent £254,307 on additional bursaries, including for post graduate students, in 2022-23 (2021-22: £146,215).
The College also supports all students through a grant scheme open to all to assist with attendance at conferences, and travel grants. In 2022-23 the College spent £125,378 on this scheme (2021-22: £118,039).
In addition to its other programmes, the College operates a hardship scheme for all students in financial hardship. In 2022-23 the College made hardship grants totalling £27,236 (2021-22: £35,233).
## **Provision of Welfare Support**
The Health and Well-being team and Tutors provide specialist and professional care for students of the College. This consists of (although is not restricted to) general pastoral provision, Professional counselling, Cognitive Behavioural Therapy, mental and physical health support, bereavement counselling, eating disorder interventions and a series of programmes to help the move from school to university which brings with it increased independence.
15
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
More mental health issues are reported in today’s culture. This may be due to the problem increasing, including due to the aftermath of the Covid pandemic, the reduced stigma in articulating problems, feelings and medical conditions, and a raised expectation that institutions have a responsibility to act and support its members with the conditions they have. Welfare provision that individual Colleges provide are widely compared by students and applicants and is seen as a key indicator of the “student experience”.
Students from disadvantaged backgrounds may have additional concerns or issues that require support. Welfare, in this way, is part of the Colleges commitment to increase access for all.
The Health and Well-being team works alongside the Tutors of the College in providing pastoral support to students. Overall responsibility for this activity rests with the Senior Tutor, however the day-to-day management is devolved to the Head of Welfare (operationally) and the Head of Academic and Tutorial Services (administratively).
The Head of Health and Well-being also acts as the College Safeguarding Officer, one of the Harassment and Assault Officers, Police Liaison Officer and Deputy Head of Prevent and Dean of Chapel.
At present (in addition to the above roles) the College employs a part time Clinical Lead (also one of the Harassment and Assault Officers), a part time Mental Health Nurse/Welfare Officer/CBT Counsellor, a part time Counsellor/Coach, and a Chaplain (part of whose job involves providing pastoral support to the wider College community). There is also a third Harassment and Assault Officer who can be used in complex cases.
Where more specialist treatment is needed this is organised with professionals on a contracted basis by the Health and Well-being team. This, in the past, has included Psychiatric Services, Psychological practitioners, Scientific Coaching, Essay writing guidance, physical trainers, legal advice and physiotherapists.
## **Academic Staff**
To fulfil its charitable purposes, the College employs College Lecturers, Tutors, Clergy and senior academic and administrative officers. These posts are qualifying offices under the College Statutes. The appointment of Fellows is a result of their employment in a qualifying office which office is undertaken with the intention of furthering the College’s aims and their employment directly contributes to the fulfilment of those aims. The private benefit accruing to the President and Fellows occurs solely through their employment in a relevant qualifying office by means of salaries, stipends and employment related benefits and is objectively reasonable, measured against academic stipends generally; moreover, annual pay increases normally follow national settlements applying to the university sector, as implemented by the University of Cambridge. Without the employment through qualifying offices of Fellows, the College could not fulfil its charitable aims as a College in the University of Cambridge.
The President and Fellows of the College also receive benefits as beneficiaries. These comprise research grants, conference grants, book grants etc. These benefits are provided with the intention of furthering the College’s aims. The amounts of the benefits provided are objectively reasonable, measured against the academic benefits made available to other beneficiaries of the College.
## **Academic Performance**
While all of our students took examinations and assessments of various sorts through the past academic year, the impact of the University and College Union Marking and Assessment boycott means that it is
16
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
impossible to assess how our students performed either in relative or absolute terms with any confidence at the time of writing
## **Capital Expenditure, Maintenance and Environmental Management**
The ever-challenging economic backdrop left by the pandemic and high levels of inflation have challenged both external revenue streams and procurement. The College has continued to work within sensible financial constraints, focusing maintenance and project activity on safety related and business critical repairs, whilst continuing to progress plans capital projects to decarbonise the estate.
The wonderful donation of £1.25m from one of our Alumni towards works specifically related to Cripps Court, has meant the Cripps Hall Lantern, the beautiful vaulted-ceiling and external light source to the Hall, has been carefully refurbished. The works included installing an ambitious scaffold from Cripps Court, up and over the Armitage Room, and onto the Cripps Hall roof. The scaffold was also suspended within the Hall, to allow the Hall to remain operational. New glazing with remote window shutters were installed alongside new energy reducing LED lights. A final external access ladder will be installed during November 2023.
In the President’s Lodge, the cloakroom area has been refurbished and expanded, and the final dormer windows on the rear of the Lodge have been repaired and insulated.
The Housekeeping and Maintenance Departments have continued their ambitious refurbishment project of the external properties on Panton Street and in Newnham, replacing kitchens, bathrooms, fitted furniture and fixings, bringing the accommodation up to modern standards. The final stage will be Norwich Street and Maids Causeway planned for the summer of 2023.
To transition towards Net Zero Carbon by 2045 a masterplan has been developed from the site wide energy assessment and estate decarbonisation study completed in 2022. The financial planning is still in the early stages, but the initial studies indicate the decarbonisation and refurbishment demands over the next 20-30 years will require considerable investment of up to £150m.
Several major projects have been identified, including the complete refurbishment of the Erasmus building. Throughout the last year, a detail design has been developed and we are currently awaiting feedback on the planning application. The Erasmus roof will be utilised to discretely house air source heat pumps, and it is estimated, that this area of heat generation will be sufficient to feed Erasmus, Friars and Dokett buildings. Funding this work will be challenging (circa £8.6m) and the College is seeking low carbon government grants. It is hoped this project can start in 2024/25.
Sadly, the Owlstone Croft masterplan was refused planning permission in January 2023. This followed a protracted planning review process which gained the full support of the City Council Planning Officers, but despite being put forward as recommend for approval, the local Councillors refused the application.
The fundamental objective for this project, is to create a community and homes for our Postgraduate students at Owlstone Croft. The homes would be supported by inspirational study and community space and enhance the existing Owlstone Croft site meeting our educational needs and accommodation objectives. The plans also included degassing the existing buildings and enhancing the biodiversity of the site by over 50%, with new trees and native hedgerow and a wetland meadow.
Following the refusal, the College has launched an appeal, and sought a public inquiry over the summer of 2023. The public inquiry is due to commence on 26[th] September 2023.
17
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
On a more positive note, the College was successful in securing a new property on Grange Road. The house and grounds were previously owned by the Margaret Beaufort Institute of Theology and provide over 30 bedspaces, study and work rooms. This is a strategically important addition to the College estate.
This purchase will enable the College to better manage future refurbishment and sustainability projects elsewhere, including at Owlstone Croft and Erasmus, both of which will result in disruptions to student accommodation over the next 10-15 years. With Grange Road, this means that the College will no longer need to seek alternative external accommodation solutions for students, when tackling large scale developments and refurbishments.
## **Donations and Fundraising**
The College’s fundraising efforts are primarily directed at raising money from our alumni. Our fundraising approach ensures that we understand and respect individual preferences for contact in relation to approaches seeking support, as well as more generally. Key objectives for the College include teaching, particularly endowing Fellowships, research, student support, widening participation as well as enhancing the endowment. The College is very grateful to those of its alumni and others who continue to support it so generously and enhanced their support as the College responded to the impact of the Covid-19 pandemic. In 2022/2023 the College received unrestricted donations totalling £2,406,000, new expendable restricted funds £2,186,000, and new endowments totalling £1,072,000, giving a total of £5,664,000 (£5.84 million 2021/2022) in support of its objectives.
The cost of the Alumni and Development Office (ADO), a College department, for the year was £720,261 compared to £579,491 in 2021/2022. The ADO costs include both fundraising and alumni relations activity, such as reunions and other events and publications. This year there have been some ‘in person’ events held and costs have been stable. As the amount received can vary significantly from year to year, the chart below details the three and five-year rolling average of donations received, as well as the annual cost of the ADO.
All fundraising is carried out by the ADO, which reports detailed quarterly results to the Bursarial Committee and a summary report to the Governing Body. The College is registered with the Fundraising Regulator and was not the subject of any complaints to that body in 2022/2023, nor did the College receive
18
**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
complaints about its fundraising activities from any other source. The College does not seek support from the public and takes active steps to respect the needs of any potential supporter who may be in a vulnerable circumstance or require additional care and support to make an informed decision.
## **Data handling**
The College continues to monitor its data handling, reporting and Data Protection Statement in accordance with the UK GDPR requirements.
## **Equal Opportunities**
The College is committed to the principle and practice of equal opportunities and strives to be an equal opportunities employer.
## **Residual Impact of the Covid-19 Pandemic on the College’s Operations**
The Covid-19 pandemic had a profound impact on the College’s operations, both academic and nonacademic, and this impact has continued to an extent during the current year, especially in respect of external revenues.
In this year the academic side of the College’s activities were restored to a normal level of activity similar to that which prevailed prior to the Covid pandemic. All academic expenditure was restored, some areas such as travel grants for students enhanced, and in all respects the students received the normal experience of the academic and social life Cambridge has to offer.
As reported in last year’s accounts, the College faced a secular change in its operating environment with there being no demand during the pandemic for conferences and catering events. This forced us to restructure the operational departments, with teams cross-working and a complete change to how we work and a review of our processes. We continue to review the way in which the College operational teams operate to ensure we continue to learn lessons and seek further improvements. The staff have responded well to the challenges the College continues to face. The operational teams have performed well and cohesively throughout 2022/23, strengthened our effectiveness and ensuring we have strong foundation for further recovery in 2023/24.
There was some recovery in the number of conference and external catering events during the current year, but with an activity and revenue level far below that achieved prior to the onset of the pandemic. It will take time, effort, and a willingness throughout the College community to see further improvements in the revenues generated. The financial impact of this is covered in the financial review below.
19
**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **FINANCIAL REVIEW**
In common with other organisations, the financial year to 30 June 2023 has been a particularly challenging one in highly uncertain economic circumstances. The continuing after effects of the Covid-19 pandemic, together with the war in Ukraine, and high inflation have greatly affected the College. The College has continued to pursue its principal goals of providing a first class educational and research environment to Undergraduates, Postgraduates, and Fellows alike, whilst striving to live within its means and manage the challenges and uncertainties presented by the pandemic.
## **Financial Results**
## **Consolidated Income and Expenditure Account**
The College recorded an Unrestricted Deficit of £1,627,000 (2021/2022: -£944,000), after unrestricted donations of £2,406,000 (2021/22: £3,145,000), a Restricted Surplus of £2,022,000, (2021/22: £1,316,000) after restricted donations which mainly relate to supporting our education activities of £2,186,000 (2021/22: £1,316,000). The overall surplus, before other gains and losses, is £573,000 (2021/22: £1,754,000).
|**Year ended 30th June**
Unrestricted Income
Unrestricted Expenditure
(Deficit) Surplus
Restricted Surplus (Deficit)
Endowments Surplus
(Deficit)
Total Surplus (Deficit)
before Other Gains and
Losses||**2023**
**£m**
15.60
17.23
(1.63)
2.02
0.18|**2022**
**£m**
14.00
14.94
(0.94)
1.31
1.38|**2021**
**£m**
11.69
13.21
(1.52)
8.51
4.44|**2020**
**£m**
11.93
13.81
(1.88)
3.36
2.46|**2019**
**£m**
13.95
14.66
(0.71)
2.49
7.90|
|---|---|---|---|---|---|---|
|||0.57|1.74|11.43|3.94|9.68|
The lower level of surplus for the “Endowment” column (£178,000) largely reflects a combination of the Endowment expenditure on education and the difference between the investment income received in the year and the drawdown under the College’s total return methodology. This is covered further below.
The Unrestricted Deficit of £1,627,000 is realised after charging depreciation of £2,772,000 (2021/2022: £2,434,000). Adding back the depreciation charge and other non-cash items in the Income and Expenditure account, such as pension deficit provisions and any underspend on Restricted Funds, is a reasonable proxy for the cash the College has generated.
20
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
This year the College shows as part of its Comprehensive Income and Expenditure account other gains and losses relating to investments assets: there is a gain of £2,977,000 (2021/2022: £932,000 loss) and a decrease in pension liabilities of £466,000 (2021/2022: £6,107,000 liability decrease), and an unrealised gain on revaluation of fixed assets of £446,000 (2021/22: nil). The total surplus is £4,461,000 (2021/2022: £6,930,000 surplus).
There are several matters to draw to your attention:
- The continuing difficult operating environment is covered under the Scenario Planning section below;
- This year the College adopted a Total Return Approach to Investment income which will act as a smoothing mechanism and reduce the volatility of investment income from which the College has historically suffered. As described above, the drawdown is calculated by reference to a weighted average of the investment assets over a five-year period, with a one year time lag for the amount of drawdown. The weighted investment assets used in this year’s Accounts is for the five-year period to 30[th] June 2021. The drawdown is set at a rate of 3%;
- The Unrestricted Deficit on the Education Account was £2,758,000 (2021/2022: £2,514,000 deficit);
- The College has restored all the Education expenditure, and in many cases enhanced it, which was curtailed during the pandemic;
- Academic fees in respect of Home Undergraduate students have not changed since 2018 so are declining in real terms. It is unlikely that such fees will rise in the foreseeable future and so we might reasonably expect the Education deficit to continue to rise;
- The Unrestricted Deficit on the Education Account, is some £529,000 greater than the unrestricted investment income, or some 1.24 times greater, (2021/2022: 1.86 times);
- This effectively means over recent years all the investment income has been devoted to the education of current students;
- The College’s accommodation, conference and catering activities showed a deficit of £2,223,000 (2021/2022: £2,070,000 deficit). This area was the most affected by the pandemic as discussed below;
- The external revenue from conference and catering during the year is recovering from the disruption caused by the pandemic but remains below the level of income enjoyed before the pandemic’s onset, and this has continued to affect the College adversely;
- The College has few levers available to it when inflation is high as costs will rise but the revenue streams which the College has the ability to increase in a similar way are very limited, and this is evident in the results.
21
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Funding of the College**
Queens’ College is funded from several sources as follows:
|Year ended 30thJune|**2023**|**2022**|**2021**|**2020**|**2019**|
|---|---|---|---|---|---|
|Academic Fees|24.9%|26.3%|19.8%|24.5%|21.5%|
|College|20.3%|21.3%|11.0%|15.5%|20.6%|
|Accommodation||||||
|College Catering|5.8%|4.5%|0.8%|4.4%|5.7%|
|Conference Activities|6.6%|2.4%|0.0%|8.1%|9.3%|
|(including Catering)||||||
|Investment Income|17.1%|18.6%|13.7%|21.9%|11.7%|
|Donations|24.5%|26.0%|52.8%|22.5%|29.9%|
|Other|0.8%|0.9%|2.9%|3.1%|1.3%|
The above table excludes new endowments from the calculations. Future income from the new endowments will appear as Investment Income. This year Restricted Donations have been included in the table. All prior years have been re-calculated accordingly.
## **Continuing Impact of Covid-19 on Financial Results**
There has been a continuing effect of the Covid pandemic on the College’s results for this financial year is principally on the income side and particularly in respect of accommodation, catering, and conference revenues. The recovery has continued from the historic lows of 2021, with total revenues from these activities of £6,141,000 (2021/22: £4,852,000). Revenues are close to, but still below, those achieved in 2019.
This year all the academic activities of the College were fully restored and there was a greater level of activity for conferences and catering events. The disruption to labour markets and supply chains with a high inflation rate is affecting the College. A persistent high inflation environment will be particularly challenging for all organisations, such as the College, with a relatively fixed cost base and limited opportunities to increase revenues. This may continue for some time.
## **Balance Sheet**
The net tangible assets of the College stood at £154.44 million compared to £149.98 million in 2022. The increase is caused by the rise in investment assets’ capital values and a 15.9% fall in the pension liability under FRS 102.
There was no increase in the level of debt issued by the College. The gearing ratio is 14.9% compared to 15.3% last year. The change in gearing ratio is solely a function of the change in net tangible assets.
22
**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Main Endowment and Investment Assets**
The College, as a long-term investor, has a medium risk appetite for the management of its investments. Risk parameters are agreed with the College’s Fund Managers and the Managers are required to have due regard to a company’s environmental, social and governance record when investing. The College does not hold any fossil fuel investments in direct holdings or funds in which it controls the investment. The College, is a beneficiary of a trust where the holdings are managed by the University as trustee and so the College does not control that investment or the policy applied to it.
The market value of the main Endowment and Investment Assets at 30[th] June 2023 stood at £129.50 million (2021/2022: £136.27 million). This figure includes £7.31 million of cash donations and other monies for operational property investment and other restricted expendable donations of £2.52 million; when this is excluded the investment assets stand at £119.67 million (2021/22: £115.31 million). The College has now deployed fully the proceeds from its £15 million private placement in new operational assets (2021/22: £8.98 million unutilised).
|**Year ended 30th June**
Closing position previous years
Endowment & Investment Assets
New Endowments & unspent
Endowment Income from previous
year invested
Opening Position
Closing Position Endowment &
Investment Assets
Investment Income Received
Gains (Losses)
Total Return|**2023**
**£mn**
**2022**
**£mn**
**2021**
**£mn**
**2020**
**£mn**
**2019**
**£mn**
115.31
112.01
93.32
91.23
89.46
1.38
4.51
4.11
11.59
1.62|
|---|---|
||116.69
116.52
97.43
102.82
91.08
119.67
115.31
112.01
93.23
91.23|
||3.21
3.20
2.92
3.68
2.04
2.98
(0.93)
14.42
(9.50)
0.15|
||6.19
2.27
17.34
(5.82)
2.19|
The portfolio was invested in Global Equities, including Carbon Free holdings, (35%), residential property and agricultural estates (27%), cash (2%), UK gilts (6%), Multi-Asset Funds which have a significant exposure to quoted equities, including holdings in the Cambridge University Endowment Fund, (16%) and the balance in the recognised alternative asset class of private equity. It should be noted that the private equity investments are shown at managers’ estimated value on a “marked to market” basis.
During the year the College has continued to increase its holding in ESG funds and has invested in key themes for the future, including clean energy, healthcare, automation, and digital intelligence. It will continue to rebalance the portfolio in future years away from purely geographic allocations to “thematics” with a long-term horizon. It should be noted that with the College’s stance on fossil fuel, the returns the College receives at times when there is a significant market shock leading to higher oil and gas prices will be lower than those achieved by other investors with such holdings. The College is aware of this but as a long-term investor it accepts these short-term impacts will occur without invalidating the College approach.
The College now undertakes an ESG analysis of its quoted holdings representing 50% of its total portfolio, relying on data provided by Morningstar and Sustainalytics, as a means of tracking the effectiveness of its investment policies regarding ESG. At the year end, this part of the portfolio had a sustainability rating of
23
**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
4.3 out of a possible 5.0 (2021/22: 3.8 out of a possible 5.0). This type of analysis is still evolving, and the College will continue to address this issue over time and seek improvements. In due course, it will apply this analysis to all its non-property holdings.
The College’s direct investment property assets have been re-valued during the year.
The total recorded return on the investment assets in the year was 5.3% (2021/2022: 1.95%). The Total Return policy of the College has been described above.
The College takes a long-term view of the investment portfolio and attempts to protect its value in real terms and, as a result, to strike an equitable balance between the interests of the present members of the College and future generations. Any new donations or bequests received during the year are added to Unrestricted Funds, unless the donor has made it clear that the funds are to be spent on a particular project.
## **Future Capital Projects**
In 2023/2024 the College will continue with capital expenditure which is deemed to be critical for the maintenance of the estate and investment for the future.
## **Long Term Debt Issue**
The significant projects in 2014 and 2015 were funded, as previously reported, using the proceeds of an unsecured long-term debt issue in which the College participated with 18 other Colleges. The College’s share of the issue was £8 million, with an average life of 34 years, at an effective rate of 4.42% per annum fixed for the duration of the loan. Although issued through a funding vehicle, the College has no responsibility for the obligations of any other of the issuing Colleges. This issue was a good example of the Cambridge Colleges working well together for a common purpose.
In January 2018, the College raised a further £15 million through a private placement. This is unsecured, at a fixed rate of interest of 2.62% per annum with repayment in one amount after 40 years. This fixed rate funding will be used to invest in further operational assets for the College to house more of its Postgraduate students and to eradicate some historic anomalies in the provision of Undergraduate accommodation. Originally raised to finance a joint venture with the University, from which the University withdrew, the College has utilised the remaining undeployed balance of the issue (£9,840,000) to acquire revenue generating operational properties within the City of Cambridge.
The issued debt has a gearing covenant (maximum 50% of net tangible assets) and a negative pledge. The College is comfortably within its covenants. This debt appears as a long-term liability on the balance sheet.
The College, as a perpetual institution, must plan effectively for repayment of the three issues of long-term debt. To this end the College had a plan to purchase almost matching gilt issues for the various maturity dates of the different tranches. These gilts are to be held to maturity in the investment portfolio and will be used to affect the repayment. The disruption to the Gilts market in September and October 2022, where the price of the relevant gilts fell significantly, provided an opportunity to purchase gilts at sensible prices in furtherance of this strategy. The total nominal value of the gilts held by the College represents 45% of the debt issued as at 30[th] June 2023.
Post the year-end further purchases of the longest dated gilt (1.75% 2057) were made as there was a fall in the price of the relevant gilt and the nominal of gilts held for this purpose now stands at 64% of the total issued debt.
24
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Pension Funds**
The College participates in two pension schemes detailed below.
The College’s academic staff are members of the Universities Superannuation Scheme and the issues and challenges facing this Scheme, and the College’s staff who are members of it, have been well publicised. The effect of the FRS102 adjustment in respect of this Scheme, following completion of the latest valuations, in the Income and Expenditure Account this year is a debit of £10,000 (2021/2022: £631,000 debit).
The Cambridge Colleges Federated Pension Scheme (CCFPS), a pension scheme exclusively for nonacademic staff, has its full liability recorded in the balance sheet under FRS102. The deficit shown this year has declined by £466,000 (2021/2022: £6,107,000 reduction). The decrease in the deficit is driven principally by a higher discount rate used to calculate the present value of the scheme’s liabilities. There is also a positive impact in the staff costs shown in the Income and Expenditure account of £299,000 (2020/2021: -£374,000) arising from FRS102. The College is currently reducing its pension liability under the scheme with additional contributions over an eleven-year period.
The effect of the above changes in respect of both Schemes is a positive balance sheet movement of £0.76 million (2021/2022: £5.10 million positive).
## **Reserves Policy**
The Governing Body, in approving these accounts, has adopted the reserves policy and target reserves as detailed below.
The reserves policy ensures that the College has sufficient financial resources to continue, but also constrains the extent to which reserves are built up from operating surpluses to help maintain intergenerational equity and balance the needs of current and future students.
Free reserves represent the unrestricted general funds of the College. The calculation involves analysis of the composition of the total reserves shown in the Balance Sheet, after adding back any provisions for pension liabilities. The following categories are excluded: Special Trust Funds, permanent restricted endowment, restricted funds and fixed and heritage assets. Net free reserves are after deducting the provision for pension liabilities.
|**Total Reserves**
Total Reserves
(including Pension Provision)
Less: Restricted Reserves
Less: Fixed & Heritage Assets
Free Reserves
Less: Pension Provision
Net Free Reserves|**2023**
**£mn**
**2022**
**£mn**
**2021**
**£mn**
**2020**
**£mn**
**2019**
**£mn**
158.5
154.7
152.9
127.2
132.7
97.4
93.2
91.2
69.8
69.3
50.3
40.9
39.5
38.0
38.3|
|---|---|
||10.8
20.6
22.2
19.4
25.1
4.0
4.8
9.9
11.3
9.2|
||6.8
15.8
12.3
8.1
15.9|
25
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
The College’s target reserves are as follows:
|**Reserve**|**Target Reserve**|**Rationale**|
|---|---|---|
|Contingency
Income & Expenditure|£8.99 million|Contingency to cover extreme/unexpected shortfall in
income or additional extreme/unexpected expenditure –
equivalent to 18 months accommodation conference and
catering income being the average of the last three non-
pandemic years|
|Emergency Building
Repair Contingency|£2.52 million|To fund unexpected urgent repairs to buildings in the estate
e.g. roof failures, etc. equivalent to 5% of buildings as fixed
assets|
|Total|£11.51 million||
As of 30[th] June 2023, the College’s free reserves were £6.8 million (2021/22 £15.8 million) compared with a target reserve of £11.51 million (2021/22: £10.75 million). The movement is almost entirely due to the acquisition of the significant additional operational property in Cambridge increasing the value of operational properties in the balance sheet, together with the increase in restricted reserves while unrestricted reserves were stable.
The significant factor which will affect future reserves is the continuing aftermath of the pandemic, the war in Ukraine, the disruptions caused to supply chains, rising interest rates, and the prevailing high inflationary environment, particularly in respect of its operations and the financial and other markets in which the College has invested. This level of reserves, while below the target, enables the College to consider carefully and react appropriately in the event of further, unforeseen extreme circumstances or a significant prolongation of the economic volatility.
The College is focusing on maximising unrestricted income and unrestricted donations, managing costs, effective use of restrictive income from Special Trust Funds, permanent restricted endowment and other restricted funds, and investing in the endowment and investment assets in order to recover from the impact of the last three years and rebuild and enhance its free reserves.
The College needs to maintain and enhance its unrestricted reserves as it is one of the measures of its relative financial strength in terms of its pension obligations as well as for its external funders. The Governing Body will keep the reserves policy under review and consider the need for further specific reserves from time to time as circumstances change.
## **Scenario Planning**
With the advent of the Covid 19 pandemic, the college introduced a four-year scenario planning exercise. This continues to be used and is now an integral part of the College’s approach to managing its financial and other risks.
The Governing Body has considered carefully the possible continuing impact of the aftermath of the Covid19, the high inflation environment and the possible disruptions to supply from the war in Ukraine and other
26
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
factors, both international and domestic, on the College’s finances in the new financial year and beyond. At meetings in June 2023, it considered a base case scenario of normal academic activities and a continuing, gradual recovery in external revenue from conference and catering activity with inflation of 8% for this year and then returning to c3% over the period. The College being able to adjust its charges only partially in the early years to meet the change in inflation together with a reduced initial level in donations with a steady improvement thereafter. Investment income rising slowly from the distribution under Total Return policy.
The base case scenario was over a four-year time horizon and showed the College being able to maintain cash generation and return to a surplus over the period. The Governing Body also considered two downside sensitivity analyses, with the severe case assuming significantly higher inflation for longer with limited ability to maintain charges in real terms and a decline in both investment and donation income. The Governing Body also considered the College’s holdings of cash and other liquid assets.
The budget for the new financial year was adopted based on the base case scenario.
## **Going Concern and Viability**
The Governing Body has assessed the viability of the College and its subsidiaries over the duration of the four-year scenario planning exercise. The Governing Body considered and approved the detailed budget for the forthcoming year, and the actions required by it, as part of the review and have concluded there is a reasonable expectation that there are adequate resources, including the strength to operate and meet the liabilities of the College as they fall due, over the period of the assessment and for the foreseeable future.
## **Principal Risks and Uncertainties**
The principal risks and uncertainties that the College faces in the forthcoming year may be briefly summarised:
- Sustained high inflation with the College having limited room for manoeuvre in respect of addressing its impact in mitigating a widening deficit. Such an environment may also adversely affect both investment markets and possibly pension obligations;
- The ongoing aftermath of world events, including the recent pandemic and the war in Ukraine, rising interest rates, and consequential global economic uncertainties, may have a significant effect on the College’s revenue streams and on the markets in which the College invests. It is possible that capital values will be highly volatile and investment income may be adversely affected. Investment capital losses would affect adversely the College’s level of free reserves;
- A similar “off model” event to the pandemic, leading to the suspension of the College’s usual activities. The college has a specific reserve for this eventuality;
- Unforeseen events disrupt the College’s education and other activities such as to prevent the College from operating;
Although the College has a long-term programme of building renewal and improvement, it is always possible with buildings of the age of the College’s estate that there will be unexpected issues that may arise.
27
**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
The College keeps under review the conditions of the fabric to identify further issues and enable them to be addressed on a timely basis. The College has also
- maintained a detailed remedial programme of works on the buildings in the estate. There is a specific reserve for this matter;
- The volatility in investment markets could be one of the factors that may give rise to a deterioration in the pension liability and a consequential adverse impact on the College’s free reserves;
- The continuing failure of academic fees to keep up with the rise in academic costs, as well as the inevitable uncertainties with a potential significant change to the funding of Universities in England, mean that the funding and costs associated with the College’s core activity will need to be kept under constant review **.**
## **Future Plans**
As part of the “Five Pillars” review, the College will also continue to develop plans for raising funds, including to enhance significantly the College’s endowment to enable it to continue achieving its objectives. Currently, the College focuses principally on raising permanent capital funds for fellowships and teaching and funds to augment further support for students the core activity of the College, and unrestricted funds, so the College may continue to invest in the future and strengthen its financial position.
The College is looking to enhance both the resilience and agility of its operating practices, including by being able to deploy staff resources where there is greatest need and maximising the flexibility of our response as circumstances change.
## **Conclusion**
The College’s financial position remains challenging and by no means comfortable; there is a great deal to be done to secure properly the long-term future of the College especially for the continued provision of teaching and research excellence, providing for Postgraduate students and refurbishing and enhancing the historic and other operational buildings.
The College will endeavour to work as efficiently as possible and maintain its resilience within the context of being an academic community. The College will regularly review its position as circumstances unfold, against its projections and its scenario planning model, to ensure it responds appropriately, proportionately and on a timely basis to the situation in which it may find itself. Our Base Case Scenario over the next few years is a return to generating cash and achieving an operating surplus.
In the medium term, the College would hope to increase its endowment from all sources by at least £100 million to £150 million from its current position. The College will also continue to control costs and manage resources to best effect to support its principal objective of providing a first-class education. It is not at all certain that academic fees will be increased adequately to meet the full costs of educating our Undergraduates and, indeed, there is a possibility they may be reduced. The College needs to plan and act accordingly.
28
QUEENS, COLLEGE, CAMBRIDGE
ANNUAL REPORT AND FINANCIAL STATEMENTS
th
FOR THE YEAR ENDED 30 JUNE 2023
There is no doubt that the very challenging environment in which th¢ College has operated in the last year
will continue for the foreseeable future as the uncertainties it faces evolve and develop. The College will
strive to use ils resources wisely and efficiently in ihese difficult circumstsnces.
On beha]f of the Governing Body
JL£_
Dr M A El-Erian
President
Mr J Spence
Senior Bursar
**QUEENS’ COLLEGE, CAMBRIDGE**
## **ANNUAL REPORT AND FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
The Governing Body is responsible for preparing the Annual Report and financial statements in accordance with applicable law and United Kingdom Accounting Standards.
The Bursarial Committee has day to day responsibility, under the overall direction of the Governing Body, for ensuring that there is an effective system of internal control and that accounting records are properly kept in accordance with the College’s Statutes. It is required to present audited financial statements for each financial year, prepared in accordance with the Statutes of the University, for approval by the Governing Body which give a true and fair view of the state of affairs of the College and of the surplus or deficit of the College for that period.
In preparing these financial statements, the Governing Body is required to:
- select suitable accounting policies and then apply these consistently;
- make 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.
The Governing Body is satisfied that the College has adequate resources to continue in operation for the foreseeable future. The financial statements are accordingly prepared on a going concern basis.
The Governing Body has taken reasonable steps to ensure that there are appropriate financial and management controls in place to achieve policy, aims and objectives and to safeguard the assets of the College and prevent and detect fraud and other irregularities.
Any system of internal control, however, is designed to manage rather than eliminate risk and can only provide reasonable, not absolute, assurance against failure to achieve policy aims and objectives and material misstatement or loss.
The Governing Body is responsible for the maintenance and integrity of the corporate and financial information included on the College’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
30
**QUEENS’ COLLEGE, CAMBRIDGE**
## **INDEPENDENT AUDITORS’ REPORT TO THE GOVERNING BODY**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Opinion**
We have audited the financial statements of Queens’ College (the ‘College) and its subsidiaries (the ‘Group’) for the year ended 30 June 2022 which comprise the Consolidated Statement of Comprehensive Income and Expenditure, the Consolidated Statement of Changes in Reserves, the Consolidated Balance Sheet, the Consolidated Cash Flow Statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
- give a true and fair view of the state of the Group’s and College’s affairs as at 30 June 2022 and of its incoming resources and application of resources for the year then ended;
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
- have been prepared in accordance with the requirements of the Charities Act 2011 and the Statutes of the University of Cambridge.
## **Basis for opinion**
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We are independent of the Group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the United Kingdom, including the Financial Reporting Council’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusions relating to going concern**
In auditing the financial statements, we have concluded that the Trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group’s or College's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report.
## **Other information**
The Governing Body are responsible for the other information. The other information comprises the information included in the Annual Report other than the financial statements and our auditors’ report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
31
**QUEENS’ COLLEGE, CAMBRIDGE**
## **INDEPENDENT AUDITORS’ REPORT TO THE GOVERNING BODY**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
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 course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
## **Opinion on other matters prescribed by the Statutes of the University of Cambridge**
In our opinion based on the work undertaken in the course of the audit:
- The contribution due from the College to the University has been computed as advised in the provisional assessment by the University of Cambridge and in accordance with the provisions of Statute G,II, of the University of Cambridge.
## **Matters on which we are required to report by exception**
In the light of the knowledge and understanding of the Group and College and its environment obtained in the course of the audit, we have not identified material misstatements in the Review of Operations and Financial Review.
We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:
- sufficient accounting records have not been kept; or
- the financial statements are not in agreement with the accounting records; or
- we have not received all the information and explanations we require for our audit.
## **Responsibilities of the Governing Body**
As explained more fully in the responsibilities of the Governing Body statement set out on page 28, the Governing Body are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Governing Body determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Governing Body are responsible for assessing the Group’s and College’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the Group or the College or to cease operations, or have 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
32
**QUEENS’ COLLEGE, CAMBRIDGE**
## **INDEPENDENT AUDITORS’ REPORT TO THE GOVERNING BODY**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
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.
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:
Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows:
- the engagement partner ensured that the engagement team collectively had the appropriate competence, capabilities and skills to identify or recognise non-compliance with applicable laws and regulations;
- we identified the laws and regulations applicable to the Group through discussions with Trustees and other management, and from our knowledge and experience of the education sector;
- we obtained an understanding of the legal and regulatory framework applicable to the Group and how the Group is complying with that framework;
- we obtained an understanding of the Group’s policies and procedures on compliance with laws and regulations, including documentation of any instances of non-compliance;
- we identified which laws and regulations were significant in the context of the Group. The Laws and regulations we considered in this context were Charities Act 2011 , the Statutes of the University of Cambridge and taxation legislation. We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items;
- in addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the Group’s and College’s ability to operate or to avoid material penalty; and
- identified laws and regulations were communicated within the audit team regularly and the team remained alert to instances of non-compliance throughout the audit.
We assessed the susceptibility of the Group’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:
- making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and
- considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations.
To address the risk of fraud through management bias and override of controls, we;
- tested journal entries to identify unusual transactions;
- assessed whether judgements and assumptions made in determining the accounting estimates set out in the accounting policy were indicative of potential bias; and
- investigated the rationale behind significant or unusual transactions.
In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:
- agreeing financial statement disclosures to underlying supporting documentation;
- reviewing minutes of meetings of those charged with governance;
33
**QUEENS’ COLLEGE, CAMBRIDGE**
## **INDEPENDENT AUDITORS’ REPORT TO THE GOVERNING BODY**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
- enquiring of management as to actual and potential litigation and claims; and
- reviewing correspondence with relevant regulators and the College’s legal advisors.
There are inherent limitations in our audit procedures described above. The more removed that laws and regulations are from financial transactions, the less likely it is that we would become aware of noncompliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.
Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.
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/auditorsresponsibilties. This description forms part of our auditors’ report.
## **Use of our report**
This report is made solely to the College’s Governing Body as a body, in accordance with College’s statutes, the Statutes of the University of Cambridge and the Charities Act 2011. Our work has been undertaken so that we might state to the Governing Body those matters we are required to state to them in an Auditors’ Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the College and the College’s Governing Body as a body, for our audit work, for this report, or for the opinions we have formed.
## **PETERS ELWORTHY & MOORE**
Chartered Accountants and Statutory Auditors
Salisbury House Station Road Cambridge CB1 2LA Date: 6 October 2023
Peters Elworthy & Moore is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006.
34
**QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Basis of preparation**
The financial statements have been prepared in accordance with the provisions of the Statutes of the College and of the University of Cambridge and applicable United Kingdom accounting standards. In addition, the financial statements comply with the Statement of Recommended Practice: Accounting for Further and Higher Education (the SORP).
The Statement of Comprehensive Income and Expenditure includes activity analysis in order to demonstrate that all fee income is spent for educational purposes. The analysis required by the SORP is set out in note 6.
## **Basis of accounting**
The financial statements have been prepared under the historical cost convention, modified in respect of the treatment of investments which are included at valuation.
## **Basis of consolidation**
The consolidated financial statements include the College and its subsidiary undertakings. Details of the subsidiary undertakings included are set out in note 16. Intra-group balances are eliminated on consolidation.
A separate balance sheet and related notes for the College are not included in the accounts because the College's subsidiary company is a conference and banqueting trading company which donates its profits to the College each year. The balance sheet for the College alone would not be materially different to the one included in the accounts.
## **Recognition of income**
## _Academic fees_
Academic fees are recognised in the period to which they relate and include all fees chargeable to students or their sponsors.
## _Grant income_
Grants received from non-government sources (including research grants from non-government sources) are recognised within the Consolidated Statement of Comprehensive Income and Expenditure when the College is entitled to the income and performance related conditions have been met.
Income received in advance of performance related conditions is deferred on the balance sheet and released to the Consolidated Statement of Comprehensive Income and Expenditure in line with such conditions being met.
## _Donations and endowments_
Non-exchange transactions without performance related conditions are donations and endowments. Donations and endowments with donor-imposed restrictions are recognised within the Consolidated Statement of Comprehensive Income and Expenditure when the College is entitled to the income. Income is retained within restricted reserves until such time that it is utilised in line with such restrictions at which point the income is released to general reserves through a reserve transfer.
Donations and endowments with restrictions are classified as restricted reserves with additional disclosure provided within the notes to the accounts.
35
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## _Donations and endowments (continued)_
There are four main types of donations and endowments with restrictions:
1. Restricted donations – the donor has specified that the donation must be used for a particular objective.
2. Unrestricted permanent endowments – the donor has specified that the fund is to be permanently invested to generate an income stream for the general benefit of the College.
3. Restricted expendable endowments – the donor has specified a particular objective and the College can convert the donated sum into income.
4. Restricted permanent endowments – the donor has specified that the fund is to be permanently invested to generate an income stream to be applied to a particular objective.
Donations with no restrictions are recorded within the Consolidated Statement of Comprehensive Income and Expenditure when the College is entitled to the income.
## _Investment income and change in value of investment assets_
Investment income and change in value of investment assets is recorded in income in the year in which it arises and as either restricted or unrestricted income according to the terms or other restrictions applied to the individual endowment fund.
## _Other income_
Income is received from a range of activities including accommodation, catering conferences, job retention scheme grant income and other services rendered.
## _Cambridge Bursary Scheme_
In 2022-2023, payment of the Cambridge Bursaries to eligible students was made directly by the Student Loans Company (SLC). As a consequence, Cambridge University reimbursed the SLC for the full amount and each College paid their portion (based on their own eligible students) to the University.
The net payment of £203,457 is shown within the Consolidated Statement of Comprehensive Income and Expenditure as follows:
Income (see note 1) £106,858 Expenditure £310,315
## **Foreign currency translation**
Transactions denominated in foreign currencies are recorded at the rate of exchange ruling at the date of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into sterling at year end rates or, where there are forward foreign exchange contract, at contract rates. The resulting exchange differences are dealt with in the determination of the comprehensive income and expenditure for the financial year.
36
**QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Fixed assets**
## _Land and buildings_
Fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses.
Where parts of a fixed asset have different useful lives, they are accounted for as separate items of fixed assets.
Costs incurred in relation to land and buildings after initial purchase or construction, and prior to valuation, are capitalised to the extent that they increase the expected future benefits to the College.
Freehold land is not depreciated as it is considered to have an indefinite useful life. Freehold buildings are depreciated on a straight line basis over their expected useful economic lives of 25-50 years.
Buildings under construction are valued at cost, based on the value of architects’ certificates and other direct costs incurred. They are not depreciated until they are brought into use.
The cost of additions to operational property shown in the balance sheet includes the cost of land. All other assets are capitalised and depreciated over their expected useful life as follows:
Furniture and fittings 10% per annum Motor vehicles and general equipment 20% per annum Computer equipment 33.33% per annum
## _Heritage assets_
The College holds and conserves a number of collections, exhibits, artefacts and other assets of historical, artistic or scientific importance. Heritage assets acquired before 1[st] July 1999 have not been capitalised since reliable estimates of cost or value are not available on a cost-benefit basis. Acquisitions since 1 July 1999 have been capitalised at cost or, in the case of donated assets, at expert valuation on receipt. Heritage assets are not depreciated since their long economic life and high residual value mean that any depreciation would not be material.
## **Investments**
Fixed asset investments are included in the balance sheet at fair value, except for investments in subsidiary undertakings which are stated in the College’s balance sheet at cost and eliminated on consolidation.
## **Stocks**
Stocks are stated at the lower of cost and net realisable value after making provision for slow moving and obsolete items.
## **Provisions**
Provisions are recognised when the College has a present legal or constructive obligation as a result of a past event, it is probable that a transfer of economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.
37
**QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Contingent liabilities and assets**
A contingent liability arises from a past event that gives the College 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 College. 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.
A contingent asset arises where an event has taken place that gives the College a possible asset whose existence will only be confirmed by the occurrence or otherwise of uncertain future events not wholly within the control of the College.
Contingent assets and liabilities are not recognised in the balance sheet but are disclosed in the notes.
## **Financial instruments**
The College has elected to adopt Sections 11 and 12 of FRS 102 in respect of the recognition, measurement, and disclosure of financial instruments. Financial assets and liabilities are recognised when the College becomes party to the contractual provision of the instrument, and they are classified according to the substance of the contractual arrangements entered into.
A financial asset and a financial liability are offset only when there is a legally enforceable right to set off the recognised amounts and an intention either to settle on a net basis, or to realise the asset and settle the liability simultaneously.
## **Financial assets**
Basic financial assets include trade and other receivables, cash and cash equivalents and investments in commercial paper (i.e. deposits and bonds). These assets are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Such assets are subsequently carried at amortised cost using the effective interest rate method. Financial assets are assessed for indicators of impairment at each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in the Statement of Comprehensive Income.
For financial assets carried at amortised cost the impairment loss is the difference between the carrying amount of the asset and the present value of the estimated future cash flows, discounted at the asset’s original effective interest rate.
Other financial assets, including investments in equity instruments, which are not subsidiaries or joint ventures, are initially measured at fair value which is typically the transaction price. These assets are subsequently carried at fair value and changes in fair value at the reporting date are recognised in the Statement of Comprehensive Income. Where the investment in equity instruments is not publicly traded and where the fair value cannot be reliably measured, the assets are measured at cost less impairment. Investments in property or other physical assets do not constitute a financial instrument and are not included.
## **Statement of Principal Accounting Policies**
Financial assets are de-recognised when the contractual rights to the cash flows from the asset expire or are settled or substantially all of the risks and rewards of ownership are transferred to another party.
38
**QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Statement of Principal Accounting Policies**
## **Financial Instruments (continued)**
Financial assets are de-recognised when the contractual rights to the cash flows from the asset expire or are settled or substantially all of the risks and rewards of ownership are transferred to another party.
## **Financial Liabilities**
Basic financial liabilities include trade and other payables, bank loans and intergroup loans. These liabilities are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Debt instruments are subsequently carried at amortised cost using the effective interest rate method.
Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down.
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade payables are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest rate method.
Derivatives, including forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date the derivative contract is entered into and are subsequently re-measured at their fair value at the reporting date. Changes in the fair value of derivatives are recognised in the Statement of Comprehensive Income in finance costs or finance income as appropriate, unless they are included in a hedging arrangement.
To the extent that the College enters into forward foreign exchange contracts which remain unsettled at the reporting date the fair value of the contracts is reviewed at that date. The initial fair value is measured as the transaction price on the date of inception of the contracts. Subsequent valuations are considered on the basis of the forward rates for those unsettled contracts at the reporting date. The College does not apply any hedge accounting in respect of forward foreign exchange contracts held to manage cash flow exposures of forecast transactions denominated in foreign currencies.
Financial liabilities are de-recognised when the liability is discharged, cancelled, or expires.
## **Taxation**
The College is a registered charity (number 1137495) and also a charity within the meaning of Section 467 of the Corporation Tax Act 2010. Accordingly, the College is exempt from taxation in respect of income or capital gains received within the categories covered by Sections 478 to 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 to exclusively charitable purposes.
The College receives no similar exemption in respect of Value Added Tax.
## **Contribution under Statute G, II**
The College is liable to be assessed for Contribution under the provisions of Statute GII of the University of Cambridge. Contribution is used to fund grants to colleges from the Colleges Fund. The liability for the year
39
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
as advised to the College by the University is based on an assessable amount derived from the value of the College’s assets as at the end of the previous financial year.
## **Pension costs**
The College participates in two funded defined benefit pension schemes, Cambridge Colleges Federated Pension Scheme (CCFPS) and the Universities Superannuation Scheme (USS)
Pension costs are accounted for on the basis of charging the cost of providing pensions over the period during which the College benefits from the Fellows’ or employees’ services.
## _Universities Superannuation Scheme (USS)_
Throughout the current and preceding periods, the Universities Superannuation Scheme was a defined benefit only pension scheme until 31[st] March 2016 which was contracted out of the State Second Pension (S2P). The assets of the scheme are held in a separate trustee-administered fund. Because of the mutual nature of the scheme, the scheme’s assets are not hypothecated to individual institutions and a scheme-wide contribution rate is set. The institution is therefore exposed to actuarial risks associated with other institutions’ employees and is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis and therefore, as required by Section 28 of FRS102 “Employee benefits”, accounts for the scheme as if it were a defined contribution scheme. As a result, the amount charged to the income and expenditure account represents the contributions payable to the scheme in respect of the accounting period. Since the institution has entered into an agreement (the Recovery Plan that determines how each employer within the scheme will fund the overall deficit), the College also recognises a liability for the contributions payable that arise from the agreement to the extent that they relate to the deficit and the resulting expense in the income and expenditure account.
## _Cambridge Colleges Federated Pension Scheme (CCFPS)_
The College participates in the Cambridge Colleges Federated Pension Scheme (CCFPS), a defined benefit scheme which is externally funded and until 31[st] March 2016 was contracted out of the State Second Pension (S2P). As CCFPS is a federated scheme and the College is able to identify its share of the underlying assets and liabilities, the College values the fund as required by Section 28 Employee Benefits of FRS102 ‘Retirement Benefits’. As a result, the amount charged to the Statement of Comprehensive Income and Expenditure represents the amount calculated under FRS102 guidelines.
## **Employment benefits**
Short term employment benefits such as salaries and compensated absences are recognised as an expense in the year in which the employees render service to the College. Any material unused benefits are accrued and measured as the additional amount the College expects to pay as a result of the unused entitlement.
## **Reserves**
Reserves are allocated between restricted and unrestricted reserves. Endowment reserves include balances which, in respect of endowment to the College, are held as permanent funds, which the College must hold to perpetuity.
Restricted reserves include balances in respect of which the donor has designated a specific purpose and therefore the College is restricted in the use of these funds.
40
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **Critical Accounting Estimates and Judgements**
The preparation of the College’s accounts requires management to make judgements, estimates and assumptions that affect the application of accounting policies and reported amounts of assets and liabilities, income and expenses. These judgements, estimates and associated assumptions are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The resulting accounting estimates will, by definition, seldom equal the related actual results.
Management consider the areas set out below to be those where critical accounting judgements have been applied and the resulting estimates and assumptions may lead to adjustments to the future carrying amounts of assets and liabilities.
Income recognition – Judgement is applied in determining the value and timing of certain income items to be recognised in the accounts. This includes determining the appropriate recognition timing for donations, bequests and legacies. In general, the later are recognised when at the probate stage.
Useful lives of property, plant, and equipment – Property, plant and equipment represent a significant proportion of the College’s total assets. Therefore, the estimated useful lives can have a significant impact on the depreciation charged and the College’s reported performance. Useful lives are determined at the time the asset is acquired and reviewed regularly for appropriateness. The lives are based on historical experiences with similar assets, Professional advice and anticipation of future events. Details of the carrying values of property, plant and equipment are shown in page 50.
Investment property – Properties are revalued to their fair value at the reporting date by Carter Jonas and Bidwells. The valuation is based on the assumptions and judgements which are impacted by a variety of factors including market and other economic conditions.
Retirement benefit obligations – The cost of defined benefit pension plans are determined using actuarial valuations. The actuarial valuation involves making assumptions about discount rates, future salary increases, mortality rates and future pension increases. Due to the complexity of the valuation, the underlying assumptions and the long-term nature of these plans, such estimates are subject to significant uncertainty. Further details are given in pages 59-64.
Management is satisfied that Universities Superannuation Scheme meets the definition of a multi-employer scheme and has therefore recognised the discounted fair value of the contractual contributions under the funding plan in existence at the date of approving the accounts.
As the College is contractually bound to make deficit recovery payments to USS, this is recognised as a liability on the balance sheet. The provision is currently based on the USS deficit recovery plan agreed after the 2018 actuarial valuation, which defines the deficit payment required as a percentage of future salaries until 2021. These contributions will be reassessed within each triennial valuation of the scheme. The provision is based on management’s estimate of expected future salary inflation, changes in staff numbers and the prevailing rate of discount. Further details are set out in pages 59 - 64.
41
**QUEENS' COLLEGE, CAMBRIDGE**
## **Consolidated Statement of Comprehensive Income and Expenditure**
## **FOR THE YEAR TO 30 JUNE 2023**
|Note
**INCOME**
Academic fees & charges
1
Accommodation, catering and conferences
2
Endowment and investment income
3
Endowment return transferred to I&E account
3a
Other income
Total income before donations and endowments
Donations
Deferred Capital write back
New endowments
Capital grants from colleges fund
Other capital grants for assets
**Total income**
**EXPENDITURE**
Education
4
Accommodation, catering and conferences
5
Other expenditure
Contribution under Statute G, II
**Total expenditure**
6
**Surplus (deficit) before other gains and losses**
Gains(loss) on disposal of fixed assets
8
Gains(loss) on investments
9
**Surplus (deficit) for the year**
**Other comprehensive income**
Unrealised surplus on revaluation of fixed assets
Actuarial gain(loss) in respect of pension schemes
15
**Total comprehensive income for the year**|**Unrestricted**
**Restricted**
**Endowment**
**Total**
**Unrestricted**
**Restricted**
**Endowment**
**Total**
**£'000**
**£'000**
**£'000**
**£'000**
**£'000**
**£'000**
**£'000**
**£'000**
4,678
4,678
4,530
4,530
6,141
6,141
4,852
4,852
408
277
2,528
3,213
1,350
1,249
602
3,201
1,821
999
(2,820)
0
148
148
128
128
**2021-22**
**2022-23**|
|---|---|
||**13,195**
**1,276**
**(292)**
**14,180**
**10,860**
**1,249**
**602**
**12,711**|
||2,406
2,186
4,592
3,145
1,316
4,462
0
0
0
1,072
1,072
0
1,383
1,383
0
0
0
0
0
0|
||**15,601**
**3,462**
**780**
**19,843**
**14,005**
**2,565**
**1,985**
**18,555**|
||7,436
1,247
602
9,285
7,044
1,249
602
8,895
8,364
8,364
6,922
6,922
1,389
193
1,582
948
948
39
39
36
36|
||**17,228**
**1,440**
**602**
**19,270**
**14,949**
**1,249**
**602**
**16,801**|
||(1,627)
2,022
178
573
(944)
1,316
1,383
1,754
446
446
0
0
899
202
1,875
2,977
(178)
(73)
(681)
(932)|
||(282)
2,224
2,053
3,995
(1,122)
1,243
702
823
0
0
0
0
466
466
6,107
6,107|
||**184**
**2,224**
**2,053**
**4,461**
**4,985**
**1,243**
**702**
**6,930**|
The notes on pages 46 to 64 form part of these accounts
42
## **QUEENS' COLLEGE, CAMBRIDGE**
## **Statement of Changes in Reserves Year Ended 30th June 2023**
|**Balance at 1 July 2022**
Opening balance
Change of Fund Classification
Surplus/(Deficit) from income and expenditure statement
Other comprehensive income
Release of restricted capital funds spent in year
**Balance at 30th June 2023**
**Balance at 1 July 2021**
Opening balance
Change of Fund Classification
Surplus/(Deficit) from income and expenditure statement
Other comprehensive income
Release of restricted capital funds spent in year
**Balance at 30th June 2022**|**Unrestricted**
**Restricted**
**Endowment**
**£'000**
**£'000**
**£'000**
56,820
23,084
70,075
0
0
0
(282)
2,224
2,053
466
0
0
0
0
0
**57,004**
**25,308**
**72,128**
**Unrestricted**
**Restricted**
**Endowment**
**£'000**
**£'000**
**£'000**
51,835
21,841
69,373
0
0
0
(1,122)
1,243
702
6,107
0
0
0
0
0
**56,820**
**23,084**
**70,075**
**Income and expenditure reserve**
**Income and expenditure reserve**|**Total**
**£'000**
149,979
0
3,995
466
0|
|---|---|---|
|||**154,440**|
|||**Total**
**£'000**
143,050
0
823
6,107
0|
|||**149,979**|
The notes on pages 46 to 64 form part of these accounts
43
QUEENS, COLLEGE. CAMBRIDGE
CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2023
Note
2023
Croup
2022
Croup
NON CIIRRENT ASSffS
Fix¢d ass¢Ls
H¢riiage Assets
Investsn¢nts
50.345
103
1?9,504
40.902
103
136,267
Total norl-eurrètti *ss¢ts
Ci1RRENT ASSETS
10
396
2.152
475
433
,702
455
Trade otherreceivab1¢5
Cash and ¢asb ¢quivalent5
Totsl ¢urrtDt avatts
3.023
2.590
CrtdltDri: ¥mouNts lalling due wlthli ott¢ year
13
1.522
Total kntts less turrtml li#bilitie5
181.452
177.747
Crtditors.. fxllillg dut afttr rnort
th*n ollt year
14
123.0001
123.0001
ProvisioDS
Pension provjsjoThs
Oth¢rprosisioll5
14.7671
Toial Mrt A$5tts
154.mo
149.979
Rt5tri¢ied regervts
lrtcome and ¢xpenditure TeserveFee income received at the Graduate rate
Other Income
**2**
Accommodation:
College members
Conferences and banquets
Catering:
College members
Conferences and banquets
Total
**3**
**3a**
Actual Income from:
Land and buildings
Quoted securities
Fixed interest securities
Other interest receivable
Total
**3b Analysis of investment gains**
Land and buildings
(Losses)/Gains on other assets
Total
**3c Summary of Total Return**
Actual Income from:
Land and buildings
Quoted securities
Fixed interest securities
Other interest receivable
Total
(Losses)/Gains on endowment assets (see note 3b)
Total return for year
Total return transferred to income & expenditure reserve
Unapplied total return for the year included within
Statement of Comprehensive Income and
Expenditure (note 19)
Fee income received at the Regulated undergraduate rate
**Income from accommodation, catering and conferences**
Income from short-term investments
**Analysis**
**Endowment and investment income**
Income from short-term investments
(Losses)/Gains on endowment assets
Quoted and other securities and cash
Investment management costs
Fee income received at the Unregulated undergraduate rate
Quoted and other securities and cash|**2023**
**£000**
2,629
199
1,743
107|
**2023**
**£000**
667
1,910
0
129
508|**2022**
**£000**
2,582
206
1,595
146|
|---|---|---|---|
||4,678||4,530|
||3,813
515
1,096
718||3,651
167
780
254|
||6,141||4,852|
||||**2022**
**£000**
494
2,072
16
46
573|
|||3,213|
3,201|
|||**2023**
**£000**
363
2,632|**2022**
**£000**
1,115
(1,795)|
|||2,995
(680)
(18)
(252)||
|||2,977
(932)||
|||667
1,356
0
129
377
2,528
2,977
(274)
5,231
(2,820)
2,411||
46
|**3b Investment management costs**
Land and buildings
Quoted securities - equities
Fixed interest securities
Other investments
Cash
Total
**4**
Teaching
Tutorial
Admissions
Research
Total
**5**
Accommodation:
Catering:
Total
Conferences and banquets
**Accommodation, catering and conferences expenditure**
College members
Conferences and banquets
Other educational facilities
College members
**Education expenditure**
Scholarships and awards|**2023**
**2022**
**£000**
**£000**
(195)
(169)
(79)
(88)
0
0
0
0
0
0|
|---|---|
||(274)
(257)|
||**2023**
**2022**
**£000**
**£000**
4,213
4,397
1,962
1,810
798
576
284
401
1,165
930
864
781|
||9,285
8,895|
||**2023**
**2022**
**£000**
**£000**
5,635
5,111
740
232
1,394
1,241
595
338|
||8,364
6,922|
47
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **6a Analysis of 2022/2023 expenditure by activity**
|Education
Accommodation, catering and conferences
Other|**Staff costs**
**Other**
**Depreciation**
**Total**
**(note 7)**
**operating**
**expenses**
**£000**
**£000**
**£000**
**£000**
4,850
3,687
941
9,478
3,377
3,157
1,831
8,364
495
933
0
1,428|
|---|---|
||8,722
7,777
2,772
19,270|
Expenditure includes fundraising costs of £452,993 and £267,268 on alumni relations.
## **6b Analysis of 2021/2022 expenditure by activity**
|Education
Accommodation, catering and conferences
Other|**Staff costs**
**Other**
**Depreciation**
**Total**
**(note 7)**
**operating**
**expenses**
**£000**
**£000**
**£000**
**£000**
5,002
3,095
799
8,895
3,107
2,179
1,636
6,922
417
567
0
984|
|---|---|
||8,525
5,841
2,434
16,801|
Expenditure includes fundraising costs of £368,193 and £211,298 on alumni relations.
## **6c Auditors' remuneration**
||||||
|---|---|---|---|---|
|**Auditors' remuneration**|**2023**||**2022**||
||**£000**||**£000**||
|Other operating expenses include:|||||
|Audit fees payable to the College's external auditors||43||38|
|Other fees payable to the College's external auditors||0||0|
48
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **7 Staff costs**
|**EENS' COLLEGE, CAMBRIDGE**
**TES TO FINANCIAL STATEMENTS**
**AR ENDED 30 JUNE 2023**
**Staff costs**||
|---|---|
|**Consolidated**
**Staff Costs:**
Emoluments
Social security
Pension
Academic
Non-academic|**Academic**
**Non- academic**
**Total**
**Total**
**2023**
**2022**
**£000**
**£000**
**£000**
**£000**
2,256
5,424
7,680
5,900
190
311
502
492
350
190
540
2,133|
||2,796
5,926
8,722
8,525|
||**Number of**
**Fellows**
**Full-time**
**equivalents**
**Number of**
**Fellows**
**Full-time**
**equivalents**
55
60
147.75
111
**Average staff numbers 2023**
**Average staff numbers 2022**|
At the Balance Sheet date there were 63 members of the Governing Body. During the year the average number receiving remuneration was the 55 shown above.
|The number of officers and employees of the College, including Head of House, who received remuneration in the|The number of officers and employees of the College, including Head of House, who received remuneration in the|||
|---|---|---|---|
|following ranges was|**2023**|**2022**||
|£100,001 - £110,000|1||1|
|£110,001 - £120,000|1||2|
|£120,001 - £130,000|0||2|
|£130,001 - £140,000|2||1|
|£140,001 - £150,000|3||0|
The total cost of remuneration includes salary, employer's national insurance contributions, employer's pension contributions plus any taxable benefits either paid, payable or provided, gross of any salary sacrifice arrangements.
## **Key management personnel**
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the College.
The aggregated remuneration paid to key management personnel consists of salary, employer's national insurance contributions, employer's pension contributions, plus any taxable benefits either paid, payable or provided, gross of any salary sacrifice arrangements. The President, Senior Bursar, and Senior Tutor are the College's key management personnel.
Key management personnel aggregated remuneration
|**Total**|**Total**||
|---|---|---|
|**2023**|**2022**||
|**£'000**|**£'000**||
|434||389|
The Trustees received no remuneration in their capacity as Trustees of the Charity.
49
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **8 Fixed assets**
|**EENS' COLLEGE, CAMBRIDGE**
**TES TO FINANCIAL STATEMENTS**
**AR ENDED 30 JUNE 2023**
**Fixed assets**||
|---|---|
|**Cost or valuation**
At beginning of year
Additions at cost
Revaluation of assets
Transfer between classes
Disposals
At end of year
**Depreciation**
At beginning of year
Charge for the year
Eliminated on Disposal
Eliminated on Transfer
Written back on revaluation
At end of year
NET BOOK VALUE
At end of year
At beginning of year|**2023**
**2022**
**Land and**
**buildings**
**Assets in**
**construction**
**Equipment**
**Heritage**
**Assets**
**Total**
**Total**
**£000**
**£000**
**£000**
**£000**
**£000**
**£000**
60,590
1,162
2,454
103
64,308
62,518
12,367
1,434
794
0
14,594
3,848
0
0
0
0
0
0
1,060
(1,060)
0
0
0
0
(2,626)
0
(835)
0
(3,461)
(2,058)|
||71,390
1,535
2,413
103
75,441
64,308|
||21,978
0
1,327
0
23,304
22,927
2,252
0
520
0
2,772
2,434
0
0
(835)
0
(835)
(2,058)
(247)
0
0
0
(247)
0
0
0
0
0
0
0|
||23,983
0
1,012
0
24,994
23,304|
||`
47,407
1,535
1,402
103
50,447
41,004|
||38,612
1,162
1,128
103
41,004
39,591|
The insured value of freehold land and buildings as at 30 June 2023 was £203m (2022: £182m).
50
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **8 Tangible fixed assets (continued)**
## **Heritage assets**
The College holds and conserves certain collections, artefacts and other assets of historical, artistic or scientific importance.
As stated in the statement of principal accounting policies, heritage assets acquired since July 1999 have been capitalised. However the majority of assets held in the College's collections were acquired prior to this date. As reliable estimates of the cost or valuation are not available for these on a cost-benefit basis, they have not been capitalised. As a result the total included in the balance sheet is partial.
Amounts for the current and previous years were as follows:
|Acquisitions purchased with specific
donations
Acquisitions purchased with College funds
Total cost of acquisitions purchased
Value of acquisitions by donation
Total acquisitions capitalised|**2023**
**2022**
**2021**
**2020**
**2019**
**£000**
**£000**
**£000**
**£000**
**£000**
0
0
0
0
0
0
0
0
0
88|
|---|---|
||0
0
0
0
88
0
0
0
0
0|
||0
0
0
0
88|
## **9 Fixed asset investments**
|Balance at beginning of year
Additions
Tranfered from fixed assets
Disposals
Less: impairment on unquoted securities
Gain/(loss)
Balance at end of year
Represented by:
Property
Quoted securities – equities
Fixed interest securities
Other investments
Cash in hand & at investment managers
Total|**2023**
**2022**
**Total**
**Total**
**£000**
**£000**
136,267
73,791
2,825
(86,355)
0
2,977
135,271
56,183
0
(54,256)
0
(932)|
|---|---|
||129,504
136,267|
||31,807
26,077
52,085
58,799
7,569
1,523
22,515
21,203
15,528
28,665|
||129,504
136,267|
51
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **10 Stocks and work in progress**
|Goods for resale
Work in progress
Other Stocks
**11 Trade and other receivables**
Members of the College
Other receivables
Prepayments and accrued income
**12**
Bank deposits
Current accounts
Cash in hand
**13 Creditors: amounts falling due within one**
**year**
Trade creditors
Members of the College
Receipts in advance
University Fees
Contribution to Colleges Fund
Accruals and deferred income
Other creditors
Amounts due from subsidiary undertakings
**Cash and cash equivalents**
Short-term money market investments
Amounts due to subsidiary undertakings|**2023**
**2022**
**£000**
**£000**
396
433
0
0
0
0|
|---|---|
||396
433|
||**2023**
**2022**
**£000**
**£000**
15
32
0
0
1,969
1,502
168
168|
||2,152
1,702|
||**2023**
**2022**
**£000**
**£000**
526
448
(51)
7|
||475
455|
||**2023**
**2022**
**£000**
**£000**
820
1,240
326
324
0
0
266
444
71
71
39
36|
||1,522
2,114|
## **14 Long term loans**
During 2013-14, the College borrowed from instutional investors, collectively with other Colleges, the College's share being £8 million. The Loans are unsecured and repayable during the period 2043-2053, and are at fixed interest rates of approximately 4.42%. The College has agreed a financial covenant of the ratio of Borrowings to Net Assets, and has been in compliance with the covenant at all times since incurring the debt.
During the course of 2017-2018, the College rasied a further £15 million of unsecured debt from institutional investors at a fixed rate of interest of 2.62% per annum. Repayment is due in one amount a the end of 40 years. There is an agreed covenant in respect of the borrowings which the College has been in compliance with.
52
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
|**15 Pension provisions**
**CCFPS**
**Balance at beginning of year**
Movement in year:
Current service costs including life assurance
Contributions
Other finance cost
Balance at end of year
**USS**
**Balance at beginning of year**
Current service costs including life assurance
Contributions
Other finance cost
Balance at end of year
Actuarial loss/(gain) recognised in Statement of
Comprehensive Income and Expenditure|**2023**
**2022**
**£000**
**£000**
3,568
9,301
935
1,478
(1,234)
(1,104)
0
0
(466)
(6,107)|
|---|---|
||2,803
3,568|
||1,199
568
65
654
(96)
(29)
40
5|
||1,208
1,199|
## **16 Principal subsidiary undertakings**
The College owns 100% of the ordinary share capital of QC Enterprises Limited, a company incorporated in England. The principal activity of the company is the provision of conference and banqueting services at the College.
## **17 Endowment funds**
Restricted net assets relating to endowments are as follows:
|**Balance at beginning of year**
Capital
New Donations and endowments
Increase/(decrease) in market value of
investments
**Balance at end of year**
**Analysis by type of purpose**
Fellowship funds
Scholarship funds
Prize Funds
Hardship funds
Bursary funds
Travel grant funds
Other funds
General
**Analysis by asset**
Property
Investments
Cash|**2023**
**2022**
**Total**
**Total**
**£000**
**£000**
**£000**
**£000**
40,260
29,815
70,075
69,373
1,051
21
1,072
1,383
1,046
(65)
981
(681)
**Restricted**
**permanent**
**endowments**
**Unrestricted**
**permanent**
**endowments**|
|---|---|
||42,358
29,770
72,128
70,075|
||30,038
0
30,038
28,315
4,746
0
4,746
4,610
0
0
0
0
133
0
133
129
5,115
0
5,115
4,956
453
0
453
438
149
0
149
144
1,723
29,770
31,493
31,481|
||42,358
29,770
72,128
70,075|
||6,751
4,745
11,497
11,169
33,194
23,330
56,524
54,915
2,412
1,695
4,108
3,991|
53
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **18 Restricted Reserves**
Reserves with restrictions are as follows:
|||**Permanent**|**Permanent**||||
|---|---|---|---|---|---|---|
|||**unspent**|**and**|**Restricted**|||
||**Capital grants**|**other restricted**||**expendable**|**2023**|**2022**|
||**unspent**|**income**||**endowment**|**Total**|**Total**|
||**£000**|**£000**||**£000**|**£000**|**£000**|
|Balance at beginning of year|0|2,328||20,756|23,084|21,841|
|Capital|0||0|20,314|20,314|19,157|
|Accumulated income|0|2,328||441|2,770|2,684|
|Change of Fund Classification|0||0|0|0|0|
|New grants|0||0|0|0|0|
|New donations|0||0|2,186|2,186|1,316|
|Endowment return transferred|0||838|162|999|906|
|Other investment income|0||277|0|277|343|
|Increase/(decrease) in market value of|||||||
|investments|0||0|202|202|(73)|
|Expenditure|0||(837)|(603)|(1,440)|(1,249)|
|Capital grants utilised|0||0|0|0|0|
|Balance at end of year|0|2,606||22,702|25,308|23,084|
|capital|0||0|22,215|22,215|20,314|
|Accumulated income|0|2,606||487|3,093|2,770|
|Analysis of other restricted|||||||
|funds/donations by type of purpose|||||||
|Fellowship funds|0|2,044||1,068|3,113|2,851|
|Scholarship funds|0||151|601|752|713|
|Prize Funds|0||0|0|0|0|
|Hardship funds|0||(7)|1,582|1,575|1,497|
|Bursary funds|0||330|669|1,000|943|
|Travel grant funds|0||41|36|76|72|
|Other funds|0||41|18,462|18,503|16,735|
|General|0||6|283|289|274|
## **19 Memorandum of Unapplied Total Return**
Within the reserves representing investments held by the College, the following are the cumulative surpluses of total return on the main investment portfolio
|**Memorandum of Unapplied Total Return**
Within the reserves representing investments held by the College, the
following are the cumulative surpluses of total return on the main
||
|---|---|
|investment portfolio
Unapplied Total Return at start of year
Surplus of total return for year (note 3)
Unapplied total return at end of year|**2023**
**2022**
**£000**
**£000**
32,679
32,679
2,411
0|
||35,090
32,679|
54
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
**20 Reconciliation of consolidated surplus for the year to net cash inflow from operating activities**
|**Reconciliation of consolidated surplus for the year to net cash inflow from**|**operating activities**|||
|---|---|---|---|
|||**2023**|**2022**|
|||**£000**|**£000**|
|Surplus/(deficit) for the year||3,995|823|
|**Adjustment for non-cash items**||||
|Depreciation|8|2,772|2,434|
|Loss/(gain) on endowments, donations and investment property|17|(2,977)|932|
|Decrease/(increase) in stocks|10|37|3|
|Decrease/(increase) in trade and other receivables|11|(450)|459|
|Increase/(decrease) in creditors|13|(592)|367|
|Increase/(decrease in provisions||0|0|
|Pension costs less contributions payable|15|(290)|1,005|
|Loss/(gain) on sale of property||(446)|0|
|**Adjustment for investing or financing activities**||||
|Investment income||(3,213)|(3,201)|
|Interest payable||747|747|
|**Net cash inflow from operating activities**||(416)|3,568|
55
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
**21 Cash flows from investing activities**
|**QUEENS' COLLEGE, CAMBRIDGE**
**NOTES TO FINANCIAL STATEMENTS**
**YEAR ENDED 30 JUNE 2023**
||
|---|---|
|**21 Cash flows from investing activities**
Proceeds from the sales of non-current fixed assets
Non-current investment disposal
Investment income
Endowment funds invested
Withdrawal of deposits
Payments made to acquire non-current assets
**Total cash flows from investing activities**
**22 Cash flows from financing activities**
Interest paid
Interest element of finance rental payment
New unsecured loans
Repayments of amounts borrowed
Capital element of finance lease rental payment
**Total cash flows from financing activities**
**23 Capital commitments**
Capital commitments at 30 June 2023 are as follows:
Authorised and contracted
Authorised but not yet contracted for|**2023**
**2022**
**£000**
**£000**
0
0
86,355
54,256
3,213
3,201
0
0
0
0
(88,385)
(60,031)|
||1,184
(2,573)|
||**2023**
**2022**
**£000**
**£000**
(747)
(747)
0
0
0
0
0
0
0
0|
||(747)
(747)|
||**2023**
**2022**
**£000**
**£000**
0
1,600
0
2,150|
56
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **24 Consolidated reconciliation and analysis of net debt**
||||||**Other**||
|---|---|---|---|---|---|---|
|||**At 1 July**|**Cash**||**non-cash**|**At 30 June**|
|||**2022**|**Flows**||**changes**|**2023**|
|||**£000**|**£000**||**£000**|**£000**|
||**Cash and cash equivalents**|455||20||475|
||**Borrowings:**||||||
||**Amounts falling due after more than one**||||||
||**year**||||||
||Unsecured loans|(23,000)||||(23,000)|
||**Total net debt**|(22,545)||20|0|(22,525)|
|**25 **|**Financial Instruments**||||**2023**|**2022**|
||||||**£000**|**£000**|
||**Financial assets**||||||
||_Financial assets at fair value through Statement of Comprehensive income_||||||
||Listed equity investments||||59,654|58,799|
||Other investments||||54,322|38,580|
||_Financial assets that are debt instruments measured at amortised cost_||||||
||Cash and cash equivalents||||16,003|30,188|
||Other debtors||||1,984|1,534|
||**Financial liabilities**||||||
||_Financial liabilities measured at amortised cost_||||||
||Loans||||23,000|23,000|
||Trade creditors||||820|1,357|
||Other creditors||||702|431|
57
## **QUEENS' COLLEGE, CAMBRIDGE NOTES TO FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2023**
## **26 Related Party Transactions**
Owing to the nature of the College’s operations and the composition of the Governing Body, it is inevitable that transactions will take place with organisations in which a Governing Body member may have an interest. All transactions involving organisations in which a member of the Governing Body may have an interest are conducted at arm’s length and in accordance with the College’s normal procedures.
The College maintains a Register of Interest for all Fellows and College employees with spending authority. It is updated every six months and during the year to 30th June 2023 it reveals that no material events occurred.
During the year no fees or expenses were paid to Fellows in respect of their duties as Trustees.
Fellows are remunerated for teaching, research and other duties within the College. Fellows are billed for any private catering. The Trustees remuneration is overseen by the Stipends Committee.
The College continues it's investment in joint equity properties with 1 College Fellow (1 Fellow in 2023). The total investment by the College amounted to £147,175 (2022 £147,175).
The salaries paid to Trustees in the year are summarised in the table below:
|**From**
**To**
£0
£10,000
£10,001
£20,000
£20,001
£30,000
£30,001
£40,000
£40,001
£50,000
£50,001
£60,000
£60,001
£70,000
£70,001
£80,000
£80,001
£90,000
£90,001
£100,000
£100,001
£110,000
£110,001
£120,000
**Total**|**2023**
**2022**
20
26
14
16
7
8
2
2
1
0
1
2
2
1
3
1
0
4
1
0
3
1
1
0|
|---|---|
||55
61|
The total Trustee salaries were £1,622,652 for the year (2022: £1,399,918)
The trustees were also paid other taxable benefits (including associated employer National Insurance contributions and employer contributions to pensions) which totalled £51,260 for the year (2022: £52,663)
The College has one trading and one dormant subsidiary undertaking, both of which are consolidated into these accounts. Both subsidiary undertakings are 100% owned by the College and are registered and operating in England and Wales. The College has taken advantage of the exemption within section 33 of FRS 102 not to disclose transactions with wholly owned group companies that are related parties.
58
**QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **UNIVERSITIES SUPERANNUATION SCHEME**
## **Significant accounting policies**
The institution participates in Universities Superannuation Scheme. The assets of the scheme are held in a separate trustee-administered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The institution is therefore exposed to actuarial risks associated with other institutions’ employees and is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis. As required by Section 28 of FRS 102 “Employee benefits”, the institution therefore accounts for the scheme as if it were a defined contribution scheme. As a result, the amount charged to the profit and loss account represents the contributions payable to the scheme. Since the institution has entered into an agreement (the Recovery Plan) that determines how each employer within the scheme will fund the overall deficit, the institution recognises a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) with related expenses being recognised through the profit and loss account.
## **Critical accounting judgements**
FRS 102 makes the distinction between a group plan and a multi-employer scheme. A group plan consists of a collection of entities under common control typically with a sponsoring employer. A multi-employer scheme is a scheme for entities not under common control and represents (typically) an industry-wide scheme such as Universities Superannuation Scheme. The accounting for a multi-employer scheme where the employer has entered into an agreement with the scheme that determines how the employer will fund a deficit results in the recognition of a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) with the resulting expense charged through the profit or loss account in accordance with section 28 of FRS 102. The directors are satisfied that Universities Superannuation Scheme meets the definition of a multi-employer scheme and has therefore recognised the discounted fair value of the contractual contributions under the recovery plan in existence at the date of approving these financial statements.
## **PENSION COSTS**
The total cost charged to the profit and loss account is £9,067 (2022: £630,803).
Deficit recovery contributions due within one year for the institution are £95,746 (2022: £87,595).
The latest available complete actuarial valuation of the Scheme is as at 31 March 2020 (the valuation date), and was carried out using the projected unit method.
Since the institution cannot identify its share of USS Retirement Income Builder (defined benefit) assets and liabilities, the following disclosures reflect those relevant for those assets and liabilities as a whole.
The 2020 valuation was the sixth valuation for the scheme under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to have sufficient and appropriate assets to cover their technical provisions. At the valuation date, the value of the assets of the scheme was £66.5 billion and the value of the scheme’s technical provisions was £80.6 billion indicating a shortfall of £14.1 billion and a funding ratio of 83%.
59
## **QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
The key financial assumptions used in the 2020 valuation are described below. More detail is set out in the Statement of Funding Principles:
( **uss.co.uk/about-us/valuation-and-funding/statement-of-funding- principles** ).
|CPI assumption|Term dependent rates in line with the difference between the Fixed Interest and
Index Linked yield curves less:
1.1% pa to 2030, reducing linearly by 0.1% pa to a long-term difference of 0.1%
pa from 2040|
|---|---|
|Pension increases (subject
to a floor of 0%)|CPI assumption plus 0.05%|
|Discount rate
(forward
rates)|Fixed interest gilt yield curve plus:
Pre-retirement: 2.75% pa
Post retirement: 1.00%pa|
The main demographic assumptions used relate to the mortality assumptions. These assumptions are based on analysis of the scheme’s experience carried out as part of the 2020 actuarial valuation. The mortality assumptions used in these figures are as follows:
## **2020 Valuation**
Mortality base table
101% of S2PMA ‘light’ for males and 95% of S3PFA for females.
Future improvements to mortality
CMI 2019 with a smoothing parameter of 7.5, an initial addition of 0.5% pa and a long-term improvement rate of 1.8% pa for males and 1.6% pa for females
The current life expectations on retirement at age 65 are:
|The current life expectations on retirement at|age 65 are:||
|---|---|---|
||**2023**|**2022**|
|Males currently aged 65 (years)|24.0|23.9|
|Females currently aged 65 (years)|25.6|25.5|
|Males currently aged 45 (years)|26.0|25.9|
|Females currently aged 45 (years)|27.4|27.3|
A deficit recovery plan was put in place as part of the 2020 valuation, which requires payment of 6.2% of salaries over the period 1 April 2022 until 31 March 2024, at which point the rate will increase to 6.3%. The 2022 deficit recovery liability reflects this plan. The liability figures have been produced using the following assumptions:
|
following assumptions:|||
|---|---|---|
||**2023**|**2022**|
|Discount rate|5.52%|3.31%|
|Pensionable salary growth|3.30%|3.33%|
60
**QUEENS' COLLEGE, CAMBRIDGE**
## **NOTES TO FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **CAMBRIDGE COLLEGES FEDERATED PENSION SCHEME**
The College operates a defined benefits plan for the College’s employees of the Cambridge Colleges’ Federated Pension Scheme.
The liabilities of the plan have been calculated at 30[th] June 2023 for the purposes of FRS102 using a valuation system designed for the Management Committee, acting as Trustee of the Cambridge Colleges’ Federated Pension Scheme, but allowing for the different assumptions required under FRS102 and taking fully into consideration changes in the plan benefit structure and membership since that date.
The principal actuarial assumptions at the balance sheet date were as follows:
|Discount rate
Increase in salaries
RPI assumption
CPI assumption
Pension increased in payment (RPI Max 5% pa)
Pension increases in payment (CPI Max 2.5% pa)|**30th June**
**2023**
5.20%
3.30%
3.40%*
2.80%*
3.30%*
2.05%*|**30th June**
**2022**
3.80%
3.25%
3.45%*
2.75%*
3.30%*
2.05%*|
|---|---|---|
*For one year only, we have assumed that RPI will be 9% and CPI will be79% (2022: 11% and 9% respectively). The caps under the Rules are applied to assumed pension increases.
The underlying mortality assumption is based upon the standard table known as S3PA on a year of birth usage with CMI_2022 future improvement factors and a long-term rate of future improvement of 1.25% per annum, a standard smoothing factor (7.0) and no allowance for additional improvements (2022: S3PA with CMI_2021 future improvement factors and a long-term future improvement rate of 1.25% per annum, a standard smoothing factor (7.0) and no allowance for additional improvements). This results in the following life expectancies:
- Male age 65 now has a life expectancy of 21.4 years (previously 21.9 years).
- Female age 65 now has a life expectancy of 23.9 years (previously 24.3 years).
- Male age 45 now and retiring in 20 years has a life expectancy of 22.6 years (previously 23.2 years).
- Female age 45 now and retiring in 20 years has a life expectancy of 25.3 years (previously 25.7 years).
61
**QUEENS’ COLLEGE, CAMBRIDGE**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **PENSION SCHEMES (CONTINUED)**
The assets in the Scheme and the expected rates of return were:
|_Long-term_
_rate of_
_return_
_expected at_
_30/06/2023_
Equities and Hedge Funds
Cash, Bonds & Net Current
Assets
Property
Total|_Value at_
_30/06/2023_
_Long-term_
_rate of_
_return_
_expected at_
_30/06/2022_
8,843,100
6,857,914
2,346,128
18,047,142|_Value at_
_30/06/2022_
_Long-term_
_rate of_
_return_
_expected at_
_30/06/2021_
10,257,694
6,706,954
2,761,687
19,726,335|_Value at_
_30/06/2021_
10,606,207
9,280,431
2,209,626
22,096,264|
|---|---|---|---|
The following results were measured in accordance with the requirements of FRS102
|Total market value of assets
Present value of Scheme liabilities
Surplus/(deficit) in the Scheme|**2023**
**£**
18,047,142
(20,850,393)
(2,803,251)|**2022**
**£**
19,726,335
(23,294,743)
(3,568,408)|**2021**
**£**
22,096,264
(31,397,694)
(9,301,430)|
|---|---|---|---|
The amounts recognised in income and expenditure are as follows:
|In staff costs: Current service cost (net of employee contributions)
In endowment and investment income:
Interest cost
Expected return on pension scheme assets
Net return
Actual return on pension scheme assets|**30th June**
**2023**
**£**
706,478
893,244
(754,999)
138,245
2,487,142|**30th June**
**2022**
**£**
1,255,992|
|---|---|---|
|||572,440
(403,831)|
|||168,609|
|||2,978,166|
62
**QUEENS' COLLEGE, CAMBRIDGE**
## **NOTES TO FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
## **PENSION SCHEMES (CONTINUED)**
|Changes in the present value of the plan liabilities are as follows:
Present value of plan liabilities at beginning of period
Current service cost (including employee’s contributions)
Interest on plan liabilities
Actuarial (gains) losses
(Gain)/loss on plan changes
Curtailment (gain)/loss
Benefits paid
Present value of plan liabilities at end of period
Changes in the fair value of scheme assets are as follows:
Market value of plan assets at beginning of year
Contributions by the College
Additional contributions by members (including AVCs)
Benefits (and expenses) paid
Interest on plan assets
Return on assets, less interest included in Prof.it & Loss
Market value of plan assets at end of year|**30th June**
**2023**
**30th June**
**2022**
**£**
**£**
23,294,743
31,397,694
1,021,287
1,532,171
893,244
572,440
(3,726,587)
(9,498,973)
36,712
0
0
0
(669,006)
(708,589)
20,850,393
23,294,743
**30th June**
**2023**
**30th June**
**2022**
**£**
**£**
19,726,335
22,096,264
1,234,057
1,103,937
314,809
276,179
(740,917)
(771,879)
754,999
403,831
(3,242,141)
(3,381,997)
18,047,142
19,726,335|
|---|---|
Amounts for the current and previous four periods are as follows:
|Present value of plan
liabilities
Market value of plan assets
Surplus/(deficit)
Experience adjustments on
plan liabilities
Change in assumptions
underlying present value of
plan liabilities|**30th June**
**2023**
**£**
(20,850,393)
18,047,142
(2,803,251)
2,241,885
(5,949,985)|**30th June**
**2022**
**£**
(23,294,743)
19,726,335
(3,568,408)
1,108,641
(10,597,748)|**30th June**
**2021**
**£**
(31,397,694)
22,096,264
(9,301,430)
(459,639)
(416,040)|**30th June**
**2020**
**£**
(30,798,169)
20,021,557
(10,776,612)
(54,536)
(3,026,582)|**30th June**
**2019**
**£**
(26,243,731)
17,915,328|
|---|---|---|---|---|---|
||||||(8,328,403)|
||||||
439,114
(2,878,488)|
63
**QUEENS' COLLEGE, CAMBRIDGE**
## **NOTES TO FINANCIAL STATEMENTS**
## **FOR THE YEAR ENDED 30[th] JUNE 2023**
The plan has no investments in property occupied by assets used by or financial instruments issued by the College.
## **Funding policy**
Actuarial valuations are carried out every three years on behalf of the Management Committee, acting as the Trustee of the Scheme, by a qualified independent actuary. The actuarial assumptions underlying the actuarial valuation are different to those adopted under FRS102.
The last such valuation was at 31[st] March 2020. This showed that the plan’s assets were insufficient to cover the liabilities on the funding basis. A Recovery Plan has been agreed with the College, which commits the College to paying contributions to fund the shortfall.
These deficit reduction contributions are incorporated into the plan’s Schedule of Contributions dated 21[st] May 2021 and are as follows:
- Annual contributions of not less than £274,247 per annum, payable for the period to 31[st] March 2029.
These payments are subject to review following the next funding valuation, due as at 31[st] March 2023.
64