2022-06-30-accounts

Clare College, Cambridge

Financial statements for the year ended 30 June 2022

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Contents	2
Contact Information and Advisors	3
Governing Body and Committees	4 - 5
Aims and Objectives of the College	6
Operating and Financial Review	7 - 12
Reserves Policy	10
Principal Risks and Uncertainties	10
Public Benefit as a Charity	11
Statement of Corporate Governance	13
Statement of Internal Control	14
Statement of Responsibilities of the Trustees of the College	15
Independent Auditors’ Report to the Trustees of the College	16 - 18
Statement of Principal Accounting Policies	19 - 23
Consolidated Statement of Comprehensive Income and Expenditure	24
Consolidated Statement of Change in Reserves	25
Consolidated and College Balance Sheets	26
Consolidated Cash Flow Statement	27
Notes to the Financial Statements	28 - 42

2

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Contact Information and Advisors

Address

Clare College Trinity Lane Cambridge CB2 1TL

Key officers

Master: Ms L R C Minghella, OBE Senior Tutor: Professor J A Tasioulas Bursar: Miss E J Conder

Registered charity number 1137531

VAT number 125 4984 96

Professional advisors:

Independent auditors Peters Elworthy & Moore Salisbury House Station Road Cambridge CB1 2LA

Principal bankers Barclays Bank plc 9-11 St Andrew’s Street Cambridge CB2 3AA

Principal solicitors Ashtons Legal Chequers House 77-81 Newmarket Road Cambridge CB5 BEU

Property managers

Bidwells Property Consultants Trumpington Road Cambridge CB2 2LD

Principal investment managers Amundi Asset Management 91-93 Boulevard Pasteur 75015 Paris, France

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Governing Body and Committees

for the year ended 30 June 2022

Status

The College is a corporate body consisting of the Master, the Fellows and the Scholars of Clare College, Cambridge as provided by the College's charter in 1359 and Statutes that were updated in 2017. The College is a registered charity with registration number 1137531 and registered office at Clare College, Trinity Lane, Cambridge, CB2 1TL.

The names of the members of the Governing Body and the Committees charged with the governance of the College during the year ended 30 June 2022 including any changes up to the date of signing are as follows:

Governing Body Master: Ms L C R Minghella, OBE Senior Tutor: Professor J A Tasioulas Bursar: Mr D J Ball (until 30.9.22) Miss E J Conder (from 1.10.22)

Professor N H Andrews	Professor R D Hedley	Mr G A C Ross
Professor A P Balmford	Professor D A Hodell	Professor D H Rowitch
Professor A A Berman	Professor N B Holdstock	Professor H L Sanson
Dr J I Block (from 1.10.22)	Professor D R Howarth	Professor O C H Shorttle
Professor I Budvytis	Professor K E Hughes	The Rev'd Dr M S Smith
Dr I R Burrows	Professor G S Jacobs	Professor M Sprik
Professor W J Byrne	Professor H F Jahn	Professor R Sterckx
Professor A Cabrera Serrenho	Professor P H Jones	Dr A M Stillman
Professor R G Cacho	Dr L R Klee	Professor S D Stranks
Professor J Carroll	Professor J Krupic	Dr M Tatulea-Codrean (from 1.10.22)
Dr A P Carter	Professor M B M Lahr	Professor A G Thomason
Professor A D Chambers	Professor H Laman	Professor H E Thompson
Professor T G Chesters	Professor R Lawson	Professor F M O Toxvaerd
Professor C J Clarke	Professor S M Lazar	Professor E C Turner
Professor N S Clayton	Professor P F Leadlay	Dr L A van Holstein (from 1.10.22)
Professor R Collepardo-Guevara	Professor I C Lestas	Professor H W van Veen
Professor M Dunajski	Professor T M Lewens	Professor J E Vinuales
Professor P C Fletcher	Professor Dame H M O Leyser	Professor R I Watson
Dr T Follini	Professor S J Lockwood	Professor M Weeks
Dr E A Foyster	Professor L Maniscalco	Professor C G Weiss
Professor S C Franklin	Dr T Moore	Dr T A H Wilkinson
Professor A D Friend	Professor G I Ogilvie	Dr S E Wimpenny (until 30.9.22)
Professor M Frolova-Walker	Dr R Pandya	Professor J Wolf
Professor J S Gibson	Professor G F Parker	Professor J M Wyburd
Professor R C Glen	Professor L C Paulson	Dr T Zhang (until 30.9.22)
Professor J M Goodman	Professor R T Phillips	Ms J T Bath (MCR President)
Professor N C Greenham	Professor A Philpott	Mr T R Else (MCR Vice-President)
Professor H Griffiths	Dr D Pollard	Mr V Kuganathan (UCS President)
Dr J A Guy	Professor J C Prabhu	Ms H S Weber (UCS Vice-President)
Dr R M Harris	Professor A M Preston
Professor S A Hartnoll	Dr K F Riley

All members of the Finance Committee and Council are trustees, except for the student members, and are given, on appointment, copies of the Statutes of the College, together with a note drawing attention to the policy for the management of conflicts of interest, and the requirements of the Charity Commission regarding such conflicts of interest.

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Governing Body and Committees for the year ended 30 June 2022

*Council

Ms L C R Minghella, OBE (Master) (Chair) Professor J A Tasioulas (Senior Tutor) Mr D J Ball (until 30.9.22) Miss E J Conder (from 1.10.22) Professor J Carroll Dr A P Carter Professor M Dunajski Professor J M Goodman Professor H Griffiths (until 30.9.22) Professor S M Lazar Professor S J Lockwood (from 1.10.22) Professor G F Parker Professor O C H Shorttle The Rev’d Dr M S Smith Ms J T Bath (MCR President) Mr V Kuganathan (UCS President)

Salaries and Stipends Committee

Professor R C Glen (Chair) Professor A D Chambers Mr T Harvey-Samuel (Bursar from another college) Professor J Woodhouse

In Attendance: Ms S Hewings (Secretary and HR Manager) Mr D J Ball (Bursar) (until 30.9.22) Miss E J Conder (Bursar) (from 1.10.22)

Audit Committee

Professor Prabhu (Chair) (from 1.10.22) Professor A D Chambers Professor Howarth Mr Newman (Clare alumnus) Professor R T Philips Mr M Smith (Clare alumnus)

In Attendance: Miss E R Easterbrook (Secretary)

*Finance Committee

Ms L C R Minghella, OBE (Master) (Chair) Professor J A Tasioulas (Senior Tutor) Mr D J Ball (Bursar) (until 30.9.22) Miss E J Conder (Bursar) (from 1.10.22) Professor A D Chambers Professor J M Goodman Professor N C Greenham Professor H Laman Professor H W van Veen Dr Wilkinson (from 1.10.22) Professor J Wolf Mr B Bergh (MCR representative) Ms A Oh (UCS representative)

In Attendance: Miss E R Easterbrook (Secretary) Mrs R C Willatt (Deputy Financial Bursar)

• All members of Council and Finance Committee are charity trustees except for the student members.

In Attendance: Mr D J Ball (Bursar) (until 30.9.22) Miss E J Conder (Bursar) (from 1.10.22) Mr J Pollington (Secretary) (until 29.7.22) Ms S Dowding (Secretary) (from 1.10.22) Mrs R C Willatt (Deputy Financial Bursar)

Estates Committee

Professor P M Allmendinger (Chair) (until 30.9.22) Professor N C Greenham (Chair) (from 1.10.22) Professor J A Tasioulas (Senior Tutor) Mr D J Ball (Bursar) (until 30.9.22) Miss E J Conder (Bursar) (from 1.10.22) Professor A P Balmford Dr T Follini Professor A D Friend Professor H Griffiths Professor W A Pullan Ms S R Mason (MCR representative) Mr L Bosnell (UCS representative)

In Attendance: Dr J E Costin (Secretary) Miss E R Easterbrook (Assistant Bursar) Ms D S Hoy (Estates Director) Mr B E Morgan (Head Porter) Mr J R Randall (IT Manager)

Investments Committee

Ms L C R Minghella, OBE (Master) Mr D J Ball (Bursar) (until 30.9.22) Miss E J Conder (Bursar) (from 1.10.22) Professor A D Chambers Mr N Cumming (Clare alumnus) Professor R C Glen Ms Griffiths (Clare alumna) Dr J A Guy Mr D Haynes (Clare alumnus) Professor J Wolf Mr T Else (MCR representative) Mr D Quan (UCS representative)

In Attendance: Miss E R Easterbrook (Secretary) Mrs R C Willatt (Deputy Financial Bursar) Dr Wilkinson (Fellow for Development)

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Aims and Objectives of the College

for the year ended 30 June 2022

The College's strategic plan sets out the College's long term aims in the context of national and global changes as follows:

• to maintain its emphasis on the individual in academic and pastoral provision; to deliver a world-class undergraduate education by safeguarding the provision of small-group teaching through the College-based supervision system; and to achieve excellence in education at both undergraduate and postgraduate levels;

• to support a community of Fellows, students and staff, allowing the benefits of a large, internationally renowned university to be realised in a small-scale and close-knit community;

• to foster and support a community of active alumni contributing to the life and future of the College;

• to promote academic research of the highest quality; and

• to maintain and enhance the endowments and benefactions, historic buildings and grounds of the College for the benefit of current and future generations.

Remaining an independent foundation within a collegiate University is fundamental to the College's long-term strategy. 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 formulating University policy.

Within the collegiate University, Clare offers distinctive strengths. The College is committed to sustaining and enhancing its particular contribution to Cambridge and to society in general by:

• maintaining and developing its long-standing commitment to encouraging applications from the most talented students, irrespective of background, in tandem with a needs-blind admissions system supported by a comprehensive programme of financial assistance;

• building on the College's strong international links to provide students with opportunities for educational and cultural exchanges, recognising the importance of such exchanges in an increasingly global society;

• supporting active engagement by the College and its members in the local community and in community activities nationally and internationally; and

• fostering excellence in music, through support of the College Choir, the choral and organ scholarships, and instrumental awards.

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Operating and Financial Review

for the year ended 30 June 2022

During the year, the College has continued to pursue its charitable aims in promoting learning, study, and teaching in a community of scholars in the University of Cambridge. The intense pressure on students to achieve the highest academic standards places corresponding demands on the College. Clare alumni, who were themselves taught by the leading academics of their generation in small group supervisions, understand those pressures and the need for financial resources to maintain this standard of education. Clare's financial resources are provided by our alumni and other sources, through donations which are increasingly important if we are to maintain our high standards, and also by our own operations as we recognise a need to run the College as an efficient organisation.

The challenges and pressures facing students today are greater than ever. The College is acutely aware of the enormous increase in the number of students that suffer with mental health issues. It is for this reason that the College employs two College nurses who, with additional support from the team of College Tutors, provide support and guidance to undergraduate and graduate students throughout the academic year. In response to this need a Health and Wellbeing Centre was established to help support students with general health and mental health needs. We are extremely proud of the great work that our nurses and Tutors do.

Standards at the top of Higher Education are continuing to rise and Clare is determined to stay in the top echelon globally. During the year ended June 2022 this meant the College spent £10,387 (2021: £9,162) on the education of each undergraduate student, mainly on the intensive support provided by each student's Director of Studies and supervisors. In addition, the College spent £4,771 (2021: £4,026) in educational support for graduate students. The total cost of educating 513 (2021: 524) undergraduates and supporting 180 (2021: 181) graduate students was £6,183,708 (2021: £5,530,245). The College receives a contribution equating to £4,625 for each new undergraduate by way of the College Fee, but this leaves a shortfall of £5,762 (2021: £4,537) for each undergraduate student, amounting to 55.5% (2021: 49.5%) of the total cost. The increase in the cost of education in the year ending 30 June 2022 was due to the increase in variable costs of education arising after the COVID-19 pandemic as student life began to return to normal. The deficit in the cost of educating students remains, which can only be sustained through the generosity of benefactors.

High inflation is increasing students’ cost of living which will result in increased levels of debt for students and inevitably lead to heavy pressure on Clare's hardship funds. During the year the College made total bursaries and awards of £758,448 (2021: £624,180) to undergraduate and graduate students. In addition to bursaries and other grants, the College offers subsidies on the cost of food and accommodation as extra undergraduate and graduate student support.

The College aims to raise sufficient funds from benefactors to preserve small-group teaching for undergraduates, provide bursaries in support of Clare undergraduates from low income backgrounds, and support graduate study through scholarships and hardship grants. This entails a significant challenge in raising additional income, while continuing to exercise tight constraints on spending.

Financial Results

The Statement of Comprehensive Income and Expenditure (SOCIE), on page 42, shows a surplus of £5.9m (2021: £32.1m). The SOCIE is a statement of all movements in the net assets of the College between one year and the next. It therefore takes account of all operating income and expenditure, investment gains and losses and other adjustments, including total return and pension provisions. The boxed sections (headed unrestricted) on page 24 is, in effect, the operating result on continuing operations before other gains and losses, but includes endowment drawdown and unrestricted spendable donations. On this "operating before other gains and losses" basis the College reported a deficit of £2,413,000 for 2022, compared to a deficit of £1,215,000 for 2021.

This operating deficit before other gains and losses was achieved after total unrestricted expenditure increased by £1,264,000 to £12.7 million. The increase in unrestricted expenditure was largely attributable to an increase in variable costs such as catering as activity recovers from the effects of the COVID-19 pandemic. Total unrestricted income increased by £66,000 to £10.3 million with Catering and Conferencing income replacing Furlough income as activity began to return and the COVID-19 Furlough scheme ended. Unrestricted donations decreased when compared to donations received in 2021.

The financial environment for the College remains challenging and it will be necessary to address a number of significant financial issues in the coming years, including the need to continue funding the ongoing refurbishment of Old Court, impact of high inflation on the cost of living and re-introducing Conferencing activity which was temporarily paused due to COVID-19. Undergraduate fees for UK students have remained unchanged since 2018, however the long term outlook for academic fees remains very uncertain and undergraduate fees are unlikely to increase any further in the near future. Without the generous support of our alumni and donors, the College's financial performance is likely to be under considerable stress over the next several years.

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Operating and Financial Review

for the year ended 30 June 2022

Benefactions and Donations

The College is very grateful for the many donations and bequests it has received over the past year from Clare members, corporate donors, trusts and foundations which totalled £5,320,000 (2021: £4,610,000) including the recovery of Gift Aid. This sum included significant amounts towards the refurbishment of Old Court, student bursaries, and teaching. The College received £466,000 in legacies, and 1410 alumni (16.11% of living, addressable alumni) made donations to the College. We ran a hybrid (first half occurred in person, second half remotely) Telethon in 2021-22 in which 286 alumni made a donation.

Total donation income and fund raising costs over the last five years are shown in the table below:

Year ended 30 June	2022	2021	2020	2019	2018
	£m	£m	£m	£m	£m
Donations
Old Court	2.3	2.0	3.5	1.9	5.1
Other	3.0	2.6	3.2	2.6	1.5
	5.3	4.6	6.7	4.5	6.6
Fundraising costs	0.5	0.5	0.5	0.6	0.5
Costs as % of donations	10%	11%	8%	14%	8%

The College is registered with the Fundraising Regulator. All Clare fundraising activity meets or exceeds current standards, including protections for vulnerable people. This activity is administered by Clare or is under Clare’s supervision and there have been no fundraising complaints during the last year.

The College Endowment

The market value of the endowment investment portfolio at 30 June 2022 was £161.0 million (2021: £156.84 million) (note 9a) resulting in a total return of 2.7% (2021: 24%) before investment management costs. The allocation of assets within the portfolio was as follows:

Year ended 30 June	Change in valuation (%)	Total Return (%)	Portfolio %	2022 Valuation (£m)	Portfolio %	2021 Valuation (£m)
Global Public Equities	-7.0%	-4.1%	59.3%	95.6	65.1%	102.1
Other Public Equities	-14.7%	-0.5%	0.9%	1.5	1.4%	2.3
Private Equities	54.1%	3.8%	10.6%	17.0	7.0%	11.0
UK Commercial Property	19.9%	4.3%	25.6%	41.1	21.9%	34.3
UK Government Bonds	-16.4%	0.0%	0.3%	0.4	0.3%	0.4
Cash and Fixed Interest	-19.5%	-0.8%	3.3%	5.4	4.3%	6.7
Total		2.7%		161.0		156.8

The College's public equity investments are mainly held in equity tracker funds with 79.6% invested in the Amundi Global Low Carbon fund and with 13.8%, 3.9% and 2.7% invested in the UK, European and Japanese Amundi SRI funds respectively. The overall exposure to US equities within the public equity portfolio amounted to 48.2% and the exposure to UK and European equities amounted to 9.6% and 19.3% respectively. Foreign currency exposures are not hedged.

The value of the endowment and total returns over the last five years were:

Year ended 30 June	2022	2021	2020	2019	2018
	£m	£m	£m	£m	£m
Investment assets	161.0	156.8	128.0	129.0	123.4
Actual Net Income	3.4	2.7	3.5	3.9	3.8
Gains/(losses)	2.5	25.1	(2.2)	4.2	7.2
Total return	5.8	27.8	1.2	8.1	11.0
Endowment drawdown	4.1	3.8	3.8	3.6	3.3
Drawdown as a % of Endowment	3.0%	3.0%	3.0%	3.0%	3.0%

The drawdown, which is the amount taken out of the Endowment as spendable income, amounted to £4,138,000 in 2022. The net investment income received of £3,354,000, while the realised and unrealised gains amounted to £2,452,000 resulting in a positive total return before investment management costs of £5,805,000 as set out in note 3a. The Endowment drawdown of £4,138,000 represented 3.0% of the average value of the Endowment over the three preceding years. The aim is to draw down sufficient funds each year to support the specific activities designated by the donors, while protecting the real value of the Endowment against inflation and preserving the capital for the future, consistent with the perpetual nature of the College Endowment.

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Operating and Financial Review

for the year ended 30 June 2022

Liquidity

The operational cash balances available at 30 June 2022 amounted to £27,200,000 (2021: £28,625,000). This was partly due to continued fundraising success and asset sales. These cash holdings were held in interest bearing accounts with the College's two principal banks. The level of cash held was relatively high, to take account both of construction plans (including current contract commitments and further plans), and also the continuing uncertainties posed by the COVID-19 pandemic for the College's educational and conference activities. It is expected that cash balances will reduce significantly during the 2022-23 financial year.

Inflation Swap Investments

In October 2008 the College borrowed £15 million in the form of a conventional loan from Santander and an inflation swap contract with HSBC, structured to provide 40 year index-linked funding. The £15 million was invested in global equity tracker funds and will be left to accumulate over the 40 year period in a ring-fenced fund, over which HSBC has a security charge to cover the inflation liability. Based on historical experience, the Governing Body considered that this investment in global equity tracker funds should make a positive real return of more than 4% per annum compound, consistent with the performance of global equity markets over each 40 year period since 1900. The Governing Body considered that this positive return would represent a significant addition to the College's Endowment, helping to achieve the goal of financial independence in the long term, and that it outweighed the risks involved. In the event that changed economic circumstances make it appropriate, the College has the right to terminate the loan with Santander and the inflation swap with HSBC early at the prevailing cost of termination.

The interest payments on the Santander loan are set at 4.4% per annum and the HSBC swap contract converts this into a real rate of 1.1% per annum. The annual inflation adjustment to the value of the loan on repayment is capped at a rate of 7%. Through this structure the College was able to take advantage of its ability to invest over the very long term at a time of very low interest rates. The liability to Santander for the conventional loan of £15 million is secured on the College's outlying operational properties, valued at £35 million. During the year to 30 June 2022 the 2048 Fund generated a total return of -3.8% gross and -19.6% net of the increase in inflation-linked liabilities and interest payments. The resulting deficit of £3,510,000 was added to the Total Return reserves as set out in Note 21. The cumulative inflation swap investment net unapplied Total Return decreased to £16,327,000 at 30 June 2022 (note 21).

During the first 13 years of the 40 year inflation swap (from October 2008 to June 2022) the level of RPI has risen by 57.0%, with the result that the College's liability to Santander and HSBC at June 2022 has increased to £22.3 million. At June 2022 the market value of global equity tracker fund investments held in the 2048 Fund amounted to £39.4 million and the outstanding cash balance stood at £813,000. The total value of inflation swap investments amounted to £40.2 million at 30 June 2022.

The complex financial structure of the inflation linked swap and accounting standards have made it necessary to apply a provision within the financial statements. The estimated value of the inflation linked swap liability based on derivative valuations as of 30 June 2022 show a break cost of £8.2 million (2021: £13.8 million). As at 30 June 2022 a provision for £8.2 million has been included as a liability in the Balance Sheet (see note 16) resulting in a decrease in liabilities and an increase in reserves by £5,650,000. However, at the present time the College has no intention to unwind the inflation swap facility and the year ending 30 June 2022 was a good year for the inflation swap investment.

Capital Expenditure and Buildings Refurbishment

During the 2021-22 financial year the College continued the Old Court project. As a result capital expenditure relating to buildings amounted to £6,534,000, a decrease of £18,932,000 compared to the prior year due to phase 1a being completed in the prior year and phase 1b still being underway during 2021-22 and not yet capitalised. In addition a further £164,000 of equipment capital expenditure was made. It is the College’s depreciation policy to depreciate in full years following the eligibility of an asset for capitalisation.

The cost of refurbishing the College's historic buildings and other historic assets represents a substantial financial commitment and the Governing Body recognises the need to set aside adequate sums to ensure that the historic buildings are properly maintained over the long term. A professional survey of the condition of all College buildings has confirmed that more than £2.7 million must be committed each year to maintain the College's historic fabric and buildings. The Finance Committee has approved a longer term target to spend a sum equal to 1.5% of the insurance replacement value of the College's operational buildings each year on the repair and maintenance of the operational estate. The insurance replacement value of the College's operational buildings is £230 million as of 30 June 2022 and the value of fixed asset investment on refurbishments expected to increase to more than £3 million per annum in the coming years.

Safeguarding Policy

Clare College recognises that Fellows, staff and students of the College may sometimes work with children and other vulnerable individuals in the course of their duties. In this context, the College is committed to respecting the rights, wishes and well-being of individuals with whom it is working; taking all reasonable steps to protect them from physical, sexual and emotional abuse; promoting the welfare of children and vulnerable individuals, and ensuring their protection within a relationship of trust. The full list of safeguarding policies is available on the College website.

The safeguarding policy has been established to support these commitments and to ensure that the College fulfils its obligations under the Safeguarding Vulnerable Groups Act 2006 and any subsequent legislation.

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Operating and Financial Review

for the year ended 30 June 2022

Reserves Policy

At June 2022 the College had £208 million (2021: £205 million) of unrestricted reserves, of which £147 million (2021: £146 million) was represented by operational fixed assets and heritage assets which are illiquid and in some cases inalienable. The balance of £61 million (2021: £59 million) constitutes free reserves and is invested to support the operations of the College and for contingencies.

The College regularly reviews the level of free reserves. In doing this, the College takes into account the guidance offered by the Charity Commission in its publication Charity reserves: building resilience (CC19). The College considers the main considerations to be:

1. The financial risks of its operations, including potential loss of annual income (due to the economic environment and changes in funding of higher education), investment risks associated with the management of the endowment, funding of the pension scheme and possible unforeseen events; and

2. The responsibility to preserve the fabric of its historic buildings.

Many of these items are difficult to quantify precisely. The College considers the current level of reserves adequate, but aims to increase the level of reserves further over time to support its charitable objectives. 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 specific project.

Principal Risks and Uncertainties

As part of its supervision of the College's activities, the Finance Committee, with input from Audit Committee, identifies and considers the major risks to which the College is exposed, and establishes procedures to manage those risks. There are three main types of risk, relating to:

• The safety of the College's buildings and facilities. These risks are mitigated primarily by management procedures, including compliance with relevant regulations, and alarm systems.

• The security of the College's assets. There are both physical security measures in place and established financial control procedures. Cyber security measures are also in place to protect information assets. Insurance arrangements are reviewed annually with professional advisers.

• Investment risks relating to the College's long-term investments. The main risk mitigation measures are an asset allocation policy which provides diversification by type of investment, management of investments by carefully selected professional managers and oversight of asset allocation and investment performance by the Investment Committee which includes both Trustees and experienced investment professionals.

There are, as always, uncertainties regarding the future external environment within which the College will operate, most notably regarding higher education policy and funding. The College prepares 5-10 year forecasts which have been stress tested based on a number of scenarios and have considered the impact upon the College and its cash resources and unrestricted reserves. The Finance Committee considers the College will be able to respond effectively to changes in that environment.

The principal risks and uncertainties that the College faces may be briefly summarised:

• The rapid increase in inflation particularly in utility and food costs will adversely affect the College in terms of higher variable costs in the provision of accommodation and catering for its members. The College is monitoring and forecasting these increases in order to make strategic decisions regarding financial stability in addition to supporting its members who are also impacted by the increased cost of living directly.

• The withdrawal of the United Kingdom from membership of the European Union may have a significant effect on the financial markets in which the College invests and it is possible that capital values will remain highly volatile and investment income may be adversely affected. To mitigate this risk the College is monitoring investment performance and has diversified its portfolio.

• The economic situation may also adversely affect the College’s conference activities which are a significant contributor to the College’s overheads. However, the College has significant investments which could be realised if required.

• 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. To mitigate this risk the College will ensure that all major building projects have robust plans and budgets which are carefully monitored over the project life.

• The failure of academic fees to keep up with the rise in academic costs, as well as the inevitable uncertainties due to the significant change in funding of Universities in England, it means that the funding and costs associated with the College’s core activity will need to be kept under constant review. To mitigate this risk the College will continue to work with the University and other organisations to achieve the fairest allocation of resources.

• The College’s building programmes may have a significant impact on College finances, through the substantial building costs involved. To reduce this risk the College monitors these major building projects carefully in line with the agreed budgets and employs professional project managers.

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Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Operating and Financial Review

for the year ended 30 June 2022

Public Benefit as a Charity

The College has met its responsibilities regarding public benefit by providing, in conjunction with the University, an education for some 693 (2021: 705) undergraduate and graduate students which is recognised internationally as being of the highest standard. This education develops students academically and advances their leadership qualities and interpersonal skills, preparing 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;

• 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; and

• specialist choral musical education for those students in the College's internationally renowned Choir.

The College advances research through:

• providing Research Fellowships to outstanding academics at the early stages of their careers, enabling 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;

• the employment of College Teaching Officers who, in addition to their role as Directors of Studies and supervisors of undergraduate students, maintain important research interests within the University;

• supporting research work pursued by Fellows through promoting interaction across disciplines, providing facilities and providing grants for national and international conferences, research trips and research materials;

• encouraging visits from outstanding academics from abroad; and

• encouraging 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), that provides a valuable resource for students and Fellows of the College, for members of other colleges and the University more widely, and for external scholars and researchers.

The College's students are the primary beneficiaries of its educational activities. Students are selected in an open application process, based solely on academic merit. The College operates a needs-blind admissions process and provides a significant level of bursary support to students who might otherwise be deterred from applying by financial concerns. The educational benefits provided by the College extend to students from other colleges, to visiting schoolchildren, and to alumni who have the opportunity to attend educational events at the College. The College also supports an extensive access and outreach programme to primary and secondary schools in the London Boroughs of Tower Hamlets and Hackney, and also in Coventry and Warwickshire, through which it aims to raise the aspirations of younger people in these parts of the country. Furthermore, the public benefit of the provision of high-quality education goes beyond the benefits to the students themselves. Whether through the vocational skills or the broader intellectual development acquired at the College, its students are able to make valuable and distinctive contributions in the public sphere.

The research advanced by the College is disseminated through publications and oral presentations. Its results are therefore publicly available and constitute a clear public benefit. The beneficiaries include the international community of scholars in the fields concerned, and the wider public who benefit through the intellectual, economic, civic and cultural development that is facilitated through the dissemination of high-quality research.

The College within the Community

The College shares its facilities with the local community. The College's sports grounds on Bentley Road and the Boathouse on the Cam are used by cricket, soccer and rowing clubs within the City.

The College is committed to reducing its carbon, water and environmental footprint. The College is actively promoting environmental awareness among Fellows, students and staff. Since the 2013-14 academic year, the College has consistently received either a Gold or Platinum award in the University Green Impact Award scheme.

11

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Operating and Financial Review

for the year ended 30 June 2022

Future Developments

There are no plans to change the College's core educational activities, with the number of students expected to remain stable and work continuing to widen participation.

The Old Court refurbishment project has continued, with the second phase (of three) now expected to be completed in spring 2023, after operational delays were encountered during and after the 2020-21 and 2021-22 financial years. Plans for further refurbishment of student accommodation are under review.

During the 2022-23 academic year, the College is marking the 50th anniversary of co-education with a series of speakers, exhibitions, and concerts. Looking further ahead, as the College approaches its 700th anniversary in 2026, a process has been initiated to develop and articulate a strategic vision for Clare’s eighth century; discussions and consultations will involve the whole College membership.

Ms L C R Minghella OBE, Master

Miss E J Conder, Bursar

15 December 2022

12

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Corporate Governance

for the year ended 30 June 2022

The College is a registered charity (registered number 1137531) and is subject to regulation by the Charity Commission for England and Wales. It is also governed by Statutes and Ordinances. The following statement is provided by the Trustees of the College to enable readers of the financial statements to obtain a better understanding of the arrangements in the College for the management of its resources and for its audit.

1. The Trustees of the College are the members of the Council and the Finance Committee (except for the student members of those committees). The Council and the Finance Committee together exercise general control and management of the College, and are responsible for ensuring compliance with charity law. The principal officers of the College are the Master, Senior Tutor and Bursar. There is a Register of Interests for Trustees. Declarations of interest are made systematically at meetings.

2. The Governing Body, which consists of the Master, the Fellows in Classes A, B, C, D and E, and four Student Members, holds at least three meetings each year. The Council, consisting of the Master, the Senior Tutor and ten Fellows elected by the Governing Body at its annual meeting, together with two Student Members, is responsible for the administration of the College in all matters not specifically assigned to the Governing Body or the Finance Committee. The Finance Committee, consisting of the Master, the Bursar, the Senior Tutor and seven Fellows elected by the Governing Body at its annual meeting, together with two Student Members, oversees the management of the College estates and investments and administers the revenues in accordance with the College Statutes, under the overall direction of the Governing Body. The Members of the Governing Body, Council and Finance Committee during the year ended 30 June 2022 are set out on pages 4-5.

3. The Governing Body, Council, and Finance Committee are advised in carrying out their duties by a number of Committees including the Audit Committee, Investment Committee, Salaries and Stipends Committee, and Estates Committee. Membership of these Committees is set out on page 5.

13

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Internal Control

for the year ended 30 June 2022

1. The Finance Committee is responsible for maintaining a sound system of internal control that supports the achievement of the College's policies, aims and objectives, while safeguarding funds and assets for which the Governing Body is responsible, in accordance with the College Statutes.

2. The system of internal control is designed to manage, rather than eliminate, the risk of failure to achieve College policies, aims and objectives; it therefore provides reasonable, but not absolute, assurance of effectiveness. The system of internal control is designed to identify the principal risks to achieving those policies, aims and objectives, to evaluate the nature and extent of those risks, and to manage them efficiently, effectively, and economically. This process was in place for the year ended 30 June 2022, and up to the date of approval of the financial statements.

3. The Members of the Finance Committee and Council are responsible for reviewing the effectiveness of the system of internal control. The following processes have been established:

4. 3.1 The Finance Committee meets six times per year.

5. 3.2 The Council meets seven times per year.

6. 3.3 The Audit Committee normally meets twice each year. It receives reports from the external auditors, including their observations on the College's system of internal control and risk management, together with recommendations for improvement.

7. 3.4 The members of the Finance Committee and Council, as Trustees of the College, review the effectiveness of the system of internal control as informed by the work of the Audit Committee, Bursar and College officers, who have responsibility for the development and maintenance of the internal control framework, and by comments made by external auditors in their management letter and other reports.

8. 3.5 The Finance Committee compares the College's costs and operational performance against the key performance indicators produced for all Cambridge Colleges to identify those areas where improvements can best be made.

9. The Finance Committee and the Audit Committee review the Risk Register which is checked and updated each year by the senior administrative staff and which is considered in detail by the College officers.

14

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Responsibilities of the Trustees of the College

for the year ended 30 June 2022

1. The Members of the Finance Committee and Council, as Trustees of the College, are responsible for preparing the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

2. In accordance with the College Statutes, the Finance Committee is responsible for the management of the College's estates and the administration of the College's revenues, subject to the overall control of the Trustees of the College. The Finance Committee is responsible for ensuring that there is an effective system of internal control and that accounting records are properly kept.

3. The College Statutes and the Statutes and Ordinances of the University of Cambridge require the Trustees of the College to prepare financial statements for each financial year, 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 year. In preparing those financial statements the Trustees of the College are required to:

4. select suitable accounting policies and apply them consistently; make judgements and estimates that are reasonable and prudent;

5. state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

6. prepare the financial statements on the going concern basis unless it is inappropriate to presume that the College will continue in operation.

7. The Trustees of the College are responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time the financial position of the College, and enables them to ensure that the financial statements comply with the Statutes of the University of Cambridge. They have general responsibilities for taking such steps as are reasonably open to them to safeguard the assets of the College and to prevent and detect fraud and other irregularities.

8. The Trustees of the College are responsible for the maintenance and integrity of the charity and financial information included on the College's website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

15

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Independent auditor’s report to the Trustees of Clare College for the year ended 30 June 2022

Opinion

We have audited the financial statements of Clare 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 and College Balance Sheets, 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/College 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 is 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.

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 Operating 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.

16

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Independent auditor’s report to the Trustees of Clare College for the year ended 30 June 2022

Responsibilities of Trustees

As explained more fully in the responsibilities of Trustees statement set out on page 15, the Trustees are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Trustees are responsible for assessing the Group’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 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/College 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/College and how the Group/College is complying with that framework;

• we obtained an understanding of the Group’s/College’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/College. 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/College’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;

• 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 non-compliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the Trustees and other management and the inspection of regulatory and legal correspondence, if any.

17

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Independent auditor’s report to the Trustees of Clare College for the year ended 30 June 2022

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 Trustees 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 Trustees 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’sTrustees 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:

Peters Elworthy & Moore is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006.

18

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Principal Accounting Policies

for the year ended 30 June 2022

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, using the Recommended Cambridge College Accounts (RCCA) format; and applicable United Kingdom Accounting Standards, including Financial Reporting Standard 102 (FRS 102) and the Statement of Recommended Practice (SORP): Accounting for Further and Higher Education issued in 2019.

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.

The College is a public benefit entity and therefore has applied the relevant public benefit requirement of the applicable UK laws and accounting standards.

Going concern

The global health crisis caused by COVID-19 has had a significant impact on all businesses. Virtually all College activities ceased as the majority of students returned home in March 2020. Students returned to the College at the start of the 2020-21 academic year in October 2020, but were mostly out of residence in Lent 2021 and returned for the Easter 2021 term in line with government guidelines. Conference activities were paused throughout the 2020-21 Financial Year as a result of COVID-19 however the College resumed Conference activity in 2021-22 and aims to return to pre-COVID-19 activity.

The Trustees have prepared forecasts over the next 5 years to June 2026 which have been stress tested based on a number of scenarios and have considered the impact upon the College and its cash resources and unrestricted reserves. The College has reviewed its cost base in order to combat the reduction in revenues and to extend financial headroom. The College has made use of the Government Job Retention Scheme. The College also has significant investments which could be realised if required.

Based upon their review the Trustees believe that the College will have sufficient resources to meet its liabilities as they fall due for the near future and therefore have continued to adopt the going concern basis in preparing the financial statements

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 9c. Intra-group balances are eliminated on consolidation.

The consolidated financial statements do not include the activities of student societies as these are separate bodies in which the College has no financial interest and over whose policy decisions it has no control.

Recognition of income

Academic fees

Academic fees are recognised in the year to which they relate and include all fees chargeable to students or their sponsors. The costs of any fees waived or written off by the College are included as expenditure.

Government grants

Grants are accounted under the accruals model as permitted by FRS 102. Grants relating to expenditure on tangible fixed assets are credited to the Statement of Comprehensive Income and Expenditure at the same rate as the depreciation on the assets to which the grant relates. The deferred element of grants is included in creditors as deferred income. Grants of a revenue nature are recognised in the Statement of Comprehensive Income and Expenditure in the same period as the related expenditure.

Government grants received during the year represent amounts receivable under the Coronavirus Job Retention Scheme (CJRS) to cover salaries of furloughed staff.

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 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.

19

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Principal Accounting Policies

for the year ended 30 June 2022

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 Statement of Comprehensive Income and Expenditure when the College is entitled to the income. All income is recognised once the College has entitlement to the income, it is probable that the income will be received and the amount of income receivable can be measured reliably.

For legacies, entitlement is taken as the earlier of the date on which either: the College is aware that probate has been granted, the estate has been finalised and notification has been made by the executor(s) to the Trust that a distribution will be made, or when a distribution is received from the estate. Receipt of a legacy, in whole or in part, is only considered probable when the amount can be measured reliably and the company has been notified of the executor's intention to make a distribution. Where legacies have been notified to the College, or the College is aware of the granting of probate, and the criteria for income recognition have not been met, then the legacy is treated as a contingent asset and disclosed if material.

Investment income and change in value of investment assets

Fixed asset investments are a form of financial instrument and are initially recognised at their transaction cost and subsequently measured at fair value at the Balance Sheet date, unless the value cannot be measured reliably in which case it is measured at cost less impairment. Investment gains and losses, whether realised or unrealised, are combined and presented as ‘Gains/(Losses) on investments’ in the Consolidated Statement of Financial Activities.

Investment property is carried at fair value determined annually by the Trustees based on professional advice received. Fair values are derived from the current market rents and investment property yields for comparable real estate, adjusted if necessary for any difference in the nature, location or condition of the specific asset. No depreciation is provided. Changes in fair value are recognised in the Statement of Financial Activities.

Investments in subsidiaries are valued at cost less provision for impairment.

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.

Total return

The College has adopted a total return policy where total return means investment return in terms of both income, whether received or accrued, and capital appreciation, whether realised or unrealised. The Finance Committee may appropriate and distribute for expenditure so much of the fair value of the endowment fund as it in its absolute discretion considers prudent, having regard to the availability of any surplus income, the total return achieved and reasonably to be expected in the long-term of the endowment.

Other income

Income is received from a range of activities including accommodation, catering, and conferences. Income is recognised on the exchange of the relevant services.

Cambridge Bursary Scheme

In 2021-22, payment of the Cambridge Bursaries to eligible students was made directly by the Student Loans Company (SLC). As a consequence, Clare College reimbursed the SLC for the full amount paid to their eligible students and the College subsequently received a contribution from the University towards this payment.

The net payment of £0 is shown within the Consolidated Statement of Comprehensive Income and Expenditure as follows:

Income (see note 1) £94,000 Expenditure £94,000

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 contracts, at contract rates. The resulting exchange differences are dealt with in the determination of the comprehensive income and expenditure for the financial year.

Fixed Assets

Land and buildings

In accordance with FRS102, the land and buildings held for operational purposes are stated at depreciated replacement cost, as determined by professional valuers. A full revaluation of all College property assets was conducted by Gerald Eve as at 30 June 2014, being the transition date to the 2015 RCCA.

20

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Principal Accounting Policies

for the year ended 30 June 2022

Where parts of a fixed asset have different useful lives, they are accounted for as separate items of fixed assets. When buildings are acquired with the aid of restricted bequests or donations, the policy for accounting for that income is as in the note above under Income Recognition, donations and endowments. Finance costs that are directly attributable to the construction of buildings are capitalised as part of the cost of those assets.

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

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.

Maintenance and renewal of premises

The College has a five-year rolling maintenance plan, which is reviewed on an annual basis. The cost of routine maintenance is charged to the Statement of Comprehensive Income and Expenditure as it is incurred.

Furniture, fittings and equipment

Furniture, fittings and equipment costing less than £3,000 per individual item or group of related items is written off in the year of acquisition. All other assets are capitalised and depreciated over their expected useful life as follows:

When furniture, fittings and equipment are acquired with the aid of restricted bequests or donations, the policy for accounting for that income is as in the note above under Income Recognition, donations and endowments. Boiler room and chapel 4% per annum

Furniture and fittings 10% per annum Motor vehicles and general equipment 20% per annum Computer equipment 20% and 25% per annum

Heritage assets

The College holds and conserves a numbers of collections, exhibits, artefacts and other assets of historical, artistic and scientific importance. Heritage assets acquired before 1 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

Investments are included in the balance sheet at fair value. Investments that are not listed on a recognised stock exchange are carried at historical cost less any provision for impairment in their value. Investment properties are valued annually based on open market values provided by third party valuers.

Stocks

Stocks are valued at the lower of cost and net realisable value.

Provisions

Provisions are recognised when the College has a present legal or constructive obligation as a result of a past event, if 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.

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.

21

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Principal Accounting Policies for the year ended 30 June 2022

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.

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 interest rate swaps, 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. The College does not apply any hedge accounting in respect of interest rate swap derivatives held to manage cash flow exposures.

Financial liabilities are de-recognised when the liability is discharged, cancelled, or expires.

Taxation

The College is a registered charity (number 1137531) 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 exclusively t o 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 G, II of the University of Cambridge. Contribution is used to fund grants to colleges from the Colleges' Fund. The liability for the year is advised to the College by the University based on an assessable amount derived from the value of the College's assets as at the end of the previous financial year.

Pension schemes

Significant accounting policies

The institution participates in Universities Superannuation Scheme. The assets of the scheme are held in a separate trusteeadministered 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

USS notes: FRS 102 requires that accounting judgements which are considered to be critical by those charged with governance are explained in more detail as to why the judgement has been applied. The disclosure below may be useful where the treatment of the scheme as a multi-employer scheme and adopting defined contribution accounting is deemed to be critical.

22

Clare College, Cambridge Financial Statements for the year ended 30 June 2022

Statement of Principal Accounting Policies for the year ended 30 June 2022

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.

The College also operates a defined contribution pension scheme, mainly for permanent non-academic employees, which is contracted into the State Second Pension (S2P), and also uses the government established National Employment Savings Trust (NEST) scheme for temporary staff. The assets of both schemes are held in separate trustee-administered funds. As a result, the amount charged to the Statement of Comprehensive Income and Expenditure Account represents the contributions payable to the schemes in respect of the accounting period.

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 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.

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 32.

Investment property – Properties are revalued to their fair value at the reporting date by Bidwells. The valuation is based on the assumptions and judgements which are impacted by a variety of factors including market and other economic conditions.

Inflation linked swap – A provision to reflect the estimated value of the inflation linked swap liability based on the derivative valuation has been included to reflect the break cost of the mechanism.

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 41-42.

Management 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 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 2022. 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 41-42.

23

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Consolidated Statement of Comprehensive Income and Expenditure

Notes Academic fees and charges 1 Accommodation, catering and conferences 2 Investment income 3a Inflation swap income 3c Endowment return transferred to I&E account 3a Other income Total income before donations and endowments Donations 20 New endowments 19 Other capital grants for assets 20 Total income Expenditure Education 4 Accommodation, catering and conferences 5 Other expenditure Contribution under Statute G, II Total expenditure Surplus/(deficit) before other gains and losses Gain/(loss) on disposal of fixed assets Gain/(loss) on financial instruments 16 Gain/(loss) on Inflation Swap Investments 3c Gain/(loss) on investments 3 Surplus/(deficit) for the year Other comprehensive income Total comprehensive income for the year		2022 Restricted Endowment Inflation Swap Total £'000 £'000 £'000 £'000 - - - 3,462 - - - 4,164 - 3,354 - 3,354 - - 48 48 2,573 (4,138) - - - - - 91 2,573 (784) 48 11,119 246 - - 1,261 - 1,737 - 1,737 2,322 - - 2,322 5,141 953 48 16,439 1,766 - - 6,184 - - - 6,890 358 238 1,936 3,846 - - - 87 2,124 238 1,936 17,007 3,017 715 (1,888) (568) - - - (16) - - 5,650 5,650 - - (1,622) (1,622) 622 1,237 - 2,452 3,639 1,952 2,140 5,896 - - - - 3,639 1,952 2,140 5,896		2021
	Unrestricted £'000	Restricted Endowment Inflation Swap Total £'000 £'000 £'000 £'000	Unrestricted £'000	Restricted Endowment Inflation Swap Total £'000 £'000 £'000 £'000
	3,462 4,164 - - 1,565 91 9,282 1,015 - -	- - - 3,462 - - - 4,164 - 3,354 - 3,354 - - 48 48 2,573 (4,138) - - - - - 91 2,573 (784) 48 11,119 246 - - 1,261 - 1,737 - 1,737 2,322 - - 2,322	3,433 2,488 - - 1,430 1,114 8,465 1,765 - -	- - - 3,433 - - - 2,488 - 2,706 - 2,706 - - 109 109 2,373 (3,803) - - - - - 1,114 2,373 (1,097) 109 9,850 218 - - 1,983 - 651 - 651 1,976 - - 1,976
	10,297	5,141 953 48 16,439	10,230	4,567 (446) 109 14,460
	4,418 6,890 1,314 87	1,766 - - 6,184 - - - 6,890 358 238 1,936 3,846 - - - 87	4,432 6,085 848 80	1,098 - - 5,530 - - - 6,085 406 263 885 2,402 - - - 80
	12,709	2,124 238 1,936 17,007	11,445	1,504 263 885 14,097
	(2,412)	3,017 715 (1,888) (568)	(1,215)	3,063 (709) (776) 363
	(16) - - 593		(1,406) - - 8,825	- - - (1,406) - - 695 695 - - 7,311 7,311 5,384 10,902 - 25,111
	(1,835) -		6,204 -	8,447 10,193 7,230 32,074 - - - -
	(1,835)		6,204	8,447 10,193 7,230 32,074

The notes on pages 28 to 42 form part of the financial statements

24

Financial Statements for the year ended 30 June 2022

Clare College, Cambridge

Consolidated Statement of Changes in Reserves

Balance at 1 July 2021 Surplus/(deficit) from income and expenditure statement Other comprehensive income Release of restricted capital funds spent in year Transfers between reserves Balance at 30 June 2022 Balance at 1 July 2020 Surplus/(deficit) from income and expenditure statement Other comprehensive income Release of restricted capital funds spent in year Transfers between reserves Balance at 30 June 2021	Inflation Swap Total Unrestricted Restricted Endowment £'000 £'000 £'000 £'000 £'000 204,953 44,656 61,444 6,013 317,066 (1,835) 3,639 1,952 2,140 5,896 - - - - - 5,258 (5,258) - - - - - - - - Income and expenditure reserve
	208,376 43,037 63,396 8,153 322,962
	Inflation Swap Total Unrestricted Restricted Endowment £'000 £'000 £'000 £'000 £'000 193,550 41,408 51,251 (1,217) 284,992 6,204 8,447 10,193 7,230 32,074 - - - - - 5,199 (5,199) - - - - - - - - Income and expenditure reserve
	204,953 44,656 61,444 6,013 317,066

The notes on pages 28 to 42 form part of the financial statements

25

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Balance Sheet

Notes Non-current Assets Fixed assets 8 Heritage assets 8a Investments 9a Inflation swap investments 9b Current assets Stock 10 Trade and other receivables 11 Short term investments 12 Cash and cash equivalents 13 Creditors : amounts falling due within one year 14 Net current assets Total assets less current liabilities Creditors : amounts falling due after more than one year 15 Inflation swap financial instruments 16 Pension provisions 17 TOTAL NET ASSETS Restricted reserves Income and expenditure reserve - endowment reserve 19 Income and expenditure reserve - restricted reserve 20 Income and expenditure reserve - inflation swap 15 Unrestricted reserves Income and expenditure reserve - unrestricted reserve TOTAL RESERVES	Group 2022 £'000 146,680 342 161,018 40,181 348,221 189 2,412 19,645 7,555 29,801 (3,965) 25,836 374,057 (42,297) (8,183) (615) 322,962 63,396 43,037 8,153 114,586 208,376 322,962	College 2022 £'000 146,782 342 161,018 40,181 348,323 189 2,306 19,645 7,175 29,315 (3,506) 25,809 374,132 (42,297) (8,183) (615) 323,037 63,396 43,037 8,153 114,586 208,451 323,037	Group 2021 £'000 145,516 342 156,842 41,755 344,455 198 1,016 20,279 8,346 29,839 (2,275) 27,564 372,019 (40,839) (13,833) (281) 317,066 61,444 44,656 6,013 112,113 204,953 317,066	College 2021 £'000 145,620 342 156,842 41,755
				344,559
				198 1,116 20,279 8,054
				29,647 (2,107)
				27,540
				372,099 (40,839) (13,833) (281)
				317,146
				61,444 44,656 6,013
				112,113 205,033
				317,146

The Financial Statements were approved by the Trustees of the College on the 21st November 2022 and signed on the 15th December 2022 on their behalf by:

Ms L C R Minghella OBE, Master

Miss E J Conder, Bursar

The notes on pages 28 to 42 form part of the financial statements

26

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Consolidated Cash Flow Statement

Notes Net cash inflow from operating activities 22 Cash flows from investing activities 23 Cash flows from financing activities 24 (Decrease)/increase in cash in the year Cash at beginning of the year Cash at end of the year 13	2022 £'000 3,317 (3,040) (1,068) (791) 8,346 7,555	2021 £'000 1,494 (8,559) 9,929
		2,864 5,481
		8,346

The notes on pages 28 to 42 form part of the financial statements

27

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

1 Academic fees and charges

Fee income received at the Regulated Undergraduate rate Fee income received at the Unregulated Undergraduate rate Fee income received at the Graduate rate Cambridge Bursary Scheme 2 Income from accommodation,catering and conferences Accommodation College members Conferences Catering College members Conferences 3 Endowment return and investment income 3a Analysis Actual income from: Land and buildings Quoted equity securities Fixed interest securities Other interest receivable (Losses)/Gains on endowment assets: Land and buildings Quoted and other securities and cash Investment management costs (note 3b) Total return on investments Total return transferred to income and expenditure reserve Unapplied total return for the year included within Statement of Comprehensive Income and Expenditure (note 21) Total return on investments	2022 £'000 2,009 502 857 94 3,462 2022 £'000 3,035 107 826 196 4,164 2022 £'000 1,838 709 795 12 3,354 5,609 (3,157) (238) 5,568 4,138 1,430 5,568	2021 £'000 2,194 373 721 145
		3,433
		2021 £'000 2,072 2 408 6
		2,488
		2021 £'000 1,417 828 367 94
		2,706
		3,090 22,020 (263)
		27,553
		3,803 23,750
		27,553

The endowment and fixed assets investments are accounted for on a total return basis. The total actual income and gains in the year are taken to a reserve, from which the planned endowment drawdown is released to the income and expenditure account. The remaining balance of the total return, after deducting the drawdown, is accumulated within the reserves, as set out in note 21.

3b Investment management costs

3b Investment management costs
Land and buildings Quoted securities Other investments Total	233 5 - 238	237 24 2
		263

28

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

3c Total return on inflation swap contracts Actual income from: Quoted securities Other interest receivable (Loss)/Gain on inflation swap asset: Inflation-linked amount due to HSBC (note 15) Interest and fees (note 3d) Total return on inflation swap contracts (note 21)	2022 £'000 48 - 48 (1,622) (1,459) (477) (3,510)	2021 £'000 109 -
		109 7,311 (579) (307)
		6,534

The inflation swap contracts are accounted for on a total return basis. The total actual income and gains/losses in the year is accumulated within the reserves, as set out in note 21. There is no drawdown permitted under the terms of the inflation swap.

3d Interest and fees on inflation swap investments

3d Interest and fees on inflation swap investments
Interest paid to HSBC Interest paid to Santander Interest received from HSBC Fees on inflation swap investments	(243) (666) (909) 666 (243) (234) (477)	(227) (666)
		(893) 666 ( )
		(227) (80)
		(307)

Interest paid to Santander and to/from HSBC is calculated on the £15 million loan and inflation swap repayable in 2048 (note 15).

29

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

				2022	2021
				£'000	£'000
4 Education expenditure
Teaching				2,649	2,317
Tutorial				1,222	1,357
Admissions				1,176	868
Research				548	510
Scholarships and awards				238	190
Other educational facilities				351	288
				6,184	5,530
5 Accommodation, catering and conferences		expenditure
Accommodation College members				5,022	5,067
	Conferences			177	5
Catering	College members			1,367	997
	Conferences			324	16
				6,890	6,085
6a Analysis of	2022 expenditure by activity
		Staff costs	Other
		(note 7)	expenses	Depreciation	2022
		£'000	£'000	£'000	£'000
Education		2,724	2,316	1,144	6,184
Accommodation, catering and conferences		3,219	1,893	1,778	6,890
Other		729	3,045	72	3,846
Contribution under statute G, II		-	87	-	87
		6,672	7,341	2,994	17,007

6b Analysis of 2021 expenditure by activity

Education Accommodation, catering and conferences Other Contribution under statute G, II	Staff costs (note 7) £'000 2,741 3,163 401 - 6,305	Other expenses £'000 1,739 1,292 1,935 80 5,046	Depreciation £'000 1,050 1,630 66 - 2,746	2021 £'000 5,530 6,085 2,402 80
				14,097

30

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

6c Auditors' remuneration

6c Auditors' remuneration
Other operating expenses include: Audit fees payable to the College's external auditors (inclusive of VAT) Other fees payable to the College's external auditors (inclusive of VAT) 7 Staff costs College Fellows Staff costs: £'000 Salaries 1,221 National Insurance 113 Pension costs (see note 28) 434 1,768 Average numbers: Academic Non-academic	Other academic Non- academic £'000 221 3,895 - 351 - 437 221 4,683 67 - - 131 Average staff numbers 2022 Number Full-time equivalents	2022 2021 £'000 £'000 32 30 - 11 32 41 2022 2021 £'000 £'000 5,337 5,357 464 450 871 498 6,672 6,305 80 - - 133 Average staff numbers 2021 Number Full-time equivalent	2021 £'000 30 11
			41
			2021 £'000 5,357 450 498
			6,305

At the Balance Sheet date there were 93 members of the Governing Body. During the year the average number receiving remuneration was the 67 shown above.

No College officer or employee, including the Head of House, received emoluments of over £100,000.

Key management personnel Key management personnel being the Master, Bursar and Senior Tutor	2022 £'000 214	2021 £'000 229

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 Trustees received no renumeration in their capacity as Trustees of the Charity.

31

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

8 Tangible Fixed Assets

Group Cost At start of year Additions and improvements at cost Disposals at cost At end of year Depreciation At start of year Charge for the year Eliminated on disposals At end of year Net book value At end of year At start of year College Cost At start of year Additions and improvements at cost Disposals at cost At end of year Depreciation At start of year Charge for the year Eliminated on disposals At end of year Net book value At end of year At start of year	Land & Buildings £'000 155,441 403 (2,697) 153,147 17,433 2,899 (192) 20,140 133,007 138,008 Land & buildings £'000 155,415 403 (2,697) 153,121 17,433 2,899 (192) 20,140 132,981 137,982	Assets in construction £'000 7,072 6,131 (36) 13,167 - - - - 13,167 7,072 Assets in construction £'000 7,202 6,131 (36) 13,297 - - - - 13,297 7,202	Equipment £'000 3,516 164 - 3,680 3,080 96 - 3,176 504 436 Equipment £'000 3,516 164 - 3,680 3,080 96 - 3,176 504 436	2022 £'000 166,029 6,698 (2,733) 169,994 20,513 2,995 (192) 23,316 146,680 145,516 2022 £'000 166,133 6,698 (2,733) 170,098 20,513 2,995 (192) 23,316 146,782 145,620	2021 £'000 160,866 25,547 (20,385)
					166,028
					18,448 2,747 (683)
					20,512
					145,516
					142,418
					2021 £'000 160,972 25,546 (20,385)
					166,133
					18,449 2,747 (683)
					20,513
					145,620
					142,523

The insured value of all the College's operational buildings as at 30 June 2022 was £230 million (2021: £213 million).

The Santander loan, as set out in note 17, is secured against certain outlying properties with a market value of £24 million as at October 2008.

32

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

8a Heritage Assets

The College holds and conserves certain collections, artifacts and other assets of historical, artistic or scientific importance. As stated in the statement of principal accounting policies, heritage assets acquired since 1999 have been capitalised. However, the assets held in the College's collections were acquired prior to this date. As reliable estimates of 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:

Value of acquisitions capitalised at start of year Acquistions purchased with specific donations Acquisitions purchased with College funds Total cost of acquisitions purchased Value of acquistions by donation Total acquisitions capitalised 9a Investments Market value at start of year Additions Disposal proceeds Gain/(loss) Increase in cash balances held at fund managers Market value at end of year Represented by: Property investment Quoted securities - equities Quoted securities - fixed interest Unquoted securities - equities Alternative assets Cash held for reinvestment Total	Securities and cash £'000 122,470 26,048 (22,738) (4,523) (1,466) 119,791	Property £'000 34,372 1,689 (1,809) 6,975 - 41,227	2022 £'000 342 - - - - 342 2022 £'000 156,842 27,737 (24,547) 2,452 (1,466) 161,018 41,227 97,038 370 17,020 - 5,363 161,018	2021 £'000 62 - -
				- 280
				342
				2021 £'000 127,980 88,686 (86,376) 25,111 1,441
				156,842
				34,372 104,321 440 11,044 - 6,665
				156,842

33

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

9b Inflation swap investments

Market value at start of year Additions Disposal Gain/(loss) Increase in cash balances held at fund managers Market value at end of year Represented by: Quoted securities - equities Cash held for reinvestment Market value at end of year	Securities £'000 40,747 - 242 (1,622) - 39,367	Cash £'000 1,008 - (242) - 48 814	2022 £'000 41,755 - - (1,622) 48 40,181 39,367 814 40,181	2021 £'000 34,415 - - 7,311 29
				41,755
				40,747 1,008
				41,755

The inflation swap investments are secured against the inflation-linked liability payable to HSBC in 2048, as set out in note 15.

9c Principal Subsidiary Undertakings

	Country of
	Incorporation	Cost	Class of	Proportion of
	and Operation	£	shares	shares held
Clare College Ltd	United Kingdom	20,001	Ordinary	100%
Clare College Conferences Ltd	United Kingdom	1	Ordinary	100%

Clare College Ltd was incorporated in 1994. The principal activity of the company is that of design and construction of buildings.

Clare College Conferences Ltd was incorporated on 29 February 2012. The principal activity of the company is that of conference accomodation and catering for non-educational clients.

10 Stocks Group and college Goods for resale Other stocks Total	2022 £'000 187 2 189	2021 £'000 197 1
		198

34

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

11 Trade and other receivables Members of the College University fees Other receivables Amounts due from subsidiary undertakings Prepayments and accrued income 12 Short term investments Bank deposits Properties held for sale 13 Cash at bank and in hand Current accounts Cash in hand 14 Creditors: amounts falling due within one year Trade creditors Members of the College University fees College student societies Contribution to Colleges' fund Other creditors Amounts due to subsidiary undertakings Accruals and deferred income	Group 2022 £'000 133 - 1,061 - 1,218 2,412 Group 2022 £'000 19,645 - 19,645 Group 2022 £'000 7,554 1 7,555 Group 2022 £'000 665 100 890 145 87 85 - 1,993 3,965	College 2022 £'000 134 - 727 227 1,218 2,306 College 2022 £'000 19,645 - 19,645 College 2022 £'000 7,174 1 7,175 College 2022 £'000 890 100 890 145 87 85 3 1,306 3,506	Group 2021 £'000 154 - 575 - 287 1,016 Group 2021 £'000 19,554 725 20,279 Group 2021 £'000 8,345 1 8,346 Group 2021 £'000 754 99 682 148 80 6 - 506 2,275	College 2021 £'000 154 - 484 191 287
				1,116
				College 2021 £'000 19,554 725
				20,279
				College 2021 £'000 8,053 1
				8,054
				College 2021 £'000 656 99 682 148 80 6 0 436
				2,107

35

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

15 Creditors: amounts falling due after more than one year Group and college Loan repayable in 2048 to Santander Inflation-linked amount due to HSBC Other loans	2022 £'000 15,000 7,297 20,000 42,297	2021 £'000 15,000 5,839 20,000
		40,839

On October 2008 the College entered into a contract with Santander to borrow £15 million at 4.4% repayable in full in October 2048 and with HSBC for an inflation financial instrument to turn the conventional loan into an index-linked loan at a real interest rate of 1.1%. This inflation swap financial instrument includes a 7% inflation cap. The Santander loan of £15 million is secured against outlying operational properties with a market value of £24 million (net book value £7.5 million). The HSBC inflation swap financial instrument is secured on the £15 million investment fund over which HSBC has a lien. The College is investing the £15 million in global equity tracker funds, accumulating income over the next 40 years to meet the RPI index-linked liability to HSBC and the £15 million liability to Santander.

At 30 June 2022 the value of the investments was £40,181,000 (2021: £41,755,000) and the liabilities to Santander and HSBC totalled £22,297,000 (2021: £20,839,000). The increase of £1,458,000 in the inflation-linked liability during the year is shown as a reduction on total return as set out in note 3c and the liability is included in creditors as set out above.

In January 2017 the College entered into a private unsecured bond placement to borrow £15m at 2.93% repayable in full in 2045. Interest is paid semi-annually.

In the year ending 30 June 2021 the College took a £5m loan as a precautionary measure as a result of COVID-19 repayable in June 2023.

16 Inflation swap financial instruments

Group and college Balance at beginning of year Charge to comprehensive income Balance at end of year	2022 £'000 13,833 (5,650) 8,183	2021 £'000 14,528 (695)
		13,833

Derivatives mark to market valuation on inflation linked swap. For further explanation regarding the Inflation swap financial instruments please see note 15

17 Pension provisions - USS Group and college Balance at beginning of year Movement in year: Contributions Change in expected contributions Other finance cost Balance at end of year 18 Capital and other commitments Group and College Authorised and contracted Authorised and but not yet contracted for	2022 £'000 281 (12) 344 2 615 2022 £'000 10,230 - 10,230	2021 £'000 348 (13) (59) 5
		281
		2021 £'000 9,850 -
		9,850

36

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

19 Endowment Funds

Restricted net assets relating to endowments are as follows:

	Restricted	Unrestricted
	Permanent	Permanent	2022	2021
	£'000	£'000	£'000	£'000
Balance at start of year:
Capital	61,444	-	61,444	51,252
New donations and endowments	1,737	-	1,737	651
Transfer from restricted reserves	-	-	-	-
(Decrease)/Increase in market value of investments	215	-	215	9,541
Balance at end of year	63,396	-	63,396	61,444
Analysis by type of purpose
Fellowship funds	5,944	-	5,944	4,731
Scholarship funds	13,360	-	13,360	12,794
Prize funds	851	-	851	836
Hardship funds	3,498	-	3,498	3,329
Bursary funds	8,582	-	8,582	9,205
Travel grant funds	775	-	775	763
Building renewals fund	9,159	-	9,159	9,007
Other funds	12,493	-	12,493	12,188
General funds	8,734	-	8,734	8,590
	63,396	-	63,396	61,444
Analysis by asset
Property	16,232	-	16,232	13,466
Investments	45,053	-	45,053	45,367
Cash	2,111	-	2,111	2,611
	63,396	-	63,396	61,444

20 Restricted Reserves

Reserves with restrictions are as follows:

Balance at start of year: Accumulated income New grants New donations Other income Endowment return transferred Transfer (Decrease)/Increase in market value of investments Management Fees Expenditure Capital grants utilised Balance at end of year Analysis by type of purpose Fellowship funds Scholarship funds Prize funds Hardship funds Bursary funds Travel grant funds Building renewals fund Other funds	Capital grants unspent £'000 6,945 2,231 - 91 - 227 - - - (5,258) 4,236 - - - - - - 4,236 - 4,236	Permanent unspent and other restricted income £'000 36,866 - 45 - 2,573 (227) 622 (242) (1,651) 0 37,986 9,703 13,613 1,920 4,550 1,116 691 202 6,191 37,986	Restricted expendable endowment £'000 845 - 201 - - - - - (231) - 815 65 23 8 132 45 5 1 536 815	2022 £'000 44,656 2,231 246 91 2,573 0 622 (242) (1,882) (5,258) 43,037 9,768 13,636 1,928 4,682 1,161 696 4,439 6,727 43,037	2021 £'000 41,408 1,916 218 60 2,373 (20) 5,384 (203) (1,282) (5,199)
					44,657
					9,433 13,306 1,888 4,616 1,066 655 7,144 6,548
					44,657

21 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 and on the inflation swap investments and liabilities (after deducting the drawdowns) since 1 July 1999 :

Unapplied Total Return at start of year Surplus of total return for year (note 3) Unapplied total Return at end of year	Main endowment £'000 87,430 1,431 88,861	Inflation swap investments £'000 19,837 (3,510) 16,327	2022 £'000 107,267 (2,079) 105,188	2021 £'000 76,982 30,285
				107,267

37

Financial Statements for the year ended 30 June 2022

Clare College, Cambridge

Notes to the financial statements

22 Reconciliation of consolidated surplus for the year to net cash inflow/(outflow) from operating activities

Surplus for the year Adjustment for non-cash items Depreciation (Gain)/Loss on disposal of non-current assets (Gain)/loss on endowments, donations and investment property (Increase)/Decrease in stocks Decrease/(Increase) in debtors (Decrease)/Increase in creditors Pension costs less contributions payable Movement in provisions Adjustment for investing or financing activities Investment income Inflation swap income Interest payable Interest receivable Management fees Net cash inflow from operating activities 23 Cash flows from investing activities Proceeds on disposal of investments Proceeds on disposal of inflation swap investments Investment income Investment costs Endowment funds invested Inflation swap invested Proceeds on disposals on non-current assets Payments made to acquire non-current assets Total cash flows from investing activities 24 Cash flows from financing activities Interest paid Interest received New loans Cash held on short term deposit Total cash flows from financing activities	2022 £'000 5,896 2,993 16 (803) 9 (1,397) 3,147 334 (5,650) (3,354) (48) 2,368 (666) 472 3,317 2022 £'000 24,547 - 3,401 (472) (26,286) (56) 2,524 (6,698) (3,040) 2022 £'000 (2,368) 666 0 634 (1,068)	2021 £'000 32,074 2,746 1,406 (32,702) 68 207 124 (67) (695) (2,706) (109) 1,472 (666) 343
		1,497
		2021 £'000 86,376 - 2,814 (343) (90,127) (29) 18,296 (25,547)
		(8,561)
		2021 £'000 (1,472) 666 5,000 5,734
		9,929

38

Financial Statements for the year ended 30 June 2022

Clare College, Cambridge

Notes to the financial statements

25 Consolidated reconciliation and analysis of net debt

Cash and Cash Equivalents Borrowings: amounts falling due after more than one year Secured Loan (repayable in 2048 to Santander) Unsecured loans Derivatives (Inflation-linked amount due to HSBC) Total 26 Financial Instruments Financial assets Financial assets at fair value through Statement of Comprehensive income Quoted equity and fixed interest investments Financial assets that are equity instruments measured at cost less impairment Unquoted equity investments Alternative assets Financial liabilities Financial liabilities at fair value through Statement of Comprehensive Income Inflation-linked amount due to HSBC Inflation swap financial instruments Net Total	At 1 July 2021 £000 8,346 15,000 20,000 5,839	Changes in Market value At 30 June 2022 £000 £000 (791) 7,555 - 15,000 - 20,000 1,458 7,297
	40,839	1,458 42,297
		2022 2021 £000 £000 97,408 104,761 17,020 11,044 - -
		114,428 115,805
		7,297 5,839 8,183 13,833
		15,480 19,672
		98,948 96,133

The fair values of the assets and liabilities held at fair value through profit and loss at the balance sheet date are determined using quoted prices.

39

Clare College, Cambridge

Financial Statements for the year ended 30 June 2022

Notes to the financial statements

27 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 member of the Governing Body 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.

2 Trustees have received loans under the College's Fellows Loan scheme where interest is charged at 1% above the Barclays base rate upon the principal amount. Total loans issued amounts to £155,000 (2021: £150,000)

The Bursar represents the College as a member of the Investment Advisory Board of the Diversified Property Fund for Charities. No compensation is received for acting in this capacity. There are no transactions outstanding at the balance sheet date.

The College maintains a register of interests for all College Council members and where any member of the College Council has a material interest in a College matter they are required to declare that fact.

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 and Salaries Committee.

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 Total	2022 Number 10 1 2 - 1 1 3 - - - 18	2021 Number 10 2 1 - 2 - 1 - 1 1
		18

The total Trustee salaries were £391,070 for the year (2021: £427,194)

The trustees were also paid other taxable benefits (including associated employer National Insurance contributions and employer contributions to pensions) which totalled £81,404 for the year (2021: £84,327)

In addition, the college has provided loans to its fellows as part of a Shared Equity Scheme. These amounts are included in Fixed Assets and total £908,222 (2021: £725,394)

The College has a number of trading and dormant subsidiary undertakings which are consolidated into these accounts. All 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.

40

Financial Statements for the year ended 30 June 2022

Clare College, Cambridge

Notes to the financial statements

28 Pension Schemes (continued)

(a) Universities Superannuation Scheme

The total cost charged to the Statement of Comprehensive Income and Expenditure is £434,000 (2021: (£82,000) as shown in note 28c.

The latest available complete actuarial valuation of the Retirement Income Builder 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%.

The key financial assumptions used in the 2020 valuation are described below. More detail is set out in the Statement of Funding Principles.

Pension increases (CPI) Term dependent rates in line with the difference between the Fixed Interest and Index Linked yield curves less:

1.1% p.a. to 2030, reducing linearly by 0.1% p.a. to a long-term difference of 0.1% p.a. 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% p.a. Post retirement: 1.00% p.a

The main demographic assumption used relates 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 female Future improvements to mortality CMI 2019 with a smoothing parameter of 7.5, an initial addition of 0.5% p.a. and a long-term improvement rate of 1.8% pa for males and 1.6% pa for females

The current life expectancies on retirement at age 65 are:

	2022	2021	2020	2019
Males currently aged 65 (years)	23.9	24.6	24.4	24.6
Females currently aged 65 (years)	25.5	26.1	25.9	26.1
Males currently aged 45 (years)	25.9	26.6	26.3	26.6
Females currently aged 45 (years)	27.3	27.9	27.7	27.9

A new 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:

	2022	2021	2020	2019
Discount rate	3.31%	0.87%	1.45%	2.24%
Pensionable salary growth	5.0%	3.0%	2.7%	3.0%

41

Financial Statements for the year ended 30 June 2022

Clare College, Cambridge

Notes to the financial statements

28 Pension Schemes (continued)

(b) Clare College Contributory Pension Scheme and NEST

The College operates a defined contribution pension scheme, mainly for permanent contracted non-academic employees which complies with the requirements of the Pensions Act 2008 and Auto Enrolment. This scheme is provided by Prudential and has been in operation since July 2016. The previous Occupational Pension Scheme is officially wound up.

Temporary employees are offered the National Employment Savings Trust (NEST) scheme, a defined contribution scheme set up by the Government. The assets of both schemes are held in separate trustee-administered funds. The amount charged to the Statement of Comprehensive Income and Expenditure represents the contributions payable to the respective schemes in respect of the accounting year.

(c) Summary of pension costs

Universities Superranuation Scheme Clare Contributory Pension Scheme NEST Total pension costs (note 7)	2022 £'000 434 437 - 871	2021 £'000 82 416 - 498

42