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2023-06-30-accounts

Paper No.: 2023/118a

Annual Report

and

Financial Statements

for the year ended 30 June 2023

Registered Charity number 1139422

Contents

Page
Reference and administrative information 2
Trustees report 4
Overview 4
Activities and achievements 5
Financial review 7
Principal risks and uncertainties 11
Responsibilities of the College Council 12
Statement of internal control 12
Outlook 13
Independent Auditor’s Report to the Governing Body of King’s College 14
Statement of Principal Accounting Policies 18
Statement of Comprehensive Income and Expenditure 27
Statement of Changes in Reserves 28
Consolidated and College Balance Sheets 29
Consolidated Cash Flow Statement 30
Notes to the Financial Statements 31

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Reference and administrative information

The formal title of the College is ‘The King’s College of Our Lady and Saint Nicholas in Cambridge’. The College’s address is King’s College, King’s Parade, Cambridge, CB2 1ST

Charity trustees

The trustees of the College, who are the members of the College Council, during the year were:

The Provost, Professor Michael Proctor (Chair), Dr James Dolan, Professor Matei Candea, Professor John Dunn, Professor Gillian Griffiths, Professor Tim Griffin (until October 2022), Dr David Good (from October 2022), Professor John Perry (until August 2022), Professor Cesare Hall (from August 2022), Professor George Efstathiou (until the end of December 2022), Dr Zoe Adams (until the end of December 2022), Dr Alexandra Clara Saracho (until the end of December 2022), Dr Sharath Srinivasan (until the end of December 2022), Dr Ronojoy Adhikari (from January 2023), Professor Chryssi Giannitsarou (from January 2023), Professor Jason Sharman (from January 2023), Dr James Taylor (from January 2023)

Members in statu pupillari were:

Ms Michaela Kadlecova, Mr Sergio Russo (to the end of December 2022), Mr Tom Pugh (to 31st December 2022), Ms Madeline Kelly (to the end of December 2022), Mr Jakub Gasienica-Ciulacz (from January 2023), Mr Dan Erwig (from January 2023), Ms Timi Olumide-Wahab (from January 2023)

Senior Officers

Provost Professor Michael Proctor Dr Gillian Tett (from October 2023) Vice Provost Professor Robin Osborne First Bursar Dr Keith Carne Dr Ivan Collister (from October 2022) Senior Tutor Dr Tim Flack Dr Myfanwy Hill (from September 2022)

Principal advisers

Actuaries Cartwright Consulting, Mill Pool House, Mill Lane, Godcalming, GU7 1EY Auditors Peters Elworthy & Moore, Sailsbury House, Station Road, Cambridge, CB1 2LA Bankers Barclays Bank plc, 9-11 St Andrew’s Street, Cambridge, CB2 3AA Investment advisers Cazenove Capital, 31 Gresham Street, London, EC2V 7QA Property advisers Bidwells, Trumpington Road, Cambridge, CB2 2LD Savills, Unex House, 132-4 Hills Road, Cambridge, CB2 8PA Solicitors Barr Ellison, 39 Parkside, Cambridge, CB1 1PN Mills & Reeve, Botanic House, 98-100 Hills Road, Cambridge, CB2 1PH

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Membership of the Governing Body

The members of the Governing Body of the College as at 30 November 2023 are set out below:

Provost: Dr Gillian Tett

Fellows (Senior Members of the Governing Body)

Dr Zoe Adams Dr Ronojoy Adhikari Dr Tess Adkins Dr Sebastian Ahnert Professor Anna Alexandrova Professor John Arnold Dr Nick Atkins Professor Gareth Austin Dr Seda Basihos Professor Mike Bate Dr Francesco Bianchini Dr Marcus Böick Dr Giulia Boitani Dr Shannon Bonke Professor Richard Bourke Dr Mirjana Bozic Professor Angela Breitenbach Professor Jude Browne Professor Nick Bullock Dr Katie Campbell Professor Matt Candea Dr Keith Carne Professor Richard Causton Rev Dr Stephen Cherry Dr Ivan Collister Professor Francesco Colucci Dr Sarah Crisp Dr Laura Davies Professor Anne Davis Professor Pete de Bolla Dr James Dolan Professor John Dunn Professor George Efstathiou Professor Brad Epps Professor Aytek Erdil Dr Sebastian Eves-Van den Akker Professor Elisa Faraglia Professor James Fawcett Professor Iain Fenlon Dr Tim Flack Professor Rob Foley Professor Matthew Gandy Professor Chryssi Giannitsarou Professor Lord Tony Giddens

Professor Ingo Gildenhard Professor Chris Gilligan CBE Professor Simon Goldhill Dr David Good Professor Caroline Goodson Professor Gillian Griffiths Professor Mark Gross Professor Henning Grosse Ruse-Khan Professor Chez Hall Professor Ross Harrison Dr Tiffany Harte Mr Api Hasthanasombat Dr Katie Haworth Ms Lorraine Headen Professor John Henderson Dr Felipe Hernandez Dr Kate Herrity Dr Myfanwy Hill Dr David Hillman Dr Stephen Hugh-Jones Professor Dame Carrie Humphrey DBE Professor Herbert Huppert Mr Reza Huseini Professor Alice Hutchings Mr Daniel Hyde Professor Martin Hyland Ms Polly Ingham Mr Phil Isaac Professor Ian James Dr Malar Jayanth Professor Mark Johnson Mr Peter Jones Dr Aileen Kelly Professor Barry Keverne Dr Phil Knox Dr Patrycja Kozik Dr Joanna Kusiak Professor James Laidlaw Professor Richard Lambert Dr Zhuangnan Li Professor Charlie Loke Professor Sarah Lummis Professor Alan Macfarlane Professor Nick Marston

Professor Jean Michel Massing Dame Judith Mayhew Jonas Professor Dan McKenzie Professor Cam Middleton Dr Jonah Miller Dr Fraz Mir Dr Perveez Mody Professor Geoff Moggridge Dr Kamiar Mohaddes Dr Ken Moody Dr Basim Musallam Dr Rory O’Bryen Professor Rosanna Omitowoju Professor Robin Osborne Dr Tejas Parasher Professor John Perry Professor Chris Prendergast Professor Mike Proctor Professor Surabhi Ranganathan Dr Ben Ravenhill Professor Thomas Roulet Professor Bob Rowthorn Dr Angus Russell Professor Paul Ryan Professor Hamid Sabourian Dr Andjela Sarkovic Professor Jason Sharman Dr Mira Siegelberg Dr Mike Sonenscher Dr Sharath Srinivasan Professor Gareth Stedman Jones Dr James Taylor Professor Nick Tosca Mr Jim Trevithick Dr Marco Tripodi Professor Caroline Van Eck Professor Bert Vaux Professor Jamie Vicary Dr Rob Wallach Professor Darin Weinberg Professor Godela Weiss-Sussex Dr Tom White Professor John Young Professor Nicky Zeeman

Members in Statu Pupillari (Junior Members of the Governing Body)

Mr Tom Pugh Mr Dan Erwig Ms Madeline Kelly Ms Timi Olumide-Wahab Mr Jakub Gasienica-Ciulacz

Ms Michaela Kadlecova Mr Sergio Russo

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Trustee’s report

Overview

King’s College, Cambridge is one of the thirty-one colleges within the University of Cambridge. It is an independent, self-governing community of scholars with its own property and income. The College was founded in 1441 by King Henry VI for ‘poor and needy scholar clerks, engaged in study within the University of Cambridge in the diocese of Ely, and bound to study and progress in the different departments of learning and skill’.

Objects and aims

The College’s charitable objects are: (i) to maintain a College within the University of Cambridge dedicated to the advancement of education, religion, learning and research; and (ii) to provide for and conduct divine service within the College.

In setting about achieving its charitable objects, the College pursues several aims for the public benefit. These are to:

The trustees have had due regard throughout the year to the Charity Commission’s guidance on public benefit and consider that the College again delivered its planned public benefits in 2022-23.

Governance

The governing documents of the College are its Statutes and Ordinances of 1441, as amended from time to time. The charity trustees are the College Council, which is responsible for the general administration and management of the College and for ensuring compliance with charity law. The members of the Council are the Provost and ten Fellows, elected by the College’s Governing Body for one-year terms. Council members may serve a maximum of four consecutive terms. The College Council meets on average five times per term, or more frequently as necessary.

The Governing Body of the College is the ultimate authority in the government of the College. It includes the Provost, all eligible Fellows and four students, at least one of whom is an undergraduate and one a post-graduate. Student representatives are elected by the College’s undergraduate and post-graduate students. They attend for the discussion of all matters directly affecting the interests of

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the College’s students. The Governing Body meets twice a term or more frequently as necessary. A register of interests is recorded for all members of the Governing Body.

The principal officers of the College are the Provost, who is responsible for general oversight of the College, the Vice Provost, who deputises for the Provost and looks after the interests of the Fellows, the First Bursar who has responsibility for the overall management of the College and its finances, and the Senior Tutor who has overall charge of education within the College. Additionally, the Domus Bursar is responsible for the College’s operations and estate, the Dean is charged with all activities within the College Chapel, the Director of Music is responsible for the College Choirs and music within the College, and the Director of Development oversees fundraising and alumni relations.

The Council and Governing Body are advised by several committees, each addressing a distinct area of College activity and whose members comprise Fellows and student members, elected annually. It is the duty of the Finance Committee to advise Council on the effectiveness of the College’s internal systems of financial and other controls. The Governing Body appoints the Audit and Scrutiny Committee to act as internal auditors. It advises on the appointment of external auditors; considers reports from those auditors; monitors the implementation of recommendations; and makes an annual report to the Council and the Governing Body. The College maintains a conflicts of interest policy and systematically requires declarations of interest at all committee meetings.

The Visitor of the College is the Bishop of Lincoln.

Activities and achievements

Introduction

King’s, like many higher education institutions, is facing into considerable headwinds and, while the restrictions of the COVID-19 pandemic have passed, its aftermath continues to affect the College. One of the most visible of these impacts is that King’s educated more students in 2022-23 than at any time in its history. Undergraduate numbers swelled because of the generous marking of A-level examinations during the pandemic. The number of graduate students also increased, with many PhD students needing more time to complete their work under COVID restrictions.

A less apparent but equally important effect of the pandemic has been its impact on students’ mental health. Successive cohorts of undergraduates have seen their lives and studies drastically disrupted by COVID-19. The impact of those experiences often comes to the fore at university and the College is keenly aware of the need to provide all the support it can to help our students flourish during their time in Cambridge. Both King’s and the University have significantly expanded support for student mental health, including specialist help within College. We know, too, that we have a lot more to learn about these challenges and that more and new forms of support may need to be considered.

Alongside these pressures, King’s has also had to face into turbulence in the wider economy. Historically high rates of inflation had a marked impact on students and non-academic staff, who were particularly vulnerable to pressures on the cost of living. Input costs rose, most obviously energy prices and food, and anxiety persisted about the ability to raise income from conferencing and visitors to the College.

It was against this background that the year was shaped by two aims:

Recovery

At the beginning of the year King’s took the important decision to prioritise the recovery of its academic and social life over immediate financial pressures. This was a careful judgement, based on

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scenario modelling of financial recovery, known and potential headwinds, and the long-term damage of a sharply restrictive approach to spending.

King’s supported almost eight hundred full and part-time students through the academic year. The numbers of undergraduate and postgraduate students in residence and registered with the University were:

were:
2018-19 2019-20 2020-21 2021-22 2022-23
Undergraduates 419 442 458 454 466
Postgraduates 251 278 294 320 326
Total 670 720 752 774 792

A considerable proportion of these students were provided with financial support through the College’s scholarships, bursaries, and other grants – many of which were made possible through the generous donations of our alumni during and after the pandemic. As well as support for individual students, the College expanded its subsidisation of student social activities.

The College continued to teach students in all subjects, except Land Economy and Veterinary Medicine, and King’s delivered over 8,000 hours of teaching during the year. Supervisions were most frequently given to pairs of students. The national marking and assessment boycott has meant that many student results were delayed: a quarter of finalists received their full results and were awarded their degrees in June 2023. Those results received to-date indicate that undergraduates at King’s are performing well in the Tripos.

Admissions to King’s remained strong, with 922 applications received, 150 students receiving an offer, and 125 admitted to the College. Of this cohort, 46% were female and 54% male. Of our UK entrants in 2023, a record 87% are state school educated and 29% met a range of widening participation criteria. As in previous years, the College was able to offer a number of students mentoring, tutoring, and financial support to help them meet their A-level offers.

King’s also continued to support its large Fellowship and, through them, the intellectual diversity and vibrancy of the College. The College provided for 74 Official Fellows in 2022-23, of whom 38 were University professors. Six new Fellows were admitted during the year, whilst four left the College or retired. The College also admitted a number of Bye Fellows, including Peter Frankopan as UNESCO Professor of Silk Roads Studies.

Resilience

The second aim for the year was to continue to strengthening King’s for the long term.

One visible aspect of this has been the College’s commitment to the sustainability of its estate. The year included the start of works to install solar panels to the roof of the Chapel, the first such scheme in Cambridge, and the completion of accommodation at Croft Gardens, the first major Passivhaus development in the city. In both projects the College was helped by extraordinarily generous contributions from our alumni; each of these works, and other projects to conserve and improve the estate, would have been very challenging without this support.

Another critical priority was attention to the community life of the College. A conscious effort was needed among students, Fellows, and non-academic staff not just to return to old habits, but to rediscover a ‘zest’ for intellectual discourse and sociability of King’s. All parts of the College contributed to this, supported by a varied programme of events and new activities designed to bring people together. The Festival of Nine Lessons & Carols was a key moment, as ever; another was a

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summer ‘festival’ of talks, exhibitions and concerts that marked fifty years since the matriculation of women at King’s.

A key element of the College’s development has been a shared commitment to equality, diversity, and inclusion. As part of this, the College completed its research project into the Legacies of Slavery. The project explored connections between the College and enslavement in the British colonies. The financial benefits accrued to the College, including bequests from those who benefitted financially from enslavement, were detailed in the report. The recommendations of the report are being taken forward by a newly formed committee for equality, diversity, and inclusion.

Lastly, the College strengthened various aspects of its administration. These changes ranged across the waterfront of life at King’s with a particularly significant change being the legal separation of the Choir School. The School became a separate charity with its directors taking responsibility for its organisation and conduct; the College’s Choristers will still be educated at the School and the relationship between the School and College will remain strong.

Financial performance

The breadth of the year’s activity was achieved only by a remarkable effort from students, Fellows, and our non-academic staff. King’s retained the vast majority of its staff through the pandemic and, this year, we reaped the benefits in the smooth running of our academic and non-academic work. The College has a remarkable culture of collegiality and it was this, as well as many outstanding individual efforts, that helped see us through the year.

With its emphasis on academic and social recovery, and on building resilience, the College agreed a budget that targeted an operational deficit, in management accounts, of £1.2 million. However, supported by the work of its Fellows and non-academic staff, and buoyed by better-than-expected operating income, the College succeeded in returning a lower deficit of £0.6 million. This was a remarkable performance in such a challenging environment.

Future plans

The overriding task of recent years has been to manage through the challenges and uncertainty caused by the COVID-19 pandemic. As it emerges from that period, the College has begun to look ahead. In the coming year, consideration will be given to strategic priorities for the medium and long term. These will focus on how best to continue the College’s charitable objects, adapting to wider trends in higher education, and making the most of King’s distinctive culture and capabilities.

Financial review

Scope of the financial statements

The consolidated financial statements include the College and the College’s wholly owned subsidiaries, which are:

Together, these entities comprise the Group. References to the College in the Financial Review refer to the results of the Group.

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The financial statements are produced by the College having regard to the Recommended Cambridge College Account (RCCA) format introduced through revisions to Statute G,III of the University which replaced the previous format introduced in 1926 by the University of Cambridge Commissioners.

A significant feature of this year’s statements is the absence of King’s College School. Following the creation of the School as a distinct legal entity, separately regulated and whose relations to the College are managed by contract, the College and School’s accounts are now reported independently. For purposes of comparison, the School accounted for £6.9m income and £6.2m expenditure in 2022.

Results overview

Income before donations and endowments

Income before donations and endowments (excluding the School) grew 15.7% from £16.2m in 2022 to £18.8m in 2023. This was driven substantially by the return of incomes from accommodation, catering and conferencing and other income, largely from visitors to the College. These showed healthy growth, albeit not fully recovering to levels achieved before the COVID-19 pandemic.

Investment income also grew significantly, largely due to growth in the endowment as capital markets recovered. (The College has a ‘spending rule’ that sets the maximum withdrawal from the endowment at 3.35% of the average year-end value of the endowment for the preceding five years. This is designed to reduce the effect on income of fluctuations in investment returns.)

----- Start of picture text -----
Accommodation, catering and conferences
Investment Income
Academic fees and charges
Other Income
£0 £1,000 £2,000 £3,000 £4,000 £5,000 £6,000 £7,000 £8,000
2021-22 2022-23
----- End of picture text -----

Income from donations and endowments

King’s fundraising is focused on five areas: student support, including bursaries and scholarships; teaching and research; maintenance and development of the College estate; extracurricular activities; and a ‘future fund’ to support the College’s long-term development.

Total donations and endowments were down from an exceptional £20.4m in 2022 to £5.9m in 2023. The College was fortunate last year to receive some exceptional donations, particularly to fund the building of new accommodation at Stephen Taylor Court. Donations recorded in 2023 remain considerably higher than the College’s historic run rate.

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----- Start of picture text -----
Capital donations for assets
New endowments
Donations
0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000
2021-22 2022-23
----- End of picture text -----

King’s College is committed to best practice in relation to all fundraising activities, which are carried out by an in-house Development team who are subject to the scrutiny of the Development Committee and College Council. The College did not engage any third parties to carry out fundraising activities on its behalf during the year. The College is registered with the Fundraising Regulator and has set up internal protocols and procedures to adhere to the Code of Fundraising Practice as a set of guiding principles to ensure fundraising is legal, open, honest and respectful.

Expenditure

Total expenditure (excluding the School) grew 10.9% in the year. This was partly because of the College’s return to pre-pandemic levels of activity, but also substantially related to the high-inflation environment and other macro drivers of input costs. These were the principal drivers of increases in expenditure on Education and Accommodation, Catering and Conferences.

----- Start of picture text -----
Education
Accommodation, catering and conferences
Other Expenditure
£0 £2,000 £4,000 £6,000 £8,000 £10,000 £12,000
2021-22 2022-23
----- End of picture text -----

The expenditure for each of the activities described above is made up of staff costs, other operating expenses, and depreciation as set out below.

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----- Start of picture text -----
Operating Expenditure
Staff costs
Depreciation
£0 £2,000 £4,000 £6,000 £8,000 £10,000 £12,000 £14,000
2021-22 2022-23
----- End of picture text -----

Falls in spending on staffing were the result of changes in pension provision. Excluding these impacts, staffing costs rose 11% in the year driven by increases in pay (to support the cost of living) and a modest growth in headcount.

The College experienced a significant increase in operating expenditure, from £9.5m to £13.0m. This related to a one-off transfer of £1.7m involved in the creation of King’s College School as a distinct legal entity. The school had accrued funds, which to College held, and that were transferred to the School’s accounts as part of the legal separation. There were also substantial increases in energy costs and funding for students.

Depreciation fell slightly through the College’s annual independent valuation, with an impact on the overall depreciation period.

Capital expenditure

The College’s capital expenditure on tangible fixed assets during the year was £10.2m, compared to a prior year figure of £20.4m. Expenditure in 2022-23 was driven by the completion of the College’s new development at Croft Gardens (£2.0m), renovation of student accommodation in Spalding Hostel (£4.5m), renovation of the roof of the Chapel (£2.7m) and more minor expenditure to repair the roof of the Gatehouse at the front of the College (£0.3m). Other significant items of capital expenditure were necessary improvements in IT infrastructure.

Balance sheet

Consolidated net assets were £431m for the Group, up £8.7m from 2022. This growth was driven mainly by a 9.2% increase in investment assets (see below). The College holds £15.8m debt at a rate of 4.4% repayable between 2043-2053. At 30 June 2023, borrowing stood at 3.5% of total assets less current liabilities. There was no new borrowing in the year.

Reserves

Unrestricted reserves grew by £1.0m to £260.6m. This included £244.3m of tangible fixed assets and heritage assets, implying ‘free reserves’ of £16.3m. Free reserves provide working capital to fund unexpected opportunities or to provide a degree of protection against unforeseen expenditure or unanticipated loss of income. The College’s free reserves in 2023 are a growth of £5.3m from 2022 and amount to approximately 12 months of operational expenditure.

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Restricted reserves for 2023 were £170.6m, an increase of 4.7% (£7.6m) on 2022. This was driven by investment returns and new donations, offset by spending down of expendable funds.

Endowment and investment performance

The College has a pool of capital (known as the ‘Endowment’) invested for the long-term to support its charitable activities (see note 14).

The College aims to manage the total return from the Endowment so that the long-term capital value is preserved in real terms, such that the College itself can fulfil its charitable objects in perpetuity. The College also believes it has a responsibility for its investments. The Investment Committee monitors both the performance of the College’s investments and their environmental, social and governance aims. The College does not hold, and has not held for a long period, any direct investments in fossil fuels. A more detailed statement of the College’s approach is available on the College website.

The total value of the Endowment was £205.1m in 2023, up 9.2% from 2022 (£187.8m). The Endowment benefitted from an £11.0m transfer due to the legal separation of the School (with the School now accounted as an investment asset). The remaining growth was driven largely by the College’s securities portfolio, which benefitted from rises in global capital markets. These increases were offset by withdrawal of £3.8m to support the College’s capital expenditure and cash reserve. A further pressure was a fall in value of the College’s investment property holdings, almost all of which are local to Cambridge and which declined in line with the local market.

Principal risks and uncertainties

The major risks to which King’s is exposed are assessed by the Finance Committee reporting to Council, using the College’s Risk Register. The principal risks the College must address relate to its ability to maintain and develop its educational and research activity and, as part of that, to attract the best academic and non-academic staff, and to maintain and enhance its physical facilities.

Key financial uncertainties and risks, and the measures taken to manage them, are:

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The College monitors and manages risks more widely through the internal control processes outlined in the Statement of Internal Control below.

Responsibilities of the College Council

The Council is responsible for preparing the Annual Report and Financial Statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice), including FRS 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ and the Statement of Recommended Practice: Accounting for Further and Higher Education .

The College’s Statutes and the Statutes and Ordinances of the University of Cambridge require the Council 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 for that period. In preparing these financial statements the Council is required to:

The College has prepared a detailed budget covering the period to 30 June 2024 as well as a five-year forecast of expected demands on the College’s operating position and capital expenditure. Accordingly, the trustees believe the College’s financial resources are sufficient to ensure there are no material uncertainties around its ability to continue as a going concern for the foreseeable future, being at least 12 months from the date of approval of the financial statements, and have therefore prepared the financial statements on the going concern basis.

The Council is responsible for keeping accounting records which disclose with reasonable accuracy at any time the financial position of the College and enable them to ensure that the financial statements comply with the Statutes of the University of Cambridge. They are also responsible for safeguarding the assets of the College and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Council is responsible for the maintenance and integrity of the corporate and financial information included on the College’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Statement of Internal Control

The Council is responsible for maintaining a sound system of internal control that supports the achievement of policy, aims and objectives while safeguarding the public and other funds and assets for which the Council is responsible, in accordance with the College’s Statutes. The system of internal control is designed to manage rather than eliminate the risk of failure to achieve policies, aims and objectives; it therefore provides reasonable but not absolute assurance of effectiveness.

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The system of internal control is designed to identify the principal risks to the achievement of 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 2023 and up to the date of approval of the financial statements.

The Council is responsible for reviewing the effectiveness of the system of internal control. The following processes have been established. The Council has sixteen regular meetings each year and, as part of the annual planning round, considers the major risks to which the College and its subsidiary undertakings are exposed and satisfies itself that systems or procedures are established to manage those risks.

Key controls used by the College include:

The College is improving these controls through various refinements, including to the risk review processes, processes for in-year performance management, financial reviews of key departments, and increased resourcing of central functions, including Finance, Legal and Governance, and Human Resources.

The Council’s oversight of internal controls is informed by the work of the committees and College Officers, including the College Audit and Scrutiny Committee, and by comments made by the external auditors in their management letter and other reports.

Outlook

King’s is fortunate in being reasonably well-endowed for the size and scope of its operations. This has allowed the College to weather a very turbulent period. At the same time, both the University and the UK higher education sector will face significant challenges in coming years. These are most visibly financial but relate to wider economic, social, and political challenges regarding the sustainability of world-class research, continued provision of outstanding teaching, support for students’ finances, provision for student mental health, and efforts to broaden access to higher education in the UK. As new headwinds have emerged, the College remains focused on securing its medium-term recovery. As it looks to the long-term, however, the College will need to continue to refine its priorities to adapt to the significant challenges facing the University and wider sector.

On behalf of College Council,

Gillian Tett Provost

Ivan Collister First Bursar

21 November 2023

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Independent Auditors’ Report to the Council and Governing Body of King’s College, Cambridge

We have audited the financial statements of King’s College (the ‘College’) and its subsidiaries (the ‘Group’) for the year ended 30 June 2023 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:

Basis for opinion

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

Conclusions relating to going concern

In auditing the financial statements, we have concluded that the Trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group’s or College's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the Trustees with respect to going concern are described in the relevant sections of this report.

Other information

The Council and Governing Body are responsible for the other information. The other information comprises the information included in the Annual Report other than the financial statements and our auditors’ report thereon. Our opinion on the financial statements does not cover the other

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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:

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 Report of the Trustees. 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:

Responsibilities of the Council and Governing Body

As explained more fully in the responsibilities of the Council and Governing Body statement set out on page 12, the Council and Governing Body are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Council and Governing Body determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Council and Governing Body are responsible for assessing the Group’s and College’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the Group or the College or to cease operations, or have no realistic alternative but to do so.

Auditors’ responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in

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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:

We assessed the susceptibility of the College’s financial statements to material misstatement, including obtaining an understanding of how fraud might occur, by:

To address the risk of fraud through management bias and override of controls, we:

16

In response to the risk of irregularities and non-compliance with laws and regulations, we designed procedures which included, but were not limited to:

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 noncompliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any.

Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website. This description forms part of our auditors’ report.

Use of our report

This report is made solely to the College’s Council and Governing Body as a body, in accordance with College’s statutes, the Statutes of the University of Cambridge and the Charities Act 2011. Our work has been undertaken so that we might state to the Council and Governing Body those matters we are required to state to them in an Auditors’ Report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the College and the College’s Council and Governing Body as a body, for our audit work, for this report, or for the opinions we have formed.

Kelly Bretherick Partner For and on behalf of Peters Elsworthy and Moore Chartered Accountants and Statutory Auditors Salisbury House Station Road Cambridge CB1 2LA

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

17

Statement of Principal Accounting Policies

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 10.

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 had a significant impact on all businesses and the recovery is not yet complete. The economic difficulties caused by the war in Ukraine, and financial concerns within the Country have also increased inflation. This adds to the pressure both our students and staff face and requires further resources from the College.

The Trustees have prepared forecasts for the period to 2028 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 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 foreseeable future and therefore have continued to adopt the going concern basis in preparing the financial statements.

Basis of accounting

The financial statements are prepared under the historical cost convention, modified in respect of the treatment of investments and operational property which are included at valuation.

Basis of consolidation

The financial statements for 2022-23 incorporate those of the College and the College’s subsidiaries, King’s College Cambridge Developments Limited and King’s College Cambridge Enterprises Limited. The figures for 2021-22 include the School and KCS Facilities Limited.

The accounts do not include the activities of the King’s College Student Union and King’s College Graduate Society, on the basis that the College does not have control over the operations of these entities.

18

Recognition of income and investment return

Academic fees

Academic fees are recognised in the period to which they relate and include all fees chargeable to students or their sponsors.

Grant Income

Grants received from non-government sources (including research grants from non-government sources) are recognised within the Statement of Comprehensive Income and Expenditure when the College is entitled to the income and performance-related conditions have been met.

Income received in advance of performance-related conditions is deferred on the balance sheet and released to the Statement of Comprehensive Income and Expenditure in line with such conditions being met.

Donations and endowments

Non-exchange transactions without performance-related conditions are donations and endowments. Donations and endowments with donor-imposed restrictions are recognised within the 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.

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.

Investment income and change in value of investment assets

Investment income and change in value of investment assets is recorded in income in the year in which it arises and as either restricted or unrestricted income according to the terms or other restrictions applied to the individual endowment fund.

Total return

The College operates a total return policy with regard to its endowment assets (including property). Spendable income equivalent to 3.35% of the average endowment for the last five years is included as endowment income and investment management costs are charged against capital.

19

Other income

Income is received from a range of activities including accommodation, catering, conferences and other services rendered.

Cambridge Bursary Scheme

The Cambridge Bursary Scheme (CBS) administration has changed from 2016/17:

The College has shown the gross payment made to eligible students and a contribution from the University as Income under “Academic Fees and Charges.

The net payment of £188k is shown within the Statement of Comprehensive Income and Expenditure as follows:

Income (see note 1) £271k
Expenditure £459k

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.

Pension schemes

The College pays contributions to three pension schemes which provide benefits to its members based on final pensionable salary and one defined contribution pension scheme, ‘NOW: Pensions’. The assets of these schemes are held separately from those of the College.

Universities Superannuation Scheme

The College participates in Universities Superannuation Scheme. With effect from 1 October 2016, the scheme changed from a defined benefit only pension scheme to a hybrid pension scheme, providing defined benefits (for all members), as well as defined contribution benefits. The assets of the scheme are held in a separate trustee-administered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The College 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 College therefore accounts for the scheme as if it were a wholly defined contribution scheme. As a result, the amount charged to the Statement of Comprehensive Income and Expenditure represents the contributions payable to the scheme. Since the College has entered into an agreement (the recovery plan) that determines how each employer within the scheme will fund the overall deficit, the College recognises a liability for the contributions payable that arise from the agreement (to the extent that they relate

20

to the deficit) and therefore an expense is recognised through the Statement of Comprehensive Income and Expenditure.

Cambridge Colleges Federated Pension Scheme

The College also contributes to the Cambridge Colleges Federated Pension Scheme (“CCFPS”), which is a similar defined benefit pension scheme to the USS. However, unlike the USS, this scheme has surpluses and deficits directly attributable to individual colleges. Current service costs, assessed by the scheme actuary, are included as part of expenditure. The expected return on assets less the interest cost is shown as a net amount as part of other income or expenditure. Actuarial gains and losses are recognised immediately in the Statement of Comprehensive Income and Expenditure.

Actuarial valuations are obtained at least triennially and are updated at each balance sheet date for accounting purposes. The assets of the Scheme are measured at fair value, and liabilities are estimated on an actuarial basis using the projected unit method and discounted at a rate equivalent to the current rate of return on a high-quality corporate bond. The resulting net asset or liability is presented separately after total assets less current liabilities on the face of the balance sheet.

Church of England Funded Pensions Scheme

The College participates in the Church of England Funded Pensions Scheme for stipendiary clergy. This scheme is administered by the Church of England Pensions Board, which holds the assets of the scheme separately from those of the Employer and the other participating employers.

Each participating employer in the scheme pays contributions at a common contribution rate applied to pensionable stipends.

The scheme is considered to be a multi-employer scheme as described in section 28 of FRS 102. This means it is not possible to attribute the Scheme’s assets and liabilities to specific employers and that contributions are accounted for as if the Scheme were a defined contribution scheme. The pension costs charged to the Statement of Comprehensive Income and Expenditure in the year are contributions payable towards benefits and expenses accrued in that year, plus any impact of deficit contributions.

NOW: Pensions

The College also operates a defined contribution scheme NOW: Pensions. This is a UK multi-employer pension fund and the pension charge represents the amounts payable by the College to the fund in respect of the year.

Fixed assets

Land and buildings

College land and buildings used for operational purposes (to house College Members) are stated at depreciated replacement cost at the 30 June 2023 following a revaluation review carried out by professional valuers, Gerald Eve. Freehold buildings are depreciated on a straight-line basis over their expected useful economic lives with a range for the different buildings (excluding the Chapel) between 45 years to 115 years. The Chapel is depreciated over 200 years. Freehold land is not shown separately and is not depreciated. Assets under construction are valued at cost, based on the value of architects’ certificates and other direct costs incurred. They are not depreciated until they are brought into use.

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

Costs incurred in relation to land and buildings after initial purchase or construction, and prior to valuation, are capitalised to the extent that they increase the expected future benefits to the College.

21

Maintenance of premises

The cost of major refurbishment is capitalised and depreciated over the expected useful economic life. The cost of routine maintenance under £10,000 is charged to the Statement of Comprehensive Income and Expenditure as it is incurred.

Plant, furniture, fittings and equipment

Plant, furniture, fittings and equipment are capitalised at cost. Depreciation is provided in equal annual instalments over the estimated useful lives of the assets, which are as follows:

Plant 20 years
Furniture and equipment 10 years
Computer equipment 5 years

Heritage assets

The College holds and conserves a number of collections, exhibits, artefacts and other assets of historical, artistic or scientific importance. Heritage assets acquired before 1 July 2006 have not been capitalised since reliable estimates of cost or value are not available on a cost-benefit basis. Acquisitions since 1 July 2006 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

Securities

Securities listed on a recognised stock exchange are shown at their market value, i.e. the middle market quotation ruling at the close of business on 30 June, translated for overseas investments into sterling at the rates of exchange ruling at that date. Unlisted securities are shown at the Governing Body’s estimate of fair value.

Investment income is included as and when dividends and interest become payable. Interest on bank deposits is included as earned. Interest purchased or sold as part of the price for investments is treated as capital rather than being brought into the statement of comprehensive income and expenditure.

Properties

The College takes advice from its agents each year on the value of its properties and carries out a full valuation periodically.

Other investments

Shared equity housing interests are stated at cost. Royalties are held at valuation and are valued periodically by independent valuers.

Stocks

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

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Provisions

Provisions are recognised if, when the College has a present legal or constructive obligation as a result of a past event, it is probable that a transfer of economic benefit 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. 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 and Expenditure.

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 and Expenditure. 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

23

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 forward foreign exchange contracts, are not basic financial instruments. Derivatives are initially recognised at fair value on the date the derivative contract is entered into and are subsequently remeasured at their fair value at the reporting date. Changes in the fair value of derivatives are recognised in the Statement of Comprehensive Income and Expenditure in finance costs or finance income as appropriate, unless they are included in a hedging arrangement.

To the extent that the College enters into forward foreign exchange contracts which remain unsettled at the reporting date the fair value of the contracts is reviewed at that date. The initial fair value is measured as the transaction price on the date of inception of the contracts. Subsequent valuations are considered on the basis of the forward rates for those unsettled contracts at the reporting date. The College does not apply any hedge accounting in respect of forward foreign exchange contracts held to manage cash flow exposures of forecast transactions denominated in foreign currencies.

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

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.

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Taxation

The College is a registered charity (number 1139422) and also a charity within the meaning of Section 467 of the Corporation Tax Act 2010. Accordingly, the College is exempt from taxation in respect of income or capital gains received within the categories covered by Sections 478 to 488 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that such income or gains are applied to exclusively charitable purposes.

The College receives no similar exemption in respect of Value Added Tax.

Contribution under Statute G,II

The College is liable to be assessed for Contribution under the provisions of Statute G,II of the University of Cambridge. Contribution is used to fund grants to colleges from the Colleges Fund. The College may from time to time be eligible for such grants. The liability for the year is as 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.

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:

25

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 2020 actuarial valuation, which defines the deficit payment required as a percentage of future salaries until 2038. 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 note 27.

All other accounting judgements and estimates are detailed under the appropriate accounting policy.

26

Statement of Comprehensive Income and Expenditure

Year ended 30 June 2023

Year ended 30 June 2023
Total Total
Unrestricted Restricted Endowment 2023 Unrestricted Restricted Endowment 2022
Note
£000		 £000 £000 £000 £000 £000 £000 £000
INCOME
Academic fees and charges 1
3,456		 271 - 3,727 3,305 248 - 3,553
Accommodation, catering and conferences 2
6,796		 - - 6,796 6,044 - - 6,044
School 3
-		 - - - 6,855 - - 6,855
Investment income 4
691		 458 4,643 5,792 401 212 4,529 5,142
Endowment return transferred 4
3,312		 2,811 (6,123) - 3,393 2,770 (6,163) -
Other income 5
2,456		 - - 2,456 1,479 - - 1,479
Total income before donations and 16,711 3,540 (1,480) 18,771 21,477 3,230 (1,634) 23,073
endowments
Donations 818 837 - 1,655 175 533 - 708
New endowments - 2,149 127 2,276 - 4,787 121 4,908
Capital donations for assets - 1,932 - 1,932 - 14,820 - 14,820
Total Income 17,529 8,458 (1,353) 24,634 21,652 23,370 (1,513) 43,509
EXPENDITURE
Education 6
5,942		 3,878 - 9,820 5,497 3,308 - 8,805
Accommodation, catering and conferences 7
9,198		 88 - 9,286 8,062 70 - 8,132
School 8
-		 - - - 6,230 - - 6,230
Other expenditure 9
3,554		 1,300 912 5,766 3,586 1,123 774 5,483
Contribution under Statute G,II 95 - - 95 91 - - 91
Total expenditure 18,789 5,266 912 24,967 23,466 4,501 774 28,741
(Deficit)/surplus before other gains and losses (1,260)
3,192		 (2,265) (333) (1,814)
18,869		 (2,287) 14,768
Gain/(loss) on investments 1,439 1,759 5,973 9,171 (991) (1,485) (999) (3,475)
Surplus/(deficit) for the year 179 4,951 3,708 8,838 (2,805)
17,384		 (3,286) 11,293
Other comprehensive income
Unrealised surplus on revaluation of fixed 188 - - 188 5,374 - - 5,374
assets
Actuarial gain/(loss) in respect of pension (372)
-		 - (372) 815 - - 815
schemes
Total comprehensive income for year (5) 4,951 3,708 8,654 3,384 17,384 (3,286) 17,482

The notes on pages 31 to 52 form part of these accounts

27

Statement of Changes in Reserves

Year ended 30 June 2023

Unrestricted
£000
Restricted
£000
Endowment
£000
Balance at 1 July 2022
259,546
58,747
104,234
Surplus from income and expenditure
statement
179
4,951
3,708
Other comprehensive income/(expenditure)
(184)
-
-
Transfer in year
(24)
24
-
Release of restricted capital funds spent in
the year
1,040
(1,040)
-
Balance at 30 June 2023
260,557
62,682
107,942
Unrestricte
d
£000
Restricted
£000
Endowme
nt
£000
Balance at 1 July 2021
233,243
63,838
107,964
Surplus from income and expenditure
statement
(2,805)
17,384
(3,286)
Other comprehensive income
6,189
-
-
Transfer in year
3,870
(3,426)
(444)
Release of restricted capital funds spent in
the year
19,049
(19,049)
-
Balance at 30 June 2022
259,546
58,747
104,234		 Total
£000
422,527
8,838
(184)
-
-
431,181
Total
£000
405,045
11,293
6,189
-
-
422,527

The notes on pages 31 to 52 form part of these accounts

28

Consolidated and College Balance Sheets

As at 30 June 2023

Note
NON-CURRENT ASSETS
Tangible assets
12
Heritage assets
13
Investment assets
14
Total non-current assets
CURRENT ASSETS
Stocks - good for resale
Trade and other receivables
15
Cash and cash equivalents
16
Total current assets
CREDITORS: amounts falling due within
one year
17
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT LIABILITIES
CREDITORS: amounts falling due after
more than one year
18
Provisions
Pension provisions
19
TOTAL NET ASSETS
RESTRICTED RESERVES
Income and expenditure reserve –
endowment reserve
20
Income and expenditure reserve –
restricted reserve
21
UNRESTRICTED RESERVES
Income and expenditure reserve –
unrestricted reserve
Revaluation reserve
TOTAL RESERVES		 Group
2023
£000
242,591
1,696
205,058
449,345
3,959
3,230
3,053
10,242
(8,645)
1,597
450,942
(15,769)
(3,992)
431,181
107,942
62,682
170,624
255,183
5,374
260,557
431,181		 College
2023
£000
242,518
1,696
205,058
449,272
34
9,120
494
9,648
(7,982)
1,666
450,938
(15,769)
(3,992)
431,177
107,942
62,682
170,624
255,179
5,374
260,553
431,177		 Group
2022
£000
247,136
1,481
187,757
436,374
3,720
3,251
7,780
14,751
(8,504)
6,247
442,621
(15,974)
(4,120)
422,527
104,234
58,747
162,981
254,172
5,374
259,546
422,527		 College
2022
£000
247,053
1,481
187,757
436,291
41
9,137
5,000
14,178
(7,846)
6,332
442,623
(15,974)
(4,120)
422,529
104,234
58,747
162,981
254,174
5,374
259,548
422,529

Approved by Council on 21 November 2023 and signed on their behalf by Dr Ivan Collister, First Bursar The notes on pages 31 to 52 form part of these accounts

29

Consolidated Cash Flow Statement

Year ended 30 June 2023

Surplus for the year
Adjustment for non-cash items
Depreciation
Non-cash donations to King’s College School
Non-cash donations or donated shares
Loss/(gain) on endowments, donations and investment
property
Pension scheme (credit)/debit
(Increase)/decrease in stocks
Decrease/(increase) in debtors
Increase/(decrease) in creditors
Adjusting for investing or financing activities
Investment income
Interest payable
Profit on sale of non-current assets
Net cash flows from operating activities
Cash flows from investing activities
Investment income
Net cash transferred to King’s College School
Non-current investment disposal
Payments to acquire non-current fixed assets
Payments to acquire non-current heritage assets
Payments to acquire non-current investments
Net cash flows from investing activities
Cash flows from financing activities
Interest paid
Increase/(decrease) in cash and cash equivalents in the
year
Cash and cash equivalents at beginning of year
(Decrease)/increase in cash and cash equivalents in the
year
Cash and cash equivalents at end of the year (note 16)
The notes on pages 31 to 52 form part of these accounts		 2023
£000
8,838
3,445
450
(127)
(9,171)
(498)
(254)
994
149
(7,272)
666
-
(2,780)
5,034
(1,079)
5,859
(10,249)
(216)
(630)
(1,281)
(666)
(666)
(4,727)
7,780
(4,727)
3,053		 2022
£000
11,293
3,893
-
(23)
3,475
1,444
137
(1,146)
(234)
(6,777)
666
-
12,728
4,410
-
8,006
(20,384)
-
(830)
(8,798)
(666)
(666)
3,264
4,516
3,264
7,780

30

Notes to the Financial Statements

As at 30 June 2023

1. ACADEMIC FEES AND CHARGES

College fees:
Fee income received at the Regulated Undergraduate rate
Fee income received at the Unregulated Undergraduate
rate
Fee income received at the Graduate rate
Total fee income
Other academic income
Cambridge Bursary Scheme
Total		 2023
£000
1,783
667
967
3,417
39
271
3,727		 2022
£000
1,746
559
971
3,276
30
247
3,553

2. INCOME FROM ACCOMMODATION, CATERING AND CONFERENCES

INCOME FROM ACCOMMODATION, CATERING AND CONFERENCES
Accommodation
College members
International programmes
Third parties
Catering
College members
International programmes
Third parties
Total		 2023
£000
3,796
44
526
1,141
22
1,267
6,796		 2022
£000
3,161
-
173
982
-
1,728
6,044

3. SCHOOL INCOME

SCHOOL INCOME
Fees
Other income
Total		 2023
£000
-
-
-		 2022
£000
6,670
185
6,855

31

Notes to the Financial Statements

4. ENDOWMENT RETURN AND INVESTMENT INCOME

4a. Analysis of Investment Income
Income drawdown from endowment
(note 4b)
Other investment income
Rent from King’s College School
Cash balances and shared equity
properties
Royalties
(Losses)/gains on investment assets:
(Losses)/gains on total return
investment assets (below)
Gains on other investment assets
4b. Summary of Total Return
Income from:
Freehold land and buildings
Quoted securities and cash
Gains/(losses) on total return
investment assets:
Freehold land and buildings
Quoted securities and cash
Investment management costs in
respect of:
Freehold land and buildings
Quoted securities and cash
Total return for the year
Transfer to income and expenditure
reserve (note 4a)
Unapplied total return for year
included within Statement of
Comprehensive Income and
Expenditure (see note 22)		 2023
£000
6,123
458
370
55
266
7,272
9,055
116
9,171
1,840
2,803
4,643
(2,225)
11,280
9,055
(526)
(386)
(912)
12,786
(6,123)
6,663		 2022
£000
6,163
212
-
32
369
6,776
(3,564)
89
(3,475)
1,549
2,980
4,529
3,084
(6,648)
(3,564)
(366)
(408)
(774)
191
(6,163)
(5,972)

32

Notes to the Financial Statements

5. OTHER INCOME

Tourist admissions and shop sales
Chapel and choir
HMRC Job Retention Scheme grant
Other income
Total		 2023
£000
1,998
338
-
120
2,456		 2022
£000
980
281
64
154
1,479

6. EDUCATION EXPENDITURE

Teaching
Tutorial
Admissions - General
Admissions - Access and Widening Participation
Research
Scholarships and awards
Other educational facilities
Total
7.
ACCOMMODATION, CATERING AND CONFERENCES EXPENDITURE
Accommodation
College members
Third parties
Catering
College members
Third parties
Total
8.
SCHOOL EXPENDITURE
Staff costs
Other expenditure
Depreciation
Total		 2023
£000
3,113
872
527
944
1,761
1,886
717
9,820
5,138
1,302
1,974
872
9,286
2023
£000
-
-
-
-		 2022
£000
3,062
765
492
1,057
1,318
1,538
573
8,805
4,580
1,158
1,520
874
8,132
2022
£000
4,530
1,301
399
6,230

33

Notes to the Financial Statements

9. OTHER EXPENDITURE

Investment management costs
Loan interest
Tourist admission and shop expenditure
Chapel expenditure
Development
FRS 102 pension provision
Other expenditure
Total
Included within other costs is auditors’ remuneration as follows:
Fees payable to the College’s auditors for the audit of the College’s
annual accounts
Fees payable to the College’s auditors for the audit of the College’s subsidiaries
Total fees payable		 2023
£000
1,077
666
351
2,060
187
(467)
1,892
5,766
42
9
51		 2022
£000
939
666
491
1,556
168
1,492
171
5,483
31
9
40

10. ANALYSIS OF EXPENDITURE BY ACTIVITY

2022/23
Education
Accommodation, catering and conferences
School
Other
Contribution under Statute G,II
2021/22
Education
Accommodation, catering and conferences
School
Other
Contribution under Statute G,II		 Staff costs
£000
3,871
3,792
-
778
-
8,441
Staff costs
£000
3,649
3,278
4,530
2,545
-
14,002		 Other
operating
expenses
£000
5,142
3,039
-
4,805
95
13,081
Other
operating
expenses
£000
4,338
2,363
1,301
2,753
91
10,846		 Deprecia-
tion
£000
807
2,455
-
183
-
3,445
Deprecia-
tion
£000
818
2,491
399
185
-
3,893		 Total
£000
9,820
9,286
-
5,766
95
24,967
Total
£000
8,805
8,132
6,230
5,483
91
28,741

The above expenditure includes £577k as the cost of fundraising (2021/22: £501k).

34

Notes to the Financial Statements

11. STAFF EXPENDITURE

STAFF EXPENDITURE
Staff costs
Salaries and wages
National Insurance
Pension contributions (see note
27)
Average staff numbers
2022/23
2021/22		 College
fellows
£000
Non-
academic
£000
Total
2023
£000
1,849
5,662
7,511
154
477
631
32
267
299
2,035
6,406
8,441
No. of
Fellows
FTE non-
academic
staff
FTE school
staff
105
184
-
88
179
94		 Total
2022
£000
10,204
883
2,915
14,002

At the balance sheet date there were 133 members of the Governing Body. During the year the average number receiving remuneration was the 105 shown above.

The number of officers or employees of the College, including Head of House and School, who received remuneration (including 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) in the following ranges were:

£100,000-£109,999
£110,000-£119,999
£120,000-£129,999
£130,000-£139,999
£140,000-£149,999
£150,000-£159,999
During the year remuneration paid to key management
personnel in their capacity as College Fellows were:
Key management personnel aggregated remuneration		 2023
1
1
1
1
-
1
2023
£000
616		 2022
1
1
2
-
1
-
2022
£000
595

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. Key management personnel include the trustees, the Provost, the First Bursar, the Domus Bursar and the Senior Tutor.

35

Notes to the Financial Statements

12. FIXED ASSETS

a) CONSOLIDATED

Buildings
113,531
2,227
-
-
(14,205)
101,553
3,593
1,176
-
(3,364)
-
1,405
100,148
100,148
-
100,148
Buildings
113,537
2,228
-
-
(14,205)
101,560
3,592
1,175
-
(3,364)
-
1,403
100,157		 Asset in
Course of
Construction
2,063
7,146
-
-
-
9,209
-
-
-
-
-
-
9,209
9,209
-
9,209
Asset in
Course of
Construction
2,063
7,146
-
-
-
9,209
-
-
-
-
-
-
9,209		 Plant
Furniture
and
equipment
52,909
602
(1,791)
-
-
51,720
2,116
2,216
-
-
(1,375)
2,957
48,763
48,763
-
48,763
Plant,
Furniture
and
equipment
52,681
592
(1,791)
-
-
51,482
1,975
2,195
-
-
(1,375)
2,795
48,687		 Computer
Equipment
Group
2023
£000
Group
2022
£000
2,035 254,536 249,818
274
10,249
20,384
(1,097)
(2,888)
(5)
-
- (15,791)
- (14,205)
130
1,212 247,692 254,536
1,691
7,400
24,677
53
3,445
3,893
-
- (21,165)
-
(1,005)
(3,364)
(2,380)
-
(5)
739
5,101
7,400
473 242,591 247,136
473 242,591 235,785
-
-
11,351
473 242,591 247,136
College
College
Computer
Equipment
2023
£000
2022
£000
1,952 254,231 249,521
272
10,238
20,378
(1,099)
(2,890)
(7)
-
- (15,791)
- (14,205)
130
1,125 247,374 254,231
1,611
7,178
24,477
52
-
3,422
-
3,871
(21,165)
-
(1,005)
(3,364)
(2,380)
(5)
658
4,856
7,178
467 242,518 247,053

36

Notes to the Financial Statements

12. FIXED ASSETS (continued)

Net book value is
represented by;
College
School
Total		 Freehold
Land
83,998
-
83,998		 Buildings
100,157
-
100,157		 Asset in
Course of
Construction
9,209
-
9,209		 Plant,
Furniture
and
equipment
48,687
-
48,687		 College
College
Computer
Equipment
2023
£000
2023
£000
467 242,518 235,702
-
-
11,351
467 242,518 247,053

c) The insured value of freehold land and buildings as at 30 June 2023 was £309 million (£305 million at 30 June 2022).

13. HERITAGE ASSETS

The College holds and conserves certain collections, artefacts and other assets of historical, artistic or scientific importance.

As stated in the statement of principal accounting policies, heritage assets acquired since 1 July 2006 have been capitalised. However, the majority of 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 five years were as follows:

Balance at beginning of year
Acquisitions purchased with
specific donations
Acquisitions purchased with
College funds
Total cost of acquisitions
purchased
Balance at end of year		 2023
£000
1,481
215
-
215
1,696		 2022
£000
1,481
-
-
-
1,481		 2021
£000
1,481
-
-
-
1,481		 2020
£000
1,481
-
-
-
1,481		 2019
£000
1,466
-
15
15
1,481		 2018
£000
1,466
-
-
-
1,466

37

Notes to the Financial Statements

14. INVESTMENTS ASSETS

Balance at beginning of year
Additions
Disposals
Gain/(loss)
Transfer to operational buildings
Increase/(decrease) in cash balances held
Balance at end of year
Represented by:
Quoted securities and unit trusts
Quoted securities – fixed interest
Freehold land and buildings
Investment in subsidiary undertakings
Unlisted securities
Cash with fund managers
College joint equity scheme
Literary royalties
Total
Subsidiary Undertakings
At 30 June 2023, Kings College held an
investment in the following companies:
King's College Cambridge Enterprises Ltd
King's College Cambridge Developments Ltd
15. TRADE AND OTHER RECEIVABLES
Members of the College
Trade debtors
Amounts due from subsidiary companies
Other debtors		 Group
2023
£000
187,757
-
(3,797)
8,943
11,000
1,155
205,058
146,551
951
42,255
-
10,333
1,671
2,195
1,102
205,058
Holding
Ordinary
Ordinary		 Group
2023
£000
187,757
-
(3,797)
8,943
11,000
1,155
205,058
146,551
951
42,255
-
10,333
1,671
2,195
1,102
205,058
Holding
Ordinary
Ordinary		 College
Group
College
2023
£000
2022
£000
2022
£000
187,757
196,145
196,145
-
4,316
4,316
(3,797)
(5,726)
(5,726)
8,943
(3,736)
(3,736)
11,000
(130)
(130)
1,155
(3,112)
(3,112)
205,058
187,757
187,757
146,551
142,398
142,398
951
42,255
-
10,333
843
32,364
-
8,342
843
32,364
-
8,342
1,671
541
541
2,195
2,055
2,055
1,102
1,214
1,214
205,058
187,757
187,757
Proportion
of voting
rights
Country of
Incorporation
Nature of
Business
100%
United
Kingdom
Provision of
conference
facilities
100%
United
Kingdom
Provision of
developmen
t facilities
Group
College
Group
College
2023
£000
2023
£000
2022
£000
2022
£000
84
84
74
74
338
326
441
341
-
5,927
-
7,256
2,808
2,783
2,736
1,466
3,230
9,120
3,251
9,137		 College
2022
£000
196,145
4,316
(5,726)
(3,736)
(130)
(3,112)		 College
2022
£000
196,145
4,316
(5,726)
(3,736)
(130)
(3,112)
205,058 187,757
146,551
951
42,255
-
10,333
1,671
2,195
1,102		 142,398
843
32,364
-
8,342
541
2,055
1,214
205,058 187,757
Holding
Ordinary
Ordinary
9,137

Included in other debtors is £769,231 (2022: £Nil) that is due in more than one year.

38

Notes to the Financial Statements

16. CASH AND CASH EQUIVALENTS

Group
College
2023
£000
2023
£000
Bank deposits
78
78
Current accounts
2,970
412
Cash in hand
5
4
3,053
494
17.
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Group
College
2023
£000
2023
£000
Bank loan
205
205
Members of the College
185
185
Trade creditors
1,637
1,439
Accruals and deferred income
2,733
2,322
Social security, pension and taxes
185
185
University fees
71
71
Contribution to Colleges fund
95
95
Amounts due to subsidiary companies
-
100
Other creditors
3,534
3,380
8,645
7,982
18.
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Group
College
2023
£000
2023
£000
Project Tintagel loan
15,000
15,000
School bank loan
769
769
15,769
15,769		 Group
2022
£000
75
7,701
4
7,780
Group
2022
£000
205
140
515
2,850
251
1,795
91
-
2,657
8,504
Group
2022
£000
15,000
974
15,974		 College
2022
£000
75
4,921
4
5,000
College
2022
£000
205
140
302
1,910
251
1,795
91
888
2,264
7,846
College
2022
£000
15,000
974
15,974

In 2014 the College borrowed from institutional investors (Project Tintagel loan), collectively with other Colleges. The College’s share was £15 million. The loans are unsecured and repayable during the period 2043-2053 and are at fixed interest rates of approximately 4.4%. Although issued through a funding vehicle, the College has no responsibility for the obligations of any other of the issuing Colleges.

In 2018 the College took out a bank loan of £2 million on behalf of the School to help fund the building of the Sports Centre. The loan is to be repaid over 10 years at a fixed interest rate of 2.99%. The balance falling due after more than one year at 30 June 2023 was £769,231.

39

Notes to the Financial Statements

19. PENSION PROVISIONS

Balance at beginning of year
Movement in year:
Current service cost
Contributions paid by the College
Change in expected contribution
Finance cost
Actuarial gains recognised in statement of
comprehensive income and expenditure
Balance at end of year		 CCFPS
£000
(1,489)
-
28
-
(85)
(370)
(1,916)		 USS
£000
(2,631)
-
-
(87)
642
(2,076)		 Total
2023
£000
(4,120)
-
28
-
(172)
272
(3,992)		 Total
2022
£000
(3,493)
-
39
(1,403)
(80)
817
(4,120)

20. ENDOWMENTS

Restricted
Permanent
Endowments
Unrestricted
Permanent
Endowments
Group and College
2023
£000
2023
£000
Balance at beginning of year:
Capital
38,699
65,535
New donations and
endowments
127
-
Increase in market value of
investments
1,416
2,165
Transfer from General
Reserves
-
-
Balance at end of year
40,242
67,700
Analysis by type of purpose:
Student support
26,409
-
Fellowship
5,405
-
Chapel and choir
4,016
-
Other funds
4,412
-
General endowments
-
67,700
40,242
67,700		 Total
2023
£000
104,234
127
3,581
-
107,942
26,409
5,405
4,016
4,412
67,700
107,942		 Total
2022
£000
107,964
121
(3,407)
(444)
104,234
25,415
5,209
3,783
4,292
65,535
104,234

40

Notes to the Financial Statements

20. ENDOWMENTS (continued)

Analysis by asset:
Property
Investments
Cash		 Restricted
Permanent
Endowments
Unrestricted
Permanent
Endowments
8,428
14,178
31,481
52,962
333
560
40,242
67,700		 Total
2023
£000
22,606
84,443
893
107,942		 Total
2022
£000
17,106
84,741
2,387
104,234

21. RESTRICTED RESERVES

RESTRICTED RESERVES

Group and College
Balance at beginning of year
Comprising:
Capital
Unspent income
Balance at beginning of year
New grants
New donations
Endowment return transferred
Other income
Increase/(decrease) in market value
of investments
Expenditure
Capital grants utilised
Transfer
Balance at end of year
Comprising:
Capital
Unspent income
Balance at end of year		 Capital
grants
unspent
£000
Permanent
unspent and
other
restricted
income
£000
Restricted
expendable
endowment
£000
350
9,413
48,984
-
-
48,984
350
9,413
-
350
9,413
48,984
1,930
-
-
-
-
-
685
1,445
458
108
-
2,149
1,365
271
1,651
-
(1,040)
(1,888)
-
(3,222)
-
-
(69)
92
1,240
10,152
51,290
-
1,240
-
10,152
51,290
-
1,240
10,152
51,290		 Total
2023
£000
58,747
48,984
9,763
58,747
1,930
2,834
2,810
729
1,759
(5,110)
(1,040)
23
62,682
51,290
11,392
62,682		 Total
2022
£000
63,838
49,033
14,805
63,838
14,820
5,228
2,769
459
(1,486)
(4,409)
(19,049)
(3,423)
58,747
48,984
9,763
58,747

41

Notes to the Financial Statements

21. RESTRICTED RESERVES (continued)

Analysis of other restricted
funds/donations by type of
purpose:

Student support
Fellowship
Chapel and choir
Buildings
Other funds		 Capital
grants
unspent
£000
Permanent
unspent and
other
restricted
income
£000
Restricted
expendable
endowment
£000
-
6,509
18,162
-
-
1,240
-
906
1,768
-
969
7,394
17,894
2,958
4,882
1,240
10,152
51,290		 Total
2023
£000
24,671
8,300
19,662
4,198
5,851
62,682		 Total
2022
£000
23,239
7,993
18,693
3,211
5,611
58,747

22. MEMORANDUM OF UNAPPLIED TOTAL RETURN

Memorandum of Unapplied Total Return
2023
£000
Within reserves the following amounts represent the Unapplied Total Return of the College:
Unapplied total return at the beginning of year
107,033
Unapplied total return for the year (note 4b)
6,663
Unapplied total return at end of year
113,696		 2022
£000
113,005
(5,972)
107,033

23. RECONCILIATION AND ANALYSIS OF NET DEBT

At 30 June
2022
£000
Cash and cash equivalents
7,780
Borrowings:
Amount falling due within one year:
Secured loans
(205)
Borrowings:
Amount falling due after more than
one year:
Secured loans
(15,974)
Total net debt
(8,399)		 Cash Flows
£000
New finance
leases
£000
(4,727)
-
-
-
205
-
(4,522)
-		 Other non-
cash
changes
£000
-
-
-
-		 At 30 June
2023
£000
3,053
(205)
(15,769)
(12,921)

42

Notes to the Financial Statements

24. FINANCIAL INSTRUMENTS

2023 2022
£000 £000
Financial assets at fair value through Statement of Comprehensive
income
Listed equity investments (note 14) 147,502 143,241
Other equity investments (note 14) 10,333 8,342
Financial assets that are debt instruments measured at amortised cost
Cash and cash equivalents (note 14 and 16) 4,724 8,321
Other equity investments (note 14) 2,195 2,055
Other debtors (note 15) - -
Financial liabilities
Financial liabilities measured at amortised cost
Bank overdraft
Loans (note 17 and 18) 15,974 16,179
Trade creditors (note 17) 1,637 515
Other creditors (note 17) 4,931 4,931

25. CAPITAL COMMITMENTS

Authorised future capital expenditure amounted to £3,064,000 at 30 June 2023 including works on Spalding, the Chapel and the Porters’ Lodge (£11,167,500 at 30 June 2022). In addition, the College has committed to invest a further £555,000 in Private Equity funds.

26. FINANCIAL COMMITMENTS

At 30 June 2023 and 2022 the College had no annual commitments under non-cancellable operating leases.

27. PENSION SCHEMES

The College and its subsidiary undertakings participate in four defined benefit schemes and one defined contribution scheme.

The total pension cost for the year was as follows:

43

Notes to the Financial Statements

27. PENSION SCHEMES (continued)

ENSION SCHEMES (continued)
University Superannuation Scheme (includes FRS 102)
Cambridge Colleges’ Federated Pension Scheme (includes FRS 102)
Teachers’ Pension Scheme (King’s College School in 2022)
Church of England Funded Pension Scheme
NOW: Pensions		 2023
£000
(47)
85
-
9
252
299		 2022
£000
2,112
78
491
15
219
2,915

University Superannuation Scheme (USS)

The total cost charged to the statement of comprehensive income and expenditure is (£47k) (2021/22 £2,112k).

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 (uss.co.uk/about-us/valuation-andfunding/statement-of-funding-principles).

CPI assumption

Term dependent rates in line with the difference between the Fixed Interest and Index Linked yield curves less: 1.1% 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 assumptions used relate to the mortality assumptions. These assumptions are based on analysis of the scheme’s experience carried out as part of the 2020 actuarial valuation. The mortality assumptions used in these figures are as follows:

44

Notes to the Financial Statements

27. PENSION SCHEMES (continued)

Mortality base table 101% of S2PMA “light” for males and 95% of S3PFA for females Future improvements to mortality CMI 2019 with a smoothing parameter of 7.5, an initial addition of 0.5% 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:

2023 2022
Males currently aged 65 (years) 24.0 23.9
Females currently aged 65 (years) 25.6 25.5
Males currently aged 45 (years) 26.0 25.9
Females currently aged 45 (years) 27.4 27.3

A 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 2023 deficit recovery liability reflects this plan. The liability figures have been produced using the following assumptions:

2023 2022
Discount rate 5.52% 3.31%
Pensionable salary growth 3.20% 3.25%

Cambridge Colleges Federation Pension Scheme (CCFPS)

The College operates a defined benefit pension plan for the College’s employees of the Cambridge Colleges’ Federated Pension Scheme.

The liabilities of the plan have been calculated, at 30 June 2023, for the purposes of FRS102 using a valuation system designed for the Management Committee, acting as Trustee of the Cambridge Colleges’ Federated Pension Scheme, but allowing for the different assumptions required under FRS102 and taking fully into consideration changes in the plan benefit structure and membership since that date.

The principal actuarial assumptions at the balance sheet date were as follows:

The principal actuarial assumptions at the balance sheet date were as follows:
2023 2022
% p.a. % p.a.
Discount rate 5.20 3.80
RPI assumption 3.40 3.45
CPI assumption 2.80 2.75

45

Notes to the Financial Statements

27. PENSION SCHEMES (CCFPS continued)

For 1 year only, we have assumed that RPI will be 9% and CPI will be 7% (2022: 11% and 9%). The caps under the Rules are applied to assumed pension increases.

The underlying mortality assumption is based upon the standard table known as S3PA on a year of birth usage with CMI_2022 future improvement factors and a long-term rate of future improvement of 1.25% p.a, a standard smoothing factor (7.0) and no allowance for additional improvements (2022: S3PA with CMI_2021 future improvement factors and a long-term future improvement rate of 1.25% p.a, a standard smoothing factor (7.0) and no allowance for additional improvements). This results in the following life expectancies:

Members are assumed to retire at their normal retirement age (65) apart from in the following indicated cases:

indicated cases:
Male Female
Deferred Members – Option 1 Benefits 63 62

Allowance has been made at retirement for non-retired members to commute part of their pension for a lump sum on the basis of the current commutation factors in these calculations.

The amounts recognised in the Balance Sheet as at 30 June 2023 (with comparative figures as at 30 June 2022) are as follows:

Present value of plan liabilities
Market value of plan assets
Net defined benefit asset/(liability)		 2023
£000
(11,595)
9,679
(1,916)		 2022
£000
(13,302)
11,812
(1,490)

The amounts to be recognised in Profit and Loss for the year ending 30 June 2023 (with comparative figures for the year ending 30 June 2022) are as follows.

Current service cost & ongoing expenses
Interest on net defined benefit (asset)/liability
Total		 2023
£000
28
57
85		 2022
£000
28
41
69

46

Notes to the Financial Statements

27. PENSION SCHEMES (CCFPS continued)

Changes in the present value of the plan liabilities for the year ending 30 June 2023 (with comparative figures for the year ending 30 June 2022) are as follows:

Present value of plan liabilities at beginning of period
Current service cost (including Employee contributions)
Benefits paid
Interest on plan liabilities
Actuarial (gains)/losses
Present value of plan liabilities at end of period		 2023
£000
13,302
-
(583)
494
(1,618)
11,595		 2022
£000
16,597
-
(529)
294
(3,060)
13,302

Changes in the fair value of the plan assets for the year ending 30 June 2023 (with comparative figures for the year ending 30 June 2022) are as follows:

Market value of plan assets at beginning of period
Contributions paid by the College
Employee contributions
Benefits paid
Interest on plan assets
Return on assets, less interest included in Profit & Loss
Market value of plan assets at end of period
Actual return on plan assets (including interest)		 2023
£000
11,812
29
-
(619)
437
(1,980)
9,679
(1,543)		 2022
£000
14,320
39
-
(561)
253
(2,239)
11,812
(1,986)

The major categories of plan assets as a percentage of total plan assets for the year ending 30 June 2023 (with comparative figures for the year ending 30 June 2022) are as follows:

2023 2022
Equities 49% 52%
Bonds & Cash 38% 34%
Property 13% 14%
Total 100% 100%

The plan has no investments in property occupied by, assets used by or financial instruments issued by the College.

Analysis of the remeasurement of the net defined benefit liability recognised in Other Comprehensive Income (OCI) for the year ending 30 June 2023 (with comparative figures for the year ending 30 June 2022) are as follows:

Actual return less expected return on plan assets
Experience gains and losses arising on plan liabilities
Changes in assumptions underlying
the present value of plan liabilities
Actuarial (loss)/gain recognised in OCI		 2023
£000
(1,980)
(496)
2,106
(370)		 2022
£000
(2,239)
(861)
3,917
817

47

Notes to the Financial Statements

27. PENSION SCHEMES (CCFPS continued)

Movement in surplus/(deficit) during the year ending 30 June 2023 (with comparative figures for the year ending 30 June 2022) are as follows:

Surplus/(deficit) in plan at beginning of year
Recognised in Profit and Loss
Contributions paid by the College
Actuarial (loss)/gain recognised in OCI
Surplus/(deficit) in plan at the end of the year		 2023
£000
(1,490)
(85)
29
(370)
(1,916)		 2022
£000
(2,277)
(69)
39
817
(1,490)

Funding Policy

Actuarial valuations are carried out every three years on behalf of the Management Committee, acting as the Trustee of the Scheme, by a qualified independent actuary. The actuarial assumptions underlying the actuarial valuation are different to those adopted under FRS102.

The last such valuation was as at 31 March 2020. This showed that the plan’s assets were insufficient to cover the liabilities on the funding basis. A Recovery Plan has been agreed with the College, which commits the College to paying contributions to fund the shortfall.

These deficit reduction contributions are incorporated into the plan’s Schedule of Contributions dated 21 May 2021 and are as follows:

These payments are subject to review following the next actuarial valuation, due as at 31 March 2023.

48

Notes to the Financial Statements

27. PENSION SCHEMES (continued)

Church of England Funded Pensions Scheme (CEFPS)

The College participates in the Church of England Funded Pensions Scheme for stipendiary clergy. This scheme is administered by the Church of England Pensions Board, which holds the assets of the schemes separately from those of the Employer and the other participating employers.

Each participating employer in the scheme pays contributions at a common contribution rate applied to pensionable stipends.

The scheme is considered to be a multi-employer scheme as described in Section 28 of FRS 102. This means it is not possible to attribute the Scheme’s assets and liabilities to specific employers and that contributions are accounted for as if the Scheme were a defined contribution scheme. The pensions costs charged to the Statement of Comprehensive Income and Expenditure in the year are contributions payable towards benefits and expenses accrued in that year, plus any impact of deficit contributions (see below).

A valuation of the Scheme is carried out once every three years. The most recent Scheme valuation completed was carried out at 31 December 2021. The 2021 valuation revealed a surplus of £560m, based on assets of £2,720m and a funding target of £2,160m, assessed using the following assumptions:

Following the 31 December 2018 valuation, a deficit recovery plan was put in place until 31 December 2022 and the deficit recovery contributions (as a percentage of pensionable stipends) were as set out in the table below. An interim reduction to deficit contributions to 3.2% of pensionable stipends was made with effect from 1 April 2022. Following finalisation of the 31 December 2021 valuation, deficit contributions ceased with effect from 1 January 2023, since the Scheme was in surplus.

As at 31 December 2020 and 31 December 2021 the deficit recovery contributions under the recovery plan in force were as set out in the table below. For senior office holders, pensionable stipends are adjusted in the calculations by a multiple, as set out in the Scheme’s rules.

49

Notes to the Financial Statements

27. PENSION SCHEMES (CEFPS continued)

PENSION SCHEMES (CEFPS continued)
1 January 2018 to 1 January 2021 to
31 December 2020 31 December 2022
Deficit repair contributions 11.9% 7.1%

Section 28.11A of FRS 102 requires agreed deficit recovery payments to be recognised as a liability. However, as there are no agreed deficit recovery payments from 1 January 2023 onwards, the balance sheet liability as at 31 December 2022 is nil. The movement in the balance sheet liability over 2021 and over 2022 is set out in the table below.

Balance sheet liability at 1 January
Deficit contribution paid
Interest cost
Remaining change to the balance sheet liability*
Balance sheet liability at 31 December		 2022
£’000
2021
£’000
2
11
(1)
(3)
-
-
(1)
(6)
-
2

This liability represents the present value of the deficit contributions agreed as at the accounting date and has been valued using the following assumptions. No assumptions are needed for December 2022 as there are no agreed deficit recovery payments going forward. No price inflation assumption was needed for December 2021 since pensionable stipends for the remainder of the recovery plan were already known.

2022 2021 2020
% p.a. % p.a. % p.a.
Discount rate n/a 0.0 0.2
Price inflation n/a n/a 3.1
Increase to total pensionable payroll n/a -1.5 1.6

The legal structure of the scheme is such that if another Responsible Body fails, the College could become responsible for paying a share of that Responsible Body’s pension liabilities.

NOW: Pensions

The College operates a defined contribution pension scheme in respect of certain employees. The scheme and its assets are held by independent managers. The pension charge represents contributions due from the College amounting to £252,000 (2021/22 £219,000).

28. CONTINGENT LIABILITIES

With effect from 16 March 2007, the Universities Superannuation Scheme (USS) positioned itself as a “last man standing” scheme so that in the event of an insolvency of any of the participating employers in USS, the amount of any pension funding shortfall (which cannot otherwise be recovered) in respect of that employer will be spread across the remaining participant employers.

50

Notes to the Financial Statements

29. RELATED PARTY TRANSACTIONS

Owing to the nature of the College’s operations and the composition of the College Council, it is inevitable that transactions will take place with organisations in which a College Council member may have an interest. All transactions involving organisations in which a member of the College Council may have an interest are conducted at arm’s length and in accordance with the College’s normal procedures.

The College maintains a register of 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 Fellows’ Remuneration Committee.

The salaries paid to Trustees in the year are summarised in the table below:

2023 2022
From To Number Number
£0 £10,000 14 11
£10,001 £20,000 - 2
£20,001 £30,000 1 -
£30,001 £40,000 1 2
£40,001 £50,000 - 1
£50,001 £60,000 - -
£60,001 £70,000 - -
£70,001 £80,000 - 1
£80,001 £90,000 - -
£90,001 £100,000 - 1
£100,001 £110,000 - -
£110,001 £120,000 - 1
£120,001 £130,000 1 -
Total 17 19

51

Notes to the Financial Statements

29. RELATED PARTY TRANSACTIONS (continued)

The total Trustee salaries were £212,568 for the year (2021/22 £263,085)

The trustees were also paid other taxable benefits (including associated employer National Insurance contributions and employer contributions to pensions) which totalled £47,037 for the year (2021/22 £58,747)

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.

52