2022-12-31-accounts

THE UNIVERSITY OF BUCKINGHAM Annual Report and Financial Statements

TABLE OF CONTENTS

01 Legal and Administrative Information

• 02 Chair's Statement

• 04 Vice-Chancellor's Statement

• 06 Trustees' Report

• 22 Chancellor and Members of Council

• 24 Statement of Responsibilities of the University's Council in Relation to the Financial Statements

• 26 Statement of Corporate Governance and Internal Control

• 30 Independent Auditors' Report to the Council of The University of Buckingham

• 34 Consolidated and University Statement of Comprehensive Income for the Year Ended 31 December 2022

• 35 Consolidated and University Statement of Changes in Reserves for the Year Ended 31 December 2022

• 36 Consolidated and University Statement of Financial Position as at 31 December 2022

• 37 Consolidated Statement of Cashflows for the Year Ended 31 December 2022

38 Statement of Principal Accounting Policies

52 Notes to the Financial Statements

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

LEGAL AND ADMINISTRATIVE INFORMATION

Corporate Status

The University of Buckingham (the “University”) is incorporated by Royal Charter, number RC000730. The University is a Registered Charity, number 1141691.

Principal place of business

The University of Buckingham Yeomanry House Hunter Street Buckingham MK18 1EG

Independent auditors MHA 6th Floor 2 London Wall Place London EC2Y 5AU

Bankers

National Westminster Bank plc Stony Stratford Branch 80 High Street Stony Stratford Milton Keynes MK11 1AJ

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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CHAIR'S STATEMENT

This is the third Chair’s statement I have written for three sets of Annual Reports and Accounts since taking up the position in January 2023. I am proud to address our esteemed faculty, staff, students, and alumni as we stand fully compliant on the threshold of a new chapter in our University's history.

The last three years have been challenging. We have faced several unprecedented obstacles, both internally and externally, that have tested our resilience, adaptability, and commitment to our core values. Our University community has faced these challenges head-on, and I am honoured to report that we have not only endured but emerged stronger and more unified.

Throughout this period, we have made significant strides in addressing the issues that have impacted our institution in the past. Through the unwavering dedication of our faculty and staff, we have maintained our high academic standards while ensuring that the student experience remains at the forefront of our mission.

We have worked tirelessly to implement measures that enhance transparency, accountability, and governance within the University, setting a strong foundation for future growth and success. In addition, we are focusing on strengthening our financial position, enabling us to continue investing in critical infrastructure, cutting-edge research, and high-quality student support services.

As we move forward, we must learn from the challenges of the past three years and use those lessons to shape our future. We must continue to foster a culture of open dialogue and collaboration where every member of our community feels valued, respected, and heard.

Our priorities for the coming year include:

Enhancing the student experience: We will continue to invest in innovative teaching methods, state-of-the-art facilities, and comprehensive student support services to ensure that every student has the tools and resources they need to succeed.

Strengthening research excellence: We will focus on fostering interdisciplinary research collaborations, building on where we can make a difference, attracting top research talent, and securing funding to support our researchers in addressing the most pressing challenges facing society today.

Community engagement and outreach: We will work to build stronger connections with our local and global communities, increasing our positive impact and reinforcing our commitment to social responsibility.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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CHAIR'S STATEMENT (CONTINUED)

Inclusion and diversity: We will actively promote an inclusive, diverse, and equitable environment, celebrating the unique strengths and perspectives that each individual brings to our community.

As The University of Buckingham embarks on this new chapter, I am confident that we are better positioned than ever before to achieve our mission of providing exceptional education, advancing knowledge, and transforming lives. I am deeply grateful for the steadfast commitment of our faculty, staff, students, alumni, and friends who have been instrumental in guiding us through these difficult times.

Together, we will continue to build upon the legacy of this unique institution, nurturing the leaders, innovators, and independent thinkers of tomorrow.

Mark St John Qualter Chair of Council

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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VICE-CHANCELLOR'S STATEMENT

It is a pleasure to introduce these Accounts. The financial statements show an income growth of 10% for the Group from 2021. This is largely the result of an 8% increase in student numbers from 2021 (up to 3,214 students). It’s also pleasing to see how the University’s improved performance is reflected in recent league tables. For instance, concerning Graduate Prospects – a key indicator of how our graduates fare in the world outside of university - we were ranked 6th in the UK in the Good University Guide 2022, and 9th in England in the Complete University Guide 2023 (a climb from 61st).

2022 was a memorable year on many levels for me as Vice-Chancellor. Summer saw some of the highest temperatures ever recorded in the UK, and the University also had a record-breaking number of graduation ceremonies. In July, we held 15 ceremonies, 14 of them over five consecutive days. These were very joyful occasions. I could not have been more proud of the way the University presented itself. Dame Mary Archer came to all of these ceremonies – and the five associated dinners and lunches – and I want to express my deep gratitude for all she does for the University. Overall, it was a tremendous team achievement and a very heart-warming experience for all.

The death of Her Majesty Queen Elizabeth II in September brought memorable scenes in London and a great many found solace in standing in line to pay their last respects at Westminster Hall. I know we all felt her loss greatly; the talk given at our University by William Shawcross CVO, the royal biographer, only a month after Queen Elizabeth’s funeral, allowed us to spend time focusing on her life and legacy.

The Vice-Chancellor Invited Speaker Series proceeded apace. We started the year with talks by Sir Tim Rice and Lord Archer at Ondaatje Hall and continued with Her Honour Judge Khatun Sapnara, Dr Arun Verma, Kate Clancy, Professor Chandra Wickramasinghe, Sir Michael Barber, and Lord (Charles) Moore.

In March 2022 I travelled to Nigeria with colleagues to host well-attended alumni events in Lagos and Abuja, and also to take part in recruitment fairs. At these fairs I realised first-hand how attractive our Royal Charter is to potential students, how it was clearly a feature that distinguished us from many of other universities represented. The alumni events were tremendous, including meeting an alumnus who had been amongst the first intake to the University College at Buckingham in 1976 – and who recalled Margaret Thatcher giving the first matriculation speech.

In October, I returned again with colleagues to West Africa, this time to Ghana. Here we were hugely honoured to have an audience with the Vice-President, Dr Mahamudu Bawumia, an alumnus of the University. We were then doubly honoured when he accepted to become our guest of honour at the event to launch a new Ghana Alumni association.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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VICE-CHANCELLOR'S STATEMENT (CONTINUED)

We have continued to collaborate with a wide range of partners internationally. I was pleased to attend graduation ceremonies for the International Business School in Budapest and the Sarajevo School of Science and Technology in September.

I have been heartened to feel the new wave of optimism across our campuses. We continue to be innovative and creative in what we offer and we can be rightly proud of everything that makes us different. Having our financial reporting back on track, with the publication of the audited statements for 2021 and now these statements, allows us to refocus on the future with renewed energy and enthusiasm.

Professor James Tooley Vice-Chancellor

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT

The Trustees’ Report represents the strategic review for The University of Buckingham (the "University") and its subsidiaries (together "the Group").

Corporate Status, Reference and Administrative Details

The University of Buckingham was incorporated by Royal Charter on 11 February 1983. Prior to that, the University College at Buckingham was founded in 1973 and admitted its first students in 1976.

The University is not-for-profit and is a Recognised Body under Statutory Instrument No.573 (The Education (Recognised Bodies) (England) Order 2020). It is authorised by its Royal Charter to award taught and research degrees in perpetuity.

The University is registered at the Charity Commission for England and Wales (Charity number: 1141691). The principal place of the University’s business, as well as the names and addresses of the University’s auditor and bankers, have been presented separately in the Legal and Administrative Information section of these accounts.

The University is registered with the Office for Students ('OfS') in the Approved provider category. Approved higher education providers ('HEPs') differ from Approved ('Fee Cap') HEPs in being able to levy uncapped tuition fees for undergraduate degrees but with the caveat that students at Approved providers can only access student loan funding to the lower limit. Since 2018, and through 2022, this has been £6,165 per annum for three-year programmes and £7,400 per annum for two-year programmes. As an Approved provider, the University is unable to access any direct government funding for learning and teaching, research or capital activity. However, the University remains subject to the full suite of OfS Conditions of Registration, with the only exception being it is not required to have an Access and Participation Plan.

The names of all Trustees/council members who served in the period and at the report date, and the name of Vice-Chancellor, have been presented in the Chancellor and Members of Council section of these accounts.

Structure, Governance and Management

The University’s governing document is the Governance Handbook, which includes:

• the University’s Royal Charter and Statutes, as well as its Ordinances and Scheme of Delegation, on which our governance structures are based; our academic, management and committee structures; and the terms of reference and membership of all committees.

The Ordinances codify the procedures by which the powers articulated in the University’s Charter and Statutes are exercised, including the procedures on the recruitment, appointment, induction and training of Trustees.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

The University's consolidated financial statements include a subsidiary company and a charity, being Medical Property Management Ltd ("MPML") and The University of Buckingham Foundation, respectively. MPML is a wholly owned trading subsidiary whose purpose is to further the University’s charitable purposes, in particular in the construction and subsequent rental of the Milton Keynes Academic Centre. The University of Buckingham Foundation is a charitable trust whose purpose is to advance education, in particular supporting and promoting the education of students at the University, and to promote research into academic and scientific fields of learning. Financial statements of these entities can be obtained from the University’s principal place of business, which is noted on page 1 of these accounts.

The Trustees are required to ensure the University is carrying out its purposes for the public benefit, complies with the governing document and law, acts in the University’s best interests, manages its resources responsibly and is accountable, through the organisation and conduct of regular meetings for both the Council and its subcommittees. The agreed decisions and actions from the meetings are then appropriately delegated to, and implemented by the University’s senior management and functional departments.

With regards to the setting of remuneration, the University, through written commitment provided in the Ordinances, comply with the Higher Education Remuneration Code published by the Committee of University Chairs. In practice, the University’s Nominations, Performance and Remuneration Committee: considers the comparative information on the emoluments of the employees within its remit; ensures all arrangements are unambiguous and diligently recorded; and determines annually the principles on which merit awards shall be made for all members of staff in the salary review for that year.

University of Buckingham is a member of the Quality Assurance Agency for Higher Education (QAA). The University has also developed a number of important partnerships which are geographically spread and culturally diverse, and has collaborations with key academic institutions such as British University in Georgia, International Business School in Budapest and the Anglo Mexican Foundation.

Objectives and Activities

As codified in the University’s Statutes, these are the advancement of learning and knowledge by teaching and research, and to enable students to obtain the advantages of university education.

The Trustees have had due regard to the Charity Commission’s guidance on public benefit during their stewardship of the University’s activities. Details of activities to further public benefit are set out in these accounts.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

In particular, the Trustees have taken care to:

• (a) make strategic decisions that further the charitable objectives;

• (b) maximise public benefit to significant numbers of beneficiaries who are local to Buckingham, as well as more widely;

• (c) manage and mitigate risks to our beneficiaries and to the University itself.

Buckingham’s distinctive position

The distinctive position of The University of Buckingham is that it is an early innovator, including pioneering the accelerated two-year honours degree some 40 years ago. This is a cost-effective route for students to spend less on tuition and living costs than if they were taking a three-year degree, and enter employment a year earlier if they wish, or leave after three years with a master’s degree. The three-year honours degree option is also available. Our Medicine course is also unique, offering a GMC accredited fourand-a-half-year course with a January start date, the removal of long holidays allowing for shorter overall study time and graduated students are able to enter the NHS foundation programme commencing in August each year.

A suitable motto is “Small is Beautiful”: The University of Buckingham prides itself on the close personal attention afforded to its students, with small group tutorials the most important part of its teaching. The small size of the campuses also promotes the sense of personal attention.

The University holds academic and social events at its premises which are open to the public, as well as to our staff and students. These include lectures, fireside chats with renowned guest speakers, taster days and musical concerts. It has been a pleasure to welcome members of the local community to these.

Staff

As with any organisation, staff numbers fluctuate through the year, therefore average numbers are used in these financial statements. In 2022, there was an average of 358 full time equivalent members of staff (2021: 382), comprising 128 academic (2021: 132), 8 research (2021: 9), 188 support (2021: 207) and 34 manual staff (2021: 34).

Achievements and Performance on Teaching & Research

The founders of the University were driven by a desire to cultivate an institution that was rigorously independent. This ethos has underpinned three striking features of the University’s provision:

• (a) the pioneering of an eight-term (two-year) accelerated undergraduate degree;

• (b) an early focus on the student experience; and

• (c) a resourcing model in which academic staff teach for three out of the four terms, with the remaining term given over to research, external engagement and programme review that ensures the availability of senior and permanent teaching staff throughout the full calendar year.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

Whilst keeping a keen eye on affordability, the University sets fee levels that fund a highquality academic experience, incorporating personalised learning and pastoral support, enabling students to thrive. The University’s robust academic and personal tutorial systems have been integral to the University’s results in recent league tables. In the Good University Guide (2022), we were ranked 15th in the UK for teaching quality and 6th in the UK for Graduate Prospects, just below Oxford and Cambridge and above Bath and Warwick. In the Complete University Guide (2023), we maintained our top 10 ranking for Student Satisfaction climbing from 8th to 7th in England, also rising significantly on “Graduate Prospects – outcomes” from 61st to 9th.

The University aims to ensure that all students feel as though they are stakeholders in their University and that it revolves around them rather than the other way around. As such, the University places a very high value on the staff-student partnership. Students are represented on academic committees at every level and their feedback, both formal (via satisfaction surveys) and informal, is sought on both the University’s courses as well as the wider learning environment. Feedback is discussed with the University's Executive team and appropriate actions are taken as warranted.

Student numbers

Student numbers vary across any year as a result of the multiple entry and completion points for different studies as illustrated in the table below.

Total student numbers increased to 3,214 in Winter 2022, up 8% from 2021 (2,963).

Undergraduate (UG) students decreased by 7% in Winter 2022 from 2021, however UG Medicine continued to show an improvement, as cohorts increase year-on-year. Postgraduate taught (PGT) student numbers increased by 9% in Winter 2022 from 2021, while PGCE (Post Graduate Certificate of Education) student numbers improved by 31%. Postgraduate research student numbers show an increase of 23% in Winter 2022 from 2021.

There are two main intakes of new students every year. The terminology “Home” within the graphs below refers to UK students only.

----- Start of picture text -----
Winter 2022 Autumn 2022 Winter 2021 Autumn 2021
1,000
750
500
250
0
UG Home, excluding MedicineUG Int/EU excluding Medicine UG Medicine PGCE PG Home PG Int/EU PG ResearchPre-degress & non-degree
----- End of picture text -----

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

The University’s student body is diverse, with substantial differentiation across all five demographic criteria as shown below and on the following page:

----- Start of picture text -----
Disability
11%
GENDER DISABILITY
Male
48%
Female
52%
No Disability
89%
Not stated
17-20
10%
15%
AGE
ETHNICITY
White
49%
BAME
41%
21+
85%
----- End of picture text -----

The student body comprises 114 nationalities with the largest number coming from the UK (72%).

During 2022 our on-site teaching and student activities were thankfully unaffected by the global COVID pandemic and returned to “normal”. Similar to many organisations, the University continues to embrace the learnings from the pandemic experience.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

Collaborat ive Partners

The University validates academic programmes and/or the learning and teaching of selected institutions within the UK and overseas. Whilst such activities are increasing, such collaborations create payment and reputational risks for the University. Therefore, we apply suitable due diligence and contractual arrangements with prospective new academic partners.

Research

Like other British universities, an important part of our intellectual mission is for our academics and graduate students to contribute to research and scholarship. Areas of growth and investment in Buckingham include Artificial Intelligence, Educational Research, Entrepreneurship, Diabetes Research, Medical Education, Modern History, Public Understanding of Economics and Entrepreneurship and Quantum Biosciences. As an independent university, Buckingham is not required to participate in the Government’s Research Excellence Framework. The University’s plans include regaining Independent Research Organisation (IRO) status, to allow the University to bid for UK Research and Innovation (UKRI) grants. In principle, we expect research income to cover its related direct costs because we do not receive “core” research funding from UKRI or other national research funding bodies.

Scholarships and Bursaries

The University’s Scholarships and Bursaries programme is an important part of assisting students to benefit from a university education. Our bursary awards are available to all undergraduates and postgraduates who meet the general entry requirements. Awards are made based on need or to relieve hardship.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

In making means-tested awards, we consider several factors including family income, investments and savings, assets and family circumstances. Students or their sponsors must meet any maintenance costs. However, living near Buckingham and the degree programme being completed in two years rather than three elsewhere, makes studying much more financially viable.

The University of Buckingham Foundation has total assets less liabilities of £4.1m at 31 December 2022 (2021: £4.7m), available for the benefit of the University and are subject to the terms of the Foundation’s trust deed. At 31 December 2022, £3.8m (2021: £3.4m) of these funds were held as endowed investments and property, generating income to support scholarships, bursaries, grants and other projects.

In the year, the University awarded total scholarships, bursaries, and prizes of £0.8m (2021: £0.6m). These scholarships and bursaries include funded, named scholarships from the Foundation of £0.4m (2021: £0.3m). These are recorded within Curriculum costs, itself within Other operating expenses.

The University is keen to increase participation within higher education in Buckingham and the local area, especially for those potential students who may find that going away to study is too expensive. Two specific methods of student support are offered to potential students: the Buckingham Bursary, aimed at students in receipt of a maintenance loan, and the High Achievers Scholarship, aimed at UK students achieving AAB or above at A-level and who make Buckingham their first choice. A Buckingham Bursary can be combined with a High Achiever Scholarship.

FINANCIAL REVIEW

Income

Total income for the Group at £47.9m in 2022 increased by 10% (2021: £43.5m).

Tuition fees remain the principal income source for the Group, and financially support the majority of our day-to-day teaching and research activities. Tuition fees represent 84% of total income in 2022 (2021: 86%).

Residences and catering income on the Buckingham campus totalled £3.3m, £1.5m more than 2021 due to the post pandemic return to campus.

At the consolidated level, donation income in 2022 was £0.1m (2021: £0.6m).

The University of Buckingham Bursary Fund has remained the University’s fundraising priority during 2022, and the University continued to actively invite our generous alumni and friends to make a gift to support students in need and to help build momentum behind this important initiative.

The Group’s income was supplemented by a £0.2m gain on the disposal of properties (2021 £1.9m), but detracted from by a loss of £0.6m on investments (2021 £0.8m gain) due to the movements on investment markets.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

Expenditure

Group expenditure increased in 2022 by £9.9m to £50.3m. Particular reasons for these movements are:

• Staff costs (excluding additional USS pension provision costs) increased by £0.9m being 5% higher than 2021. The USS pension provision increased by £1.4m in 2022 compared to a reduction in 2021 of £1.1m, resulting in a £2.5m increase year-on-year.

• Other operating expenses increased by £6.4m, largely driven by higher Curriculum and medical placement fees (£2.0m), Premises & Residences costs (£1.4m), General administrative expenses (£2.2m) and travel costs (£0.7m), as the University returned to full operations post the pandemic.

• The University continues to use scholarships and bursaries to improve its student recruitment, and to support students who would otherwise struggle financially to join the University. The University spent £0.8m on this support, (2021: £0.6m).

Management did not identify any indicators of impairment of assets in 2022.

Key performance indicators

The University uses key performance indicators (KPIs) to monitor its performance.

KPIs covering academic performance of The University of Buckingham	2022	2021
Student satisfaction: National Student Survey Data	80%	82%
Quality of teaching: National Student Survey Data	84%	84%

These KPIs have remained relatively static between the two years above.

KPIs covering financial strength of The University of Buckingham group	2022	2021
Cash and cash equivalents	£12.9m	£10.3m
External borrowing as a percentage of total income	10%	11%
(Deficit)/surplus for the year	(£2.8m)	£5.8m

The University of Buckingham Foundation

Scholarships and other disbursements made in 2022 by the Foundation, in support of the University’s activities, were £0.4m (2021: £0.3m). The grants awarded included funds awarded from the Klatten fund, a restricted fund used to support the development of entrepreneurship, enterprise and innovation in courses and other development projects.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

The stock market performance in 2022 resulted in losses in the Foundation’s investment valuations of £0.3m, (2021: gains of £0.3m). These losses, in addition to disbursements of £0.4m, contributed to the net reduction in funds for the year of £0.5m (2021 net income of £0.02m).

University Investments

The University’s investments are guided by the University’s Financial Regulations, and the University’s Finance, Estates and Resource Committee is responsible for approving the Treasury Management Policy statement which sets out the strategy and policies for cash management, long term investments and borrowings. This requires compliance with the regulatory rules for approval for any secured or unsecured loans that go beyond the consent levels set out in regulations.

No investments may be made without the approval of the Finance, Estates and Resource Committee. The priorities for investment are identified by the Vice-Chancellor and University senior management, through business, social and environmental considerations.

Statement of Financial Position

Net assets, when considered at the University level, decreased from £17.1m to £14.8m during the year largely the result of the operational deficit.

During the year, the Group made additions to tangible assets of £1.2m, which meant that after depreciation in the year of £2.4m and the sale of properties with a book value of £0.2m, the net book value of tangible fixed assets decreased by £1.4m to £33.8m.

Reserves

The Group aims to maintain an appropriate level of unrestricted reserves and cash resources for the following reasons:

• Market fluctuations may impact the number of students attending University courses, and the mix of courses and students. The University gains most of its income from academic programmes and may rely on reserves if there is a reduction in student numbers, whether permanent or temporary.

• The University has substantial ongoing commitments relating to the welfare and education of the students and needs to maintain a level of reserves sufficient to continue to meet these commitments.

• The University has commitments to its lenders to repay capital and interest on its borrowings.

The Group’s unrestricted reserves decreased to £8m in 2022 (2021: £10m), driven by the financial performance in the year as discussed throughout these accounts.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

The consolidated restricted reserves reduced to £5.7m in 2022 (2021: £5.8m). The consolidated total endowment reserves decreased to £7.0m (2021: £7.8m) due to a decrease in market value of investments.

The timing of expenditure of restricted funds is based on when the costs required to complete the specific purposes of the funds arise, as well as the award of bursaries and scholarships to students in certain degree courses, which are sponsored by specific trust funds.

The Trustees consider the level of reserves at the balance sheet date to be adequate for the purposes outlined above and anticipate that over the course of the next five years unrestricted reserves will increase following pursuit of income growth and cost efficiency. A more detailed view of the University's future is covered under the 'going concern' portion of this report.

At the date of the signing of these accounts the Trustees were performing but had not yet completed, a review of the University’s Endowment, Restricted and Unrestricted funds, and the presentation of income and expenditure associated with the University endowment funds.

RESERVES ANALYSIS (£'000) Endowment Reserves Restricted Reserves Unrestricted Reserves

----- Start of picture text -----
12,500
10,000
7,500
5,000
2,500
0
2022 Group 2022 University 2021 Group 2021 University
----- End of picture text -----

Cash Flow and Financing

Consolidated cash balances as at 31 December 2022 were £12.9m (2021: £10.3m).

The University held liquid cash balances of £11.2m at the year-end (2021: £7.8m) an increase of £3.4m.

As at the balance sheet date, a loan drawn in 2021 with Natwest of £5m remained repayable within 5 years, with no capital repayment due within the next 12 months. The University also has a £7m revolving credit facility available to it from NatWest which was not used during 2022.

The University continues to take steps to ensure further improvement in the cash position, which will ensure further funds for future investment to provide high-quality teaching and student experience.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

Principal risks

The University considers its principal risks (which include external factors outside of its control) to lie in the seven key areas below and has taken active steps to identify and mitigate these as well as other detailed operational risks.

1. Financial

Whilst current student recruitment remains encouraging, there are many higher education providers competing for students and if there were a significant shortfall in our student recruitment, this would create serious financial pressure. The unique proposition the University offers – especially as a private university with its pioneering two-year degrees, four and a half year medical degrees, and one year post graduate courses in Education – will continue to help attract students. The Vice-Chancellor is actively driving advancement and fundraising activities to generate philanthropic donation income, and contain costs where appropriate to mitigate risks.

Overall, the Trustees are confident in the University’s ability to manage through the uncertainties that may arise through the focus on income generation and cost control, as appropriate, whilst managing the provision of academic delivery and student outcomes and experience.

1. Staffing

Like many organisations, there is a risk of not being able to recruit and retain proficient staff – with a resultant adverse impact on the student experience and the quality of administrative services. Management across the University ensure sufficient staff resources are available at crucial times, such as for exam marking and new student registration. Among the mitigation measures, particular care is taken around staff engagement, well-being, and professional development. The Vice-Chancellor holds regular ‘town hall’ meetings to discuss current and future issues with staff colleagues, and there are regular events to promote staff wellbeing. As a relatively small organisation there is recognition that the University is reliant on several key individuals but our collegiate approach allows information and expertise to be shared so that absences can be cross-covered where needed and, in some cases, interim staffing brought in.

1. Built Estate

Whilst the academic space and student accommodation is sufficient for current needs, it is important to recognise the need to be aware of, and respond to changes in these requirements. Whilst capital expenditure in 2022 was relatively small, plans were developed and work commenced at the end of the year on phase 2 of the major refurbishment of the Franciscan building to further update facilities for the Computing, Law and Psychology faculty and associated student study and library facilities. The Hunter Street campus is near the River Great Ouse and whilst there have been problems in the past with flooding, these did not impact the University’s ability to continue operations with little disruption to services. Plans are in place to prepare a new business continuity plan during 2023, addressing estate issues as well as other operational areas.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

4. Information Systems and Data Security

An information security breach could severely impact our operations, reputation, and possibly lead to regulatory fines. Therefore, IT systems and cybersecurity are under constant review and IT security measures and enhancements are deployed proactively. The University holds Cyber Essentials accreditation, the Government backed accreditation scheme, as part of its continued drive to ensure the security of systems and data. IT staff keep abreast of new technologies in case these disrupt connectivity, functionality, or lifestyles – with consequent impacts on how best to approach the delivery of teaching, learning, and research.

5. Regulatory Compliance

There is regular correspondence with our regulators, so they are aware of measures that are being taking to deliver regulatory compliance, and the senior management team keep abreast of the changing regulatory landscape. The principal regulatory bodies are:

The University of Buckingham Office for Students The University of Buckingham Foundation Charity Commission Medical Property Management Limited Companies House

As fully disclosed in the previous years' accounts, there were significant delays to the publication of accounts for 2019 which also impacted 2020 and 2021 accounts publication timescales. We kept regulators informed of the reasons for the delays. As a result of late submission of the 2019 financial statements, the University received a financial penalty in 2022 from the Office for Students. The University is pleased to now have all financial reporting up to date. The Trustees are very cognizant of the continued reputational risk created by being noncompliant with regulatory requirements and actions focussed on preventing the possibility of recurrence in the future continue.

In addition the subsidiary Medical Property Management Ltd is in discussion with HM Revenue and Customs in relation to over claims of VAT in previous years. Details of this issue and the provision that has been maintained are in Note 16 to the financial statements. At the year end the best estimate of the liability remains at £808,000 which has previously been provided for, however this provision is subjest to material estimation uncertainty and there are plausible and realistic scenarios under which the total liability could be significantly lower than this current estimate. Subject to further enquiries being made by HMRC it is anticipated that this matter will be resolved and settled during calendar year 2023

The University is also mindful of regulatory compliance relating to immigration, employment law and our academic activities generally (and particularly within healthcare and education).

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

1. Joint Venture

2. The Crewe campus joint venture challenges disclosed and provided for in previous years' accounts continue to be systematically resolved and the associated risks managed and reduced by working with the joint venture partner and growing the student numbers on the campus. The Trustees are confident in the University’s ability to manage remaining issues within the financial provisions contained within these financial statements.

3. Pension Scheme Costs

4. Like other institutions, the University faces significant costs relating to staff who are members of defined benefit pension schemes. At the end of 2022 there were 113 members of the USS pension scheme (2021: 113). The USS pension scheme is not available to new staff. Occupational pension provision for new staff is delivered via an Aviva defined contribution scheme. The continued risk regarding future pension cost increases is discussed further at Note 22.

Financial Risk Management Objectives and Policies

The Group's main financial instruments are cash and quoted investments held by the University and the Foundation. In addition, items such as trade debtors and trade creditors arise directly from its operations. The main purpose of these financial instruments is to fund the Group's operations. The existence of these financial instruments exposes the Group to several financial risks, namely market risk, liquidity risk and credit risk. The Trustees review and agree policies for managing each of these risks and they are summarised below.

a. Market Risk

• 1.Currency risk: The Group is exposed to some translation and transaction foreign exchange risk in respect of cash, cash equivalents, and investments. This risk is not significant to the Group and accordingly there are no hedging provisions in place.

• 2.Interest rate risk: At the balance sheet date the University had a £5m bank loan outstanding. Details of the loan are in Note 15. Since the loan interest rate is fixed, there is no interest rate risk.

• 3.Share price risk: The Group's exposure to share price risk consists mainly of movements in the value of the Group's investments in quoted shares.

b. Liquidity risk

• The University has sufficient liquid cash resources partially arising from funds drawn down from the loan. The University manages its liquidity risk through regular cash flow forecasts and other financial management information tools. Also, the University monitors cash resources as a proportion of operating costs through the year, considering peaks and troughs in cash flows and the projected impacts on banking covenants. In addition the University has a £7m revolving credit facility with NatWest available which has been unused since it was established in January 2021.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

c. Credit Risk

• The Group's principal financial assets are quoted investments held by the University (and via the Foundation), cash and trade debtors. Quoted investments are managed by independent professional advisers, working with a cautious risk appetite set by The University of Buckingham and The University of Buckingham Foundation. The credit risk associated with the investments and cash is limited, as the counterparties are well-established financial institutions. The principal credit risk arises therefore from the Group’s receivables. The nature of the Group's client base, being mainly undergraduate and postgraduate students, is such that it is not significantly exposed to any single individual customer, although there are a number of commercial and institutional clients. For example, the University validates other providers’ programmes in the UK and internationally. The Trustees therefore concentrate their efforts on ensuring that the processes around credit approval and debt collection are sufficiently robust.

Fraud and error

As with any business, there are potential risks to the integrity of financial assets and financial information. The primary safeguards are the staffing of the finance office and its financial procedures. In addition, the Risk, Audit and Compliance Committee undertakes rolling reviews of risk management. The Finance, Estates & Resources Committee and the Council receive financial reports and information which are enables them to engage in significant financial decisions.

Forward outlook and plans for future periods

Like other higher education providers, the University has faced a great deal of challenge and uncertainty in recent years - and may continue to do so in the years to come.

In response to financial challenges, the University set in place a Financial Recovery Plan in mid-2020, the benefits of which have flowed into 2021 and 2022:

• The sale of some local residential properties that are not core to the University’s activities. The sale of these properties has had no impact on the delivery of teaching and services provided but will improve our financial resilience. Renegotiated bank financing arrangements.

• Addressing the challenges associated with the Crewe joint venture.

These actions are intended to result in the University maintaining a satisfactory liquidity position, as defined by available cash resources, through to the end of 2024.

Based on the forward forecasts and projections, the University forecasts to be compliant with its debt service covenants for the foreseeable future and able to withstand plausible variations in those forecasts.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

C limate change

We recognise climate change as an important matter for the University and the wider community. The University has already taken steps to reduce consumption of energy (such as by installing modern heating and lighting systems, and insulation). Furthermore, we reuse and recycle materials where possible and our vehicles are predominantly electric. The Trustees recognise there is more to do over the coming years to assess and respond to climate risks.

Some buildings on the Hunter Street campus are only about 200 feet away from the River Great Ouse, and we have had instances of the basements of some older Hunter Street buildings being flooded due to abnormally high river levels. We were able to continue business operations without significant disruption. Whilst these were acute oneoff instances, climate change may result in flooding at Hunter Street becoming a more frequent physical risk. The University is able to mitigate the risk to operations through the insurances it holds.

The University, like other organisations, needs to transition to more environmentally friendly means of delivering its objectives. There is desire for this from within the University and our students and we will see increasing demands to make changes to our working practices and our built estate because of societal changes and legislation.

Risk of exposure to Ukraine and Russia

Occasionally, a handful of students from these countries enroll, and the tragic conflict that exists currently in Ukraine is noted. Otherwise, the University does not have business operations connected to these countries, so there is minimal and immaterial risk exposure.

Perspectives on future direction

The various challenges which have arisen over recent years have been taken as learning experiences and are driving determination to further enhance the University's controls and systems, and improve efficiency over the coming years.

Key plans and actions include the development a robust future strategy for the University plus actions to improve cost efficiency and control, such as the review of end-to-end finance processes and the IT review, both of which commenced in late 2022 with a view to improvement in automation, control and resilience. Further operational plans will be developed during 2023 as the new strategy evolves.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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TRUSTEES' REPORT (CONTINUED)

Going concern

The Group and University’s financial statements are prepared on a going concern basis, based on Trustees’ assessment of the financial position, operating model, and forecast cash flows. This assumes the Group and University will continue in operation for the foreseeable future including meeting its future obligations as they fall due.

The University experienced financial challenges and a decline in financial operating performance in recent years. As noted above, responses included measures to reduce costs, such as a necessary programme of staff redundancies, to help ensure long-term financial sustainability, in addition to addressing the costs of the Crewe campus lease. The University will continue to drive improved cost efficiency and control in the future to further improve resilience and enable investment in growth and infrastructure to enhance the student experience.

The University continues to engage proactively with its regulators and take actions to further improve governance to prevent recurrence of past issues.

At the balance sheet date the Group is reporting net current liabilities of £2.8m (University: £3.3m), which is a decline of £1.7m (University decline of £0.9m) due to an increase in fees received in advance, trade creditors and accruals.

The University forecasts to meet all its banking covenant and debt servicing requirements for the foreseeable future.

After considering significant potential risks to future plans and forecasts and the potential actions, which could include the sale of additional capital assets and a programme of cost restructuring, the Trustees are satisfied that it remains appropriate to prepare the Group and University financial statements on a going concern basis.

Approved by the Trustees and signed on their behalf on 26 May 2023 by:

Professor James Tooley Vice-Chancellor 26 May 2023

Mark St John Qualter David Cole Chair of Council Chief Financial Officer

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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CHANCELLOR AND MEMBERS OF COUNCIL

Chancellor
Dame Mary Archer
Independent Members of Council
Mr Mark Qualter	(Chair of Council)	Appointed December 2022
Mrs Camilla Soames	(Acting Vice-Chair of Council) (Acting Chair of Council) (Member) (Vice-Chair)	Appointed July 2022 Appointed October 2022 - December 2022 Re-appointed January 2023 Appointed February 2023
Dr Keith Bothongo
Professor Timothy Evans		Appointed November 2022
Sir Francis Habgood		Appointed November 2022
Professor Joe Harrison	(Vice-Chair of Council) (Acting Chair of Council)	Appointed February 2021 Appointed March 2022 Resigned October 2022
Mr Nicholas Hillman
Mr Christopher Hollis
Mrs Penny Jones		Resigned October 2022
Lord Peter Lilley		Appointed November 2022
Ms Karen Mitchell		Appointed November 2022 Resigned April 2023
Mr Mark Rawlinson	(Chair of Council)	Resigned July 2022
Mr Stephen Rubin KC		Term Ended September 2022
Mr Mark Rushton
Ms Rachael Shimmin	(Acting Vice-Chair of Council)	Appointed October 2022 Resigned November 2022
Professor Alan Smithers
Mr Mohammad Syed	(Treasurer)	Resigned December 2022

The University of Buckingham 22 Annual Report and Financial Statements for the year ended 31 December 2022

CHANCELLOR AND MEMBERS OF COUNCIL (CONTINUED)

Elected Members
Professor Hongbo Du	(Senate Representative)	Re-appointed November 2022
Ms Josephine Mbuya	(Alumni Representative)	Appointed March 2022
Professor Jaqueline O'Dowd	(Senate Representative)
Professor Adolfo Paolini	(Senate Representative)
Mr Callum Roberts	(Professional Services Staff Representative)
Ex-Officio Members
Professor James Tooley	(Vice-Chancellor)
Dr Jane Tapsell	(Pro Vice-Chancellor)	Resigned September 2022
Ms Caitlin Botha	(President of the Students' Union)	Resigned December 2022
Mr Toby Corbett	(President of the Students' Union)	Appointed January 2023

The composition of the Council

Pursuant to Statute 15, the Council shall comprise ex-officio members, independent members and elected members.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF RESPONSIBILITIES OF THE UNIVERSITY'S COUNCIL IN RELATION TO THE FINANCIAL STATEMENTS

Responsibilities and activities of the Council in relation to the financial statements The Council is responsible for preparing the Annual Report and financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 “Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law). In accordance with its regulatory responsibilities under section 18 of Schedule 7 of the Education Reform Act 1988, the University’s Council presents audited financial statements for each financial year.

The financial statements have also been prepared in accordance with:

• The Statement of Recommended Practice “Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102)”; and The Charities Act 2011.

The financial statements have also been prepared in accordance with the provisions of the Statement of Recommended Practice – Accounting for Further and Higher Education 2019 and meet the requirements of the Office for Students accounts direction dated 25 October 2019.

The Council is required to keep proper accounting records which: disclose with reasonable accuracy at any time the financial position of the Group and University; which enable it to ensure that the annual financial statements give a true and fair view of the state of affairs of the Group and University and of the income and expenditure for that year; and comply with the Charities Act 2011 and the provisions of its Royal Charter. In causing the financial statements to be prepared, Council has ensured that:

• Judgements and estimates are made that are reasonable and prudent; Financial statements are prepared on the going concern basis unless it is inappropriate to presume that the Group and University will continue in operation for the foreseeable future.

Council is responsible for safeguarding the assets of the Group and University and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF RESPONSIBILITIES OF THE UNIVERSITY'S COUNCIL IN RELATION TO THE FINANCIAL STATEMENTS (CONTINUED)

Operations of Council

Council’s powers are exercised through a number of sub-committees, whose terms of reference were approved by Council:

• Finance, Estates and Resources Committee

• Risk, Audit and Compliance Committee

• Nomination, Performance and Remuneration Committee Inclusion Committee*

• Honorary Appointments and Awards Committee*

• (* Joint Committee of Council and Senate)

Operations of Senate

Senate’s powers are exercised through a number of sub-committees, whose terms of reference were approved by Senate:

• University Research Committee

• University Learning & Teaching Committee

• Inclusion Committee*

• Honorary Appointments and Awards Committee*

(* Joint Committee of Council and Senate)

Mark St John Qualter Chair of Council

Professor James Tooley Vice-Chancellor

26 May 2023

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL

Introduction

This statement of corporate governance and internal control covers the period from 1 January 2022 to the date of approval of these financial statements.

Corporate governance structure

The University of Buckingham was established in 1976 and was incorporated by Royal Charter (number RC000730) on 11 February 1983. The conduct of the University’s affairs is governed by the Royal Charter and accompanying Schedule (Statutes), approved by the Privy Council.

The University is registered as an Approved Provider with the Office for Students (UKPRN: 10007787) and is a registered charity (number 1141691). It is authorised by its Royal Charter to award taught and research degrees in perpetuity. The University is a member of Universities UK.

The University has a bicameral constitution comprising the Council and the Senate. Whereas the Council is the governing body and its members are Trustees of the University, the Senate is the governing academic authority, responsible for the setting and maintenance of threshold academic standards and for assuring and enhancing the quality of students’ learning opportunities.

The Council of the University has responsibility for the stewardship of the University’s assets; its members focus on strategic decision making and ensuring adherence to its charitable objectives whilst delegating day-to-day operational responsibilities to the Vice-Chancellor, the Executive and senior management team. It receives assurances that the University meets all legal and regulatory requirements imposed on it as a corporate body.

The Senate of the University is its governing academic authority. Senate’s responsibilities include: the regulation and control of all academic awards as well as the programming and teaching that facilitates students’ admission to said academic awards, the management of the formalities associated with making academic awards and the regulation of University discipline. The Senate is responsible for overseeing the development of the University’s academic portfolio (including all associated research, learning and teaching and assessment activities), for the admission of students and for all areas pertaining to academic delivery and support.

The principal academic and administrative officer of the University is the ViceChancellor, who has a general responsibility to the Council for maintaining and promoting the efficiency and good order of the University and who is the Chair of the Senate. The Vice-Chancellor also chairs the Executive Group, comprising the members of the University’s senior management.

The University performed and concluded a detailed review of its governance structures, including the amendment of the charter and statutes, in 2021.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED)

Oversight of Corporate Governance, Risk Management, Statutory and Regulatory Responsibilities

The Risk, Audit and Compliance Committee of the Council (RACC) provides much of the oversight of the University’s corporate governance and risk management. This is through reports to RACC from senior management, the University’s auditors, and from the University’s risk management lead from whom a report is received at every meeting of RACC. The Council, in turn, considers the minutes of RACC as a standing item. The Council receives updates on matters relating to Corporate Governance from the ViceChancellor and approves the Terms of Reference of its Committees on an annual basis.

The Council and its Committees ensure that the University complies with its statutory and regulatory responsibilities. The RACC, together with Senate, provide much of the oversight of compliance with OfS’ ongoing conditions of registration. The Finance, Estates and Resources Committee (FERC) oversees compliance with the University’s statutory obligations in relation to health and safety.

The University’s management accounts are considered by the Council, FERC and RACC on at least a quarterly basis.

Scope of responsibility

The Council has ultimate responsibility for the University’s system of internal control and for reviewing its effectiveness. The Council has delegated to RACC and the ViceChancellor the day-to-day responsibility for maintaining sound systems of internal control that support the policies, aims and objectives of the University whilst safeguarding the public funds and assets in accordance with responsibilities set out in the Office for Students’ conditions of registration. The Vice-Chancellor is also responsible for reporting to the Council any material weaknesses or breakdowns in internal control.

The purpose of the system of internal control

The system of internal control is an on-going process designed to identify the principal risks to the achievement of the University’s plans, policies and objectives; to evaluate the extent of those risks; and to manage them efficiently, effectively, and economically. Such a system is designed to manage and mitigate rather than eliminate the risk of failure to achieve business objectives and can provide only reasonable and not absolute assurance against material misstatement or loss.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED)

The risk and control framework

The Council has taken reasonable steps to ensure:

• There are appropriate financial and management controls in place to safeguard the assets of the Group and University and prevent and detect fraud, with any concerns investigated thoroughly before the financial statements are signed off. The economical, efficient and effective management of the Group and University’s resources and expenditure.

• Funds from whatever sources and administered by the University for designated purposes have been applied properly for those purposes and managed in accordance with applicable legislation.

• It is in receipt of regular reports and additional meetings are scheduled, where required, to discuss the issues arising from significant matters such as Crewe, financial statements, OfS and regulatory compliance and the Change Management Plan.

A process is in place for identifying, evaluating, and managing the significant risks facing the University, and ensuring the associated procedures have been in place and operational throughout the year, notably through the regular review and updating of the University’s Risk Register. The Risk Register details strategic and recurrent risks and covers governance, management, quality of service, reputational, operational, compliance as well as financial risks together with the range of mitigating controls in place and the early warning indicators for each risk. The Risk Register is under continuous review by senior management and RACC. This enables the University to ensure that it is able to monitor and manage risks in an ever-changing environment.

The key elements of the University’s system of risk assessment and internal control, which is designed to discharge the responsibilities set out above, include the following:

• Risk Management, which is led by the Registrar, supported by senior managers, and reports into RACC;

• A medium and short-term financial planning process, supplemented by detailed annual income, expenditure, capital and cash flow budgets;

• Regular reviews of academic performance and monthly reviews of financial results involving variance reporting and updated of forecast outturns;

• Clearly defined requirements for approval and control of expenditure - with investment decisions involving capital or revenue expenditure being subject to review according to approval levels set by FERC; and

• Refresh of an outsourced internal audit function. A new provider was appointed in April 2023 which will create and implement a new framework and program of internal audit across the University's operations.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED)

Review of effectiveness

The Council receives periodic reports from RACC (including copies of minutes of its meetings), and arrangements are in place to ensure regular reports are received from University management on their actions to manage risks in their areas of responsibility. Reviews by Council of the effectiveness of the system of internal control are informed by the reports of Council, committees and Officers of the University.

Nominations, Performance and Remuneration Committee

The Nominations, Performance and Remuneration Committee ('NPRC') normally meets bi-annually to monitor the performance of Officers of the University (including the ViceChancellor) and members of the University’s Executive Committee to determine their remuneration and conditions of service. The Vice-Chancellor attends all meetings other than those involving consideration of his own salary.

The purpose of the system of internal control

NPRC sets the salary of the Vice-Chancellor taking account of the nature of the role, the institution, performance, and in accordance with the Committee of University Chairs’ Higher Education Senior Staff Remuneration Code (2018). The Chair of Council undertakes an annual appraisal of the Vice-Chancellor’s performance in the previous year, agreeing objectives for the next 12-month period. This takes place at the end of each calendar year.

Mark St John Qualter Professor James Tooley David Cole Chair of Council Vice-Chancellor Chief Financial Officer

26 May 2023

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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INDEPENDENT AUDITORS’ REPORT TO THE COUNCIL OF THE UNIVERSITY OF BUCKINGHAM

Opinion

We have audited the financial statements of The University of Buckingham (the 'University') and its subsidiaries (‘the Group’) for the year ended 31 December 2022 which comprise the Group and University Statements of Comprehensive Income, Group and University Statements of Changes in Reserves, Group and University Statements of Financial Position, Group Statement of Cashflows and the related notes, including a Statement of Principal 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).

The financial statements have been prepared in accordance with Statement of Recommended Practice Accounting for Further and Higher Education 2019 in preference to the Accounting and Reporting by Charities: Statement of Recommended Practice issued on 1 April 2005 which is referred to in the extant regulations, The Charities (Accounts and Reports) Regulations 2008, but has been withdrawn.

This has been done in order for the accounts to provide a true and fair view in accordance with the Generally Accepted Accounting Practice effective for reporting periods beginning on or after 1 January 2015. In our opinion the financial statements:

• give a true and fair view of the state of the University’s affairs as at 31 December 2022 and of its incoming resources and application of resources for the year then ended; have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the requirements of the Charities Act 2011.

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 Auditor's 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 Council’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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INDEPENDENT AUDITORS’ REPORT TO THE COUNCIL OF THE UNIVERSITY OF BUCKINGHAM

Based on the work we have performed, including consideration of financial forecasts and cashflows and compliance with bank covenants, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Group’s and University’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 Council with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the Annual Report other than the financial statements and our Auditors’ Report thereon. The Council are responsible for the other information contained within the Annual Report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. 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 this gives rise to a material misstatement in the financial statements themselves. 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.

Responsibilities of the Governing Body

As explained more fully in the Statement of Responsibilities of the University’s Council in Relation to the Financial Statements, the Council are responsible for the preparation of the financial statements which give a true and fair view, and for such internal control as the Council 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 are responsible for assessing the Group and University’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 Council either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with the Act and relevant regulations made or having effect thereunder.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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INDEPENDENT AUDITORS’ REPORT TO THE COUNCIL OF THE UNIVERSITY OF BUCKINGHAM

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditors’ Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

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

• Enquiry of management and those charged with governance concerning actual and potential litigation, regulatory actions and claims;

• Enquiry of staff to identify any instances of non-compliance with laws and regulations; Performing audit work over the risk of management override of controls, including testing of journal entries and other adjustments for appropriateness;

• Evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for bias;

• Reviewing minutes of meetings of those charged with governance;

• Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations.

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our Auditors Report.

Report on other legal and regulatory

We are required to report on the following matters by the Accounts Direction dated 25 October 2019 issued by the Office for Students (‘the Accounts Direction’).

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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INDEPENDENT AUDITORS’ REPORT TO THE COUNCIL OF THE UNIVERSITY OF BUCKINGHAM

In our opinion, in all material respects:

• funds from whatever source administered by the Academy for specific purposes have been properly applied to those purposes and managed in accordance with relevant legislation; and

• the financial statements meet the requirements of the Accounts Direction dated 25 October 2019 issued by the Office for Students.

We are also required by the Accounts Direction to report where the results of our audit work indicate that the University’s grant and fee income, as disclosed in the notes to the financial statements, has been materially misstated. We have nothing to report in these respects.

Use of our report

This report is made solely to the Council, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the Governing Body those matters we are required to state to them in an Auditor’s 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 Group and University and its Council, as a body, for our audit work, for this report, or for the opinions we have formed.

MHA, Statutory Auditor London, United Kingdom

Date: 31 May 2023

MHA is the trading name of MacIntyre Hudson LLP, a limited liability partnership in England and Wales (registered number OC312313)

MHA is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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GROUP AND UNIVERSITY STATEMENTS OF COMPREHENSIVE INCOME FOR YEAR ENDED 31 DECEMBER 2022

Note		Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
	Income
1 2 3 4	Tuition fees and education contracts Research grants and contracts Other income Investment income	41,128 1,049 5,498 145	41,128 1,049 4,971 18	37,510 1,189 4,069 114	37,510 1,189 3,544 2
	Total income before donations and endowments	47,820	47,166	42,882	42,245
5	Donations and endowments	123	513	647	986
	Total income	47,943	47,679	43,529	43,231
	Expenditure
6 7 11 8	Staff Costs Other operating expenses Depreciation Interest and other finance costs	20,455 27,315 2,385 171	20,455 26,940 2,095 171	17,088 20,884 2,184 259	17,085 20,580 1,877 259
9	Total expenditure	50,326	49,661	40,415	39,801
	(Deficit)/surplus after other gains/ (losses)	(2,383)	(1,982)	3,114	3,430
12	Gains on disposal of fixed assets (Losses)/gains on investments	189 (621)	189 (529)	1,917 798	1,917 517
	(Deficit)/surplus for the year	(2,815)	(2,322)	5,829	5,864
	Total comprehensive (expenditure)/income for the year	(2,815)	(2,322)	5,829	5,864
	Represented by:
17 18	Endowment (expenditure)/income for the year Restricted (expenditure)/income for the year Unrestricted (expenditure)/income for the year	(712) (107) (1,996)	(443) 173 (2,052)	1,059 (303) 5,073	798 (60) 5,126
	(Deficit)/surplus for the year	(2,815)	(2,322)	5,829	5,864
The consolidated income is attributable to the University and its subsidiaries. There is no non-controlling interest. All income and expenditure of the University and its subsidiaries relates wholly to continuing operations. The notes on pages 52 to 81 form part of these financial statements.

The University of Buckingham 34 Annual Report and Financial Statements for the year ended 31 December 2022

GROUP AND UNIVERSITY STATEMENTS OF CHANGES IN RESERVES FOR YEAR ENDED 31 DECEMBER 2022

Group	Endowment £000	Restricted £000	Unrestricted £000	Total £000
Balance at 1 January 2021	6,704	6,063	4,968	17,735
Surplus/(deficit) for the year Release of restricted funds spent in the year Transfer of expenditure between reserves New donations and reclassifications	261 - 552 246	(243) (31) (169) 140	5,811 (355) (383) -	5,829 (386) - 386
Surplus/(deficit) for the year ended 31 December 2021	1,059	(303)	5,073	5,829
Balance at 1 January 2022	7,763	5,760	10,041	23,564
(Deficit) for the year Release of restricted funds spent in the year Transfer of expenditure between reserves New donations and reclassifications	(269) - (443) -	(280) (258) 80 351	(2,266) (117) 363 24	(2,815) (375) - 375
(Deficit) for the year ended 31 December 2022	(712)	(107)	(1,996)	(2,815)
Balance at 31 December 2022	7,051	5,653	8,045	20,749
University	Endowment £000	Restricted £000	Unrestricted £000	Total £000
Balance at 1 January 2021	3,331	5,866	2,028	11,225
Surplus for the year Release of restricted funds spent in the year Transfer of expenditure between reserves New donations and reclassifications	- - 552 246	- (31) (169) 140	5,864 (355) (383) -	5,864 (386) - 386
Surplus/(deficit) for the year ended 31 December 2021	798	(60)	5,126	5,864
Balance at 1 January 2022	4,129	5,806	7,154	17,089
(Deficit) for the year Release of restricted funds spent in the year Transfer of expenditure between reserves New donations and reclassifications	- - (443) -	- (258) 80 351	(2,322) (117) 363 24	(2,322) (375) - 375
(Deficit)/surplus for the year ended 31 December 2022	(443)	173	(2,052)	(2,322)
Balance at 31 December 2022	3,686	5,979	5,102	14,767

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

35

GROUP AND UNIVERSITY STATEMENTS OF FINANCIAL POSITION AT 31 DECEMBER 2022

Note		Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
	Fixed assets
10 11 12	Intangible assets Tangible assets Investments	- 33,757 6,633	- 26,624 7,531	- 35,151 6,581	- 27,733 8,064
	Total fixed assets	40,390	34,155	41,732	35,797
	Current assets
12 13	Investments Trade and other receivables Cash and cash equivalents	85 13,305 12,923	- 14,330 11,163	84 11,777 10,289	- 12,717 7,800
	Total current assets	26,313	25,493	22,150	20,517
14	Less creditors amounts falling due within one year	(29,102)	(28,837)	(23,283)	(22,998)
	Net current liabilities	(2,789)	(3,344)	(1,133)	(2,481)
	Total assets less current liabilities	37,601	30,811	40,599	33,316
15	Creditors: amounts falling due after more than one year	(5,000)	(5,000)	(5,000)	(5,000)
16 16	Pension provisions Other provisions	(3,450) (8,402)	(3,450) (7,594)	(2,056) (9,979)	(2,056) (9,171)
	Total net assets	20,749	14,767	23,564	17,089
	Restricted reserves
17 18	Income and expenditure reserve - Endowment Income and expenditure reserve - Restricted	7,051 5,653	3,686 5,979	7,763 5,760	4,129 5,806
	Unrestricted reserves
	Income and expenditure reserve - Unrestricted	8,045	5,102	10,041	7,154
19	Total reserves	20,749	14,767	23,564	17,089
The financial statements on pages 34 to 81 were approved by Council on 26 May 2023 and were signed on its behalf by: Professor James Tooley Vice-Chancellor Mark St John Qualter Chair of Council David Cole Chief Financial Officer

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

36

GROUP STATEMENT OF CASHFLOWS FOR THE YEAR ENDED 31 DECEMBER 2022

	Group 2022 £000	Group 2021 £000
Cashflow from operating activities
(Deficit)/surplus for the year	(2,815)	5,829
Adjustments for non-cash items
Depreciation Release of restricted donations (Increase)/decrease in current investments (Increase) in student receivables Decrease/(increase) in other debtors, prepayments, and accrued income Increase/(decrease) in creditors (Decrease) in other provisions Increase/(decrease) in pension provision, excluding interest of £5,000 (2021:£23,000)	2,385 (375) (1) (2,071) 543 5,819 (1,577) 1,389	2,184 (386) 250 (1,554) (995) (1,761) (842) (1,106)
Adjustments for investing or financial activities
Interest payable Investment income (Gain) on disposal of fixed assets Loss/(gain) in investments Net cash inflow/(outflow) from operating activities Cashflows from investing activities	171 (145) (189) 621	259 (114) (1,917) (798)
	3,755	(951)
Investment income (Gain)/loss of investments (Purchase) of investments (Payments) to acquire tangible assets Proceeds of fixed asset disposals Net cash (outflow)/inflow from investing activities Cash flows from financing activities	145 (621) (52) (1,171) 369	114 798 (784) (2,610) 4,943
	(1,330)	2,461
Interest paid New donations - restricted and endowment New secured loans Repayments of amounts borrowed Net cash inflow/(outflow) from financing activities Increase/(decrease) in cash and cash equivalents in the year	(166) 375 - -	(274) 386 5,000 (17,750)
	209	(12,638)
	2,634	(11,128)
Cash and cash equivalents as the beginning of the year	10,289	21,417
Cash and cash equivalents at the end of the year	12,923	10,289

Details of the analysis of changes in net debt can be found in Note 20.

The University of Buckingham 37 Annual Report and Financial Statements for the year ended 31 December 2022

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES

1 Basis of Preparation

The consolidated and University financial statements have been prepared in accordance with the Statement of Recommended Practice (SORP 2019): Accounting for Further and Higher Education, and in accordance with United Kingdom Accounting Standards, including Financial Reporting Standard 102, “The Financial Reporting Standard applicable in the United Kingdom and the Republic of Ireland’ (FRS 102)”, and the Charities Act 2011.

The University is a public benefit entity and therefore has applied the relevant public benefit requirement of FRS 102. The financial statements are prepared on a going concern basis, under the historical cost convention as modified by the recognition of certain financial assets and liabilities measured at fair value. The accounting policies have been applied consistently over the period.

The financial statements reflect the requirements of the Accounts Direction dated 25 October 2019 issued by the Office for Students.

The functional currency of the group is UK sterling and all financial statements have been prepared to the nearest thousand pounds.

The financial statements have been prepared and give a ‘true and fair’ view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a ‘true and fair’ view. This departure is required following Statement of Recommended Practice – Accounting for further and higher education issued on 1 October 2018, since this statement of recommended practice is most relevant to the University, rather than the Accounting and Reporting by Charities: Statement of Recommended Practice effective from 1 January 2019.

The University has taken advantage of exemptions in FRS 102 from:

• a. Preparing a statement of cash flows for the University, on the basis that it is a qualifying entity and the consolidated statement of cash flows included in these financial statements includes the University’s cash flows.

• b. The financial instrument disclosures, required under FRS 102 paragraphs 11.39 to 11.48A and paragraphs 12.26 to 12.29, as the information is provided in the consolidated financial statement disclosures.

Basis of preparation - Going concern

The Consolidated and University financial statements are prepared on a going concern basis, based on Trustees’ assessment of the financial position, operating model, and forecast cash flows. This assumes the Group and University will continue in operation for the foreseeable future including meeting its future obligations as they fall due.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

38

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

1 Basis of Preparation (continued)

Basis of preparation - Going concern (continued)

The University experienced financial challenges and a decline in financial operating performance in recent years. Responses included measures to reduce costs, such as a necessary programme of staff redundancies to help ensure long-term financial sustainability, in addition to addressing the costs of the Crewe campus lease. The University will continue to drive improved cost efficiency and control in the future to further improve resilience and enable investment in growth and infrastructure to enhance the student experience.

The University continues to engage proactively with its regulators and take actions to further improve governance to prevent recurrence of past issues.

At the balance sheet date the Group is reporting net current liabilities of £2.8m (University: £3.3m), which is a decline of £1.7m (University decline of £0.9m) due to an increase in fees received in advance, trade creditors and accruals.

The University prepares and works to budgets and forecasts on income, expenditure and cashflows to support operational activity and to ensure that it meets all its banking covenant and debt servicing requirements, for the foreseeable future, which is considered to be at least 12 months from the date of this report.

After considering significant potential risks to future plans and forecasts and the potential actions, which could include the sale of additional capital assets and a programme of cost restructuring, the Trustees are satisfied that it remains appropriate to prepare the Group and University financial statements on a going concern basis.

2 Basis of Consolidation

The financial statements for the Group are the consolidation of the financial statements of The University of Buckingham (The “University”), the University of Buckingham Foundation ("the Foundation") and Medical Property Management Ltd ("MPML"). The University has not consolidated its other subsidiaries, being:

• a. Buckingham Business Enterprises Ltd, whose net assets and financial performance are immaterial for the purpose of giving a true and fair view.

• b. University of Buckingham Medical Sciences North Ltd, a dormant company whose net assets and financial performance are immaterial for the purpose of giving a true and fair view.

The consolidated financial statements do not include the income and expenditure of the Students’ Union as the University does not exert control or dominant influence over policy decisions.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

39

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

2 Basis of Consolidation (continued)

The close relationship between the University and the Foundation is a determining factor in the University exercising effective control. The Trustee board, including the Chair of Trustees, agree that the primary intent of the Foundation is to support the University and are guided by the University in decisions relating to the distribution of funds.

The makeup of the Foundation board is an important, but not the only, factor. Trustees are appointed by the trustee board and the University has a specified minimum number set out in the Foundation trust deed. At the financial year end the Foundation Board comprises four Trustees appointed by the University and three independent of the University.

Membership of the Board fluctuates over time, but the Trustees are clear that their intent is to manage and invest endowments and thereby provide funds for the University in support of its students and staff. They are strongly guided by the University in where funds should be directed, such guidance contributed to the decision to consolidate the results of the Foundation.

Associated companies are accounted for using the equity method. Investment in an associate is held at cost less accumulated impairment losses.

An investment in a subsidiary company is held at cost less accumulated impairment losses in the University’s financial statements.

3 Income Recognition

This accounting policy covers: Tuition fees and education contracts, Research grants and contracts, Other income, Investment income, and Donations and endowments.

Income arising from the sale of goods or provision of services (including student accommodation and catering) is recognised and credited to the Consolidated Statement of Comprehensive Income on exchange of such goods and services, or when the terms of the contracts have been satisfied fully. These accounts are shown net of VAT, returns, discounts, and rebates as appropriate. Where services are rendered but are not complete at the end of the period, income is recognised by stage of completion/degree of provision.

Tuition fee income is stated gross of any expenditure which is not a discount. Tuition fee income is credited to the Consolidated Statement of Comprehensive Income on a pro-rata basis across the length of the course, in line with the provision of courses to students.

Bursaries and scholarships are accounted for as expenditure and not deducted from income, unless a restricted donation has been received for the scholarship. These are reflected as a cost to the University, as part of its delivery of student support.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

40

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

3 Income Recognition (continued)

Validation involves the University reviewing the educational offerings of third-party providers of being a suitable standard for those providers’ students to receive University of Buckingham degrees. Validation fee income is recognised when the University is satisfied that its contractual services including academic due diligence have been delivered/ satisfied and the collection of the fees will occur with reasonable certainty.

Franchising involves a third-party provider delivering The University of Buckingham’s curriculum to students, who are students of The University of Buckingham, at an external location. Franchise fee income is recognised when the associated student fee income has been billed to students and the collection of these fees will occur with reasonable certainty in the periods in which the students are studying. The University does not currently have any franchise agreements.

Both Validation and Franchise fee income are shown within Other income at Note 3.

Investment income is credited to the Consolidated Statement of Comprehensive Income on a receivable basis.

Grant Funding:

All grant funding, including research grants and capital grants from government and other sources, is recognised in income when the University is entitled to the funding and any performance-related conditions have been met. Performance conditions are defined as ‘a condition that requires the performance of a particular level of service or units of output to be delivered, with payment of, or entitlement to, the resources conditional on that performance.'

Income received in advance of performance related conditions being met is recognised as deferred income within Creditors on the Statement of Financial Position and released to income as or when any conditions are met.

Donations and Endowments

Non-exchangeable transactions without performance related conditions are donations and endowments. Donations and endowments with donor-imposed restrictions are recognised as income when the University is entitled to the funds. Income is retained within the restricted reserve 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 with no restrictions are recognised as income once the University is entitled to the funds.

Investment income and appreciation of endowments is recorded in income in the year in which it arises and as either restricted or unrestricted income according to the terms applied to the individual endowment fund.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

41

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

3 Income Recognition (continued)

Donations and Endowments (continued)

There are five main types of donations and endowments identified within reserves:

• (a) Restricted donations – the donor has specified that the donation must be used for a particular objective.

• (b) Unrestricted donations – the donor has not specified the use of the donation and so it is to be used for the general benefit of the University.

• (c) 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 University.

• (d) Restricted expendable endowments – the donor has specified a particular objective other than the purchase or construction of tangible fixed assets, and the University has the power to use the capital.

• (e) 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.

4 Pension Schemes

The Aviva Group Personal Pension Plan (GPP) is a defined contribution scheme, established by contract. The employer’s contributions payable for each accounting period are accounted for as expenditure in the period in which they are incurred.

The NEST Auto Enrolment Scheme (NEST-AES) is a defined contribution scheme, established by contract. The employer’s contributions payable for each accounting period are accounted for as expenditure in the period in which they are incurred.

The Universities Superannuation Scheme (USS) is a defined benefit scheme, established by trust deed with assets held in a separate fund. The employer’s contributions payable for each accounting period are accounted for as expenditure in the period in which they are incurred. In addition, the University is required to provide for the future liability of the deficit recovery plan implemented by the USS.

The University of Buckingham Employee Benefits Plan (EBP), established as a defined contribution scheme by trust deed was closed to further contributions on 31 December 2007. However, the scheme provides a Guaranteed Minimum Pension in respect of periods of membership prior to 6 April 1997. The University accounts for any funding deficit, based on the actuary’s reports to the scheme’s Trustees on the funding of the scheme at the schemes most recent valuation date, April 2020.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

42

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

5 Taxation and Charitable status

The University is a Registered Charity within the meaning of Part 3 of the Charities Act 2011. It is also a charity within the meaning of Paragraph 1 of Schedule 6 to the Finance Act 2010. The University is potentially exempt from taxation in respect of income or capital gains received within categories covered by section 472 – 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.

Charitable status provides no similar exemption from VAT, but the University is defined as an Eligible Body by Schedule 9 Group 6 of the VAT Act 1994. This means that the education provided is exempt from VAT but that VAT cannot be recovered on education related purchases. Irrecoverable VAT is therefore included in both revenue and capital expenditure.

6 Tangible Fixed Assets and Depreciation

Tangible fixed assets are stated at historic purchase cost less accumulated depreciation. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use.

Equipment and property costing more than £3,000 per item or project is capitalised. Other equipment is written off in the year of purchase. Land is not depreciated. Depreciation is provided on a straight-line basis on other assets at the following annual rates so as to write off the cost/valuation:

Buildings:		2%
Equipment:	Furniture, furnishings, equipment Office equipment Science laboratory equipment Motor vehicles Computing equipment and software Specialist laboratory equipment	10%-20% 10%-20% 20%-25% 20% 25% 33%

On the grounds of materiality, the above six categories have been aggregated as equipment.

The carrying amount of fixed assets is tested for impairment in accordance with the policy described in Note 9.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

43

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

7 Intangible Assets

Intangible assets are stated at cost less accumulated amortisation and any impairment losses. Cost includes the original purchase price of the asset and costs attributable to bringing the asset to its working condition for intended use.

Amortisation is provided on a straight-line basis over the estimated useful life of the asset. The carrying amount of intangible assets is tested for impairment in accordance with the policy described in Note 9.

8 Investments and joint ventures

Investments

Investments in listed shares are re-measured to fair value at each year-end date. Gains and losses on re-measurement are recognised in surplus or loss for the period. Gains or losses on disposal are recognised within Gains/(losses) on investments within the Statement of Comprehensive Income.

Investments in subsidiaries are carried as cost less impairment.

Joint ventures

Interests in joint ventures are accounted for using the equity method, after being recognised initially at cost in the consolidated Statement of Financial Position.

Under the equity method of accounting, the investments are initially recognised at cost and adjusted thereafter to recognise the Group’s share of the post-acquisition profits or losses of the investee in the Group Statement of Comprehensive Income. Dividends received or receivable from associates and joint ventures are recognised as a reduction in the carrying amount of the investment.

Where the Group’s share of losses in an equity-accounted investment equals or exceeds its interest in the entity, including any other unsecured long-term receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the other entity.

Unrealised gains on transactions between the Group and its associates and joint ventures are eliminated to the extent of the Group’s interest in these entities. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of equity-accounted investees have been changed where necessary to ensure consistency with the policies adopted by the group.

The carrying amount of equity-accounted investments is tested for impairment in accordance with the policy described in Note 9.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

44

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

9 Impairment of assets

Assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount might not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.

10 Cash and cash equivalents

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

An investment qualifies as a cash equivalent only when it has a short term maturity of three months or less from the acquisition date.

11 Provisions

Provisions are recognised in the financial statements when:

• (a) The University has a present obligation (legal or constructive) as a result of a past event;

• (b) It is probable that an outflow of economic benefit will be required to settle the obligation; and

• (c) A reliable estimate can be made of the amount of the obligation.

12 Reserves

Reserves are classified as restricted or unrestricted. There are two types of restricted reserves:

• (a) The first type of restricted reserve, “Endowment reserves”, include balances which, through endowment to the University, are held as a permanently restricted fund which the University must hold in perpetuity.

• (b) The second type of restricted reserve, called “Restricted reserves”, includes balances where the donor has designated a specific purpose and therefore the University is restricted in the use of these funds, and unspent balances of restricted donations are treated in line with the British Universities Finance Directors Group (BUFDG) Implementation Guidance to the SORP. Reserve transfers are made between Restricted and Unrestricted reserves for the depreciation on assets that were funded by grants or donations with restrictions on those underlying assets.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

45

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

13 Leases

The Group and the University are lessees of property and whether an arrangement is or contains a lease depends on the substance of that arrangement. Leases in which substantially all the risk and rewards incidental to the ownership of an asset are transferred to the lessee by the lessor are classed as finance leases. Leases which are not finance leases are classified as operating leases. Gross rental expenditure in respect of operating leases is recognised on a straight-line basis over the term of the leases, unless another systemic basis is representative of the time pattern of the lessee’s benefit from the use of the leased asset. Rent free periods are accounted for within the Statement of Financial Position as Accruals and deferred income.

14 Financial instruments

The Group has chosen to adopt Sections 11 and 12 of FRS 102 in respect of financial instruments.

i) Financial assets

Basic financial assets, including trade and other receivables, cash and bank balances and investments in commercial paper, 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 method.

At the end of each reporting period financial assets measured at amortised cost are assessed for objective evidence of impairment. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in the Consolidated Statement of Comprehensive Income.

If there is a decrease in the impairment loss arising from an event occurring after the impairment was recognised, the impairment is reversed. The reversal is such that the current carrying amount does not exceed what the carrying amount would have been had the impairment not previously been recognised. The impairment reversal is recognised in profit or loss.

Other financial assets, including investments in equity instruments which are not subsidiaries, associates or joint ventures, are initially measured at fair value, which is normally the transaction price. Such assets are subsequently carried at fair value and the changes in fair value are recognised in the Statement of Comprehensive Income, except that investments in equity instruments that are not publicly traded and whose fair values cannot be measured reliably are measured at cost less impairment.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

46

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

14 Financial Instruments (continued)

• i) Financial assets (continued)

Financial assets are derecognised when:

• (a) the contractual rights to the cash flows from the asset expire or are settled; or

• (b) substantially all the risks and rewards of the ownership of the asset are transferred to another party; or

• (c) despite having retained some significant risks and rewards of ownership, control of the asset has been transferred to another party who has the practical ability to unilaterally sell the asset to an unrelated third party without imposing additional restrictions.

ii) Financial liabilities

Basic financial liabilities, including trade and other payables, bank loans, and loans from fellow Group entities 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 receipts 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. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalised as a pre-payment for liquidity services and amortised over the period of the facility to which it relates.

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade payables 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 method.

Financial liabilities are derecognised when the liability is extinguished, that is when the contractual obligation is discharged, cancelled or expires.

iii) Offsetting

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneousl . y

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

14 Financial Instruments (continued)

iv) Financial guarantee contracts

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due in accordance with the original or modified terms of a debt instrument. These are accounted for under Section 21 of FRS 102. Where appropriate, a provision has been made and/or a contingent liability disclosed.

15 Critical Accounting Judgements and Estimates

The preparation of financial statements requires management to make judgements and adopt estimates that affect the financial statements during the reporting period. These estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

• a) Critical judgements in applying the Group and University’s accounting policies

• (i) Evaluation of the Universities Superannuation Scheme as a multi-employer scheme

The University has judged that the USS meets the definition of a multi-employer scheme for the reasons set out in Note 22.

The scheme is 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 trusteeadministered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The University 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. Therefore, as required by Section 28 of FRS 102 “Employee benefits”, the University accounts for the scheme as if it were a defined contribution scheme.

(ii) Effective control of The University of Buckingham Foundation

The University has judged that it is in a position of effective control arising from a number of factors, notwithstanding that the Foundation is a distinct charitable trust, therefore the results of the Foundation have been consolidated in the consolidated financial statements.

The trust deed for the Foundation declares that its primary purpose is to advance the education of the public by, in particular, supporting and promoting the education of students attending the University and by benefiting the wider academic community and purposes of the University as a whole.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

15 Critical Accounting Judgements and Estimates (continued)

a) Critical judgements in applying the Group and University’s accounting policies (continued)

The close relationship between the University and the Foundation is a determining factor in the University exercising effective control. The Trustee board, a number of whom are officers of the University, agree that the primary intent of the Foundation is to support the University and are guided by the University in decisions relating the distribution of funds.

• (iii) The extent of control over a joint venture, Apollo Buckingham Health Sciences Campus Ltd (ABHSC)

The University has a 48% shareholding in ABHSC as at 31 December 2022 (2021: 40%). It has judged that this should be accounted for as a joint venture and as a jointly controlled entity. ABHSC is governed by a joint venture agreement (JVA) between the University and the other two parties holding the remaining shareholding, with no single party having majority control. The JVA sets out the contractual terms governing the joint venture and as such the University has judged that it will account for its shareholding and the results of ABHSC in accordance with the equity method.

• (iv) Estimate of financial guarantee contract

The University has provided a commitment to make good up to 50% of any lease payment shortfall for the Booth Hall student residences in Crewe. The lease of Booth Hall was taken out by the JV (ABHSC) from Manchester Metropolitan University. The full value of the guarantee is maintained in a separate Escrow bank account in favour of Manchester Metropolitan University. The Council of The University of Buckingham considers that due to the level of uncertainty of the level of student accommodation income in the JV the full amount of the financial guarantee may need to be invoked, and have maintained appropriate provision for this.

b) Critical estimates in applying the Group and University’s accounting policies

In the preparation of the consolidated financial statements, management has made estimates and assumptions that affect the amounts reported for assets and liabilities as at the Statement of Financial Position date and the amounts reported for income and expenses during the year. Actual results could differ from these estimates.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

15 Critical Accounting Judgements and Estimates (continued)

b) Critical estimates in applying the Group and University’s accounting policies (continued) (i) Depreciation and impairment of fixed assets

Assets are depreciated as set out in Note 6, Principal Accounting Policies, which are judged to be an appropriate assessment of the useful life of assets, and assuming that the University is operating as a going concern on the Buckingham campus for the foreseeable future.

The University’s material fixed assets are reviewed annually to determine whether their book value should be reduced due to their value being impaired. Estimates are made of the extent of any impairment on individual assets or related groups of assets.

(ii) Onerous contract provisions

The University has a liability under non-cancellable operating lease for its Crewe campus. The lease is effective for 10 years from 2019, with a rent review from 1 January 2025 and an option to renew beyond 10 years. More details are set out in Note 27.

The financial viability of the Crewe campus is dependent on income from Medical and Allied Health students, generated through their teaching and learning at Crewe and on the Joint venture agreement with the Crewe partners

The Crewe campus operating lease is considered to be an onerous lease as the expected net revenues to the University from all relevant activities at Crewe is materially less than the operating lease costs over the lease period, both on a net present value basis. The University uses internal assumptions on forecast student numbers and income and discount rates, and assesses the net revenue due to the University in accordance with the profit share arrangements set out in the Crewe joint venture agreement. Whilst negotiations are ongoing to make new arrangements including a new replacement lease, council considers it prudent to maintain the full provision for the onerous lease made in previous financial statements until the outcome is more certain.

(iii) Impairment of receivables

Student and commercial/trade receivables are reviewed at least annually to determine the extent to which a provision is required against debts that have a reasonable risk of nonpayment. The risk reflects the length of time for which the debt has been unpaid and the reason for non-payment.

The University assesses such debts on an individual student or customer basis and does not include general provisions. The University continues to seek payment of such debts until all reasonable efforts have been exhausted.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

50

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (CONTINUED)

15 Critical Accounting Judgements and Estimates (continued)

b) Critical estimates in applying the Group and University’s accounting policies (continued) (iv) USS provision

Management, aided by external third-party advisers, has made estimates, as set out in Note 23, on economic and mortality assumptions, including pay awards, as well as estimates of changes to the future membership of the scheme as the scheme is closed to new entrants to the University, unless new staff are transferring benefits.

A key assumption is that future contribution rates will not change, apart from the unwinding of the deficit recovery plan.

16 Related party transactions

The Group and University discloses transactions with related parties which are not wholly owned within the same Group. Where appropriate, transactions of a similar nature, such as regular payments, are aggregated unless, in the opinion of the Council, separate disclosure is necessary to understand the effect of the transactions on the consolidated financial statements.

17 Termination benefits

Termination benefits of any kind relating to staff are based upon the relevant employment contracts, length of service, discretionary awards, and any statutory requirements.

18 Exceptional items

Exceptional items are disclosed separately in the financial statements where it is necessary to do so to provide further understanding of the financial performance of the company. They are items that are material either because of their size or their nature, or that are nonrecurring and are considered as exceptional items.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

51

NOTES TO THE FINANCIAL STATEMENTS

1 Tuition fees and education contract

1 Tuition fees and education contract
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Full-time undergraduates - Home & EU	15,296	15,296	14,616	14,616
Full-time undergraduates – International	17,323	17,323	14,411	14,411
Part-time undergraduates	170	170	167	167
Postgraduates - Home & EU	5,776	5,776	5,238	5,238
Postgraduates - International	2,328	2,328	2,048	2,048
Pre and non-degree courses	235	235	1,030	1,030
	41,128	41,128	37,510	37,510

2 Research grants and contracts

2 Research grants and contracts
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Research charities	257	257	292	292
Industry and commerce	792	792	897	897
	1,049	1,049	1,189	1,189

3 Other income

3 Other income
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Residences	2,932	2,932	1,766	1,766
Catering and bar	365	365	76	76
Validation and franchise fees	1,181	1,181	1,196	1,196
Other income *	973	446	999	474
Government**	47	47	32	32
	5,498	4,971	4,069	3,544

*Other income comprises, in particular: registration fees, medical school materials, credit card commissions earned, and rental income from parties outside The University of Buckingham.

**Figure comprised entirely of the payments received from the Coronavirus Job Retention Scheme. Amounts are recognised, having met all the conditions of the scheme.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

52

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

4 Investment income

4 Investment income
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Investment income	127	-	112	-
Other investment income	18	18	2	2
	145	18	114	2

5 Donations and endowments

5 Donations and endowments
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Donations with restrictions	80	80	647	647
University of Buckingham Foundation donations	-	390	-	339
Unrestricted donations	43	43	-	-
	123	513	647	986

6 Staff costs

6 Staff costs
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Salaries*	15,762	15,762	14,963	14,960
Social security costs	1,626	1,626	1,493	1,493
Pension costs, excluding USS	1,615	1,615	1,678	1,678
USS exceptional provisions	1,390	1,390	(1,106)	(1,106)
Apprenticeship levy	62	62	60	60
	20,455	20,455	17,088	17,085

*Within salaries, compensation for loss of office (including voluntary severance) of £66,385 was paid in 2022 (2021: £120,335) which relates to 3 employees (2021: 5 employees). Within these figures, no payments were made in 2022 in respect of compensation for loss of office to members of the key management personnel (2021: £nil).

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

53

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

6 Staff costs (continued)

6 Staff costs (continued)
Average number of full time equivalent members of staff	Group 2022	University 2022	Group 2021	University 2021
Academic	128	128	132	132
Research	8	8	9	9
Support	188	188	208	207
Manual	34	34	34	34
	358	358	383	382

Average headcount of members of staff	Group 2022	University 2022	Group 2021	University 2021
Academic	152	152	140	140
Research	10	10	10	10
Support	223	223	220	219
Manual	40	40	36	36
	425	425	406	405

Remuneration of the Vice-Chancellor

Remuneration of the Vice-Chancellor
Emoluments of the Vice-Chancellor	2022 £	2021 £
Basic Salary	174,708	170,638
Non-taxable benefits - living accommodation	21,000	18,000
Bonus	-	37,735
Pension contribution to USS	37,650	36,134
	233,358	262,507

As a requirement of the contract of employment, the Vice-Chancellor is required to reside at Ondaatje Hall in order to discharge their duties fully. There is considerable value to the University in the Vice-Chancellor residing on the University campus. The University, and not the Vice-Chancellor, has first call on the use of the ground floor and garden of Ondaatje Hall, which is used for hosting University seminars and events during the working week, evenings and weekends. The annual rental value of Ondaatje Hall, a two-storey house, has been assessed by a local estate agent to be £42,000 per annum. The Vice-Chancellor has exclusive use of the first floor only, so £21,000 per annum is considered an appropriate value of the benefit to the Vice-Chancellor. In these financial statements this has been treated as a non-taxable benefit in kind.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

54

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

6 Staff costs (continued)

The benefit is considered exempt from tax as it is provided for the better performance of the employee’s duties and the employment is one of the kinds for which it’s customary for employers to provide accommodation for the employee.

Performance-related payments are not contractually a part of the Vice-Chancellor’s salary package. During 2022 no ex-gratia bonus was made to the Vice-Chancellor (2021: £37,735).

The Vice-Chancellor’s salary is 7.16 times the median salary of staff (2021: 5), where the median pay is calculated on a full-time equivalent basis for the salaries paid by the University to its staff. The Vice-Chancellor’s remuneration is 8.87 times (2021: 7.5) the median total remuneration of staff where the median total remuneration is calculated on a full-time equivalent basis for the total remuneration by the University of its staff.

The Vice-Chancellor has the overall responsibility for ensuring the effective and efficient management of the University. The Vice-Chancellor is the Accountable Officer as per OfS Regulatory Advice 10 and as such, bears the responsibility of effective governance and financial stewardship of the University.

The University undertakes collaborations with other institutions around the world and its undergraduate and postgraduate students come from various parts of the world. The ViceChancellor is responsible for promoting the University's interests at home and overseas, developing good business relationships between the University and its Collaboration Partners and other stakeholders; including Government representatives, the Office for Students and the Charity Commission.

The Vice-Chancellor works closely with both Council and Senate bodies and leads the Executive Board of the University in all matters relating to governing and running the operations of the University. This ensures appropriate strategic development to deliver the University’s academic and financial sustainability.

Assessment of the Vice-Chancellor’s performance is conducted on an annual basis This is conducted by the Chair of Council, in consultation with the Remuneration Committee which is based on achievements against the set objectives and the overall performance of the University. These include student recruitment and completion, student satisfaction, staff satisfaction and the overall financial performance.

The Remuneration Committee is responsible for ensuring the right remuneration is set for the Vice-Chancellor to reflect the strategic workload, achievement of performance targets and the general remuneration for Higher Education Heads in the United Kingdom.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

55

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

6 Staff costs (continued)

Below are the numbers of staff members throughout the University whose basic pay exceeded £100k. Following the guidance issued by the OfS, amounts reimbursed by another body (such as the National Health Service, or the research councils), bonus payments, employer pension contributions, compensation for loss of office and payments under early retirement schemes are not included in these figures.

retirement schemes are not included in these figures.
£	31 Dec 2022 Number	Restated 31 Dec 2021 Number
100,000 - 104,999	1	-
105,000 - 109,999	-	-
110,000 - 114,999	-	-
115,000 - 119,999	-	-
120,000 - 124,999	1	1
125,000 - 129,999	1	1
130,000 - 134,999	-	1
135,000 - 139,999	2	2
140,000 - 144,999	-	-
145,000 - 149,999	-	-
150,000 - 154,999	-	-
155,000 - 159,999	-	-
160,000 - 164,999	-	-
165,000 - 169,999	-	-
170,000 - 174,999	1	1
	6	6

Key management personnel

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the University and are represented at the University’s Executive Committee. Staff costs include salaries paid to key management personnel, plus employer’s pension contributions.

personnel, plus employer’s pension contributions.
	Group/University 2022	Group/University 2021
Key management personnel - total remuneration Number of key management personnel Key management personnel - average remuneration	£1.27m	£1.17m
	10	11
	£127k	£106k

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

56

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

6 Staff costs (continued)

Council members

Council members are the Trustees for charitable law purposes.

A list of Council members who served at any time during the financial year and until the date these financial statements were formally approved is contained in the “Chancellor and Members of Council” section on page 22.

Due to the nature of the University’s operations and the composition of the Council, drawn from local public and private sector organisations, it is inevitable that transactions may take place with organisations in which a member of Council may have an interest. All transactions involving organisations in which a member of Council have an interest, including those identified below, are conducted at arm’s length and in accordance with the University’s Financial Regulations and usual procurement procedures. Note 23 contains details of related party transactions in the year.

No members of Council received honoraria from the University during the year (2021: Nil).

The total expenses paid to or on behalf of the Council members in the year was £nil (2021: £1,980), representing travel and subsistence expenses incurred in attending Council, Committee meetings and Charity events including fundraising in their official capacity.

7 Other operating expenses

Other operating expenses include:	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
External auditors' remuneration in respect of audit services	126	120	148	138
Accountancy services from firms other than the external auditor	-	-	32	32
Other costs (see page 58 for further analysis)	27,189	26,820	20,704	20,410
	27,315	26,940	20,884	20,580

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

57

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

7 Other operating expenses (continued) Further analysis of other costs	7 Other operating expenses (continued) Further analysis of other costs	7 Other operating expenses (continued) Further analysis of other costs	7 Other operating expenses (continued) Further analysis of other costs	7 Other operating expenses (continued) Further analysis of other costs
Significant cost categories included within other costs:	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Curriculum costs	4,306	4,306	3,377	3,377
Medical student placement fees	7,435	7,435	6,385	6,385
Staff and student travel	1,455	1,455	730	730
Premises costs	3,476	3,247	2,232	2,084
Residence costs	595	595	479	479
General administrative expenses*	9,599	9,459	7,362	7,216
Catering and merchandising costs	323	323	139	139
	27,189	26,820	20,704	20,410

*General administrative expenses include the movements in provisions disclosed in Note 16, plus an increase in the bad debt provision by £1m and other general accruals increases.

8 Interest and other finance costs

8 Interest and other finance costs
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Bank loans	166	166	236	236
Pension finance interest	5	5	23	23
	171	171	259	259

The Pension finance interest relates to interest charges, incurred by The University of Buckingham, relating to the USS pension scheme.

9 Total expenditure

9 Total expenditure
	Group 2022 £000	University 2022 £000	Restated Group 2021 £000	Restated University 2021 £000
Academic and related expenditure	25,597	25,597	20,071	20,070
Administration and central services	18,930	18,265	15,066	14,453
Premises	3,424	3,424	3,062	3,062
Residences	1,246	1,246	1,148	1,148
Catering and bar	301	301	148	148
Research grants and contracts	828	828	920	920
	50,326	49,661	40,415	39,801

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

58

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

9 Total expenditure (continued)

The University has two classes of business being the provision of education and the delivery of research. The provision of residences, catering, bar plus administration and central services are ancillary activities.

Group Academic and central services expenditure does not include (primarily) £300,000 (restated 2021: £300,000) of rent charged by MPML to the University, as this is eliminated upon consolidation.

In reviewing the categorisation of total expenditure, we have restated the 2021 comparison in order to include the most appropriate costs in each category. there is no impact on the overall results for 2021.

10 Intangible assets

The Group holds one written down intangible asset, relating to a podiatry programme curriculum, acquired by MPML in 2019 at a cost of £246k (2021: £246k). This has been fully amortised and therefore carried a year end book value of £nil (2021: £nil).

11 Tangible assets

11 Tangible assets
GROUP	Freehold land £000	Freehold Buildings £000	Equipment £000	Assets in course of construction £000	Total £000
Cost:
At 1 January 2022 Additions Disposal Transfer	4,222 - - -	36,179 - (229) -	19,510 - - 1,141	230 1,171 - (1,141)	60,141 1,171 (229) -
At 31 December 2022	4,222	35,950	20,651	260	61,083
At 1 January 2022 Charge for the year Disposal	403 - -	11,715 670 (49)	12,872 1,715 -	- - -	24,990 2,385 (49)
At 31 December 2022	403	12,336	14,587	-	27,326
Net book amount:
At 31 December 2022	3,819	23,614	6,064	260	33,757
At 31 December 2021	3,819	24,464	6,638	230	35,151

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

59

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

11 Tangible assets (continued)

UNIVERSITY	Freehold land £000	Freehold Buildings £000	Equipment £000	Assets in course of construction £000	Total £000
Cost:
At 1 January 2022 Additions Disposals Transfer At 31 December 2022 Accumulated depreciation:	4,222 - - -	29,265 - (229) -	17,774 - - 1,141	230 1,166 - (1,141)	51,491 1,166 (229) -
	4,222	29,036	18,915	255	52,428
At 1 January 2022 Charge for the year Disposal At 31 December 2022 Net book amount:	403 - -	11,103 574 (49)	12,252 1,521 -	- - -	23,758 2,095 (49)
	403	11,628	13,773	-	25,804
At 31 December 2022 At 31 December 2021	3,819	17,408	5,142	255	26,624
	3,819	18,162	5,522	230	27,733

12 Investments

12 Investments
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Investments in subsidiary undertaking	-	3,844	(53)	3,946
Shares in ABHSC (a joint venture)*	-	-	-	-
Shares in CVCP Properties Plc	23	23	23	23
Other listed investments	6,462	3,516	6,496	3,980
Cash investment deposits: Non-current	148	148	115	115
Cash investment deposits: Current	85	-	84	-
	6,718	7,531	6,665	8,064

*Further details of the joint venture can be found in Note 24

The University owns 0.54% of the issued ordinary share capital in CVCP Properties plc, the company that owns the offices of Universities UK.

The University has an immaterial dormant subsidiary, University of Buckingham Medical Sciences North Ltd., as detailed in Note 24.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

60

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

12 Investments (continued)

Other listed investments represent equity shares, principally UK equities, managed by external independent professional fund managers. These are recognised as non-current asset investments, as they are held with a long-term intention to earn recurring income that pays for expenditure connected with Restricted and Endowment Funds.

	Group £000	University £000
At 1 January 2022	6,665	8,064
Net movement in the year*	53	(533)
At 31 December 2022	6,718	7,531

*The net movement in the year consists of:

GROUP	£000
(Losses) on investments	(372)
(Losses) on investments held by Foundation	(249)
(Losses) on investments held by the Group	(621)
Net disposal of investments	674
At 31 December 2022	53
UNIVERSITY	£000
(Losses) on investments	(529)
At 31 December 2022	(529)

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

61

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

13 Trade and other receivables

	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Amounts falling due within one year:
Escrow funds	2,512	2,512	2,507	2,507
Student receivables	9,295	9,295	7,224	7,224
Other trade receivables	76	9	291	6
Prepayments and accrued income	962	958	1,337	1,333
Amounts due from subsidiary undertakings	-	1,096	-	1,229
Other debtors	460	460	418	418
	13,305	14,330	11,777	12,717

The amounts due from subsidiary undertakings are unsecured interest free loans and repayable on demand.

The Group holds £2,512k of funds in an escrow account relating to the financial guarantee contract connected with the Booth Hall student accommodation. The funds were placed in escrow and the liability of £1,623k as at 31 December 2022 (2021: £2,126k) is held within Provisions in these financial statements. The University was required to place these funds in escrow as part of the arrangement made by ABHSC to lease the Booth Hall student accommodation.

The University has judged that this should be treated in the financial statements as a receivable rather than cash and cash equivalents. The restricted cash is contained in a bank account held jointly in escrow with Manchester Metropolitan University and, whilst this does represent cash funds, it is freely available only to the extent released by both parties following payment of rents due.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

62

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

14 Creditors: amounts falling due within one year

	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Student fees received in advance	14,618	14,618	12,156	12,156
Trade payables	5,077	5,033	3,362	3,103
Social security and other taxation payable	378	378	300	299
Other payables	1,568	1,568	1,464	1,464
Accruals and deferred income	7,461	7,240	6,001	5,976
	29,102	28,837	23,283	22,998

Any amounts owing to group companies are unsecured, interest free and repayable on demand.

15 Creditors: amounts falling due after more than one year

	Group 2022 £000	Group 2022 £000	University 2022 £000	Group 2021 £000	Group 2021 £000	University 2021 £000
Bank loans	5,000		5,000	5,000		5,000
	5,000		5,000	5,000		5,000
Analysis of loan repayments		2022 £000			2021 £000
Due between two and five years At 31 December 2022		5,000			5,000
		5,000			5,000

The £5m term loan agreement that was set up in 2021 is repayable in 5 years and bears a fixed interest rate of 2.15%. As part of the agreement, a revolving credit facility is available to the University for the duration of the loan, at £7m for 2 years, reducing to £5m in 2023. The revolving credit facility has not been used since the start of the loan agreement. The terms of the loan include financial covenants and in 2022 the University agreed with NatWest that the covenant reporting would be measured from 31st December 2022 and then on a quarterly basis thereafter.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

63

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

16 Provisions

16 Provisions
GROUP	Financial guarantee contract provision £000	Pension: Employee Benefit Plan £000	Pension: USS £000	VAT provision £000	Crewe lease £000	Total £000
At 1 January 2022	2,126	134	1,922	808	7,045	12,035
Additional provision	-	-	1,394	-	-	1,394
Utilised in the year At 31 December 2022	(503)	-	-	-	(1,074)	(1,577)
	1,623	134	3,316	808	5,971	11,852

Financial guarantee contract provision

The Group holds £2,512k of funds in escrow relating to the financial guarantee contract with Manchester Metropolitan University on behalf of ABHSC in relation to the Booth Hall student accommodation. The funds were placed in escrow and the guarantee value as at 31 December 2022 is £1,623k (2021: £2,126k); and as such the provision has been reduced to that value.

Employee Benefit Plan

The Employee Benefit Plan is an in-house pension scheme that is in the process of being wound up. Provisions relate to guaranteed minimum payment equalisation and legal and professional costs relating to the wind-up.

Universities Superannuation Scheme ('USS')

Figures recorded in the table above for the USS pension represent the University’s share of the scheme’s liabilities and past deficits. USS will adjust its scheme contribution rates from time-to-time, in order to address the deficit in this multi-employer pension scheme. See Note 22 for details.

Adjustment for VAT repayable by the MPML subsidiary

The VAT provision was initially recognised in the financial statements for the year ended 31 December 2019 and relates to the Medical Property Management Ltd (MPML) subsidiary which is expected to pay a sum to HM Revenue and Customs (HMRC) relating to the correction of overclaims of VAT in previous years. These errors relate to the change in the VAT group structure made in early 2018 but implemented retroactively in late 2017, plus corrections regarding the use of the Capital Goods Scheme.

MPML has in subsequent years been in communication with HMRC to make disclosures concerning these errors and with the assistance of independent professional taxation advisers has been liaising with HMRC to finalise the quantum of monies repayable and the chronology for repayment.

The University of Buckingham 64 Annual Report and Financial Statements for the year ended 31 December 2022

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

16 Provisions (continued)

A Notice of VAT assessments and over-declarations has been received from HMRC which indicates an initial assessment of this liability of £115k. However, HMRC are continuing their investigations regarding other aspects of the liability, all material areas remain under consideration, and interest and penalties can be applied on the amounts due, accordingly at the year end the best estimate of the ultimate liability remains at £808,000. However, this provision is subject to material estimation uncertainty as there are plausible and realistic scenarios under which the total liability could be significantly lower than this current estimate.

Subject to further enquiries being made by HMRC it is anticipated that this matter will be resolved and settled during calendar year 2023.

Crewe campus lease

Where anticipated costs in relation to a leasehold property exceed its anticipated income, a provision is made for the future shortfall to the end of the lease. This provision relates to the Crewe campus lease between ABHSC and the University. Discussions on revised lease terms continued during the year and were ongoing at the date of the signing of these accounts and it is therefore considered prudent to maintain a provision until the results of those discussions are more certain. Movement in provision in the year is the result of the review and update of the discounted cashflow model assumptions.

UNIVERSITY	Financial guarantee contract provision £000	Pension: Employee Benefit Plan £000	Pension: USS £000	Crewe lease £000	Total £000
At 1 January 2022	2,126	134	1,922	7,045	11,227
Additional provision	-	-	1,394	-	1,394
Utilised in the year At 31 December 2022	(503)	-	-	(1,074)	(1,577)
	1,623	134	3,316	5,971	11,044

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

65

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

17 Endowment reserves

2022 Capital	Group Restricted Permanent £000	Group Restricted Expendable £000	Group Total £000	University Restricted Permanent £000	University Restricted Expendable £000	University Total £000
As at 1 January 2022 New donations Decrease in market value of investments Capital expenditure	5,590 - (631) (19)	910 - (62) -	6,500 - (693) (19)	3,447 - (443) -	22 - - -	3,469 - (443) -
As at 31 December 2022	4,940	848	5,788	3,004	22	3,026
Accumulated Income As at 1 January 2022 Investment income Expenditure	1,128 - -	135 - -	1,263 - -	660 - -	- - -	660 - -
As at 31 December 2022	1,128	135	1,263	660	-	660
Total Funds As at 1 January 2022	6,718	1,045	7,763	4,107	22	4,129
As at 31 December 2022	6,068	983	7,051	3,664	22	3,686
Analysis by Fund Type Scholarships and bursaries Development funds	2,104 3,964	961 22	3,065 3,986	- 3,664	- 22	- 3,686
At 31 December 2022	6,068	983	7,051	3,664	22	3,686

Analysis by asset type 2022	Group Total £000	University Total £000
Fixed assets	888	-
Investments	6,611	4,095
Other current assets At 31 December 2022	(448)	(409)
	7,051	3,686

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

66

NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

17 Endowment reserves (continued)

2021 Capital	Group Restricted Permanent £000	Group Restricted Expendable £000	Group Total £000	University Restricted Permanent £000	Univeristy Restricted Expendable £000	University Total £000
As at 1 January 2021 New donations Increase in market value of investments Capital expenditure	4,579 246 784 (19)	841 - 69 -	5,420 246 853 (19)	2,628 246 573 -	22 - - -	2,650 246 573 -
As at 31 December 2021	5,590	910	6,500	3,447	22	3,469
Accumulated Income As at 1 January 2021 Investment income Expenditure	1,149 40 (61)	135 - -	1,284 40 (61)	681 40 (61)	- - -	681 40 (61)
As at 31 December 2021	1,128	135	1,263	660	-	660
Total Funds As at 1 January 2021	5,728	976	6,704	3,309	22	3,331
As at 31 December 2021	6,718	1,045	7,763	4,107	22	4,129
Analysis by Fund Type Scholarships and bursaries Development funds	2,311 4,407	1,023 22	3,334 4,429	- 4,107	- 22	- 4,129
At 31 December 2021	6,718	1,045	7,763	4,107	22	4,129

Analysis by asset type 2021	Group Total £000	University Total £000
Fixed assets	888	-
Investments	6,611	4,095
Other current assets At 31 December 2021	264	34
	7,763	4,129

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

17 Endowment reserves (continued)

Details of the material funds (balances over £500,000) as at 31 December 2022 are as follows:

----- Start of picture text -----
As at 1 Income Revaluation As at 31
January & New Expenditure Gains/ December
Fund Name Type Purpose 2022 Donations (losses) 2022
£000 £000 £000 £000 £000
Economics &
Vinson Permanent 4,107 - - (443) 3,664
Entrepreneurship
Economics &
Gregory Permanent 1,852 90 (42) (111) 1,789
Entrepreneurship
Scholarships &
Desborough Expendable Bursaries 657 10 (3) (40) 624
----- End of picture text -----

Each of the individually material endowment funds detailed above represent other listed investments and cash investment deposits only, and each are of sufficient value and liquidity to enable them to be applied in accordance with their associated restrictions.

18 Restricted reserves

Reserves with restrictions are as follows:

18 Restricted reserves Reserves with restrictions are as follows:
2022	Group £000	University £000
At 1 January 2022	5,760	5,806
Other restricted income New donations and re-classifications Expenditure Transfer to unrestricted reserves	127 375 (689) 80	- 351 (258) 80
Total restricted reserve comprehensive (expenditure)/income for the year	(107)	173
At 31 December 2022	5,653	5,979

2021	Group £000	University £000
At 1 January 2021	6,063	5,866
Other restricted income New donations and re-classifications Expenditure Transfer to unrestricted reserves Total restricted reserve comprehensive (expenditure) for the year At 31 December 2021	112 140 (386) (169)	- 140 (31) (169)
	(303)	(60)
	5,760	5,806

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

19 Total reserves

19 Total reserves
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
At 1 January	23,564	17,089	17,735	11,225
(Deficit)/surplus for the year	(2,815)	(2,322)	5,829	5,864
Release of restricted funds spent in year	(375)	(375)	(386)	(386)
New donations and re-classifications At 31 December	375	375	386	386
	20,749	14,767	23,564	17,089

Analysis of donations and new grants in the year by type of purpose:

	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Scholarships and bursaries	80	80	647	647
Research support	-	390	-	339
Unrestricted donations	43	43	-	-
	123	513	647	986
	Group 2022 £000	University 2022 £000	Group 2021 £000	University 2021 £000
Restricted donations	80	470	647	986
Unrestricted donations	43	43	-	-
	123	513	647	986

At the date of the signing of these accounts the Trustees were performing but had not yet completed a review of the University’s Endowment, Restricted and Unrestricted funds, and the presentation of income and expenditure associated with the University endowment funds.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

20 Consolidated reconciliation of net debt

20 Consolidated reconciliation of net debt	20 Consolidated reconciliation of net debt
		At 31 December 2022 £000
Net debt 1 January		(5,289)
Movement in cash and cash equivalents		2,634
Other non-cash changes Net debt 31 December Change in net debt		(5,268)
		(7,923)
		(2,634)
Analysis of net debt:	2022 £000	2021 £000
Cash and cash equivalents	12,923	10,289
Borrowings: amounts falling due in one year Unsecured loans	-	-
Borrowings: amounts falling due after more than one year Unsecured loans Net debt	(5,000)	(5,000)
	(7,923)	(5,289)

21 Capital commitments

At the year end the University had £1.6m in capital commitments (2021: £nil), relating to the Franciscan building development project (£1.4m) and other smaller renovation projects (£0.2M), started in 2022.

22 Pension commitments

The University participates in the following pension schemes:

• The Aviva Group Personal Pension Plan ('GPP') and the NEST Auto Enrolment Scheme ('NEST-AES') are defined contribution schemes, so no commitment exists beyond the employer’s contractual contributions for each accounting period. The NEST-AES is a money purchase scheme contracted into the State Second Pension ('S2P'), which covers a small number of staff under auto enrolment.

• The University of Buckingham Employee Benefits Plan ('EBP') has defined benefits for those members with Guaranteed Minimum Pension rights and the University accounts for the deficit of EBP’s liabilities over assets.

• The Universities Superannuation Scheme ('USS') provides defined benefits, which entail long term liabilities, for which the University is ultimately responsible and accounts for its share of USS’s deficit. The fund is valued every three years by professionally qualified independent actuaries. Membership of the fund is closed to new members of staff unless they are already members of the scheme through previous employments.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

22 Pension commitments (continued)

The Universities Superannuation Scheme ('USS')

Basis of the scheme

USS is the main scheme covering academic and academic-related staff which provides pensions based in part on defined benefit career average and part defined contributions. The scheme is 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 trusteeadministered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The University 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 University accounts for the scheme as if it were a defined contribution scheme. As a result, the amount charged to the Statement of Income represents the contributions payable to the scheme. Since the University has entered into an agreement (the 'Recovery Plan') that determines how each employer within the scheme will fund the overall deficit, the University recognises a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) and an expense is recognised.

FRS 102 makes the distinction between a group plan and a multi-employer scheme. A group plan consists of a collection of entities under common control typically with a sponsoring employer. A multi-employer scheme is a scheme for entities not under common control and typically represents an industry-wide scheme such as USS.

In a multi-employer scheme, where the employer has entered into an agreement with the scheme that determines how the employer will fund a deficit, this results in the recognition of a liability for the contributions payable (to the extent that they relate to the deficit). The resulting expense is reflected in profit or loss in accordance with section 28 of FRS 102. The University is satisfied that the USS meets the definition of a multi-employer scheme and has therefore recognised the discounted fair value of the contractual contributions under the latest available recovery plan at the year end.

Financial impact of the scheme valuation

A schedule of contributions based on the 31 March 2022 valuation has been agreed as:

	Employer	Employee
1 October 2019 to 30 September 2021 1 October 2021 to 31 March 2022 1 April 2022 to 31 March 2024 1 April 2024 onwards	21.1% 21.4% 21.6% 21.4%	9.6% 9.8% 9.8% 9.8%

These contributions include a provision for the costs of future accrual of defined benefits and contributions towards the correction of the deficit in the defined benefit section.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

22 Pension commitments (continued)

The University’s provision for future liabilities increased by £1.4 during the year to £3.3m at 31 December 2022 (2021: £1.9m).

Actuarial information and assumptions

Since the University cannot identify its share of USS Retirement Income Builder assets and liabilities, the following disclosures reflect those relevant for the scheme’s assets and liabilities as a whole.

The University has 113 active members as at 31 December 2022 (2021: 113 active members).

Discount rate: 4.0% at 31 December 2022, based on the discount rate for Barclays 2-Year Flexible Bond - Issue 55 as at 31 December 2022.

Discount rate (forward rates)

Years 1-10: CPI + 0.14% reducing linearly to CPI – 0.73% Years 11-20: CPI + 2.52% reducing linearly to CPI + 1.55% Years 21+: CPI + 1.55%

Pension increases (CPI): term dependent rates in line with the difference between the fixed interest and index linked yield curves less 1.3%

Pay increases: Future salaries increase rate 2%, no change in staff membership.

Mortality base table

The main demographic assumption relates to the mortality assumptions. These assumptions are based on analysis of the scheme’s experience carried out as part of the 31 March 2018 actuarial valuation.

The current life expectancies on retirement at age 65 are:

The current life expectancies on retirement	at age 65 are:
	2022	2021
Males currently aged 65 years Females currently aged 65 years Males currently aged 45 years Females currently aged 45 years	24.4 years 25.9 years 26.3 years 27.7 years	24.4 years 25.9 years 26.3 years 27.7 years

Figures in the table above are identical for 2022 and 2021; they are taken from the scheme valuation dated 31 March 2018 and there was no scheme valuation performed in 2022.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

22 Pension commitments (continued)

22 Pension commitments (continued)	22 Pension commitments (continued)
Cost to the University		Group/Univeristy 2022 £000	Group/University 2021 £000
Contributions to USS		950	1,081
Contributions to GPP		656	589
Contributions to AES		9	7
Increase/(decrease) in provision for USS liabilities		1,390	(1,106)
Total pension cost for the year (Note 6)		3,005	571
Contributions outstanding at 31 December Group/Univeristy 2022 £000 Group/University 2021 £000 To USS 107 117 To GPP 85 80 To AES 4 2 Total outstanding 196 199
	Group/Univeristy 2022 £000		Group/University 2021 £000
	107		117
	85		80
	4		2
	196		199

Most recent actuarial valuations

A triennial actuarial valuation of the USS Retirement Income Builder was carried out at 31 March 2020 (the valuation date), using the projected unit method. This was performed for USS under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to adopt a statutory funding objective, which is to have sufficient and appropriate assets to cover their technical provisions.

At the valuation date of 31 March 2022, the value of the assets of the scheme was £88.9 billion and the value of the scheme’s technical provisions was £91.0 billion indicating a deficit of £2.1 billion and a funding ratio of 97.0%.

Based on the Schedule of contributions per the 31 March 2022 valuation, the agreed contributions for employer and employee is now 21.4% and 9.8% respectively, from 1 April 2024 onwards.

In accordance with the requirements of FRS 102, the University currently recognises a provision for its obligation to fund past deficits arising within USS. The recovery plan in the 2018 actuarial valuation required employers to contribute 2.0% of salaries over the period 1 October 2019 to 30 September 2021, at which point the rate would increase to 6.0%. If the deficit contributions are made at this level and experiences follow the assumptions made in the recovery plan, the deficit is expected to be resolved by 31 March 2028.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

22 Pension commitments (continued)

The Universities Superannuation Scheme (USS) “Schedule of contributions – March 2022” has been prepared by the Trustee of USS, to satisfy the requirements of section 227 of the Pensions Act 2004, after obtaining advice of Aaron Punwani, the actuary to the Scheme appointed by the Trustee.

This is the second schedule of contributions for the Scheme following the valuation with an effective date of 31 March 2020 and it supersedes all earlier versions. It reflects the benefit structure and covenant support measures implemented as part of and then subsequent to the 2020 valuation.

A pattern of contributions was determined by the Trustee on 28 March 2022 after consultation with Universities UK, the body nominated by the Rules of the Scheme to act as the representative of the institutions with a liability in the Scheme (the “Employers”), for the purposes of consultation required by the Trustee with Employers under Section 229 of the Pensions Act 2004.

The Trustee has signed the March 2022 Schedule of contributions to indicate that it represent an accurate record of the pattern of contributions and the schedule is effective from the date it is certified by the Scheme Actuary (i.e. 28 March 2022).

The USS Trustee board has agreed the future contribution rates effective from 1 October 2021, with employer contributions at 21.4% and member contributions at 9.8%. This replaces the employer and member contributions in place to 30 September 2021 of 21.1% and 9.6% respectively. In February 2022 the board confirmed they will pursue their initial proposal to instigate a small increase in contribution rates from the 2018 valuation but extend the deficit recovery period as a result of the decision to proceed with benefit change by the Joint Negotiating Committee (JNC).

Management are assessing the impact of this revised schedule of contributions on the reported deficit provision.

The University of Buckingham Employee Benefits Plan (EBP)

The EBP is a defined contribution (money purchase) scheme which includes guaranteed minimum pension (GMP) benefits. The scheme started to wind up on 31 January 2008 when it operated on a contracted in basis. The scheme was contracted out on a GMP basis prior to 6 April 1997.

Those members with GMP benefits in respect of contracted out service prior to April 1997 have pensions payable from the scheme which must not be less than the GMPs specified in legislation. The GMP rights mean the scheme provides a defined benefit. On retirement the full proceeds of each member’s individual account with Royal London are used to secure benefits in terms of the rules of the scheme, via the purchase of an annuity policy.

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

22 Pension commitments (continued)

The net assets of the fund as at 5 April 2020 (the plan’s financial year-end) were £65,000 with the value of investments designated to members valued on this date as £65,000. The assets of the plan are invested in units of various funds with Royal London.

The latest actuarial valuation of the scheme in place at the year-end was prepared as at 6 April 2020. The valuation results indicated the scheme was 75% funded with a calculated shortfall of £152,000. It was agreed that no further contributions will be made but UOB will continue to pay the cost of Pensions Protection Fund levies and the cost of any expenses other than those paid by Royal London.

The assumptions underlying the contributions required to address the valuation shortfall allow for changes since the valuation date. The purchase of immediate annuities for 3 members and deferred annuities for the remaining two members match the members’ benefits. The assets at the valuation date are slightly in excess of the purchase price of the deferred annuities, leading to no shortfall in the scheme and no recovery plan contributions were required, despite a shortfall being shown at the valuation date.

Most recent valuations and actuarial information and assumptions There are 5 members of the scheme.

There are 5 members of the scheme.
Funding Position	6 April 2020 Valuation £000	6 April 2017 Valuation £000
Total GMP member liabilities	153	201
Assets GMP accounts Contingency account Net current assets	- 7 (6)	113 43 (6)
Total Assets	1	150
(Deficit) Funding ratio	(152) 1%	(51) 75%
Discount rate: Before retirement 0.6% p.a. (10 year gilts -0.95%) After retirement 0.2% p.a. (10 year gilts -0.55%)
RPI inflation: CPI inflation: GMP increases in deferment:	2022 3.1% p.a. 2.3% p.a. Fixed rates	2021 3.1% p.a. 2.3% p.a. Fixed rates
Increases in payment: GMP earned before 6/4/88 level GMP earned on or after 6/4/88 (CPI max 3% p.a)	2021 0.0% p.a. 2.3% p.a.	2021 0.0% p.a. 2.3% p.a.

There are 5 members of the scheme.
Funding Position	6 April 2020 Valuation £000	6 April 2017 Valuation £000
Total GMP member liabilities	153	201
Assets GMP accounts Contingency account Net current assets	- 7 (6)	113 43 (6)
Total Assets	1	150
(Deficit) Funding ratio	(152) 1%	(51) 75%
Discount rate: Before retirement 0.6% p.a. (10 year gilts -0.95%) After retirement 0.2% p.a. (10 year gilts -0.55%)
RPI inflation: CPI inflation: GMP increases in deferment:	2022 3.1% p.a. 2.3% p.a. Fixed rates	2021 3.1% p.a. 2.3% p.a. Fixed rates
Increases in payment: GMP earned before 6/4/88 level GMP earned on or after 6/4/88 (CPI max 3% p.a)	2021 0.0% p.a. 2.3% p.a.	2021 0.0% p.a. 2.3% p.a.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

22 Pension commitments (continued)

Mortality base table:

The main demographic assumption relates to the mortality assumptions. These assumptions are based on analysis of the scheme’s experience carried out as part of the 6 April 2020 actuarial valuation. The mortality assumptions used in these figures are as follows:

	Male	Female
Current pensioner aged 65 years - cohort Current pensioner aged 65 years - period Future pensioner aged 65 - 20 years in the future Future improvement rate	87.5 86.1 89.2 1.50%	89.1 87.8 90.7 1.25%

The EBP pension provision of £134,000 in the University relates to potential payments to encourage a reduction in Scheme membership by way of transfer values or the purchase of annuities, where possible. The provisions are required for GMP equalisation costs and legal advice, together with wind up costs. If a member, after taking financial advice, decides that he/she wishes to transfer his/her benefits to a new provider, then the employer will need to provide this enhancement. The aim has been for the benefits of the GMP members to be bought and replaced with a deferred annuity. The intention is to wind up the scheme and distribute assets to remaining members.

23 Related party transactions

Council members are the trustees for charitable law purposes. Due to the nature of the University’s operations and the composition of the Council, being drawn from local public and private sector organisations, it is inevitable that transactions will take place with organisations in which a member of the Council may have an interest. All transactions involving organisations in which a member of Council may have an interest are conducted in accordance with the University’s Financial Regulations and usual procurement procedures. An updated Register of Interests for all members of Council and senior management is maintained.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

23 Related party transactions (continued)

Individual Trustee or senior management	Related party and relationship	Transaction	2022	2022	2022	2022
			Receipts £	Payments £	Debtors £	Creditors £
Professor Joe Harrison	Chief Executive Officer of Milton Keynes University Hospital NHS Foundation Trust	Operating costs of the University - payments made to the NHS Trust not to Prof. Harrison personally	-	1,256,199	-	2,160,411
Caitlin Botha	Member of the University Council	Accommodation Provided	1,435	-	1,515	-
Mr Nicholas Hillman	Director of HEPI	The University pays an annual membership to HEPI and sponsored a specific report	-	2,400	-	4,200
Rachael Shimmin	Chief Executive Officer of Buckinghamshire Council	Operating costs of the University - payments made to the Council not to Ms Shimmin personally	-	68,773	-	-
Mr Keith Bothongo	Daughter was a student	Course fees	19,000	-	-	-

Adolfo Paolini and Debapita Bardhan-Correia, a member of Council and of senior management respectively, had spouses employed by the University during 2022 and 2021. Their employment was on an arms length basis

Individual Trustee or senior management	Related Party and Relationship	Transaction	2021	2021	2021	2021
			Receipts £	Payments £	Debtors £	Creditors £
Professor Joe Harrison	Chief Executive Officer of Milton Keynes University Hospital NHS Foundation Trust	Operating costs of the University - payments made to the NHS Trust not to Prof. Harrison personally	-	2,932,547	-	686,268
Ms Misty McCrory	Director of Medical Property Management Ltd	Salary from wholly- owned subsidiary	-	2,629	-	-
Caitlin Botha	Member of the University Council	Accommodation Provided	11,874	-	2,950	-
Mr Nicholas Hillman	Director of HEPI	The University pays an annual membership to HEPI	-	2,400	-	-
Mr Mark Rushton	Member of the University Council	Expenses as Council Member of the University	2,250	-	-	-

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

23 Related party transactions (continued)

Related party transactions for the year ended 31 December 2022 are as follows: Medical Property Management Ltd (MPML)

Transaction	2022	2022	2022	2022	2021	2021	2021	2021
	Receipts £	Payments £	Debtors £	Creditors £	Receipts £	Payments £	Debtors £	Creditors £
Rental payments made by the University to MPML for the former’s use of the Milton Keynes Academic Centre	-	450,000	-	-	-	300,000	-	150,000
Settlement of inter-company balance	630,695	-	-	-	-	-	-	-
Amounts owed by MPML to the University	-	-	93,979	-	-	-	630,695	-

University of Buckingham Foundation (UoBF)

Transaction	2022	2022	2022	2022	2021	2021	2021	2021
	Receipts £	Payments £	Debtors £	Creditors £	Receipts £	Payments £	Debtors £	Creditors £
Grants awarded by the Foundation to the University	-	-	414,840	-	-	-	339,732	-
Rent paid by the University regarding student accommodation properties owned by the Foundation	-	61,200	-	-	-	61,200	-	-
Balances owed by the Foundation to the University at year end	-	-	1,002,395	-	-	-	598,229	-

Other related party transactions and disclosures are as follows:

Apollo Buckingham Health Sciences Campus Ltd (ABHSC) is a related party of The University of Buckingham. Two of the four Board of Directors of ABHSC are University employees and the University is not considered to be the controlling entity.

The University provides a financial guarantee contract for 50% of the lease payments between ABHSC and Manchester Metropolitan University as per Note 13.

In 2019 the University entered into lease arrangements with ABHSC in respect of the campus at Crewe. The lease is currently being renegotiated, an update on which is provided in Note 24.

Mr Mohammed Syed, Council member and Chair of the University’s Finance, Estates and Resources committee during the year, is a senior executive of a bank which is a member of National Westminster Bank plc (NatWest). NatWest are the University’s main bankers and have provided loans to the University, as set out in Note 15.

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

24 Subsidiary, joint venture, and associate undertakings

Company	Principal Activity	Status	Holding of ordinary shares	Registered Office
Medical Property Management Ltd	Property holding and management, acquisition of academic curriculum	Subsidiary	100%	Yeomanry House Hunter Street Buckingham MK18 1EG
Buckingham Business Enterprise Ltd	Used as academic support for business, enterprise, and innovation students	Subsidiary	100%	Yeomanry House Hunter Street Buckingham MK18 1EG
The University of Buckingham Foundation	Receives, holds, and distributes donations, primarily in support of the University	A separately constituted unincorporated charity, under the effective control of the University	Not applicable	Yeomanry House Hunter Street Buckingham MK18 1EG
Apollo Buckingham Health Sciences Campus Ltd	Provides facilities management and student support services for medical and other Allied Health students on the Crewe campus	Joint venture	48%	College House The Campus Crewe Green Road Crewe Cheshire CW1 5DU
University of Buckingham Press Ltd	Publishers	Associate	25%	9 The Fairway Northwood HA6 3DZ
University of Buckingham Medical Sciences North Ltd	Dormant company	Subsidiary	N/A Company limited by guarantee	Yeomanry House Hunter Street Buckingham MK18 1EG

Medical Property Management Ltd

This wholly owned subsidiary has been consolidated in the University financial statements.

Buckingham Business Enterprise Ltd

The results of this wholly owned subsidiary are deemed to be immaterial to the results of the University so have not been consolidated.

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

24 Subsidiary, joint venture, and associate undertakings (continued)

The University of Buckingham Foundation (the Foundation)

The University is in a position of effective control arising from a number of factors, notwithstanding that the Foundation is a distinct charitable trust and therefore the results of the Foundation have been consolidated in the consolidated financial statements.

The trust deed for the Foundation declares that its purpose is to advance education, in particular supporting and promoting the education of students at the University, and to promote research into academic and scientific fields of learning.

The close relationship between the University and the Foundation is a determining factor in the University exercising effective control. The Foundation’s Board of Trustees agrees that the primary intent of the Foundation is to support the University and the Trustees are guided by the University in decisions relating to the distribution of funds.

Apollo Buckingham Health Sciences Campus Ltd (ABHSC)

The University held a 40% shareholding (80 x £1 ordinary shares) in the company, ABHSC from its inception in 2019, until an agreement was signed in October 2022, whereby the share in the joint venture held by Unique CIC were transferred in agreed proportions to the University and Apollo Education UK Ltd," increasing the University’s shareholding in the JV to 48%.

In August 2022, £1.3m became payable under an agreement signed in December 2021 and was duly paid. Discussions are continuing, the purpose of which is to review and revise the commercial arrangements, as set out in the joint venture agreement, plus the University’s arrangements to occupy certain buildings on campus. and even though the sum has been paid, the University has a reasonable expectation that its financial commitments overall will be lower than current commitments (per Note 25) as a result of a new agreement.

The University has no contractual commitment to cover any losses of ABHSC but is committed to its occupational damages payments reflecting an economic rental for the utilised campus whilst contractual lease arrangements are renegotiated.

The unaudited ABHSC financial statements for the year ended 31 March 2022 show retained losses of £2,730,000 from incorporation on 24 March 2017 to 31 March 2022. Accordingly, the University’s shares in ABHSC are held at 31 December 2022 at a value of £nil (2021: £nil).

University of Buckingham Press Ltd

The results of the University's minority investment in this company are immaterial to the results of the University and have not been consolidated.

University of Buckingham Medical Sciences North Ltd

This subsidiary was registered on 29 January 2020. This company has remained dormant since its incorporation.

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NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)

25 Lease commitments

The University entered into a joint venture agreement in October 2018 with Apollo Education UK Ltd and Unique Children’s Community Interest Company, including a 10 year lease with Apollo Buckingham Heath Sciences Ltd for the University’s campus in Crewe. Under the agreement, the University would be committed to lease payments estimated at £40.1m in total over 10 years, after the benefit of an initial £4.0m rent-free amount. Lease payments are fixed amounts payable in accordance with the terms of the operating lease agreement until 31 December 2024, following which there is a rent review option. There is an option to renew the lease after 10 years. These arrangements are all subject to the discussions as per Note 24 and as such are in the process of being renegotiated. The commitments disclosed here are as per the original lease as at the balance sheet date.

Total minimum lease payments under non-cancellable operating leases under the lease for the Crewe campus are as follows, after taking into account the £4m rent-free amount:

	Land and buildings 2022 £000	Other Leases 2022 £000	Total 2022 £000	Land and buildings 2021 £000	Other Leases 2021 £000	Total 2021 £000
Not later than one year	4,424	43	4,467	3,913	31	3,944
Later than one year and not later than five years	19,548	52	19,600	18,950	73	19,023
Later than five years	10,347	-	10,347	15,384	-	15,384
	34,319	95	34,414	38,247	104	38,351

Onerous lease provisions have been disclosed in Note 16.

Lease payments in the year amounted to £1,400k (2021: £1,525k) for land and buildings leases and £64k (2021: £36k) for other leases.

The University of Buckingham Annual Report and Financial Statements for the year ended 31 December 2022

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