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School as part of a twinning arrangement with
Odesa National Economic University in Ukraine.
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STRATEGIC REVIEW
## **5** | **Welsh language and culture**
**Aberystwyth University is renowned for its unwavering commitment to promoting the language and culture of Wales, whether it’s through fostering education through the medium of Welsh or contributing to enhancing the understanding of the socioeconomic needs of our country.**
We were pleased to see the National Eisteddfod return to our home county of Ceredigion for the first time in 30 years in August. It proved the perfect platform to officially launch our 150th anniversary programme as well as serve as the ideal venue for our ever-popular alumni and reunion events for UMCA, Aberystwyth’s Welsh Student Union. We were honoured to lead both the Science Village and Learn Welsh Village, and many leading academics from all over the University took part in lectures and panels across the Maes.
We held an open afternoon at Pantycelyn to coincide with the National Eisteddfod to welcome alumni and the local community to visit the newly refurbished hall, which has been brought back to its former glory, and hear about the experiences of its student residents. It has now been three years since Neuadd Pantycelyn reopened and it continues to be the hub for much of the Welsh student community’s activities. It is home to Welsh societies’ meetings and rehearsal space for choirs and other groups.
The hall is also home to UMCA, which is critical for student engagement and community cohesion. We have a strong relationship with our student body and their feedback has led us to introduce a number of changes that have improved their experience living in Pantycelyn.
Broadening the reach of Welsh culture has been central to our history. Our 150th anniversary volume, ‘Ceiniogau’r Werin’, featured a range of contributions that illustrated our rich and proud Welsh heritage, such as historic protests, establishing UMCA, and introducing our bilingual policy and simultaneous translation. But as well as
celebrating the Welsh culture of our past, we want to foster that of our present and future. In a collaboration with the National Library of Wales and UMCA, we curated Pop Aber, a celebration of the close relationship between the University’s Welsh student community and the emerging Welsh language music scene. Several of these prominent artists performed at the Gig Mawr Aber during October’s Founders Week.
The University’s commitment to the Welsh language and its close alliance with Y Coleg Cymraeg Cenedlaethol was illustrated by a new Ysgoloriaeth Defi Fet Scholarship, which will be awarded to a Welsh language veterinary student who is dedicated to developing their language skills in a professional learning context. The scholarship was launched at a joint event held by Aberystwyth University and the Coleg Cymraeg at the Royal Welsh in July 2023.
It is just one example of the relevance and impact of Welsh language opportunities embedded across our new courses at the University. The veterinary course is meeting a demand in the local community for more vets and it is vital that those graduates are also equipped with the necessary language skills. Similarly, we are working to improve the proportion of Welsh language students within our nursing courses from already encouraging figures within its first year of teaching.
We have seen several successes in Welsh language teaching and delivery, as well as research and innovation. The Department of Geography & Earth Sciences’ Dr Hywel Griffiths won Coleg Cymraeg Cenedlaethol’s Most Outstanding Contribution to Welsh-medium Education. Dr Gwenllian Rees won the Royal College of Veterinary Surgeons’ Impact Award for her involvement in the Arwain Vet Cymru project, a national collaborative anti-microbial stewardship programme for all farm vets in Wales. The University itself continues to recognise staff and students’ promotion of the language through its own Gwobrau Cymraeg Aber/Aberystwyth University Welsh Language Awards.
Further examples of our success include the award of two PhD scholarships by the Coleg Cymraeg for a joint project between the School of Education and Learn Welsh for Adults, as well as another in agriculture. The latter flies the flag for the Welsh language within Aberystwyth University with 50% of students Welsh-speaking during the 2022/23 academic year. We also celebrated the best of our research within the University with an event as part of our 2022 Festival of Research, involving the Departments of Geography, International Politics, and Welsh and Celtic Studies.
As ever, our Centre for Welsh Language Services and Dysgu Cymraeg teams had a busy year. We also saw the return of support for staff who are learning and improving their Welsh language skills by holding lunchtime chat sessions. Engagement by staff and the local community with classes endures. We have also piloted new courses tailored especially for students following a new Welsh Government policy on free classes for the under 25s.
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STRATEGIC REVIEW
## **6 | Our People**
**All colleagues working at Aberystwyth University play a vital role in making it the thriving and successful institution it is known for. Our continued success in a variety of student surveys demonstrates how we have built a strong platform upon which our community can deliver to great effect.**
We are proud of our record of low staff turnover. It is an indication of the loyalty of our colleagues to the University and to the wider Ceredigion area. While industrial action has affected the UK’s university sector during the academic year, our relationship with our trade union representatives continues to be professional and positive, reflecting commitment and hard work on both sides.
Despite a competitive marketplace for jobs, a changing labour market and a wider shift towards remote working in most sectors, we continue to make high-calibre appointments across a range of different roles. This demonstrates how the University is an attractive employer with a clear sense of strategic direction. A key priority for the forthcoming academic year will be ensuring this trend continues
with the appointment of a new Vice-Chancellor who will continue the progress made by the University in recent years.
Engagement with colleagues continues to be critical to the running of the University, providing an opportunity to reconnect through discussion and feedback. An increase in in-person meetings represents a shift back to normalcy after working under the restrictions of the COVID-19 pandemic. We have taken the lessons learned from that period on board and introduced the likes of hybrid working and offering greater flexibility to how people can work.
We have held a number of workshops with our leaders and research colleagues to discuss and plan how we organise ourselves as part of continuing improvements in our profile and performance in all aspects of research, knowledge exchange and innovation.
There has been significant activity in leadership and management development through both in person and online training and workshops. We have continued and increased our training and development courses at the University in response to high demand, positive feedback, and the impact that the training is having on skills development and confidence of colleagues. We have taken steps to support colleagues with wider cost of living challenges with earlier than usual implementation of Real Living Wage increases, financial training support as well as introducing subsidised meals in catering facilities across our campuses.
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## STRATEGIC REVIEW
## **7** | **Equality, Diversity and Inclusion**
**The University is committed to embedding equality, diversity and inclusion into all areas of our teaching, research and working environments, central to decisionmaking and in the delivery of our services. We are guided by our Strategic Equality Plan 20202024, which demonstrates our commitment to foster an inclusive learning and working culture, free from discrimination, harassment, and victimisation, and which upholds the values of respect, dignity and courtesy.**
The new Equality, Diversity and Inclusion Strategic Oversight Group will bring a whole community approach to monitoring EDI activity and impact, maintaining progress on priority areas, and
consulting the community to prepare the Strategic Equality Plan 2024-2028.
In the past year, the Race Action Plan 2022-2025 was launched during an event to discuss race in the workplace. We implemented new initiatives such as anti-racism training, a diversifying the curriculum pilot project and an internal race equality audit. Alongside this plan, a new Race Action Group and the student and staff-led working groups are leading the University’s work and preparation to apply for a Race Equality Charter Bronze award in November 2024.
We have maintained progress in the area of Gender Equality with an application for an Athena Swan Charter Bronze Award. The representation of our senior academics is a particular priority, and we worked closely with departments to help those who may have had to take leave for parental or other care responsibilities. This has shown positive progress – in 2022, there were 59 applications for academic promotions, of which 37% were female. In 2023, there were 53 applications, of which 51% were female. Separately, work continues on improving our gender pay gap, which remains below the sector average.
The University is becoming more diverse. Our proportion of minority ethnic colleagues has grown 7.7% to be 5.6% of our staff population, and colleagues who declared as LGB+ has grown 4.8% to 4.4% of our staff population. Colleagues who have declared a disability account for 8.2% of total staff. While growth in some areas is slow, albeit in line with local demographic trends, we recognise these challenges and have plans in place to improve these metrics.
Prom, which returned to Aberystwyth after a 10year absence, to hate-crime workshops and local recruitment fairs. The University has also been celebrating the diversity of our community with events such as Black History Month, LGBT History Month, International Women’s Day, Neurodiversity Week, Diwali and Ramadan.
During the year we successfully renewed our Disability Confident Employer status and achieved the Stonewall Workplace Equality Index Bronze Award, which led to arranging specific activity, including awareness raising sessions for colleagues on Neurodiversity and Active Bystander.
Being part of the Mid and West Wales EDI Network, we have been working with organisations and services within the local community to talk about what we are doing, share learnings and identify opportunities for collaboration. We have also supported events, ranging from Pride on the
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## **Annual Pay Policy Statement and Senior Remuneration**
**All staff within the University, regardless of salary, undertake an Effective Contribution Scheme performance review annually, which is then used to inform career development plans and training needs. In addition, we offer a variety of networks and leadership development and mentoring schemes to support career development and progression.**
retain the best staff possible. However, in taking any decisions relating to the remuneration of senior staff, the Remuneration Committee is required to be mindful of the affordability of those decisions and refer to benchmarking data for comparable Universities.
The outcomes of appraisals for senior staff under the institution’s Effective Contribution Scheme are subsequently presented to the Remuneration Committee and form the basis of any recommendations to the Remuneration Committee with respect to any changes to the remuneration of the staff in question. All senior post holders at the University automatically receive any ‘cost of living’ pay awards provided by the University to employees on the nationally-agreed single pay spine.
The University has an Individual Contribution Award scheme that was introduced in October 2021.
The Governing Body has approved a Senior Remuneration Framework for the University, which sets out the institution’s approach to the remuneration of senior post holders. As set out by the Senior Remuneration Framework, the Remuneration Committee has been delegated the authority by Council to agree matters relating to the remuneration of the Vice-Chancellor; Pro ViceChancellors; and Director of Finance and Corporate Services.
The highest salary point is Point 9 on the Grade 10 Scale, which equates to £105,566 (as at 31 July 2023). There are 11 senior academic or professional services posts with a remuneration package of more than £100,000, based on basic pay plus any allowance for additional responsibility as at 31 July 2023. These salaries take account of relevant benchmarking data from within and outside of the HE sector.
The lowest pay point is spinal point 3 on the Single Pay Spine, which equates to £20,410 (as at 31 July 2023). However, individuals on this spinal point in practice receive the prevailing Real Living Wage at £20,688 (the University started to pay the Real Living Wage in April 2018 and became an accredited Real Living Wage employer in October 2018).
The University recognises that it operates in a competitive environment and wishes to attract and
## **Joint report on the financial year by the Chair of the Finance Committee and the Director of Finance**
The challenging financial environment has increased pressure on the University cash flow and short-term funds management. The University understands the importance of this function and is actively engaged in managing the short-term position and planning to increase cash reserves over the longer term.
**The University has operated in a challenging financial landscape during 2022-23. The (£2.5) million deficit underlying operating position for the group is not in line with budgetary expectations but reflects lower than budgeted for student numbers, inflationary pressures and interest**
Aberystwyth continues to invest to meet its strategic goals, specifically the long-term provision of excellent teaching and research including the associated capital investment that underpins those objectives. The redevelopment of the Old College dominates the capital planning horizon with budgeted expenditure of c.£34 million between 2023-24 and 2025-26. However, the project’s multiple funder structure and timescales have allowed for some targeted capital investment in other key strategic areas such as the University estate, digital and learning infrastructure enhancements and continued investment in projects that make University operations more efficient.
## **rate rises.**
Excluding the movement in pension schemes and other non-cash adjustments, the underlying group operating position is a (£2.5) million deficit in 2022-23. These adjustments are set out in the table below. Whilst the student body has grown and income has increased, this was not in line with budgetary expectations. Funding body grants have remained consistent as expected, and research income has increased reflecting strategic direction. Expenditure has remained largely consistent with previous years in most operational areas, matching increased income in areas with improved performance. However, large variances in staff costs, debt service, utilities and consumables in areas impacted by inflation have been recognised, leading to the reporting of the deficit.
Looking forward and in line with the wider sector, key issues faced by the University will relate to current challenges associated with a competitive recruitment environment and the continued need to invest in staff and resources to support high quality research activity. The University has seen growth in student numbers for the 2023-24 academic year although behind budgeted income plans. As this growth does not match continuing inflationary cost increases, further cost savings and operational efficiencies will be required to achieve the budget target. The University will continue to carefully allocate resources, supporting strategic growth objectives and ensuring that efficiencies in ongoing operations are maintained.
The financial benefits of the strategic refocus undertaken in recent years have largely been realised, particularly the rebalancing of the University’s cost base relative to income and the student population. Whilst those changes have enabled Aberystwyth to operate with more flexibility and to focus resources strategically, in 2022-23 these gains were more than offset by cost pressures in other areas, predominantly in premises costs.
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## **Scope of the financial statements**
The financial statements for the year ended 31 July 2023 consolidate the results of the University, Aberystwyth Innovation, Aber Trading Ltd and Aber – Business Consultancy Ltd, all of which are subsidiary companies. The table below shows a summary of the Group results. The total comprehensive income for the year includes several non-cash accounting entries.
The University recognised a £4.3 million gain from a decrease to the University Superannuation Scheme (USS) provision in 2022-23 (2021-22 £27.8 million loss). The University also recognised an accounting gain of £5.2 million in 2022-23 (2021-22 £17.0 million gain) following a valuation of the assets and liabilities of the pension fund (actuarial valuation) by our independent advisors Mercers. More detail on the University’s pensions schemes is shown from page 91 onwards.
A summary reconciliation between the Financial Statements and the Management Accounts (underlying operating position) is shown below for completeness. Accounting standards require the University to include several non-cash accounting adjustments in the Statement of Comprehensive Income. The underlying operating position is a (£2.5) million deficit in the group when these items are eliminated, and these are set out in the table below.
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2022-23 2021-22
£m £m
Total comprehensive income 9.1 (11.0)
Profit on disposal of fixed assets (0.1) (0.1)
Revaluation gain (1.9) -
Loss/(gain) on investments 1.0 0.9
New endowments (3.7) (0.5)
Movements in USS pension during the year (4.3) 27.8
Pension charges 2.7 1.3
Other recognised gain - (1.2)
Movement in AUPAS and LA Pensions during the year (5.3) (17.0)
Underlying operating position (2.5) 0.2
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The table below provides a summary of group results for the year. Further information is available in the Financial Statements.
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2022-23 2021-22
£m £m
Income 132.7 123.5
Expenditure (129.9) (150.7)
Surplus / (deficit) before other gains and losses 2.8 (27.2)
Profit on disposal of fixed assets 0.1 0.1
(Loss) / gain on investments (1.0) (0.9)
Surplus on revaluation 1.9 -
Surplus / (deficit) before taxation 3.8 (28.0)
Surplus / (deficit) after taxation 3.8 (28.0)
Actuarial (loss) / gain on pension schemes 5.3 17.0
Total comprehensive income 9.1 (11.0)
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## **Financial health metrics**
The University utilises several Key Financial Indicators (KFI) to monitor its financial health. The KFIs used were reviewed and updated in line with the University’s Financial Strategy and to aid sector comparisons in 202122. They are still considered relevant for 2022-23. These are summarised in the table below:
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FINANCIAL HEALTH METRICS 2022-23 2021-22 Target
Profitability
Retained result as % of income (1.80%) 0.20% 5.00%
Liquidity
Net liquidity days 30 days 36 days 120 days
Current assets: Current liabilities 0.8 0.8 1.3
Gearing
External borrowing as % of income 48.50% 46.40% 50.00%
Efficiency
Staff costs as % of Income 54.90% 56.30% 58.00%
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As at July 2023, only two of the KFIs have been met; those for gearing and staff costs as a percentage of income. The efficiency KFI has improved because of management actions taken to reduce staff costs following the lower than budgeted student fee income in year. Though external borrowing as a percentage of income has increased from 2021-22, it remains within University targets. The increase primarily relates to the University having drawn down more funds from the Revolving Credit Facility as at July 2023 to combat timing differences and delays to anticipated cash inflows. Achievement of these indicators will depend on the University meeting student fee income targets, new research grant capture and cost saving measures. Progress towards liquidity targets will also be aided by an anticipated material reduction in USS contribution obligations stemming from the triennial valuation and surplus asset sales.
## **Profitability**
The £3.6 million reduction on budgeted levels of student fee income coupled with ongoing increases in costs aligned with inflationary pressures have resulted in the University delivering an underlying operating deficit in 2022-23. The retained result as a percentage of income metric is -1.8% and reflects an underlying operating position that has moved into deficit following a return to an operating surplus in 2021-22. The increased costs are reflective of the prevailing national and international economic challenges during the period.
The value of the University’s investments is also unpredictable due to its dependence on market values. In 2022-23 the University made an unrealised loss of £1.0 million based on the market value of investments (2021-22 £0.9 million loss).
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## **Liquidity**
The University’s cash holdings remain below target due to historic adverse impact of COVID-19 on operations and several significant strategic capital investments over the same period. A 12% increase in operating income over the last two financial years has unfortunately coincided with recent historic inflation and interest rate highs, which have in turn impacted the University’s ability to generate and retain target levels of operational cash over the same period.
The University reported cash holdings of £8.2 million as at July 2023 (2021-22 £8.1 million). Despite the slight increase in cash holdings reported, the University’s liquidity metrics have either decreased (Net Liquidity Days) or remained unchanged (Current Ratio) in 2022-23. Net Liquidity Days have decreased to 30 days (2021-22 36 days). The metric demonstrates the estimated number of days the University’s cash and short-term investment balances at July 2023 could sustain its core operations. Core operations are calculated as expenditure less depreciation, interest, amortisation, non-cash pension adjustments and non-recurring costs. The reduction in the metric is driven by a sharp increase in core operating costs, due to inflationary pressures and linked in-year pay awards, and figures for cash holdings and short-term investments that have not increased from the prior year. The metric remains below University targets and this remains a key consideration in the short- and medium-term. Pressures on core operating costs and margins are expected to persist in the short-term but the University’s aim is to mitigate through operational efficiencies, supplemented by reductions in USS pension contribution obligations, and strategic asset divestment to increase cash held. The cash figure reported includes £10 million of utilised funds from the University’s RCF as at July 2023, meaning there remained further capacity (£5 million) within the facility for accessible short-term funds at the reporting date. Despite a reduction to net current assets of £2.3m in 2022-23 the University’s Current Ratio (current assets: current liabilities) remains at 0.8, which is also below internal targets. Liquidity measures will be closely monitored through existing reporting mechanisms.
## **Gearing**
Although the University has reported increased operational income in 2022-23 of £132.8 million (2021-22 £123.5 million), external borrowing as percentage of this income has also increased marginally to 48.5% (2021-22 46.4%) over the period. The increase to external borrowing in 2022-23 relates almost entirely to the increased utilisation of RCF funds as at July 2023, with £10 million utilised (2021-22 £3 million). The increase in utilised funds was required to combat timing differences and delays to forecast cash inflows as at July 2023, illustrated by a further increase in the reported Group receivables to £23.6 million (2021-22 £19.8 million). The remaining external borrowing in the metric consists of secured liabilities and interest-free Salix finance to fund the University’s energy efficiency projects and remained broadly unchanged over the period. The University robustly monitors its debt obligations and covenant compliance to ensure all are met through the reporting period and beyond. External borrowing as 48.5% of income lies within University aspirational targets and this metric will be continually monitored through existing reporting mechanisms.
## **Efficiency**
Staff costs are by far the group’s biggest single element of cost. Reported group staff costs (excluding USS staff costs adjustments) were £72.8 million in 2022-23 (2021-22 £70.4 million). The expected increase to staff costs, alongside a planned increase to operational income, means that staff costs as a percentage of income remains broadly unchanged at 54.8% in 2022-23. This metric is a barometer of institutional efficiency and sustainability and is currently within University targets.
The operating environment for universities remains challenging and the student recruitment market carries uncertainties and is highly competitive. Student numbers increased year on year in 2022-23 but were lower than our targets. For the 2023-24 academic year, we planned for our student body to grow again. As a result of a shortfall in this growth a series of management actions and cost containment measures are being implemented to ensure that the University achieves its budget. We have highlighted above the improvement in the percentage of research activity of an internationally recognised standard. Whilst this is excellent news, the University’s share of total HEFCW research grant income is expected to fall significantly in future periods. Research grant funding for the 2023-24 academic year has been protected, though to a smaller extent than in 2022-23, through mitigation funding, but steps will need to be taken to mitigate the impact in the longer term as the University seeks to grow its research activities.
## **Income**
The University attracted more students in 2022-23 than in 2021-22 which led to increases in tuition fee income (£2.9 million). Research grant capture and associated margins were also higher than in the previous year, increasing by £4.8 million (21.5%). The decrease in other income was driven by a reduction in other revenue grants. However, there were many positive movements in year, most notably student residential income, which increased by £0.7 million, largely due to a return to pre-pandemic accommodation uptake and an increase in annual charges in line with inflation, coupled with increased activity in other commercial and conferencing facilities. Aberystwyth Arts Centre and University Farms also generated an additional £0.6 million compared with 2021-22 because of increased activity and programming and milk prices in the Farms benefiting from inflation. Income received from funding bodies is comparable with 2021-22, reflecting a return to more normal and expected levels following the receipt of additional support funding during the COVID-19 pandemic. As part of the budgeting process, the University had financially planned for most of the movements in income and these are therefore broadly in accordance with budget expectations, recognising that the University is a large and complex organisation that will naturally experience some variation. Our activities are planned to continue to match income fluctuations with necessary cost reductions, with the aim of delivering financial sustainability in line with the overarching Strategic Plan.
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3%
1%
INCOME SOURCES (2022-23)
Tuition fees
23% Funding grants
43% Research grants & contracts
Other income
17%
Investment income
14%
Endowments & donations
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INCOME CHANGE £MILLION (2022-23 CF 2021-22)
6.0
5.0
4.0
3.0
2.0
1.0
0.0
-1.0
-2.0
Tuition fees Funding grants Research grants Other income Investment Endowments &
& contracts income donations
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## **Expenditure**
The University continued to carefully manage its cost base in 2022-23 in proportion to income generation, building upon the progress of recent years and fine-tuning key areas. A robust and challenging budget setting process, interlinked with a focus on developmental activities, continues to support this objective. In 202223 the University has broadly balanced the cost base in proportion to income generated, albeit there remain business improvements to be made. Staff costs have increased by some £2.3 million (3.2%) compared with the prior year, reflecting in-year promotions and pay awards as well as higher staff costs in residences and trading facilities as they return to more usual activity. Some change efficiencies were also undertaken during the year. The balanced academic portfolio, supported by proportional professional services, provides for expenditure stability. The use of the staff establishment during 2022-23 has embedded that control environment. Research expenditure has increased by £3.7 million compared with 2021-22, mirroring the increase in income above. Overall, research contribution has remained relatively constant, reporting a small increase in 2022-23, despite the challenges of reduced EU funding.
Consumable expenditure has also been tightly controlled, facilitated by rigorous budgetary review and the use of real time management information for budget holders driven from the financial reporting system. The University sought to implement expenditure reductions to manage the overall impact of fee losses but incurred significant increases in premises costs (utilities), up £1 million on 2021-22 and on the University Farms, up £0.8 million on 2021-22, both of which are driven by inflation. Inflation and interest increases also drove an increase to our ‘Interest and other Finance’ costs. The University has recognised that there remain challenges in managing the cost base of specific operations and has developed strategic action plans to target those areas. This, matched with the corporate strategy of sustainable planned growth of the student population, will drive the improving financial performance in future years.
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5%
EXPENDITURE SPLIT (2022-23)
11% [Staff costs]
[Increase in USS pension]
57% Restructuring
31%
Other operating expenses
Depreciation
Interest and other finance costs
0%
-3%
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EXPENDITURE CHANGE £MILLION (2022-23 CF 2021-22)
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6.0
5.0
4.0
3.0
2.0
1.0
0.0
Staff costs Restructuring Other operating Depreciation Interest and other
expenses finance costs
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## **Balance sheet**
The University’s consolidated net assets have increased by £9 million from those reported in 2021-22. The most significant movement is a decrease to the Pension Provision of £11.7 million. This is a combination of a decrease to the USS liability based on current assumptions and actuarial gains relating to the AUPAS and local authority schemes. Long-term creditors have increased by £2.0 million from 2021-22, stemming from deferred capital grant receipts relating to the Old College project, which exceed the annual amortisation charge. Noncurrent assets have increased by £1.8 million following a revaluation of the University’s investment properties.
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£ millions Fixed Assets Investments Bank & Cash Long-term Creditors Pension Liability
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|2022-23|250.3|33.3|8.2|133.6|50.0|
|---|---|---|---|---|---|
|2021-22|250.2|34.4|8.1|131.6|61.7|
||-|-|-|-|-|
## **Capital investment**
The University’s investment in its estate, facilities and student residences increased in 2022-23 as the Old College Project picked up pace. The refurbishment commenced in the spring of 2022 but ramped up considerably in the last quarter of 2022-23 and into 2023-24. The forecast total cost of the redevelopment is currently £34.0 million and the construction phase is currently expected to run until autumn 2025. The project will breathe new life into the University’s historic seafront presence and funding has already been secured from the Heritage Lottery Fund, the Welsh Government, fundraising initiatives, and the University’s own earmarked investments.
During the year £14.3 million (2021-22 £11.4 million) was spent on investment in infrastructure, buildings, and equipment across the group. Capital investment on the Old College project, including purchase of the adjacent Cambria building, was £4.4 million in 2022-23 (2021-22 £1.7 million). Successful work to bring the University’s claims to external funders up to date resulted in capital grant receipts of £4.6 million relating to the project in 2022-23. The University has continued to invest in projects aimed at reducing the carbon footprint of its operations and achieve its voluntary target of carbon neutrality by 2030. A significant step towards this goal was made through the completion of the solar PV array on University land in 2022-23. The final £0.4 million was spent in 2022-23, with the PV array going fully live in February 2023. The majority of the £2.9 million project costs were funded through interest-free Salix finance. Of the total capital expenditure, £2.5 million (2021-22 £2.2 million) relates to new research equipment fully funded by external grants. The remaining £7 million of capital expenditure across 2022-23 relates to strategic investment in the campus and facilities, reflecting improvements to buildings and physical and technological infrastructure.
To support the investment in facilities and assist with the replenishment of cash reserves, the University Council approved a divestment strategy in November 2023. The strategy identified additional University assets with an estimated market value of c.£7.3 million, which were obsolete or no longer contributing to core University activity, with a view to rationalising the estate and either redirecting capital to new initiatives or building cash reserves. These assets are in addition to those that remain unsold from the previous phase of divestment, approved in May 2022, with a market value of c.£6.3 million. Therefore, across both phases the University has identified assets for sale with a total estimated market value of £13.6 million. At the date of signing, none of the identified assets had been sold but several offers had been accepted with assets totalling c.£2.2 million having been sold subject to contract. Further progress is expected in this area into 2023-24.
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## **Investments**
Over the one-year period to 31 July 2023, the endowment and University investments bore a tough start to the year and heightened volatility, because of concerns surrounding the persistent level of inflation and the global economic slowdown. Despite this, growth assets held up well over the period. The best performing portions of the portfolio were Private Equity (14% return) and UK Equity (8.5% return). The worst performing portions of the portfolio were Index-Linked Gilts (20% loss). Gilt yields increased significantly at the start of the year following the mini-budget announcements in September 2022 and have remained elevated since, resulting in large negative returns.
## **Cash and short-term deposits**
The University’s liquidity (net current assets / (liabilities)) as at July 2023 remains negative at (£8.4) million. This is a worsening of £2.3 million from the (£6.1) million reported at July 2022 although the Current Ratio (current assets: current liabilities) remains consistent at 0.8. This is not in line with internal University targets and has been adversely impacted by in-year operational challenges, particularly cost pressures, and planned strategic asset divestment for 2022-23 of c.£1 million running into 2023-24. Overall, the University has identified assets with an estimated market value of c.£13.6 million for divestment as it aligns its estate with its strategic direction. Although this rationalisation will depress the University’s fixed assets, it will also improve reported cash and liquidity, as well as supplementing a period in which there is considerable pressure on the University’s operating cash flows.
A net operating cash flow of (£4.0) million (2021-22 £5.0 million) is considerably lower than was budgeted. Although this has been adversely impacted by timing differences and a further increase in Group debtors of £3.8 million, additional in-year cost pressures have resulted in operating cash flows being considerably below targets. Clearly this is not sustainable, and the University will comprehensively review both operational efficiencies and its recovery of material receivables for 2023-24 and beyond.
A Revolving Credit Facility (RCF) has enabled the University to navigate planned and short-term volatility in its cash flow profile. In November 2020, the University increased the total available RCF facility from £10 million to £15 million under the Coronavirus Large Business Interruption Loan Scheme (CLBILS). To combat significant adverse timing differences relating to delayed asset divestment and debtor recovery, the University had drawn down £10 million against the facility as at July 2023, considerably more than the £3 million utilised as at July 2022. The RCF assists with short-term cash timing differences only and is not long-term, secured loan finance. The £5 million CLBILS loan facility expired in November 2023. The University has reviewed the borrowing capacity that it needs, both to smooth known operational cash flow profiles and cash flow timing differences relating to material and externally funded capital projects, such as the Old College. Based on its anticipated borrowing needs, the University is consolidating the current £15 million RCF capacity into one product extended by three years, with an option to renew for a further 12 months.
This RCF agreement was signed and completed by both parties on 18 January 2024. The nature of the group’s business is such that there can be considerable unpredictable variation in the timing of cash inflows. The Council has prepared projected cash flow information to assess going concern over a period of at least 12 months from the date of its approval of these financial statements. On the basis of this cash flow information and discussions with the group’s bankers, the Council considers that the group will continue to operate within the facility agreed, noting the margin of facilities over requirements is not large.
The University robustly monitors its cash balances and commitments through monthly and quarterly reporting and forecasting, whereby risks are highlighted and managed. During 2022-23, the impact of COVID-19 on university operations further diminished. However, considerable economic pressures such as energy costs, wider inflation and increasing interest rates have continued to pose a challenge to the University as well as the sector as a whole. These challenges are expected to remain pertinent in 2023-24 and beyond, meaning the University will actively manage its short-term cash position through a review of its borrowing capacity and requirements, management of working capital, particularly receivables, and continued rationalisation of its estate to align with core strategic direction. An anticipated material reduction to USS employer contributions, stemming from the recent triennial review, is also expected to alleviate the position.
## **Principal risks and uncertainties**
The University’s risk management process recognises a number of areas of risk, including corporate strategic risks, which identify the most significant risks to achieving the University’s objectives; operational risks, which may affect the day-to-day operations of the institution; and risks associated with major development projects, which identify the risks affecting the University’s capital investment programme. All risk registers are recorded in an online tool to facilitate management oversight and the identification of linked risks. Corporate risks are updated on a regular basis and reviewed by the Governing Body. The Audit, Risk and Assurance Committee receives a detailed report on the management of risk at each of its meetings. Risk registers for each academic and professional service department are recorded in the same online tool and are monitored at faculty level. During the 2022-23 academic year, the University continued to monitor risk scores to focus attention on risk records where further mitigation may be required. These potential impacts have been incorporated into risk records as appropriate. Student recruitment remains a key issue, especially from international markets, where global events have introduced greater uncertainty over student numbers and fee income. Greater focus is being given to the threat posed to cybersecurity and issues relating to mental wellbeing and student experience are subject to considerable activity and attention.
The principal risks to the University and how they have been mitigated are shown in the table below:
**----- Start of picture text -----**
Risk Area Risk Description Risk Mitigation
**----- End of picture text -----**
|Recruitment|The University fails to recruit and retain
sufcient student numbers.|The University plans for student demand and has recruitment
strategies in place, focusing on key areas around the UK and Wales,|
|---|---|---|
|||developing international networks as well as strong links with local|
|||schools. The University regularly reviews its portfolio to ensure it|
|||continues to meet student and employer needs.|
|Sustainability
and funding|Changes in the funding of universities from
public sources, including the impact of fat
undergraduate student fees and the funding of|The University plans prudently and has incorporated detailed
sensitivity analyses of income assumptions within its fnancial
forecasts, coupled with efective controls over costs. Financial plans|
||research, introduce considerable uncertainty
in fnancial planning and forecasting. Increased|for the medium term show an improving operating position.|
||costs in the wider supply chain and in energy||
||prices create increased pressures.||
|Cybersecurity|Failure to prevent a cybersecurity breach.|The University has accredited cybersecurity arrangements, including|
|||centralised technical controls, policies, procedures, and mandatory
staf training, that are all updated and reviewed regularly.|
|Education|High levels of student withdrawals due to|An external review of student support measures has been undertaken|
|and student
experience|increased demand for support services arising
from mental health, wellbeing and fnancial
pressures from increases in the cost of living.|with an action plan and recommendations being addressed, including
steps to embed wellbeing into the curriculum. A series of measures
to support students and staf with concerns over the cost of living are|
|||being undertaken.|
|Reputation|The University fails to maintain its international|The University invests signifcantly in the student experience and in|
||reputation in both teaching and research.|world class research. Success in league tables, Teaching Excellence|
|||Framework and Research Excellence Framework, including the latest|
|||REF 2021, validates the University’s strategies.|
|General cost
management
and infation|The University fails to control budgets in
response to increased costs from infation.|As for most institutions, general infation is a continued concern for the
University, particularly in relation to utilities and input costs in trading
areas and the University Farms. Employment costs, including pay|
|||awards and pension contributions, have been provided for in budgets.
Similarly, areas where signifcant infationary pressures are prevalent|
|||have also been addressed, the most obvious being energy costs.|
|Short-term
cash fow
management|Operational pressures diminish cash holdings
and working capital available to meet short-
term obligations.|The University robustly monitors its short- to medium-term cash
position, upcoming obligations and any adverse (or favourable) timing
diferences to allow for mitigating action. The University will actively|
|||seek to enhance its short-term cash position through reviewing its|
|||borrowing requirements, managing its material receivables and|
|||progressing its asset divestment strategy.|
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## **Sustainability, future financial opportunities and going concern considerations**
The University’s long-term financial planning to 2027-28 is built on the delivery of excellence for students. Aberystwyth continues to refocus marketing and recruitment for both domestic and international students. Our strategies are based around developing a portfolio of high-quality programmes with clearly articulated identities, meaningful relationships with our feeder schools, and an individual and supportive relationship with our applicants. The priorities underpinning the growth component of our plans are to establish a uniformly excellent teaching provision and a leading marketing and recruitment function. Both are embedded in our Corporate Strategy for the future and we continue to actively review the teaching and recruiting activities of all University departments.
Student intake in September 2022 was lower than budgeted, but an increase on 2021-22. The student body has grown. Expectations are that this will continue in 2023-24 but at a lower rate than has been forecast. Our strategic aims are to ensure that more students choose Aberystwyth University as a place where they can learn and live in an exceptional environment. Our business intelligence and modelling supports this assumption, illustrated through increasing applications compared with previous enrolment cycles. The University continues to make a major investment in its estate which will impact upon its financial position over the planning horizon.
Though liquidity continues to be maintained, and the University has increased cash balances marginally in 2022-23, metrics and performance in this area are clearly behind the University’s aspirational targets. The short-term impact can be managed by a review of the University’s non-committed capital programme and continued rationalisation of University land and buildings, recovery of the Group’s most material receivables, and systematic assessment of the University’s access to short-term borrowing. This will be supported by an expected material reduction in USS employer contributions stemming from the latest triennial review. However, it remains clear that forecast growth and associated financial performance over the planning period needs to be achieved to secure long-term sustainability and financial health.
Our financial forecasts show a tight budgetary landscape, with the University budget under pressure from a tight student market, price inflation and requiring further cost efficiencies. The University has included in its forecasts pay awards, uplifts to the real living wage and a reduction in employer pension contributions arising from the latest valuation. The University is a member of a number of pension schemes (see note 29), which contain a degree of risk relating to the outcome of valuation processes. Given these significant uncertainties, it remains important that the University financial strategy delivers improved financial performance and a sustainable business model focussed on operational efficiency, income stream diversification and investment in strategic assets. It will continue to carefully control expenditure, particularly those incurred in acquiring fixed assets, ensuring they are in line with capital planning projections.
The ongoing emphasis on delivery of Strategic Plan objectives will continue to ensure long-term sustainability, attracting students to study at all levels at the University. Against the wider economic backdrop, there will be challenging times ahead. However, with continuing strong management, the University is confident of successfully making progress in its strategic plans and achieving its objectives. As part of its approach to financial sustainability, the University undertakes detailed expenditure reviews and has a budget monitoring system in place. Additional financial commitments have been reviewed and reduced as necessary, such as phasing some capital expenditure. During 2022-23, the University continued a comprehensive strategic review of its procurement activities, which has the propensity to be transformational in the way the University purchases goods and services, together with realising long-term sustainable savings. The University Executive and the Governing Body exercise detailed oversight of the financial position and cash flows, alongside the consideration of any mitigating actions. Additional revenue generation opportunities, necessary cost controls, cash management and financing options are considered. An integrated planning process is being reviewed and updated to model fee income, growth in student numbers and research activity, together with associated infrastructure requirements over the longer-term planning horizon.
The financial outlook remains uncertain and 2023-24 will be challenging, as we manage the shortfall in student numbers against budget and the additional costs presented from inflationary pressures and the cost-of-living crisis. Like most universities, Aberystwyth is exposed to this risk, particularly that relating to student recruitment and commercial trading activities. However, our financial and cash management modelling, including scenarios that incorporate downside risk, demonstrates that the University remains able to meet its financial commitments.
Based on the above indications the directors believe that it remains appropriate to prepare the financial statements on a going concern basis.
## **Simon Crick**
**Simon Crick Kate Eden** Director of Finance and Planning Chair of the Resources and Performance Committee
## **Public Benefit Statement**
**Aberystwyth University is a Registered Charity (No 1145141) in accordance with the terms of the Charities Act 2011. In setting and reviewing the University’s objectives and activities, the University Council has due regard for the Charity Commission’s general guidance on public benefit and supplementary guidance for charities established for educational purposes.**
Since 1872 the University has promoted excellence in research and teaching under its motto ‘Nid byd, byd heb wybodaeth – A world without knowledge is no world at all’. We aim to enable the student to develop a passion for academic enquiry, learning, and personal development which is both lifelong and life-changing. We value innovation and excellence in research in all fields and disciplines and we encourage an inter-disciplinary approach to seek solutions to global issues. We seek to break down barriers to education and work closely with the community to widen access to our provision.
## **Teaching**
Our core mission is to produce well-educated, skilled, and confident graduates, fully equipped for the world of work and for the work of the world. We provide this through excellent teaching across 19 core academic departments and embedding employability, transferrable skills, and issues of global citizenship into our curriculum.
We support a range of projects for learning in the community, including providing a wide range of lifelong learning courses in languages, the sciences, arts and humanities on the University campus as well as in community venues across Wales and a portfolio of part-time, micro-credential and day courses. We recognise our special responsibility to further Welsh medium engagement and promote the Welsh language, and actively encourage Welsh speaking students to pursue their studies through the medium of Welsh. The first School of Veterinary Science in Wales is now well-established and we are consolidating the training of future nurses following
our successful development of a Healthcare Education Centre on campus.
All of this is built upon the University’s continuing accolades for Student Satisfaction in UK league tables and the National Student Survey.
## **Research**
We have a long and distinguished record of undertaking cutting edge research of international significance, conducting research that addresses the major challenges society faces, including climate and environmental change, global inequality, space research, international economics, artificial intelligence, and cultural identities. We are establishing ourselves as a centre for research collaborations with business through our Innovation and Enterprise Campus, AberInnovation. Community engagement with research includes health and wellbeing programmes, robotics workshops, and public lectures.
## **Widening Access**
Our approach to widening access begins early and we work with schools and communities across Ceredigion, Wales and England to raise aspirations and encourage the participation of under-represented groups in higher education, and to students from groups under-represented at Aberystwyth to make this their university of choice.
Each year the University runs Science Week for students who come from across mid-Wales, and where undergraduate and postgraduate students as well as academics encourage engagement with science and technology subjects. This complements the work that our outreach team undertakes in schools across the country. The work undertaken in widening access to under-represented groups at Aberystwyth and across higher education more generally aligns with the University’s broader commitment to equality, diversity and inclusion.
The University provides a range of bursaries, scholarships and awards for undergraduate and graduate students that complement the tailored pastoral and residential support for students who have previously been in care.
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## **Corporate Governance and Internal Control**
## **International Reach**
We are a thriving international community, welcoming staff and students from over 90 countries worldwide. We work in partnership with other educational institutions, businesses and organisations across the world. Our research has relevance globally, and for those increasing numbers of students who come from overseas to study with us we are dedicating more resources to make sure that they are supported and have a successful experience at the University. Ultimately we are creating graduates and ambassadors who will champion Aberystwyth University and Wales.
## **Sustainability**
In mid-July 2023, we published our ‘Towards net zero 2030 strategy’. This sets out our priority actions that support decarbonising our operations and working towards becoming a Net Zero organisation by 2030. We are already making strong progress on net emissions reductions activity - our latest emissions are down 22% since our base year of 2019/20. We have recently completed a number of significant decarbonisation projects, including a 2.5MW solar array, first large-scale woodland creation project (over 16,000 trees planted to date), new plant growth LED lighting and the replacement of several fleet vehicles with EV cars and vans. We are now working on a number of additional large scale decarbonisation projects, including subsequent phases of woodland creation/tree planting and further large-scale energy efficiency works. We are also working on feasibility studies associated with further renewable energy opportunities and heat decarbonisation options. We are also developing a biodiversity enhancement action plan for the whole estate.
We are committed to being carbon neutral by 2030 and are prioritising our responsibility to protect the environment from the impact of our operations and activities. The University’s Sustainability Policy Statement outlines its commitment to conduct its activities in an environmentally responsible manner.
## **Community Engagement**
We engage fully with our local community through our Arts Centre’s thriving cultural programmes, which include theatre, music, cinema, gallery exhibitions, film and literary festivals, dancing classes, summer projects for school children, and evening classes and workshops for adults. We are also proud of our partnership work with the National Library of Wales and with local schools and community groups and charities including the University Charity of the Year, which is chosen by our staff and students. We encourage staff and student volunteering and are proud of the involvement of both in activities such as beach conservation and engagement with St John Ambulance Brigade. We offer services to regional businesses. We support the local hospital and community health programmes and provide access to high quality sporting facilities and classes for the local community, including sports classes, sports holiday clubs, and activities to promote health and wellbeing in the over-50s.
**In accordance with Aberystwyth University’s Supplemental Royal Charter as revised in 2018, the institution’s Council is “the supreme governing body of the University” and is responsible for “determining the University’s strategic direction and for the conduct of the University’s financial, administrative and other affairs, in**
## **accordance with its objects”.**
As set out in the University’s governing documents, the Council consists of: Independent Members (some serving in an ex-officio capacity); ex-officio staff members; and members elected by the Senate, the non-academic staff, and the students. In total, the membership of the Council shall not exceed 18 voting members. The Council may also appoint additional co-opted members provided the overall number of members is consistent with Statute, although this is not current practice.
The majority of Council members are non-executive, independent members who are not members of staff or students at the University. Further, the role of the Chair of the Council – which can only be undertaken by an Independent Member – is separated from the role of the University’s Chief Executive, the Vice- Chancellor.
Aberystwyth University is committed to promoting equality and diversity, and endeavours to be inclusive, valuing the diverse nature of its staff, students and community. All vacancies for Independent Members on the Council are advertised externally, with expressions of interest particularly welcome from underrepresented groups. Such expressions of interest are considered by a Nominations Committee against the Council’s current composition to ensure that members possess a range of skills which meet the University’s requirements.
The University aims to conduct its activities in an ethical manner in accordance with the seven principles set out in the Nolan Committee’s ‘Report on Standards in Public Life’: selflessness, integrity, objectivity, accountability, openness, honesty, and leadership. The University is also committed to exhibiting best practice in all aspects of corporate governance, applying the core values and associated seven primary elements of governance as set out in the Committee of University
Chairs (CUC) ‘Higher Education Code of Governance’ (September 2020), as well as the relevant principles detailed in the ‘UK Corporate Governance Code’ issued by the Financial Reporting Council.
A review of governance effectiveness was commissioned by the Council during the spring 2019. This was undertaken by AdvanceHE, with its final report presented to Council on 28 June 2019. The Council applies an approach of continuous improvement to governance and institutional performance. The recommendations made in the most recent governance effectiveness review are being implemented under the oversight of the Governance and Compliance Committee. The next review of governance effectiveness will be conducted during the 2023-24 academic year.
On 19 February 2020, Gillian Camm’s independent review of Governance in Wales (‘A review of Governance of the Universities in Wales’) was published, along with the sector’s unanimous response (in the form of the ‘Governance Charter for Universities in Wales’ and ‘Commitment to Action’ plans). The University has developed its own action plan in response to the recommendations of the Camm Review, as well as the sector’s own Charter and ‘Commitment to Action’ plan. The University’s own action plan was agreed by the Council on 27 April 2020, with progress implementation reports submitted to the Governance and Compliance Committee biannually.
Good progress has been made since April 2020 in implementing many of the agreed actions. Some of the initiatives include a full review of the corporate risk register and collecting data from Council members regarding protected characteristics to facilitate positive action for future recruitment processes. The Governance and Compliance Committee held a workshop in April 2023 to discuss and consider the Council’s role and oversight of culture at the University; whether the structure and processes supported good governance to enable a culture of openness, transparency and trust, as outlined in recommendation 15; and discussed organisational culture as a component of organisational performance. Further work and initiatives are underway to develop and enhance the work that underpins the action plan, and to ensure that recommendations have been fully embedded in the governance structure.
A full and thorough recruitment process was undertaken for a new Chair of Council during 2022-23, where the skills and qualities of the applicants were
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tested by a panel of independent Council members and an external, independent member in accordance with recommendation 9. Further to a review by internal audit, a significant review of the risk register was also undertaken and presented to Audit, Risk and Assurance Committee for consideration.
The Council’s primary responsibilities are set out in both the University’s Statutes and Ordinances. By custom, and under the Financial Management Code agreed with the Higher Education Funding Council of Wales, the Council holds to itself, inter alia, the approval of major development and expenditure, as well as responsibility for the establishment and activities of any subsidiary companies.
The Council held five meetings during the 2022-23 academic year. Much of the detailed work is initially handled by several sub-committees. The University’s main governance sub-committees include: an Audit, Risk and Assurance Committee; a Governance and Compliance Committee; a Remuneration Committee; and a Resources and Performance Committee.
All of these sub-committees report their decisions to the Council and are formally constituted with their own terms of reference and a proportion of their membership drawn from the Independent Members serving on the Council. Detailed information on the membership and responsibilities of these subcommittees can be found on our website.
The Remuneration Committee is constituted to consider and determine matters relating to the remuneration of Senior Staff at the University, within an overall framework approved by the Council. In agreeing any changes to the remuneration of the ViceChancellor, the Pro Vice-Chancellors and other defined Senior Staff, the Remuneration Committee is mindful of the affordability of any such determinations. All decisions taken by the Remuneration Committee are reported to the Council.
The University’s Council is ultimately responsible for the University’s system of internal control and for reviewing its effectiveness. Such a system is designed to manage rather than eliminate the risk of failure to achieve business objectives and will only provide reasonable – and not absolute – assurance against material misstatement or loss. A surplus budget was set for the year and reporting forecast this result, although there was a trading deficit in the final accounts. Subsequently, an external review was undertaken which identified improvements to controls and reporting systems to mitigate against this reoccurring.
The Council undertakes an ongoing process for identifying, evaluating, and managing the University’s
significant risks, and that has been in place for the year ended 31 July 2023, and up to the date of approval of the Annual Report and Financial Statements. It is regularly reviewed by the governing body; and it accords with the internal control guidance for Directors on the UK Corporate Governance Code, as amended by the British Universities Finance Directors Group.
The Audit, Risk and Assurance Committee is responsible for meeting with the External Auditors to discuss audit findings, and with the Internal Auditors to consider detailed internal audit reports and recommendations for the improvement of the University’s systems of internal control, together with the management’s responses and implementation plans. This sub-committee also monitors adherence with regulatory requirements and reviews the University’s annual financial statements together with accounting policies. In addition, they may be required to investigate instances of non-compliance with legislation and other regulations. Whilst senior executives attend meetings of the Audit, Risk and Assurance Committee as necessary, they are not members of the sub-committee, and sub-committee members may meet with the Auditors on their own for independent discussions.
The University’s Executive has formal processes in place for evaluating and managing significant risks faced on an ongoing basis. This involves identifying the types of risks the University faces through a topdown and bottom-up process of identification of risks at both corporate and departmental level. Risks are prioritised in terms of potential impact and likelihood of occurrence in accordance with an established and approved risk management policy. These risks are aligned to the institution’s Strategic Objectives and are monitored along with the associated controls and risk mitigation actions on an ongoing basis by the University Executive. The Audit, Risk and Assurance Committee receives an update on risk at each of its meetings, with appropriate reports and recommendations presented to the University Council.
The University has a process for dealing with significant control issues which involves immediate notification to the Chair of Council and Chairs of the Resources & Performance Committee and the Audit, Risk and Assurance Committee along with notification to the Higher Education Funding Council of Wales and the Charity Commission as appropriate.
The University has an agreed Publication Scheme which sets out the information made publicly available by the institution. Further information can be found on our website. Once formally approved by the Council, this document shall be published on the University’s website alongside documents relating to previous academic and financial years.
## **The University’s Executive Group**
The Executive is the University’s senior management team and is responsible for the overall management and administration of the University.
## **Professor Elizabeth Treasure**
## Vice-Chancellor
Professor Elizabeth Treasure joined Aberystwyth University in April 2017. Previously, she was Deputy Vice-Chancellor of Cardiff University. A Vice-President (Wales) of UUK, she is a member of the Universities & Colleges Employers Association (UCEA) Board. A graduate of Birmingham University, she has worked in the NHS in both clinical and managerial roles as well as in the University of Otago, New Zealand. Elizabeth is a Fellow of the Learned Society of Wales.
## **Professor Tim Woods**
## Pro Vice-Chancellor for Learning, Teaching and Student Experience
Professor Tim Woods currently oversees quality assurance and student-related matters across the University. He is a reviewer for the Quality Assurance Agency and was appointed to chair Advance HE’s Fellowship and Accreditation Expert Advisory Group in 2021. He represents Aberystwyth University on numerous Universities Wales networks. He has participated in previous REF and TEF panels, and currently sits on the QAA Board representing UnisWales. He chairs the QAA Wales Strategic Advisory Committee.
_Professor Tim Woods served as Acting Vice-Chancellor during any periods of absence by Professor Treasure._
## **Professor Colin McInnes**
## Pro Vice-Chancellor for Research, Knowledge Exchange and Innovation
Colin is a fellow of the Academy of Social Sciences, the Royal Society for the Arts and the Learned Society of Wales. He recently worked with the World Health Organisation developing its advisory framework for civil-military cooperation in health emergencies, was a member of the REF2021 panel for Politics and International Studies, and also served on the REF2021 interdisciplinary advisory panel.
## **Professor Anwen Jones**
Pro Vice-Chancellor for the Faculty of Arts and Social Sciences
In addition to her role as Pro Vice-Chancellor, Professor Anwen Jones has institutional responsibility for Welsh academic provision, scholarship, and research as well as for the gender strand of the Equality and Diversity agenda. A Professor in Theatre Studies, she is Editor for the Welsh language interdisciplinary scholarly e-journal, Gwerddon, supported by the Coleg Cymraeg Cenedlaethol, is a National Library of Wales trustee and a Coleg Cymraeg Cenedlaethol Director.
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## **Professor Qiang Shen**
## Pro Vice-Chancellor for the Faculty of Business and Physical Sciences
Professor Qiang Shen is a Fellow of the Royal Academy of Engineering and a Fellow and Council Member of the Learned Society of Wales. He has served twice as a REF panel member for Computer Science and Informatics, and is a former Head of Department of Computer Science and Director of the Institute of Mathematics, Physics and Computer Science.
## **Professor Neil Glasser**
## Pro Vice-Chancellor for the Faculty of Earth and Life Sciences
In addition to his role as Pro Vice-Chancellor, Professor Glasser has responsibility for Equality, Diversity and Inclusion as well as Environment and Sustainability across the University. A former Fulbright Distinguished Scholar at the National Snow and Ice Data Centre in Boulder, Colorado, he is a member of the NERC Peer Review College and editor on the Journal of Glaciology.
## **Nicholas Rogers**
## Director of Human Resources and Organisational Development
Nick joined Aberystwyth University as Director of Change Strategy in January 2018. He has almost 20 years’ experience in Director level HR roles in the higher Education sector, including as HR Director in three UK Universities (Napier University, Edinburgh; Kingston University, London; and University of the Arts, London) and the James Cook University in Australia. Prior to working in Higher Education Nick worked in two UK Government Departments.
_Nicholas Rogers assumed responsibility for Estates, Residences and Facilities, and Corporate Services following Stephen Forster’s departure and became a member of the Executive Group on 1 January 2023._
## **Stephen Forster**
## Director of Finance and Corporate Services
Stephen Forster joined the University in 2018. His current role encompasses strategic oversight and responsibility for Finance & Procurement, Planning & Risk Management, Estates Facilities & Residences and Commercial Services. Formerly of the UK firm of PricewaterhouseCoopers LLP (PwC) where he held roles in Finance, Risk Management & Insurance, Supplier Contract Management and Internal Management Consultancy, he is a fellow of the Chartered Association of Certified Accounts (FCCA).
_Stephen Forster left the University on 31st December 2022. Mark Godsell, Deputy Director of Finance, covered all Finance responsibilities from then onwards on an interim basis._
## **Dr Rhodri Llwyd Morgan**
## Director of Welsh Language and External Engagement
Dr Rhodri Llwyd Morgan leads on Welsh language engagement, external relations and on the Old College project. Prior to joining the University he worked for BBC Wales, the Welsh Language Board and Ceredigion County Council. He is Chair of the Board for Welsh-medium early years care and education provider Mudiad Meithrin and has been a member of the Welsh Government’s Welsh Language Partnership Council.
## **Annual reports from Council committees**
## **AUDIT, RISK AND ASSURANCE COMMITTEE**
For the 2022-23 academic year, the members of this Committee were:
|Name|Category|Meetings Attended|
|---|---|---|
|Mark Tweed (Chair)
Sharron Lusher|Chair
Independent Member|3/4
2/4|
|Arwel Thomas
Charu Miani
Rachel Barwise|Independent Member
Independent Member
Student Member|4/4
1/4
3/4|
As permitted by paragraph 122 of the Funding Council’s Financial Management Code, Arwel Thomas served as an Independent Member on both the Audit, Risk and Assurance Committee (ARAC) and the Resources and Performance Committee (RPC). This principle was agreed by Council on 10 July 2020 on the basis that the increasing focus on financial viability within the sector deemed crossrepresentation essential so that the member could hear first-hand from the auditors at ARAC and then relay to RPC as appropriate.
of members’ responsibilities, the statement of internal control and any relevant issue raised in the external auditors’ management letter.
During 2022-2023, the Committee largely focused on scrutinising and advising the Council as appropriate on key business. Where appropriate, decisions were also taken by the Committee in accordance with its terms of reference. The business being considered during 2022–23 included:
- the outcome of the External Audit of the Annual Report and Accounts for the year ended 31 July 2022, and the steps taken by the University Executive to address any recommendations raised by the External Auditors;
Representatives of the University’s external and internal auditors were present during the Committee meetings held in 2022-23, as were the Director of Finance and Corporate Services, the University Secretary and the Vice-Chancellor.
- the formal re-appointment of External Auditors from 1 August 2023;
The role of the Audit, Risk and Assurance Committee is to advise and assist the governing body in respect of the entire assurance and control environment of the University. Accountable to Council, its overriding duties include:
- the Annual Report and Opinion of the Internal Auditors;
- the Internal Audit Plan for the 2022–23, 2023–24, and 2024-25 academic years and the resulting Internal Audit reports. During 2022–23, Internal Audit reports were received on: Planned preventative maintenance and Estates small works; Risk management – maturity; Student Accommodation (UUK Code); Anti-Racist Wales Strategy; Higher Education Funding Data, Student Recruitment; TRAC; and the annual follow up of recommendations raised in previous years;
- Testing and advising Council on the effectiveness of the institution’s risk management, culture, control and governance arrangements, and the internal controls and procedures to promote economy, efficiency, and effectiveness;
- Oversight of external and internal audit arrangements, including advising the governing body on the appointment of the audit providers, and oversight of the nature and scope of external and internal audits and the effectiveness of the audit processes; and
- the progress made by the University Executive in implementing recommendations raised as part of Internal Audit reports over recent years;
- Oversight of audit aspects of the institution’s financial statements, including the external and internal auditors’ opinions, the statement
- risk management arrangements within the institution, including the review of the Risk Management Policy, the Risk Appetite Statement and Matrix, and a full review of the corporate risk register.
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## **GOVERNANCE AND COMPLIANCE COMMITTEE**
For the 2022-23 academic year, the members of this Committee were:
**----- Start of picture text -----**
Name Category Meetings Attended
Meri Huws (Chair) Independent Member 3/3
Melanie Hamer Independent Member 2/3
Matthew Norman Independent Member 3/3
Jane Usherwood Independent Member 3/3
Claire Vaughan Independent Member 2/3
Nicola Wood Independent Member 2/3
Professor Elizabeth Treasure Vice-Chancellor 2/3
Jackie Sayce Non-Academic Staff Member 3/3
Dafi Jones Student Member 3/3
Dr Louise Marshall Senate Member 3/3
**----- End of picture text -----**
The Director of Human Resources and Organisational Development, the Health, Safety and Environment Manager, and the University Secretary were in attendance as appropriate during the Committee meetings.
- Prevent Annual Report;
- Annual Report on Freedom of Speech;
- Aberystwyth Students’ Union Relationship Agreement;
The Governance and Compliance Committee undertakes a scrutiny role and advises the Council on matters including institutional governance; information governance; human resources and staff development; equality and diversity; health and safety; the Welsh language; and compliance with legislation, and with the general requirements of government, HEFCW, and other regulators.
- University Annual Report;
- Annual Equality Report and Gender Pay Gap 2022.
## **REMUNERATION COMMITTEE**
For the 2022-23 academic year, the members of this Committee were:
**----- Start of picture text -----**
Name Category Meetings Attended
Meri Huws (Chair) Independent Member 1/1
Dr Emyr Roberts Chair of Council 1/1
Claire Vaughan Independent Member 1/1
Ellen ap Gwynn Independent Member 1/1
Professor Elizabeth Treasure Vice-Chancellor 1/1
Aisleen Sturrock Student Member 1/1
Professor Reyer Zwiggelaar Senate Member 1/1
**----- End of picture text -----**
The Director of Human Resources and Organisational Development, the University Secretary, and the ViceChancellor were also present during meetings of the Committee held in 2022–23. The Vice-Chancellor and the Director of Human Resources and Organisational Development did not participate in any discussions relating to their own remuneration, while the remuneration of the University Secretary does not come within the purview of the Remuneration Committee.
In 2022-2023 the Remuneration Committee agreed incremental progressions for senior staff. The Committee also considered gender pay at senior level.
A fuller report on the activities of the Remuneration Committee during 2022–23 is presented elsewhere in the Annual Report, as required by the Committee of University Chairs (CUC) ‘Higher Education Senior Staff Remuneration Code’ (June 2018).
The Remuneration Committee considers and determines matters relating to the remuneration of senior staff at the University, in accordance with the policy approved by Council. The Committee is independent and competent and has the ability to engage external independent expertise if required.
During 2022-23, members received, considered and advised the Council as appropriate with respect to other key business, including:
- Health and Safety Annual Report;
- Annual Pay Statement;
- Nominations for Honorary Awards;
- Modern Slavery Disclosure 2022-23;
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## **RESOURCES AND PERFORMANCE COMMITTEE**
During the 2022–23 academic year, the Resources and Performance Committee met on six occasions, two meetings being special meetings held regarding the Old College. For the 2022-23 academic year, the members of this Committee were:
**----- Start of picture text -----**
Name Category Meetings Attended
Kate Eden (Chair)* Independent Member 2/6
Dr Emyr Roberts (Chair) Chair of Council 6/6
Ellen ap Gwynn Independent Member 6/6
Rhuanedd Richards Independent Member 5/6
Arwel Thomas Independent Member 6/6
Dr William Williams Independent Member 5/6
Professor Elizabeth Treasure Vice-Chancellor 6/6
Tom Bates Non-Academic Staff Member 6/6
Aisleen Sturrock Student Member 4/6
Professor Reyer Zwiggelaar Senate Member 4/6
**----- End of picture text -----**
_*Kate Eden stepped away from her role on Council, and as Chair of the Resources and Performance Committee, between September 2022 and April 2023. Dr Emyr Roberts, Chair of Council, chaired four meetings in her absence._
The Director of Finance and Corporate Services, Deputy Director of Finance; and the University Secretary were in attendance as appropriate during the Committee meetings.
- the delivery of major projects against agreed schedules and budgets, with a particular focus on the Old College refurbishment project;
- the current condition of the University’s estate, the development of a new Estates Strategy, and proposals to dispose of land and building assets which are deemed surplus to the institution’s requirements;
The Resources and Performance Committee undertakes a scrutiny role and advises the Council on matters including institutional financial management and sustainability; student recruitment and enrolment, including international activity; income generation; research, knowledge transfer and innovation; estates and the environment.
- institutional performance against its Carbon Management Strategy, proposals to revise that Strategy, and initiatives to improve environmental sustainability;
During 2022–23, the Committee largely focused on scrutinising and advising the Council as appropriate on key business, including:
- the performance of the Aberystwyth University Pension and Assurance Scheme, the related investment strategy, and the University’s covenants as employer;
- the Annual Report and Accounts for the year ended 31 July 2022, and associated annual sustainability return to the Funding Council;
- considering and approving recommendations for unregulated tuition fees for 2023-24 and 2024-25.
- development of the institutional budget for 2027– 28, and financial forecasts for the years through to 2025–26;
## **SENATE**
For the 2022-23 academic year, the members of Senate were:
**----- Start of picture text -----**
Name Category Meetings
Attended
Prof Elizabeth Treasure (Chair) Vice-Chancellor 4/5
Professor Neil Glasser Pro Vice-Chancellor 3/5
Professor Anwen Jones Pro Vice-Chancellor 3/5
Professor Qiang Shen Pro Vice-Chancellor 5/5
Professor Colin McInnes Pro Vice-Chancellor 4/5
Professor Tim Woods Pro Vice-Chancellor 5/5
Mr Jonathan Fry Chair of Aberystwyth University Branch of Coleg Cymraeg 5/5
Cenedlaethol
Professor Reyer Zwiggelaar Head of the Graduate School 5/5
Dr Samuel Raybone Departmental Representative 4/5
Professor Hazel Davey Departmental Representative 5/5
Professor Iain Donnison Departmental Representative 3/5
Dr Otar Akanyeti Departmental Representative 5/5
Dr Lucy Trotter Departmental Representative 5/5
Dr Alex Mangold Departmental Representative 5/5
Dr Sarah Davies Departmental Representative 5/5
Professor Phillipp Schofield Departmental Representative 4/5
Dr Aloysius Igboekwu Departmental Representative 4/5
Dr Patrick Finney Departmental Representative 3/5
Jen Phipps Departmental Representative 4/5
Dr Alex Pitchford Departmental Representative 4/5
Dr Heather Norris Departmental Representative 4/5
Dr Ffion Jones Departmental Representative 4/5
Professor Mererid Hopwood Departmental Representative 3/5
Professor Eleri Pryse Departmental Representative 5/5
Dr Louise Marshall Departmental Representative 4/5
Dr Sarah Higgins Departmental Representative 3/5
Aisleen Sturrock Student Member 4/5
Dafi Jones Student Member 5/5
Elizabeth Manners Student Member 4/5
Tom Bates Non-Academic Staff Member 4/5
Jackie Sayce Non-Academic Staff Member 2/5
**----- End of picture text -----**
The Academic Registrar, the Head of the ViceChancellor’s Office, and the University Secretary were invited to attend all meetings held in 2022–23, as were the heads of all academic departments where they had not been elected to represent their departments on the Senate.
approving the academic portfolio, and managing the regulation of the academic interests of the institution.
During 2022–23, the Senate reviewed and approved revisions to the Student Charter, as well as various academic regulations and procedures. These included amendments to regulations and associated measures in response to industrial action.
The Senate is the academic authority of the University and provides assurance to the Council on academic quality in teaching and research, managing and
The Senate scrutinised and advised Council on relevant decisions to be taken by the governing body, including the annual Quality Assurance Statements, for submission to the Funding Council.
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## **UNIVERSITY EXECUTIVE**
For the 2022–23 academic year, the members of the University Executive were:
**----- Start of picture text -----**
Name Category Meetings Attended
Professor Elizabeth Treasure Vice-Chancellor 19/23
(Chair)
Stephen Forster (until Director of Finance and Corporate Services 8/8
December 2022)
Mark Godsell (from January Interim Director of Finance 13/15
2023)
Professor Neil Glasser Pro Vice-Chancellor 20/23
Professor Anwen Jones Pro Vice-Chancellor 21/23
Professor Colin McInnes Pro Vice-Chancellor 21/23
Dr Rhodri Llwyd Morgan Director of Welsh Language and External Engagement 22/23
Professor Qiang Shen Pro Vice-Chancellor 21/23
Professor Tim Woods Pro Vice-Chancellor 20/23
Nicholas Rogers Director of Human Resources and Organisational 13/15
Development [1 ]
**----- End of picture text -----**
_1 With temporary responsibility for Estates Facilities &Residences and Commercial Services from January 2023_
The Director of Human Resources and Organisational Development, the Head of Communications and Public Affairs, the Head of the Vice-Chancellor’s Office, and the University Secretary also attended meetings of the University Executive held during 2022–23, noting that the Director of Human Resources and Organisational Development became a full member of the Executive following the temporary assignment of additional responsibilities in January 2023. Mark Godsell also joined the Executive in January 2023, having taken taken on the role of Interim Director of Finance following the departure of Stephen Forster.
- advise other members of the University Executive on matters for which they have specific delegated responsibility, where these core members wish to consult with colleagues before taking a decision; and
- consider and advise the Vice-Chancellor on matters delegated to the University Executive Group relating to the University’s Charter and Statutes, Ordinances, Regulations, Policies and Procedures.
Where appropriate, the University Executive presented recommendations to Council and its sub-committees for approval – such matters are outlined above as part of the summary of business considered by each committee.
As the institution’s senior management team, the University Executive is primarily advisory to the Vice-Chancellor who, as the chief academic, administrative and accounting officer, has been delegated overall responsibility by Council for the management of the University.
The University Executive therefore considered any such matter which was deemed appropriate to:
- advise the Vice-Chancellor on matters for which they have overall responsibility, where the ViceChancellor wishes to consult with members of the University Executive before taking a decision;
## **Statement of Council Responsibilities in respect of the Annual Report and the Financial Statements**
- assess the Group and parent University’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
**The Council is responsible for preparing the Annual Report and the Financial Statements in accordance with the requirements of the Terms and Conditions of Funding issued by the Higher Education Funding Council for Wales (HEFCW), the Accounts Direction to Higher Education Institutions for 2022/23 issued by HEFCW, the Financial Management Code issued under the Higher Education (Wales) Act 2015 and applicable law and regulations.**
- use the going concern basis of accounting unless it either intends to liquidate the Group or the parent University or to cease operations, or have no realistic alternative but to do so.
The Council is responsible for keeping adequate accounting records that are sufficient to show and explain the parent University’s transactions and disclose with reasonable accuracy at any time the financial position of the parent University. It is responsible for such internal control as it determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and has general responsibility for taking such steps as are reasonably open to it to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.
It is required to prepare the Group and parent University financial statements in accordance with UK accounting standards and applicable law (UK Generally Accepted Accounting Practice), including FRS 102 (the Financial Reporting Standard applicable in the UK and Republic of Ireland), and the requirements of the Charities Act 2011. The Terms and Conditions of Funding further require the financial statements to be prepared in accordance with the 2019 Statement of Recommended Practice – Accounting for Further and Higher Education, in accordance with the requirements of the Accounts Direction to Higher Education Institutions for 2022/23 issued by HEFCW.
The Council is also responsible for ensuring that:
- funds from whatever source administered by the Group or the University for specific purposes have been properly applied to those purposes and managed in accordance with relevant legislation;
- income, where appropriate, has been applied in accordance with paragraph 145 of HEFCW’s Financial Management Code (FMC);
- Funding Council grants have been applied in accordance with terms and conditions attached to them and used for the purposes for which they were received, including the Terms and Conditions of Funding;
The Council is required to prepare financial statements which give a true and fair view of the state of affairs of the Group and parent University and of their income and expenditure, gains and losses and changes in reserves for that period. In preparing each of the Group and parent University financial statements, the directors are required to:
- there are appropriate financial and management controls in place to safeguard public funds and funds from other sources; and
- the economical, efficient, and effective management of the University’s resources and expenditure is secure.
- select suitable accounting policies and then apply them consistently;
- make judgements and estimates that are reasonable and prudent;
The Council is responsible for the maintenance and integrity of the corporate and financial information included on the University’s website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
- state whether applicable UK accounting standards and the Statement of Recommended Practice have been followed, subject to any material departures disclosed and explained in the financial statements;
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## **Professional advisors**
## **UNIVERSITY TRUSTEES**
The University’s Trustees for the year ended 31 July 2023, and subsequently to the Council meeting where these financial statements were formally approved, were:
## **Independent Members**
## **Ex-officio**
Dr Emyr Roberts, Chair of Council (5/5) Ms Meri Huws, Deputy Chair of Council (5/5)
## **Appointed**
Ms Kate Eden (3/4)
Professor Simon Green (5/5)
## **Staff / Student Members**
## **Ex-officio**
Prof Elizabeth Treasure, Vice-Chancellor (5/5) Prof Tim Woods, Pro Vice-Chancellor (5/5)
## **Senate Members**
Dr Louise Marshall (5/5) Prof Reyer Zwiggelaar (5/5)
## **Non-academic Staff Members**
Ms Kylie Evans (3/5)
## **External auditor and corporate tax advisors**
**KPMG LLP** 3 Assembly Square Britannia Quay Cardiff CF10 4AX
## **Internal auditor**
**TIAA Ltd** Artillery House Fort Fareham Newgate Lane Fareham PO14 1AH
Ms Sharron Lusher (until 30 June 2023) (3/4)
Ms Rhuanedd Richards (4/5) Mr Arwel Thomas (5/5) Mr Mark Tweed (4/5)
Ms Claire Vaughan (5/5)
Dr William Williams (until 31 July 2023) (4/5) Ms Nicola Wood (until 31 August 2023) (5/5)
Ms Ellen ap Gwynn (appointed from 5 October 2023)
Ms Jane Usherwood (appointed from 5 October 2023)
## **Student Representative Members**
Mr Dafi Jones, UMCA President (until 30 June 2023) (3/4)
Ms Elain Gwynedd (from 1 July 2023) (1/1)
Ms Ash Sturrock, Aberystwyth University Students’ Union President (until 30 June 2023) (4/4)
Mr Bayanda Vundamina (from 1 July 2023) (1/1)
Attendance information is provided for those Council members serving during the year ended 31 July 2023, expressed as the number of Council meetings attended out of a total number of meetings the member was due to attend.
## **Bankers**
**Barclays Bank** 26 Terrace Road Aberystwyth Ceredigion SY23 2AE
## **Solicitors**
**Shakespeare Martineau** No 1 Colmore Square Birmingham B4 6AA
## **Principal office**
**Aberystwyth University** Visualisation Centre Penglais Campus Aberystwyth Ceredigion SY23 3BF
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## **Independent auditor’s report to the council of Aberystwyth University**
However, as we cannot predict all future events or conditions and as subsequent events may result in outcomes that are inconsistent with judgements that were reasonable at the time they were made, the above conclusions are not a guarantee that the Group or the University will continue in operation.
## **Fraud and breaches of laws and regulations – ability to detect**
_Identifying and responding to risks of material misstatement due to fraud_
## **REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS**
## **Opinion**
We have audited the financial statements of Aberystwyth University (“the University”) for the year ended 31 July 2023 which comprise the Consolidated and University Statement of Comprehensive Income, the Consolidated and University Balance Sheet, the Consolidated and University Statement of Changes in Reserves, the Consolidated Cash Flow Statement, and the Statement of Principal Accounting Policies and related notes.
In our opinion the financial statements:
- give a true and fair view of the state of the Group’s and of the University’s affairs as at 31 July 2023, and of the Group’s and of the University’s income and expenditure, gains and losses and changes in reserves, and of the Group’s cash flows, for the year then ended;
- have been properly prepared in accordance with UK accounting standards, including FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland, and with the 2019 Statement of Recommended Practice – Accounting for Further and Higher Education; and
- have been prepared in accordance with the requirements of the Charities Act 2011.
## **Basis for opinion**
We have been appointed as auditor under the Charters and Statutes of the University and in accordance with section 144 of the Charities Act 2011 (or its predecessors) and report in accordance with regulations made under section 154 of that Act.
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities are described below. We have fulfilled our ethical responsibilities under, and are independent of the Group in accordance with, UK ethical requirements including the FRC Ethical Standard. We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion.
## Going concern
The Council has prepared the financial statements on the going concern basis as it does not intend to liquidate the Group or the University or to cease their operations, and as it has concluded that the Group and the University’s financial position means that this is realistic. It has also concluded that there are no material uncertainties that could have cast significant doubt over their ability to continue as a going concern for at least a year from the date of approval of the financial statements (“the going concern period”).
In our evaluation of the Council’s conclusions, we considered the inherent risks to the Group’s business model and analysed how those risks might affect the Group and University’s financial resources or ability to continue operations over the going concern period.
## Our conclusions based on this work:
- we consider that the Council’s use of the going concern basis of accounting in the preparation of the financial statements is appropriate;
• we have not identified, and concur with the Council’s assessment that there is not, a material uncertainty related to events or conditions that, individually or collectively, may cast significant doubt on the Group or the University’s ability to continue as a going concern for the going concern period.
To identify risks of material misstatement due to fraud (“fraud risks”) we assessed events or conditions that could indicate an incentive or pressure to commit fraud or provide an opportunity to commit fraud. Our risk assessment procedures included:
- Enquiring of the Council, the Audit, Assurance and Risk Committee and internal audit as to the Group’s high-level policies and procedures to prevent and detect fraud, including the internal audit function, as well as inquiring whether they have knowledge of any actual, suspected or alleged fraud. This included obtaining an understanding of the Group’s channel for “whistleblowing”, and reading any relevant reports in relation to actual, suspected, or alleged fraud, including assessing the impact of any findings on our audit.
- Reading Council and Audit, Assurance and Risk Committee minutes.
- Using analytical procedures, including analysing internal financial information and reporting, to identify any unusual or unexpected relationships or changes occurring within the period.
- Consultation with our own forensic professionals regarding the identified fraud risks and the design of the audit procedures planned in response to these. This involved discussion between the engagement partner, engagement manager and the forensic professional.
We communicated identified fraud risks throughout the audit team and remained alert to any indications of fraud throughout the audit.
As required by auditing standards, we perform procedures to address the risk of management override of controls and the risk of fraudulent revenue recognition, in particular:
- the risk that research income is not recognised in accordance with the relevant grant terms and conditions; and
- the risk that Group management may be in a position to make inappropriate accounting entries.
We also identified a fraud risk related to inappropriate financial reporting in response to pressures to meet financial targets and our overall knowledge of the control environment.
We performed procedures including:
- Identifying journal entries to test based on risk criteria and comparing the identified entries to supporting documentation. These included revenue journals posted to unusual account combinations, journals with a description that contained specific words and journals posted in certain periods within the year, which were approved by senior finance staff and increased surplus.
- For a selection of research income recognised in the period, evaluating whether the income recognised is appropriate based on the underlying grant agreement and corresponding research expenditure.
## _Identifying and responding to risks of material misstatement related to compliance with laws and regulations_
We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our general commercial and sector experience, and through discussion with the Council and other management (as required by auditing standards) and discussed with the Council and other management the policies and procedures regarding compliance with laws and regulations.
We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.
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The potential effect of these laws and regulations on the financial statements varies considerably.
Firstly, the Group is subject to laws and regulations that directly affect the financial statements including financial reporting legislation and regulation (including related charities legislation and higher education legislation, including the Accounts Direction issued by the Higher Education Funding Board of Governors for Wales (HEFCW)), taxation legislation and pensions legislation, and we assessed the extent of compliance with these laws and regulations as part of our procedures on the related financial statement items.
Secondly, the Group is subject to many other laws and regulations where the consequences of non-compliance could have a material effect on amounts or disclosures in the financial statements, for instance through the imposition of fines or litigation or the need to include significant provisions. We identified the following areas as those most likely to have such an effect: compliance with higher education regulatory requirements of HEFCW, recognising the regulated nature of the Group’s activities. Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the directors and other management and inspection of regulatory and legal correspondence, if any. Therefore, if a breach of operational regulations is not disclosed to us or evident from relevant correspondence, an audit will not detect that breach.
## _Context of the ability of the audit to detect fraud or breaches of law or regulation_
Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed non-compliance with laws and regulations is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it.
In addition, as with any audit, there remained a higher risk of non-detection of fraud, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Our audit procedures are designed to detect material misstatement. We are not responsible for preventing noncompliance or fraud and cannot be expected to detect non-compliance with all laws and regulations.
## **Other information**
The Council (the members of which are the Trustees of the University for the purposes of charity law) is responsible for the other information, which comprises all of the information in the Annual Report and Accounts other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except as explicitly stated below, any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether, based on our financial statements audit work, the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. We are required to report to you if:
- based solely on that work, we have identified material misstatements in the other information; or
- in our opinion the information given in the Annual Report (which constitutes the Trustees’ Annual Report for the financial year) is inconsistent in any material respect with the financial statements.
We have nothing to report in these respects.
## **Matters on which we are required to report by exception**
Under the Charities Act 2011 we are required to report to you if, in our opinion:
- the charity has not kept sufficient accounting records; or
## **Council responsibilities**
As explained more fully in its statement set out on page 57, the Council is responsible for: the preparation of the financial statements which give a true and fair view; such internal control as it determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error; assessing the Group and parent 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 it either intends to liquidate the Group or the parent University or to cease operations, or has no realistic alternative but to do so.
## **Auditor’s responsibilities**
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 our opinion in an auditor’s report. Reasonable assurance is a high level of assurance, but does not 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 aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.
A fuller description of our responsibilities is provided on the FRC’s website at **www.frc.org.uk/auditorsresponsibilities.**
## **REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS**
We are required to report on the following matters prescribed in HEFCW’s Audit Code of Practice (effective 1 August 2017) issued under the Further and Higher Education Act 1992 and in the Financial Management Code issued under the Higher Education (Wales) Act 2015 and the Accounts Direction to Higher Education Institutions for 2022/23 issued by HEFCW (“the Accounts Direction”).
In our opinion, in all material respects:
- funds from whatever source administered by the Group or the University for specific purposes have been properly applied to those purposes and managed in accordance with relevant legislation;
- income, where appropriate, has been applied in accordance with paragraph 145 of HEFCW’s Financial Management Code (“FMC”);
- Funding Council grants have been applied in accordance with terms and conditions attached to them and used for the purposes for which they were received, including the Terms and Conditions of Funding 2022/23; and
- the requirements of HEFCW’s Accounts Direction have been met.
## **THE PURPOSE OF OUR AUDIT WORK AND TO WHOM WE OWE OUR RESPONSIBILITIES**
This report is made solely to the Council in accordance with Section 4 of the University’s Charter and Statutes and in accordance with the section 144 of the Charities Act 2011 (or its predecessors) and regulations made under section 154 of that Act. Our audit work has been undertaken so that we might state to the Council 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 University and the Council for our audit work, for this report, or for the opinions we have formed.
- the financial statements are not in agreement with the accounting records; or
- we have not received all the information and explanations we require for our audit.
We have nothing to report in these respects.
## **Rees Batley**
for and on behalf of KPMG LLP, Statutory Auditor
## Chartered Accountants
KPMG LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006 66 Queen Square, Bristol, BS1 4BE
31 January 2024
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**STATEMENT OF PRINCIPAL ACCOUNTING POLICIES**
## **Financial Statements for the Year ending 31 July 2023**
## **3. INCOME RECOGNITION**
## **STATEMENT OF PRINCIPAL ACCOUNTING POLICIES**
Income from the sale of goods or services is credited to the Consolidated and University Statement of Comprehensive Income and Expenditure when the goods or services are supplied to the external customers or the terms of the contract have been satisfied.
## **1. BASIS OF PREPARATION**
These financial statements have been prepared in accordance with the Statement of Recommended Practice (SORP): Accounting for Further and Higher Education 2019; Accounts Direction issued by HEFCW; and Financial Reporting Standards (FRS102).
The University is a public benefit entity and therefore has applied the relevant public benefit requirement of FRS102. The financial statements are prepared in accordance with the historical cost convention with the exception of investment properties and the defined benefit pension liabilities which are held at fair value.
The University has presented the Cash Flow Statement of the group only as permitted by the disclosure exemption available in FRS102.
The financial statements have been prepared on a going concern basis.
## **Going Concern**
The Consolidated Aberystwyth University Group made a surplus of £3.8 million (2021-22 loss of £28.0 million) which has resulted in a net cash inflow of £0.10 million (2021-22 £0.82 million inflow). Additionally, the Group has net current liabilities of £8.4 million (Net current liability 2021-22 £6.1 million) and net assets of £98.1 million (2021-22 £89.0 million), of which £64.1 million (2021-22 £58.1 million) is represented by unrestricted reserves. Included within net current assets are cash and cash equivalents of £8.2 million (2021-22 £8.1 million) which may be used by the Group to settle its ongoing liabilities and support the Group’s Capital Programme.
Financial forecasts, including cash flow projections and sensitivity analysis, have been prepared for the Group covering the going concern assessment period, being 12 months from the date of approval of these financial statements. These forecasts indicated that after the application of considered stress testing and sensitivity analysis, relating to tuition fees and research income as well as inflation and interest rate increases, the Group will remain able to meet its cash obligations and maintain lender covenant compliance during the going concern assessment period.
The Group retains the capacity to defer uncommitted capital investment plans in order to maintain sufficient cash balances and reserves to meet liabilities as they fall due. To support cash flow, Aberystwyth University renewed a £15 million revolving credit facility on 18 January 2024. The facility runs up until 18 January 2027 with an option to renew for a further 12 months. As part of the renewal, the University has agreed updated covenants and is forecasting to achieve the revised covenant obligations throughout the going concern period, even when considering the stress testing and sensitivity.
## **2. BASIS OF CONSOLIDATION**
The consolidated financial statements include the University, Aberystwyth Innovation and Enterprise Campus (AIEC) (subsidiary), Aber Trading Ltd (subsidiary) and Aber Business Consultancy Ltd (subsidiary) for the financial year to 31 July 2023. The results of the subsidiary during the period are included in the consolidated statement of income and expenditure. Intra-group transactions are eliminated on consolidation.
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. Associated companies and joint ventures are accounted for using the equity method.
Fee income is stated gross of any expenditure which is not a discount and credited to the Consolidated and University Statement of Income and Comprehensive Expenditure over the period in which students are studying. Where the amount of the tuition fee is reduced, by a discount for prompt payment or guaranteed discount for all students, income receivable is shown net of the discount. Non general bursaries and scholarships are accounted for gross as expenditure and not deducted from income.
Funds the University receives and disburses as paying agent on behalf of a funding body are excluded from the income and expenditure of the University where the University is exposed to minimal risk or enjoys minimal economic benefit related to the transaction.
## **Grant funding**
Government revenue grants, including funding council block grant and research grants, are recognised in income over the periods in which the University recognises the related costs for which the grant is intended to compensate. Where part of a government grant is deferred, it is recognised as deferred income within creditors and allocated between creditors due within one year, and due after more than one year as appropriate.
Grants (including research grants) from non-government sources are recognised in income when the University is entitled to the income, and performance related conditions have been met. Income received in advance of performance related conditions being met is recognised as deferred income within creditors on the balance sheet and released to income as the conditions are met.
## **Capital grants**
Government capital grants are recognised in income over the expected useful life of the asset. Other capital grants are recognised in income when the University is entitled to the funds subject to any performance related conditions being met.
## **Donations and endowments**
Donations and endowments with donor-imposed restrictions are recognised in income when the University is entitled to the funds. Restricted endowment income is retained within the endowment 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. Unrestricted endowment income is recognised in the period it is received.
Restricted donations are retained within restricted reserves until such time that it is utilised in line with such restrictions at which point the income is released to general reserves through a reserve transfer. Donations with no restrictions are recognised in income when 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. The classification depends on the term and restrictions applied to the individual endowment fund.
There are four main types of donations and endowments identified within reserves:
1. Restricted donations - the donor has specified that the donation must be used for a particular objective.
2. Unrestricted permanent endowments - the donor has specified that the fund is to be permanently invested to generate an income stream for the general benefit of the University.
3. 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.
4. Restricted permanent endowments - the donor has specified that the fund is to be permanently invested to generate an income stream to be applied to a particular objective.
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## **4. ACCOUNTING FOR RETIREMENT BENEFITS**
The four principal pension schemes for the University are:
- the Universities Superannuation Scheme (USS), this is a Multi-employer Defined Benefit scheme;
- the Aberystwyth University Pension Provision (AUPP), this is a Defined Contribution Plan;
- the Aberystwyth University Pension and Assurance Scheme (AUPAS), this is a Defined Benefit Scheme closed to future employee contributions; and
- the Dyfed Pension Fund (DPF), this is a Defined Benefit scheme closed to new entrants.
## **6. FINANCE LEASES**
Leases in which the University assumes substantially all the risks and rewards of ownership of the leased asset are classified as finance leases. Leased assets acquired by way of finance lease and the corresponding lease liabilities are initially recognised at an amount equal to the lower of their fair value and the present value of the minimum lease payments at inception of the lease.
Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability.
The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
## **Multi-employer Defined Benefit scheme**
Multi-employer Defined Benefit schemes are valued every three years by professionally qualified independent actuaries. Where the University is not able to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis due to the mutual nature of the scheme, the scheme is accounted for as a defined contribution retirement benefit scheme. A liability is recorded within provisions for any contractual commitment to fund any past deficits within the scheme.
## **Defined Contribution Plan**
The University pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an expense in the income statement in the periods during which services are rendered by employees.
## **Defined Benefit Scheme**
Under defined benefit schemes the University’s obligation is to provide the agreed benefits to current and former employees. The University bears the actuarial risk (that benefits will cost more or less than expected) and the investment risk (that returns on assets set aside to fund the benefits will differ from expectations).
The University recognises a liability for its obligations under defined benefit plans net of plan assets. This net defined benefit liability is measured as the estimated amount of benefit that employees have earned in return for their service in the current and prior periods, discounted to determine its present value, less the fair value (at bid price) of plan assets. The calculation is performed by a qualified actuary using the projected unit credit method. Where the calculation results in a net asset, recognition of the asset is limited to the extent to which the University is able to recover the surplus either through reduced contributions in the future or through refunds from the plan. Defined benefit schemes are valued every three years by professionally qualified independent actuaries.
## **7. OPERATING LEASES**
Costs in respect of operating leases are charged on a straight-line basis over the lease term. Any lease premiums or incentives are spread over the minimum lease term.
Income received in respect of awarding operating leases is charged on a straight-line basis over the lease term. Any lease premiums or incentives are spread over the minimum lease term.
## **8. FOREIGN CURRENCY**
The functional currency of the Aberystwyth University Group is GBP (Sterling).
Transactions in foreign currencies are translated to Sterling at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated to the functional currency at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation to the functional currency are recognised in Consolidated Statement of Comprehensive Income.
The assets and liabilities of foreign operations are translated to Sterling at foreign exchange rates ruling at the balance sheet date. The revenues and expenses of foreign operations are translated at an average rate for the year where this rate approximates to the foreign exchange rates ruling at the dates of the transactions. Exchange differences arising from this translation of foreign operations are reported as an item of interest and other finance costs.
## **9. FIXED ASSETS**
## **5. EMPLOYMENT BENEFITS**
Short-term employment benefits, such as salaries and compensated absences, are recognised as an expense in the year in which the employees render service to the University. Any unused benefits are accrued and the value of the liability is recognised as the additional amount the University expects to pay as a result of the unused entitlement.
Fixed assets are capitalised at deemed cost on initial recognition. After initial recognition fixed assets are subsequently measured at deemed cost less accumulated depreciation and accumulated impairment losses. Certain items of fixed assets that had been revalued to fair value on or prior to the date of transition to the 2015 Higher Education SORP are measured on the basis of deemed cost, being the revalued amount at the date of that revaluation.
Where parts of a fixed asset have different useful lives, they are accounted for as separate items of fixed assets. Depreciation methods, useful lives and residual values are reviewed at the date of preparation of each Balance Sheet.
A review for potential indicators of impairment is carried out at each reporting date. If events or changes in circumstances indicate that the carrying amount of the property, plant and equipment may not be recoverable, a calculation of the impact is completed and arising impairment values charged against the asset and to the Consolidated & University Statement of Comprehensive Income.
## **Land and buildings**
The University’s freehold property excluding Residences and other trading related buildings, were revalued on a depreciated replacement value basis as at 31 July 2014. These assets are carried at the 2014 valuation. Subsequent additions are held at cost.
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Freehold buildings are depreciated on a straight-line basis over their expected useful lives according to their constituent parts as follows:
Long term e.g. foundations & structure 40 to 60 years Medium Term e.g. services 10 to 30 years Short Term e.g. internal fittings 5 to 10 years
Costs incurred in relation to land and buildings after initial purchase or construction are capitalised to the extent that they increase the expected future benefits to the University. No depreciation is charged on assets in the course of construction.
Freehold land is not depreciated as it is considered to have an indefinite useful life. Leasehold land is depreciated over the life of the lease.
## **Plant and Machinery**
Equipment costing less than £10,000 per individual item is written off in the year of acquisition. Other equipment is capitalised.
Capitalised equipment is stated at cost and depreciated on a straight-line basis over its expected useful life of five years, other than equipment acquired for specific research projects which is depreciated over the life of the project (generally three years).
## **Heritage assets**
Heritage assets are paintings, works of art and ceramics held by the University. They are held and maintained principally for their contribution to knowledge and culture. Those items valued at over £10,000 have been capitalised and recognised at the cost or value of acquisition, where such a cost or valuation is reasonably obtainable. Heritage assets are not depreciated since their long economic life and high residual value mean that any depreciation would not be material.
Any costs incurred relating to the restoration or conservation of these assets is included in the Consolidated Statement of Comprehensive Income in the year in which it is incurred.
## **10. INVESTMENT PROPERTIES**
Investment property is land and buildings held for rental income or capital appreciation rather than for use in delivering services.
Investment properties are measured initially at cost and subsequently at fair value and to be considered annually with movements recognised in the Consolidated Statement of Comprehensive Income.
## **11. OTHER INVESTMENTS**
Listed investments are valued at fair market value with gains and losses recognised in the Statement of Comprehensive Income.
Non current asset investments are held on the Balance Sheet at amortised cost less impairment.
Investments in jointly controlled entities, associates and subsidiaries are carried at cost less impairment in the University’s accounts.
Current asset investments are held at fair value with movements recognised in the Consolidated Statement of Comprehensive Income.
## **12. STOCK**
Stock is held at the lower of cost and net realisable value.
## **13. CASH AND CASH EQUIVALENTS**
Cash includes cash in hand, deposits repayable on demand and overdrafts. Deposits are repayable on demand if they are in practice available within 24 hours without penalty.
Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash with insignificant risk of change in value.
## **14. PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS**
Provisions are recognised in the financial statements when:
- (i) the University has a present obligation (legal or constructive) as a result of a past event;
- (ii) it is probable that an outflow of economic benefits will be required to settle the obligation; and
- (iii) a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is determined by discounting the expected future cash flows at a pre-tax rate that reflects risks specific to the liability.
A contingent liability arises from a past event that gives the University a probable obligation whose existence will only be confirmed by the occurrence or otherwise of uncertain future events not wholly within the control of the University. Contingent liabilities also arise in circumstances where a provision would otherwise be made but either it is not probable that an outflow of resources will be required or the amount of the obligation cannot be measured reliably.
A contingent asset arises where an event has taken place that gives the University a possible asset whose existence will only be confirmed by the occurrence or otherwise of uncertain future events not wholly within the control of the University.
Contingent assets and liabilities are not recognised in the Balance Sheet but are disclosed in the notes.
## **15. TAXATION**
The University is an exempt charity within the meaning of Part 3 of the Charities Act 2011. It is therefore a charity within the meaning of Para 1 of schedule 6 to the Finance Act 2010 and accordingly, the University is potentially exempt from taxation in respect of income or capital gains received within categories covered by section 478-488 of the Corporation Tax Act 2010 (CTA 2010) or section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied to exclusively charitable purposes.
The University’s subsidiaries are liable to Corporation Tax in the same way as any other commercial organisation.
Deferred tax would be provided in full on timing differences which result in an obligation at the balance sheet date to pay more tax, or a right to pay less tax, at a future date.
The University’s principal activities are exempt from Value Added Tax (VAT) but certain ancillary supplies and services are liable to VAT at various rates. Expenditure includes irrecoverable VAT charged by suppliers to the University.
## **16. RESERVES**
Reserves are classified as restricted or unrestricted. Restricted endowment reserves include balances which, through endowment to the University, are held as a permanently restricted fund which the University must hold in perpetuity.
Other restricted reserves include balances for which the donor has designated a specific purpose and therefore the University is restricted in the use of these funds.
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## **17. BASIC FINANCIAL INSTRUMENTS**
## **Trade and other debtors / creditors**
Debtors and creditors with no stated interest rate and receivable or payable within one year are recorded at transaction price. Any losses arising from impairment are recognised in the statement of comprehensive income in other operating expenses.
## **Long-term financial liabilities**
Long-term financial liabilities are classified according to the substance of the financial instrument’s contractual obligations, rather than the financial instrument’s legal form. All loans held by the Group are classified as basic financial instruments in accordance with FRS 102 and are held at amortised cost. Loans and investments that are payable or receivable within one year are not discounted.
The University’s student accommodation Fferm Penglais was acquired using finance from Legal & General (L&G) and Balfour Beatty. The building has been recognised at cost. The finance provided by L&G and Balfour Beatty has been recognised under long-term creditors based on the implicit interest rate of the arrangements.
## **18. CRITICAL ESTIMATES AND JUDGEMENTS**
The preparation of the Institution’s financial statements requires management to make judgements, estimates, and assumptions that affect the application of accounting policies and reported amounts of assets and liabilities, income, and expenses. These judgements, estimates, and associated assumptions are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The resulting accounting estimates will, by definition, seldom equal the related actual results.
- (i) Retirement benefit obligations
## **Estimate – AUPAS**
The University operates its own scheme, Aberystwyth University Pension Scheme (AUPAS), a defined benefit scheme. Actuarial valuation of the scheme is carried out as determined by the trustees at intervals of not more than three years. Pension costs under FRS 102 are assessed in accordance with the advice of independent actuaries based upon latest actuarial valuations and assumptions determined by the actuaries. The assumptions are based upon information supplied to the actuaries by the University, supplemented by discussions between the actuary and management, where relevant. The assumptions are documented in Note 29.
## **Estimate - USS**
As the University is contractually bound to make deficit recovery payments to USS, this is recognised as a liability in the balance sheet. The provision is currently based on USS deficit recovery plan agreed after the 2020 actuarial valuation, which defines the deficit payment required as a percentage of future salaries. These contributions are re-assessed within each triennial valuation of the scheme. The provision is based on management’s estimate of future salaries inflations, changes in staff numbers and the prevailing rate of discount. Further details are set out in Note 29.
## **Judgement – USS**
FRS 102 makes the distinction between a group plan and a multi-employer scheme. A group plan consists of a collection of entities under common control typically with a sponsoring employer. A multi-employer scheme is a scheme for entities not under common control and represents (typically) an industry-wide scheme such as Universities Superannuation Scheme.
The accounting for a multi-employer scheme, where the employer has entered into an agreement with the scheme that determines how the employer will fund a deficit, results in the recognition of a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) and the resulting expense in profit or loss in accordance with section 28 of FRS 102. The directors are satisfied that Universities Superannuation Scheme meets the definition of a multi-employer scheme and the institution has therefore recognised the discounted fair value of the contractual contributions under the recovery plan in existence at the date of approving these financial statements.
## **CONSOLIDATED & UNIVERSITY STATEMENT OF COMPREHENSIVE INCOME for the year ended 31 July 2023**
**----- Start of picture text -----**
2023 2022
Notes Consolidated University Consolidated University
£’000 £’000 £’000 £’000
INCOME
Tuition fees and education contracts 1 57,095 57,095 54,236 54,236
Funding body grants 2 18,571 18,571 19,106 19,106
Research grants and contracts 3 22,230 22,230 17,449 17,449
Other income 4 30,101 28,120 31,315 27,642
Investment income 5 730 730 337 337
Donations and endowments 6 4,044 4,044 1,080 1,080
Total income 132,771 130,790 123,523 119,850
EXPENDITURE
Staff costs 7 73,034 72,470 70,448 69,913
Staff costs - increase/(decrease) in USS pension 7 (4,249) (4,249) 27,752 27,752
Fundamental restructuring costs 7 395 395 133 133
Other operating expenses 9 40,617 40,727 34,791 33,299
Depreciation 10/11 14,250 12,631 13,389 11,795
Interest and other finance costs 8/9 5,819 5,819 4,212 4,212
Total expenditure 129,866 127,793 150,725 147,104
Surplus/(deficit) before other gains/losses and share of
2,905 2,997 (27,202) (27,254)
operating surplus/defcit of joint ventures and associates
Gain/(loss) on disposal of fixed assets 77 77 110 110
Gain on revaluation 12 1,866 1,866 - -
(Loss) / gain on investments (1,036) (1,036) (919) (919)
Surplus / (deficit) before tax 3,812 3,904 (28,011) (28,063)
Taxation 11 - (11) -
Surplus / (deficit) after tax 3,823 3,904 (28,022) (28,063)
Other comprehensive income
Actuarial (loss)/gain in respect of pension schemes 29 5,289 5,289 17,059 17,059
Total comprehensive income/(loss) for the year 9,112 9,193 (10,963) (11,004)
Represented by:
Endowment comprehensive income for the year 21 3,269 3,269 (675) (675)
Restricted comprehensive income / (expenditure) for the year 22 (10) (10) 432 432
Unrestricted comprehensive income for the year 5,853 5,934 (10,720) (10,761)
9,112 9,193 (10,963) (11,004)
Total comprehensive income for the year attributable to
Non-controlling interest (16) - (13) -
University 9,128 9,193 (10,950) (11,004)
9,112 9,193 (10,963) (11,004)
Surplus / (deficit) after tax attributable to
Non-controlling interest (16) (13)
University 3,839 3,904 (28,009) (28,063)
3,823 3,904 (28,022) (28,063)
**----- End of picture text -----**
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**CONSOLIDATED AND UNIVERSITY BALANCE SHEET as at 31 July 2023**
## **CONSOLIDATED AND UNIVERSITY STATEMENT OF CHANGES IN RESERVES**
**year ended 31 July 2023**
|**CONSOLIDATED AND UNIVERSITY BALANCE SHEET**
**as at 31 July 2023**|**CONSOLIDATED AND UNIVERSITY BALANCE SHEET**
**as at 31 July 2023**|**CONSOLIDATED AND UNIVERSITY BALANCE SHEET**
**as at 31 July 2023**|**CONSOLIDATED AND UNIVERSITY BALANCE SHEET**
**as at 31 July 2023**|**CONSOLIDATED AND UNIVERSITY BALANCE SHEET**
**as at 31 July 2023**|**CONSOLIDATED AND UNIVERSITY BALANCE SHEET**
**as at 31 July 2023**|**CONSOLIDATED AND UNIVERSITY STATEMENT OF CHANGES IN RESERVES**
**year ended 31 July 2023**|**CONSOLIDATED AND UNIVERSITY STATEMENT OF CHANGES IN RESERVES**
**year ended 31 July 2023**|
|---|---|---|---|---|---|---|---|
|**2023**
**2022**
Notes
Consolidated
University
Consolidated
University
£’000
£’000
£’000
£’000
**NON CURRENT ASSETS**
Fixed assets
10
250,279
223,722
250,176
222,339
~~ee~~
~~SS~~||||||**CONSOLIDATED**
Income and expenditure account
Total including
non-controlling
interest
Non-controlling
interest
Total
Endowment
£’000
Restricted
£’000
Unrestricted
£’000
£’000
£’000
£’000
**Balance at 1 August 2022**
30,271
580
58,136
88,987
(13)
88,974
Opening adjustment
-
-
-
-
12
12
~~Pe~~
~~I~~||
||Heritage assets
Investment properties
Investments|11
1,898
1,898
12
6,941
6,941
14
31,952
31,952|1,898
5,155
31,971|1,898
5,155
31,971||Surplus/(deficit) from the statement of
comprehensive income
**Total comprehensive income for the year**|3,269
(10)
5,869
9,128
(16)
9,112
3,269
(10)
5,869
9,128
(16)
9,112|
|291,070
264,513
289,200
261,363
**CURRENT ASSETS**
Stock
15
2,392
2,392
2,189
2,189
~~ST~~||||||**Balance at 31 July 2023**|33,540
570
64,005
98,115
(17)
98,098
~~Bn~~|
||Trade and other receivables
Investments
Cash and cash equivalents|16
23,550
23,872
17
1,396
1,396
23
8,208
8,121
35,546
35,781|19,803
2,389
8,111
32,492|19,409
2,389
7,853
31,840||**UNIVERSITY**
Income and expenditure account
Total including
non-controlling
interest
Non-controlling
interest
Total
Endowment
£’000
Restricted
£’000
Unrestricted
£’000
£’000
£’000
£’000
~~Pe~~||
||Less: Creditors: amounts falling due within one year
Net current (liabilities)/assets
**Total assets less current liabilities**|18
43,965
42,492
(8,419)
(6,711)
282,651
257,802|38,577
(6,085)
283,115|37,901
(6,061)
255,302||**Balance at 1 August 2022**
Surplus/(deficit) from the income and
expenditure statement
**Total comprehensive income for the year**|30,271
580
58,144
88,995
-
88,995
3,269
(10)
5,934
9,193
-
9,193
3,269
(10)
5,934
9,193
-
9,193|
||Creditors: amounts falling due after more than one year|19
133,719
108,780|131,596|103,760||||
|**PROVISIONS**
Pension provisions
~~SS~~||20
49,945
49,945|61,657|61,657||**Balance at 31 July 2023**|33,540
570
64,078
98,188
-
98,188
~~ae~~|
||Other provisions|20
889
889|889|889||||
|Total net assets
98,098
98,188
88,973
88,995
**RESTRICTED RESERVES**
Income and expenditure reserve - endowment reserve
21
33,540
33,540
30,271
30,271
~~ST~~||||||||
||Income and expenditure reserve - restricted reserve|22
570
570|580|580||||
||**UNRESTRICTED RESERVES**|||||||
||Income and expenditure reserve - unrestricted|64,005
64,078|58,135|58,144||||
||Non-controlling interest|(17)
-|(13)|-||||
||**Total Reserves**|**98,098**
**98,188**|**88,973**|**88,995**||||
The financial statements were approved by the University Council on 19 January 2024 and were signed on its behalf by:
Meri Huws, Chair of Council
Professor Jon Timmis, Vice-Chancellor
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## **CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 July 2023**
**----- Start of picture text -----**
Notes 2023 2022
£’000 £’000
Cash flow from operating activities
Surplus for the year 3,823 (28,022)
Adjustment for non-cash items
Depreciation 9 14,250 13,390
Impairment of fixed assets 12 80 -
Loss/(gain) on endowment investments 21 1,036 496
Gain on other investments - 423
Gain on revaluation (1,866) -
(Increase) / decrease in stock 15 (203) (505)
(Increase) / decrease in debtors 16 (3,747) (6,416)
Increase / (decrease) in creditors 18/19 (3,835) 3,631
Pension interest cost 8/29 2,018 845
Contribution to pension greater than current service charge 29 (4,193) (2,284)
Change in USS deficit reduction plan assumptions 7/29 (4,249) 27,752
(Decrease) / increase in other provisions 20 - (924)
NCI in subsidaries 31 16 -
Adjustment for investing or financing activities
Investment income 5 (730) (337)
Other interest payable 8 3,801 3,397
Endowment income 6/21 (3,663) (504)
Profit on the sale of fixed assets (77) (110)
Capital grant income (6,460) (5,852)
Net cash inflow from operating activities (3,999) 4,980
Cash flows from investing activities
Proceeds from sales of fixed assets 77 178
Capital grants receipts 10,858 2,529
Investment income 730 337
Payments made to acquire fixed assets (14,354) (11,423)
New non-current asset investments (24) 4,981
(2,713) (3,398)
Cash flows from financing activities
Interest paid (3,801) (3,399)
Endowment cash received 3,663 504
Unsecured loans 6,947 2,134
6,809 (761)
Increase/(Decrease) in cash and cash equivalents in the year 97 821
Cash and cash equivalents at beginning of the year 23 8,111 7,290
Cash and cash equivalents at end of the year 23 8,208 8,111
**----- End of picture text -----**
## **NOTES TO THE FINANCIAL STATEMENTS for the year ended 31 July 2023**
**----- Start of picture text -----**
2023 2022
Notes Consolidated University Consolidated University
£’000 £’000 £’000 £’000
1 TUITION FEES AND EDUCATION CONTRACTS
Full-time home and EU students 45,395 45,395 44,027 44,027
Full-time international students 10,436 10,436 9,108 9,108
Part-time students 906 906 930 930
Short course and other fees 358 358 171 171
57,095 57,095 54,236 54,236
2 FUNDING BODY GRANTS
Recurrent grant
Higher Education Funding Council 14,830 14,830 15,843 15,843
Release of HEFCW deferred capital grant 1,179 1,179 1,078 1,078
Specific grants
Welsh Government Department for Education and Skills 2,562 2,562 2,185 2,185
18,571 18,571 19,106 19,106
3 RESEARCH GRANTS AND CONTRACTS
Research councils 8,041 8,041 5,483 5,483
Research charities 955 955 1,159 1,159
Government (UK and overseas) 11,564 11,564 9,356 9,356
Industry and commerce 1,476 1,476 1,281 1,281
Other 194 194 170 170
22,230 22,230 17,449 17,449
4 OTHER INCOME
Residences, catering and conferences 11,771 11,771 11,037 11,037
Other revenue grants 1,393 456 2,334 348
Other services rendered 2,197 2,197 2,925 2,925
Arts Centre 3,209 3,209 3,038 3,038
Farms 2,258 2,258 1,783 1,783
Released from deferred capital grants 3,876 2,257 3,669 2,080
Other income 5,397 5,972 6,529 6,431
30,101 28,120 31,315 27,642
5 INVESTMENT INCOME
Investment income on endowments 43 43 13 13
Investment income on restricted reserves 482 482 187 187
Other investment income 205 205 137 137
730 730 337 337
**----- End of picture text -----**
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**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
**----- Start of picture text -----**
2023 2022
Notes Consolidated University Consolidated University
£’000 £’000 £’000 £’000
6 DONATIONS AND ENDOWMENTS
New endowments 21 3,663 3,663 504 504
Donations with restrictions 22 355 355 482 482
Unrestricted donations 26 26 94 94
4,044 4,044 1,080 1,080
7 STAFF COSTS
Salaries 59,403 58,969 56,469 56,054
Social security costs 5,392 5,349 5,046 5,009
USS pension costs 6,886 6,886 7,769 7,686
Other pension costs 1,353 1,266 1,164 1,164
73,034 72,470 70,448 69,913
Staff costs - Increase / (decrease) in USS pension (4,249) (4,249) 27,752 27,752
68,785 68,221 98,200 97,665
Staff costs - restructuring 395 395 133 133
Emoluments of the Vice-Chancellor
Salary 245 236
Taxable benefits in kind 22 22
267 258
Pension contributions to USS 15 13
282 271
**----- End of picture text -----**
The amount shown as “Taxable benefits in kind” in the table above relates to the accommodation provided by Aberystwyth University at Plas Penglais. The accommodation provision itself has not changed.
On 21st September 2018, the Council approved a Senior Remuneration Framework for the University, which sets out the institution’s approach to the remuneration of senior post holders, including the Vice-Chancellor. A copy can be accessed at: https://www.aber.ac.uk/en/corporate-information/remuneration/
The Remuneration Committee has been delegated the authority by Council to agree matters relating to the Vice-Chancellor’s remuneration. There is no bonus scheme in place and no other benefit is provided other than accommodation and being a member of the USS pension scheme as shown in the table above.
The University recognises that it operates in a competitive environment and wishes to attract and retain the best staff possible. The salary also needs to reflect the complexity of running an organisation such as Aberystwyth University. We have a strong reputation for teaching, learning and research and it is incumbent that any Vice-Chancellor builds upon these existing strengths. However, in taking any decisions relating to the remuneration of senior staff, the Remuneration Committee is required to be mindful of the affordability of those decisions and refer to benchmarking data for comparable universities.
For the Vice-Chancellor’s remuneration, benchmarking data is drawn from the annual Universities and Colleges Employer Association (UCEA) Senior Staff Remuneration Survey, and the annual Committee of University Chairs (CUC) Vice-Chancellor Salary Survey. The salary paid is considered to be in line with similar roles within other institutes of similar size and stature.
All senior post holders at the University - including the Vice-Chancellor - automatically receive any “cost of living” pay awards provided by the University to employees on the nationally agreed single pay spine.
## **7 STAFF COSTS (continued)**
The Vice-Chancellor is also required to participate in the institution’s Effective Contribution Scheme appraisal process, where specific objectives are set on an annual basis and reviewed on an ongoing basis. This annual appraisal is conducted by the Chair of Council and the process takes account of how the institution as a whole is performing against the Key Performance Indicators (KPIs) that have been agreed by Council to monitor targets set against the delivery of the institutional Strategic Plan. The Strategic Plan can be read in full here - https://www.aber.ac.uk/en/about-us/strategicplan/ and the achievements of the Vice-Chancellor and wider University can be read in the Strategic Review (pages 16 through 33). The outcome of this appraisal is subsequently presented to the Remuneration Committee and forms the basis of any recommendations to the Remuneration Committee with respect to any changes to the Vice-Chancellor’s remuneration.
The Vice-Chancellor’s basic salary, expressed as a multiple of all other employees, is 6.75 times (2021-22 6.87 times) the median pay of staff, where the median pay is calculated on a full-time basis for the salaries paid by the University to its staff.
The Vice-Chancellor’s total salary, expressed as a multiple of all other employees, is 7.77 times (2021-22 7.90 times) the median pay of staff, where the median pay is calculated on a full-time basis for the salaries paid by the University to its staff.
The emoluments of the Vice-Chancellor and Acting Vice-Chancellor are shown on the same basis as for higher paid staff. The University’s contributions to USS are paid at the same rate as for other academic staff.
Remuneration of other higher paid staff, excluding employer’s NI and pension contributions (subject to relevant accounts direction), is shown below. All remuneration shown before any salary sacrifice:
**----- Start of picture text -----**
Number of Staff 2023 Number of Staff 2022
£100,001 to £105,000 1 6
£105,001 to £110,000 5 1
£110,001 to £115,000 1 1
£115,001 to £120,000 2 -
£120,001 to £125,000 - 2
£125,001 to £130,000 1 -
£130,001 to £135,000 - -
£135,001 to £140,000 1 -
£140,001 to £145,001 - 1
11 11
Total Cost of Higher Paid Staff (shown above) 1,250 1,221
**----- End of picture text -----**
The above costs exclude Vice-Chancellor and employer’s pensions costs. However, the allowance paid for Acting Vice-Chancellor duties is included for a period of the Vice-Chancellor’s absence. The total amount paid for Acting Vice-Chancellor duties was £20,000 for 2022-2023.
|**AVERAGE STAFF NUMBERS BY MAJOR CATEGORY**
2023|2022|
|---|---|
|Academic
412|
399|
|Research
127|
125|
|Management & specialist
368|
354|
|Technical
127|
132|
|Other
403|
416|
|1,437|
1,426|
## **KEY MANAGEMENT PERSONNEL**
Key management personnel relates to those members of the executive board of the University which is made up of nine members.
||2023|2022|
|---|---|---|
||£’000|£’000|
|Key management personnel compensation|1,363|1,330|
The above costs include Vice-Chancellor and employer’s pensions costs.
76
77
**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **7 STAFF COSTS (continued)**
## **Council Members**
No member of Council has received any remuneration or waived payment from the University for acting as a member of Council during the year (2021-22 £Nil). Members of University staff appointed to the Council do not receive any additional remuneration in respect of their membership of Council.
No member of Council has received payment for other services provided to the University, other than under a contract of employment for members of Council who are also University employees, during the year (2021-22 £Nil).
The total expenses paid to or on behalf of eight Council members was £12,000 (2021-22 £2,858 to nine Council members). This represents travel and subsistence expenses incurred in attending Council and other meetings in their official capacity.
**----- Start of picture text -----**
2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
8 INTEREST AND OTHER FINANCE COSTS
Interest cost re USS pension liability 1,465 1,465 276 276
Interest on Penglais Farm student accommodation 3,469 3,469 3,274 3,274
Other 332 332 93 93
Net charge on pension scheme 553 553 569 569
5,819 5,819 4,212 4,212
**----- End of picture text -----**
## **9 UNIVERSITY ANALYSIS OF TOTAL EXPENDITURE BY ACTIVITY**
|Staf costs
Other||
|---|---|
|Operational
staf costs
Restructuring
costs
Depreciation
Other
operating
expenses
Interest
Payable
Total
2023|
Total
2022|
|£’000
£’000
£’000
£’000
£’000
£’000|£’000|
|Academic departments
30,691
-
1,198
2,848
-
34,737|31,936|
|Academic services
6,504
-
67
2,512
2,350
11,433|9,994|
|Researchgrants & contracts
12,976
-
1,316
7,829
-
22,121|17,387|
|Residences, catering & conference
5,180
-
1,404
6,137
-
12,721|11,736|
|Premises
1,444
-
7,938
6,775
3,469
19,626|17,893|
|General education expenditure
5,328
-
59
3,931
-
9,318|8,016|
|Central administration & services
(1,296)
395
320
5,453
-
4,872|38,634|
|Student & staf facilities & amenities
2,811
-
36
564
-
3,411|3,345|
|Other services rendered
1,731
-
11
676
-
2,418|2,605|
|Arts Centre
2,125
-
136
1,677
-
3,938|3,336|
|Farms
727
-
146
2,086
-
2,959|2,059|
|Auditor's remuneration
-
-
-
239
-
239|129|
|Other expenses
-
-
-
-
-
-|34|
|68,221
395
12,631
40,727
5,819
127,793|147,104|
|**9 CONSOLIDATED ANALYSIS OF TOTAL EXPENDITURE BY ACTIVITY (continued)**|
|---|
|Staf costs
Other|
|Operational
staf costs
Restructuring
costs
Depreciation
Other
operating
expenses
Interest
Payable
Total
2023
Total
2022
£’000
£’000
£’000
£’000
£’000
£’000
£’000|
|Academic departments
30,691
-
1,198
2,848
-
34,737
31,936|
|Academic services
6,504
-
67
2,512
2,350
11,433
9,994|
|Researchgrants & contracts
12,976
-
1,316
7,829
-
22,121
17,387|
|Residences, catering & conference
5,180
-
1,404
6,137
-
12,721
11,735|
|Premises
1,444
-
7,938
6,775
3,469
19,626
17,893|
|General education expenditure
5,328
-
59
3,931
-
9,318
8,016|
|Central administration & services
(732)
395
1,939
5,315
-
6,917
42,236|
|Student & staf facilities & amenities
2,811
-
36
564
-
3,411
3,345|
|Other services rendered
1,731
-
11
676
-
2,418
2,605|
|Arts Centre
2,125
-
136
1,677
-
3,938
3,337|
|Farms
727
-
146
2,086
-
2,959
2,059|
|Auditor's remuneration
-
-
-
267
-
267
148|
|Other Expenses
-
-
-
-
-
-
34|
|68,785
395
14,250
40,617
5,819
129,866
150,725|
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AUDITOR’S REMUNERATION INCLUDES 2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
External auditor’s remuneration in respect of audit services 150 122 98 79
External auditor’s remuneration in respect of non-audit services:
All other assurance services 108 108 23 23
All other non-audit services 9 9 27 27
**----- End of picture text -----**
## **Voluntary Severance**
The obligation to fund voluntary severance included in restructuring costs relates to arrangements that have been agreed and costs are expected to be incurred within one year.
78
79
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **10 FIXED ASSETS**
**----- Start of picture text -----**
Freehold Land Leasehold Land Plant and Assets in Total
and Buildings and Buildings Machinery the course of
construction
£’000 £’000 £’000 £’000 £’000
CONSOLIDATED COST AND VALUATION
At 1st August 2022 275,330 53,156 58,179 12,645 399,310
Additions 1,348 - 3,673 9,327 14,348
Transfers 3,337 - 320 (3,657) -
Disposals/derecognition - - (398) - (398)
At 31st July 2023 280,015 53,156 61,774 18,315 413,260
CONSOLIDATED DEPRECIATION
At 1st August 2022 91,967 10,043 47,125 - 149,135
Charge for the year 8,150 1,347 4,753 - 14,250
Disposals/derecognition (6) - (398) - (404)
At 31st July 2023 100,111 11,390 51,480 162,981
Net book value
At 31 July 2023 179,904 41,766 10,294 18,315 250,279
At 31 July 2022 183,363 43,113 11,054 12,645 250,175
UNIVERSITY COST AND VALUATION
At 1st August 2022 248,456 53,156 54,573 12,639 368,824
Additions 1,349 - 3,332 9,327 14,008
Transfers 3,337 - 320 (3,657)
Disposals/derecognition - - (398) - (398)
At 31st July 2023 253,142 53,156 57,827 18,309 382,434
UNIVERSITY DEPRECIATION
At 1st August 2022 90,213 10,043 46,229 - 146,485
Charge for the year 7,277 1,347 4,007 - 12,631
Disposals (6) (398) - (404)
At 31st July 2023 97,484 11,390 49,838 - 158,712
Net Book Value
At 31 July 2023 155,658 41,766 7,989 18,309 223,722
At 31 July 2022 158,243 43,113 8,344 12,639 222,339
**----- End of picture text -----**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **11 FIXED ASSETS - HERITAGE ASSETS**
**----- Start of picture text -----**
University and Consolidated
2020/21 2021/22 2022/23
£'000 £'000 £'000
Opening balance 1,347 1,898 1,898
Additions 724 - -
Total acquisitions capitalised 2,071 1,898 1,898
Impairment (173) - -
Closing balance 1,898 1,898 1,898
**----- End of picture text -----**
A valuation of heritage assets with a value greater than £10,000 was completed by Webb Valuations Fine Art Ltd in March 2023. There were no impairments identified to any heritage assets in the year.
## **12 FIXED ASSETS - INVESTMENT PROPERTIES**
**----- Start of picture text -----**
University and Consolidated
Freehold investment Land and Buildings Total
Valuation £’000 £’000
At 1st August 2022 5,155 5,155
Revaluation 1,866 1,866
Impairment (80) (80)
At 31st July 2023 6,941 6,941
**----- End of picture text -----**
A full valuation of these assets at 31 July 2023 was completed by Cooke & Arkwright. A gain of £1,866,000 was recorded in the Consolidated Statement of Comprehensive Income for the year (2022-21 NIL).
Impairment took place of an asset due to a building being demolished in the year with a total value of £80,000. No other impairments took place during this Financial Year.
Included within freehold land and buildings is £3,296,000 (2021-22 £3,132,000) that relates to endowment property (see note 21).
80
81
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
**----- Start of picture text -----**
13 INVESTMENTS IN UNIVERSITY SUBSIDIARY COMPANIES
Company Principal Activity Status Shareholding
Aberystwyth Innovation and Provision of research in food, nutrition & energy 75% owned 75 Class A shares
Enterprise Campus Limited (AIEC) renewable energies & biotechnologies in UK
Aber Trading Limited Provider of consultancy and research work in the UK 100% owned 1 Ordinary share
Aber Business Consultancy Limited Provider of consultancy work in UK 100% owned 2 Ordinary shares
Aber Commercial Trading Limited Dormant company commercial trading through the Old 100% owned 1 Ordinary share
College project including hotel and conference facilities
**----- End of picture text -----**
**----- Start of picture text -----**
2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
14 NON-CURRENT INVESTMENTS
Fixed interest Stocks 3,339 3,339 3,935 3,935
Non-equity investments 132 132 108 108
Equities 20,030 20,030 19,089 19,089
Absolute returns 6,643 6,643 6,504 6,504
Property unit trust 1,808 1,808 2,335 2,335
31,952 31,952 31,971 31,971
**----- End of picture text -----**
**----- Start of picture text -----**
2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
15 STOCK
General consumables 2,392 2,392 2,189 2,189
2,392 2,392 2,189 2,189
2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
16 TRADE AND OTHER RECEIVABLES
Amounts falling due within one year:
Research grants receivables 9,490 9,490 9,834 9,834
Other trade receivables 9,330 8,966 5,496 4,713
Taxation asset RDEC Credit 16 16 16 16
Prepayments and accrued income 4,714 4,700 4,457 3,987
Amounts due from subsidiary companies - 700 - 859
23,550 23,872 19,803 19,409
**----- End of picture text -----**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
**----- Start of picture text -----**
2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
17 CURRENT INVESTMENTS
Treasury bills 1,396 1,396 2,389 2,389
1,396 1,396 2,389 2,389
2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
18 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Payment received on account 3,633 3,633 8,734 8,734
Research grant balances 8,123 8,115 8,517 8,842
Deferred income from student village lease 680 680 680 680
Salix loan 508 508 298 298
Short-term employee benefit 1,574 1,574 1,651 1,651
Trade payables 8,014 8,256 3,461 3,298
Social security and other taxation payable 3,085 3,169 3,011 3,051
Revolving Credit Facility 10,000 10,000 3,000 3,000
Accruals and deferred income 2,613 2,441 4,971 4,093
Deferred capital grant less than one year 5,735 4,116 4,254 4,254
43,965 42,492 38,577 37,901
**----- End of picture text -----**
**----- Start of picture text -----**
2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
19 CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Deferred income from Student Village lease 2,714 2,714 3,392 3,392
Salix Loan 3,391 3,391 3,654 3,654
Secured liabilities
- L&G finance 45,137 45,137 45,086 45,086
- Balfour Beatty deferred consideration 5,348 5,348 5,253 5,253
Deferred capital grants greater than 1 year 77,129 52,190 74,211 46,375
133,719 108,780 131,596 103,760
Analysis of secured and unsecured loans:
Due in five years or more 50,485 50,485 50,339 50,339
Total secured and unsecured loans 50,485 50,485 50,339 50,339
Secured loans repayable by 2048 50,485 50,485 50,339 50,339
**----- End of picture text -----**
Both the L&G and Balfour Beatty liabilities are repaid through annual payments that increase by RPI until 2048. The implicit interest rates are 6.6% (2021-22 6.8%) for the L&G finance and 14.9% (2021-22 13.8%) for the Balfour Beatty finance.
82
83
**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **20 PROVISIONS FOR LIABILITIES AT 31 JULY 2023**
**----- Start of picture text -----**
Pensions Other
Defined Obligation to Total Tax Voluntary Other Total
benefit fund deficit pensions severance other
obligations on USS provisions
pension
Consolidated £’000 £’000 £’000 £’000 £’000 £’000 £’000
At 1st August 2022 17,390 44,267 61,657 160 - 729 889
Utilised in year
- - -
Additions in 2022/23 (6,159) (5,553) (11,712)
At 31st July 2023 11,231 38,714 49,945 160 - 729 889
University
At 1st August 2022 17,390 44,267 61,657 160 - 729 889
Utilised in year
- - - -
Additions in 2022/23 (6,159) (5,553) (11,712)
At 31st July 2023 11,231 38,714 49,945 160 - 729 889
**----- End of picture text -----**
## **USS Deficit**
The obligation to fund the past deficit on the University’s Superannuation Scheme (USS) arises from the contractual obligation with the pension scheme for total payments relating to benefits arising from past performance. Management has assessed projections for future employees within the USS scheme and projections for salary payment over the period of the contracted obligation in assessing the value of this provision. More detail can be found in note 29.
## **Tax Provision**
This tax provision is in respect of an ongoing taxation review resulting in a payment that is expected to be
incurred within one year.
## **Other Provision**
Of the total £729,000, £629,000 of the other provision relates to backlog maintenance on leased property which the University is contractually obliged to restore back to its original condition for which payments are expected to be incurred within one to five years. This value is based on current expected costs.
These outflows of economic resources are deemed probable and therefore a provision has been made rather than a contingent liability.
## **21 ENDOWMENT RESERVES**
Restricted net assets relating to endowments are as follows:
**----- Start of picture text -----**
Restricted Unrestricted
permanent permanent endowmentsExpendable Total
endowments endowments
£’000 £’000 £’000 £’000
Capital brought forward 25,697 - 2,097 27,794
Accumulated income brought forward 2,460 - 17 2,477
Restated balances at 1st August 2022 28,157 - 2,114 30,271
New endowments 3,160 - 503 3,663
Investment income 482 - 43 525
Expenditure (197) - (169) (366)
(Decrease) / increase in market value of investments (656) - (61) (717)
Increase on revaluation of investment properties 164 - - 164
Total endowment comprehensive income for the year 2,953 - 316 3,269
Balances At 31 July 2023 31,110 - 2,430 33,540
Capital carry forward 28,365 - 2,539 30,904
Accumulated income carry forward 2,745 - (109) 2,636
At 31st July 2023 31,110 - 2,430 33,540
**----- End of picture text -----**
In addition to the decrease in market value of the investments (£717,000) during the year included in the above (2021-22 decrease £546,000), there has been a £146,000 increase in the market value of investment properties) (2021-22 Nil).
The University has undertaken an internal review and rationalisation of the endowment funds to ensure that they reflect the purpose and intentions of the donors’ wishes.
**----- Start of picture text -----**
2023 2022
Consolidated University Consolidated University
Analysis by type of purpose: £’000 £’000 £’000 £’000
Lectureships 2,146 2,146 2,188 2,188
Scholarships and bursaries 19,254 19,254 18,960 18,960
Research support 9,306 9,306 6,252 6,252
Prize funds 1,380 1,380 1,402 1,402
General 1,454 1,454 1,469 1,469
33,540 33,540 30,271 30,271
Analysis by asset:
Investment 26,212 26,212 22,272 22,272
Land and Buildings 3,296 3,296 3,132 3,132
Endowment cash and treasury bills 4,032 4,032 4,867 4,867
33,540 33,540 30,271 30,271
**----- End of picture text -----**
84
85
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **21 ENDOWMENT RESERVES (CONTINUED)**
The accumulated income relating to the following permanent endowments is currently in deficit. Income to cover these deficits is expected to be received by 31st July 2024.
**----- Start of picture text -----**
Capital Income
Balances at 31 July 2023 £’000 £’000
Glaxo Book Prize (Biochemistry) 1 (2)
Open Scholarship Fund 2,415 (302)
**----- End of picture text -----**
The Institution has the following individually material endowments all of which are restricted in their use.
**----- Start of picture text -----**
Nature and
Assets Liabilities Income Expenditure
purpose
Balances at 31 July 2023 £’000 £’000 £’000 £’000 £’000
Gregynog Gift Fund - 6,117 - 75 47
Wilson Chair of International Politics - 1,800 - 38 25
Open Scholarship Fund - 2,415 - 51 4
David & Eleanor James Research Studentship - 2,326 - 49 36
Joy Welch PhD and Post-Doctoral Grants Fund - 3,156 - - -
- 15,814 - 213 112
**----- End of picture text -----**
- (a) Gregynog Gift Fund - Funds are to be allocated to Geography, Welsh and Celtic Studies, Music, Extra Mural studies for public lectures and travelling grants for students.
- (b) Wilson Chair of International Politics - Paying for a Professor to teach International Politics, assist with travelling for the Professor, purchase books to assist with lectures and students. Cover the cost of printing and publishing books. Scholarships tenable to undergraduates and postgraduates and prizes for students.
- (c) Open Scholarship Fund - The Charity Commissioners approved in February 1984 pooling of income from the dormant endowment funds.
- (d) David & Eleanor James Research Studentship - The purpose of the gift is to establish The David and Eleanor James Research Studentship Fund to fund at least three-year periods of study for students undertaking research at the University and who satisfy at least one of the following four criteria:
- -Has undertaken his/her secondary education in Wales
- -Has lived in Wales for at least 10 years
- -Graduated from the University
- -Was born in Wales
- (e) Joy Welch PhD and Post-Doctoral Grants Fund - To fund grants towards high calibre research in every academic year with all areas of research across all subjects open to consideration.
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
**----- Start of picture text -----**
22 RESTRICTED RESERVES 2023 2022
Reserves with restrictions are as follows: Consolidated & University Consolidated & University
Donations Total Donations Total
£’000 £’000 £’000 £’000
Capital brought forward 116 116 116 116
Accumulated income brought forward 464 464 32 32
As at 31 July 2022 580 580 148 148
New donations 355 355 483 483
Restricted grants 361 361 - -
Expenditure (726) (726) (51) (51)
Total restricted comprehensive income for the year (10) (10) 432 432
Capital carry forward 116 116 116 116
Accumulated income carry forward 454 454 464 464
As at 31 July 2023 570 570 580 580
Analysis of other restricted funds and donations by purpose: 129 129 99 99
Scholarships and bursaries 1 1 1 1
Prize funds 440 440 480 480
General 570 570 580 580
**----- End of picture text -----**
## **23 CONSOLIDATED RECONCILIATION OF NET DEBT**
||At 1st August 2022|Other - Non Cash
Movement|Cash Flow|At 31st July 2023|
|---|---|---|---|---|
||£’000|£’000|£’000|£’000|
|L&G Loan|(45,086)|(51)|-|(45,137)|
|Balfour Beatty deferred consideration|(5,253)|(95)|-|(5,348)|
|Revolving Credit Facility|(3,000)|-|(7,000)|(10,000)|
|Salix loan|(3,952)|-|53|(3,899)|
||(57,291)|(146)|(6,947)|(64,384)|
||||||
|Cash and cash equivalents|||||
|Cash available to University|1,862|-|1,274|3,136|
|Restricted endowment cash|6,250|-|(1,178)|5,072|
||8,112|-|96|8,208|
||||||
|Net Debt|(49,179)|(146)|(6,851)|(56,176)|
86
87
**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
**----- Start of picture text -----**
24 FINANCIAL INSTRUMENTS 2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
Financial assets
Financial assets at fair value through Statement of Comprehensive Income - - - -
Listed investments 31,951 31,951 31,971 31,971
31,951 31,951 31,971 31,971
Financial assets that are equity instruments measured at cost less
impairment
Other investments - - 94 94
- - 94 94
Financial assets that are debt instruments measured at amortised cost
Cash and cash equivalents 8,208 8,121 8,112 7,853
Investments 1,396 1,396 2,389 2,389
Other debtors 25,942 26,264 21,991 21,597
35,546 35,781 32,492 31,839
Financial liabilities
Financial liabilities at fair value through Statement of Comprehensive
Income
Loans RCF - Natwest 10,000 10,000 3,000 3,000
Loans - Salix 3,899 3,899 3,952 3,952
Loans - Legal & General 45,137 45,137 45,086 45,086
Balfour Beatty deferred consideration 5,348 5,348 5,253 5,253
Deferred income from Student Village lease 2,714 2,714 3,392 3,392
Deferred capital grant 82,864 56,306 78,465 50,629
Trade payables 8,014 8,256 3,461 3,298
Other creditors 19,708 19,612 27,564 27,051
177,684 151,272 170,173 141,661
**----- End of picture text -----**
## **25 FINANCIAL RESPONSIBILITY SUPPLEMENT SCHEDULE**
The following extracts of the three tables illustrate an approach of using the two left-most columns to reflect the required local customisation for both page numbers and referencing of primary statements/notes/line items in an institution’s own accounts:
**----- Start of picture text -----**
PRIMARY RESERVES RATIO 2023 2022
Page Line item/related disclosures Expendable Net Assets £’000 £’000
72 Unrestricted reserves Net assets no restriction 63,988 58,122
72 Restricted reserves Net assets with donor restriction 34,110 30,851
Less
85 Note 21 Restricted capital Restricted in perpetuity (31,110) (28,157)
Annuities - -
85 Note 21 Expendable Term endowments (2,430) (2,114)
endowments
Life income funds - -
Goodwill - -
80 & 81 Note 10, 11 & 12 PPE (220,124) (216,976)
Note 10, 11 & 12 Pre implementation PPE 166,373 175,409
80 Note 10 Lease - right of use, net (38,996) (40,253)
80 Note 10 Remove pre-implementation lease right-of-use 38,996 40,253
84 Note 20 Pension liability 49,945 61,656
Line of credit - short term for CIP - -
Notes payable - -
83 Note 19 Line of credit for long term purposes 83,234 81,257
83 Note 19 Modify for post implementation debt not related to purchase (83,234) (81,257)
of assets
83 Note 19 Lease right-of-use asset liability 50,485 50,339
83 Note 19 Remove pre-implementation lease right-of-use (50,485) (50,339)
Related party receivable - -
60,752 78,791
Page Line item/related disclosures Total Expenses and Losses without donor restrictions £’000 £’000
71 Total expenditure (excluding Total Expenditure (excluding USS) 134,115 122,973
USS)
71 SOCI pension movement SOCI actuarial pension movement (5,289) (17,059)
75 Note 5 - SOCI gain/loss on investments Net investment gain/loss 306 582
Change in value of split-interest agreements - -
- -
Other gains (losses)
129,132 106,496
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**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **25 FINANCIAL RESPONSIBILITY SUPPLEMENT SCHEDULE (CONTINUED)**
## **EQUITY RATIO**
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Page Line item/related disclosures Modified Net Assets £’000 £’000
72 Unrestricted reserves Net assets without donor restriction 63,988 58,122
72 Restricted reserves Net assets with donor restrictions 34,110 30,851
Goodwill - -
Related party receivable - -
98,098 88,973
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Page Line item/related disclosures Modified Assets £’000 £’000
72 Balance sheet Total assets 326,615 321,692
Goodwill - -
Related party receivable - -
80 Note 10 Pre-implementation lease asset (38,996) (40,253)
287,620 281,439
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## **NET INCOME RATIO**
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Page Line item/related disclosures Change in Net Assests Without Donor Restrictions £’000 £’000
71 Unrestricted comprehensive income Change in net assets without donor restrictions 5,853 (10,720)
Page Line item/related disclosures Total Revenues and Gains Without Donor Restrictons £’000 £’000
Total income on I&E Total operating revenue - unrestricted 132,771 123,523
Unrestricted investment
71 & 75 income and donations Investment return appropriated for spending 804 582
71 Disposals of fixed assets Sale of fixed assets (77) (110)
133,498 123,995
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During the year the University received feedback from the US Department of Education with regards to the format of the note previously used in the financial statements. The 2022/23 note has been updated as a result of this feedback with the prior period comparative amended for comparison purposes.
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26 CAPITAL AND OTHER COMMITMENTS 2023 2022
Consolidated University Consolidated University
£’000 £’000 £’000 £’000
Capital commitments 27,293 27,293 33,279 33,279
27,293 27,293 33,279 33,279
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## **27 CONTINGENT LIABILITIES AND ASSETS**
There are no contingent liabilities or assets at the end of the period
## **29 UNIVERSITY AND CONSOLIDATED PENSION SCHEMES**
The University participates in four different schemes:
|The University participates in four diferent schemes:||
|---|---|
|Aberystwyth University Pension Plan (AUPP)|defned contribution|
|Universities Superannuation Scheme (USS)|defned beneft multi-employer|
|Aberystwyth University Pension Assurance Scheme (AUPAS)|defned beneft closed|
|Dyfed Pension Fund (DPF)|defned beneft closed to new entrants|
AUPAS has been closed to further member contributions since April 2015. The Dyfed Pension Fund is not open to new members.
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IMPACT ON CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 2023 2022
Operating charge in staff costs £’000 £’000
USS 2,630 35,527
DPF 13 17
Total pension charge in staff costs 2,643 35,544
Interest costs
USS 1,465 276
AUPAS 585 571
DPF (32) (2)
Total interest costs 2,018 845
Actuarial gain/(loss) in respect of pension schemes
AUPAS 5,414 17,221
DPF (125) (162)
Total actuarial gain/(loss) 5,289 17,059
Impact on Balance Sheet
Pension Provision
USS 38,714 44,267
AUPAS 11,231 17,390
DPF - -
Total Pension Liability 49,945 61,657
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## (i) ABERYSTWYTH UNIVERSITY PENSION PLAN
The Aberystwyth University Pension Plan is a defined contribution pension plan which is administered by Legal & General. All employee and institute contributions are invested in a Legal & General Group Personal Pension Plan. The University contributes 10% of salary into the pension scheme. The total contribution in 2022-23 was £1,134,370 (2021-22 £1,095,108)
## **28 EVENTS AFTER THE REPORTING PERIOD**
There are no events after the reporting period.
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**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **29 PENSION SCHEMES (continued)**
## (iI) THE UNIVERSITIES SUPERANNUATION SCHEME
The institution participates in the Universities Superannuation Scheme (USS) which is the main scheme covering most academic and academic-related staff. 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 trustee-administered fund.
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||||
|---|---|---|
|29 PENSION SCHEMES (continued)|
|THE CURRENT LIFE EXPECTANCIES ON RETIREMENT AT AGE 65 ARE:|2023|2022|
|Males currently aged 65 (years)|24.0|23.9|
|Females currently aged 65 (years)|25.6|25.5|
|Males currently aged 45 (years)|26.0|25.9|
|Females currently aged 45 (years)|27.4|27.3|
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USS is a multi-employer scheme and is accounted for as set out in the accounting policies.
The total adjustment charge to the Consolidated Statement of Comprehensive Income is £2,630,000 (2022: £35,527,000) including PensionChoice but excluding the impact of the change in the deficit recovery plan, as shown in note 7.
Deficit recovery contributions paid in year by the institution are £9,648,582 (2022: £8,765,696).The latest available complete actuarial valuation of the Retirement Income Builder is as at 31 March 2020 (the valuation date), and was carried out using the projected unit method. Since the Institution cannot identify its share of USS Retirement Income Builder (defined benefit) assets and liabilities, the following disclosures reflect those relevant for those assets and liabilities as a whole.
The 2020 valuation was the sixth valuation for the scheme under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to have sufficient and appropriate assets to cover their technical provisions. At the valuation date, the value of the assets of the scheme was £66.5 billion and the value of the scheme’s technical provisions was £80.6 billion indicating a shortfall of £14.1 billion and a funding ratio of 83%.
The key financial assumptions used in the 2020 valuation are described below. More detail is set out in the Statement of Funding Principles (uss.co.uk/about-us/valuation-and-funding/statement-of-fundingprinciples).
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|||
|---|---|
|Term dependent rates in line with the difference between the Fixed Interest and|
|Index Linked yield curves less:|
|CPI assumption|
|1.1% p.a. to 2030, reducing linearly by 0.1% p.a. to a long-term difference of 0.1%|
|p.a. from 2040|
|Pension increases|
|(subject to a floor of 0%)|CPI assumption plus 0.05%|
|Fixed interest gilt yield curve plus:|
|Discount rate (forward rates)|Pre-retirement: 2.75% p.a.|
|Post retirement: 1.00% p.a.|
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The main demographic assumptions used relate to the mortality assumptions. These assumptions are based on analysis of the scheme’s experience carried out as part of the 2020 actuarial valuation. The mortality assumptions used in these figures are as follows:
A new deficit recovery plan was put in place as part of the 2020 valuation, which requires payment of 6.2% of salaries over the period 1 April 2022 until 31 March 2024, at which point the rate will increase to 6.3%. The 2023 deficit recovery liability reflects this plan. The liability figures have been produced using the following assumptions:
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2023 2022
Discount rate 5.52% 3.31%
Pensionable salary growth
Yr 1 6.00% 4.20%
Yr 2 5.00% 3.50%
Yr 3-16 (avg) 3.00% 3.00%
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## **Significant accounting policies**
The institution participates in Universities Superannuation Scheme. The assets of the scheme are held in a separate trustee-administered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The institution is therefore exposed to actuarial risks associated with other institutions’ employees and is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis. As required by Section 28 of FRS 102 “Employee benefits”, the institution therefore accounts for the scheme as if it were a defined contribution scheme. As a result, the amount charged to the profit and loss account represents the contributions payable to the scheme. Since the institution has entered into an agreement (the Recovery Plan) that determines how each employer within the scheme will fund the overall deficit, the institution recognises a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) with related expenses being recognised through the profit and loss account.
## **Critical accounting judgements**
FRS 102 makes the distinction between a group plan and a multi-employer scheme. A group plan consists of a collection of entities under common control typically with a sponsoring employer. A multi-employer scheme is a scheme for entities not under common control and represents (typically) an industry-wide scheme such as Universities Superannuation Scheme. The accounting for a multi-employer scheme where the employer has entered into an agreement with the scheme that determines how the employer will fund a deficit results in the recognition of a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) with the resulting expense charged through the profit or loss account in accordance with section 28 of FRS 102. The directors are satisfied that Universities Superannuation Scheme meets the definition of a multiemployer scheme and has therefore recognised the discounted fair value of the contractual contributions under the recovery plan in existence at the date of approving these financial statements.
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|||
|---|---|
|2020 valuation|
|Mortality base table|101% of S2PMA “light” for males and 95% of S3PFA for females|
|CMI 2019 with a smoothing parameter of 7.5, an initial addition of 0.5% p.a.|
|Future improvements to mortality|and a long-term improvement rate of 1.8% pa for males and 1.6% pa for|
|females|
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## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
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2023 2022
£’000 £’000
Opening deficit (44,267) (17,230)
Current service cost (6,879) (7,775)
Change in deficit reduction plan assumptions 4,249 (27,752)
USS Pension cost in the Consolidated Income Statement (2,630) (35,527)
Net interest cost (1,465) (276)
Contribution from University 9,649 8,766
Closing deficit (38,713) (44,267)
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## (iiI) ABERYSTWYTH UNIVERSITY PENSION AND ASSURANCE SCHEME
The University maintains a closed final salary defined benefit pension scheme called the Aberystwyth University Pension and Assurance Scheme. The scheme is externally funded. The last formal triennial actuarial valuation of the scheme was performed as at 1 August 2020 by a professionally qualified actuary.
During the accounting period, the University paid contributions of £1,330,000 (2021-22 £1,209,000) to the pension scheme as a contribution to reduce the value of the deficit. The scheme is closed and no contributions were made by members.
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ASSUMPTIONS 2023 2022
The financial assumptions used to calculate scheme liabilities under FRS102 are:
%pa %pa
Price inflation (RPI) 3.15 3.2
Rate of increase in salaries 3.3 3.3
Discount rate 5.15 3.5
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The most significant non-financial assumption is the assumed level of longevity. The table below shows the life expectancy assumptions used in the accounting assessments based on the life expectancy of male and female members at age 65.
|
female members at age 65.|||
|---|---|---|
|Males currently aged 65 (years)|20.9|21.7|
|Females currently aged 65 (years)|23.4|24.1|
|Males currently aged 40 (years)|22.6|23.9|
|Females currently aged 40 (years)|25.3|26.3|
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
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29 PENSION SCHEMES (continued)
SUMMARY OF THE AMOUNT SHOWN IN THE BALANCE SHEET FOR AUPAS 2023 2022
£’000 £’000
Scheme assets 72,322 87,531
Scheme liabilities 83,553 104,921
Net pension liability 11,231 17,390
Analysis of movement in the present value of AUPAS liabilities
Present value of AUPAS liabilities at the start of the year 104,921 140,432
Current service cost (net of member contributions) - -
Loss on curtailments/changes - -
Interest cost 3,596 2,281
- -
Actual member contributions (including notional contributions)
Actuarial (gain)/loss due to changes in assumptions (23,141) (37,564)
- -
(Gain)/loss on curtailments/change/introduction
Actuarial (gain)/loss due to effect of experience adjustment 2,508 4,143
Actual benefit payments (4,331) (4,371)
Present value of AUPAS liabilities at the end of the year 83,553 104,921
Analysis of movement in the present value of AUPAS assets
Fair value of assets at the start of the year 87,531 105,193
Expected interest income on plan assets 3,011 1,710
Actual return on plan assets (excluding interest income) (15,219) (16,210)
Actual contributions paid by University 1,330 1,209
- -
Actual member contributions (including notional contributions)
Actual benefit payments (4,331) (4,371)
Administrative expenses paid from plan assets - -
Fair value of scheme assets at the end of the year 72,322 87,531
Fair value of AUPAS scheme assets
Cash and cash equivalents 8,840 8,224
Equity instruments 14,625 14,244
Debt instruments 24,469 34,231
Real estate 3,193 4,660
Other 21,195 26,172
Total fair value of AUPAS scheme assets 72,322 87,531
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AUPAS assets do not include any of the University’s own financial instruments, or any property occupied by the University.
|**Actual return on scheme assets**||
|---|---|
|Expected return on scheme assets|3,011
1,710|
|Asset gain/(loss)|(15,219)
(16,210)|
|Actual return on scheme assets|(12,208)
(14,500)|
|Percentage return on scheme assets at start of year|-13.95%
-13.80%|
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**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **29 PENSION SCHEMES (continued)**
## (IV) DYFED PENSION FUND
The University is an admitted member of the Dyfed Pension Fund which is a multi-employer Local Government Pension Scheme regulated by statute. The last full actuarial valuation was carried out at 31 March 2022 by a qualified independent actuary. An approximate actuarial valuation was carried out at 31 July 2023 by a qualified independent actuary.
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ASSUMPTIONS 2023 2022
The financial assumptions used to calculate scheme liabilities under FRS102 are:
%pa %pa
Price inflation 2.7 2.7
Rate of increase in salaries 4.2 4.2
Rate of increase of pensions in payment for DPF members 2.8 2.8
Discount rate 5.4 3.4
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The most significant non-financial assumption is the assumed level of longevity. The table below shows the life expectancy assumptions used in the accounting assessments based on the life expectancy of male and female members at age 65.
|Males currently aged 65 (years)
21.4|23|
|---|---|
|Females currently aged 65 (years)
23.7|24.9|
|Males currently aged 45 (years)
22.8|24.4|
|Females currently aged 45 (years)
25.5|27.1|
|**ANALYSIS OF THE AMOUNT SHOWN IN THE CONSOLIDATED**
**STATEMENT OF COMPREHENSIVE INCOME FOR DPF**
**2023**|**2022**|
|£’000|£’000|
|Pension cost within surplus/defcit before othergains/losses
-|-|
|Current service cost
13|17|
|Total operating charge in staf costs
13|17|
|**Interest on plan assets**
209|101|
|Interest on pension liabilities
177|99|
|Net interest cost
(32)|(2)|
|Administrative cost
-|-|
|Total pension cost within surplus/defcit before other gains/losses
(19)|15|
|Actuarial gain/(loss) in respect of pension schemes
-|-|
|(Loss)/gain on assets
(308)|(158)|
|Gain/(loss) on liabilities
1,148|880|
|Asset Ceiling Adjustment
(965)|884|
|Net Actuarial gain/(loss)in respect of pension schemes
(125)|(162)|
|Total Comprehensive income/(cost) for the year
(106)|(177)|
## **29 PENSION SCHEMES (continued)**
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SUMMARY OF THE AMOUNT SHOWN IN THE BALANCE SHEET FOR DPF 2023 2022
£’000 £’000
Scheme assets 5,985 6,187
Scheme liabilities 4,136 5,303
Net pension (liability) / asset 1,849 884
Asset Ceiling Adjustment (1,849) (884)
Amount in Statement of Financial Position - -
Analysis of movement in the present value of DPF liabilities
Present value of DPF liabilities at the start of the year 5,303 6,277
Current service cost (net of member contributions) 13 17
Interest cost 177 99
Actual member contributions (including notional contributions) 2 2
Past service costs - -
Actuarial (gain) / loss due to changes in assumptions (1,148) (880)
Actual benefit payments (211) (212)
Present value of DPF liabilities at the end of the year 4,136 5,303
Analysis of movement in the fair value of scheme assets
Fair value of assets at the start of the year 6,187 6,355
Expected interest income on plan assets 209 101
Actual return on plan assets (excluding interest income) (308) (158)
Actual contributions paid by University 106 99
Actual member contributions (including notional contributions) 2 2
Actual benefit payments (211) (212)
Fair value of scheme assets at the end of the year 5,985 6,187
Fair value of DPF scheme assets
Cash and cash equivalents 72 68
Equity instruments 4,375 4,355
Debt instruments 521 539
Real estate 790 978
Other 227 247
Total fair value of DPF scheme assets 5,985 6,187
Actual return on scheme assets
Expected return on scheme assets 209 101
Asset gain (308) (158)
Actual return on scheme assets (99) (57)
Per cent return on scheme assets at start of year -1.6% -0.4%
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Pension asset has not been recognised as such on the Statement of Financial Position, as there is no automatic entitlement to a refund from the scheme.
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**NOTES TO THE FINANCIAL STATEMENTS (continued)**
**NOTES TO THE FINANCIAL STATEMENTS (continued)**
## **30 UNIVERSITY AND CONSOLIDATED LEASE OBLIGATIONS**
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Land and Plant and Other Total Total
Buildings Machinery leases 2023 2022
£’000 £’000 £’000 £’000 £’000
Payable during the year 274 - 160 434 405
Future minimum lease payments due:
Not later than 1 year 320 - 235 555 378
Later than 1 year and not later than 5 years 977 - 630 1,607 971
Later than 5 years 874 - 19 893 1,570
Total lease payments due 2,171 - 884 3,055 2,919
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## **31 RELATED PARTY TRANSACTIONS**
The University’s Council, Senate and Senior Staff members are the Trustees for charitable law purposes. Due to the nature of the University’s operations and the composition of the Trustees, it is inevitable that transactions will take place with organisations in which a member of the Trustees may have an interest. All transactions involving organisations in which a member of the Trustees may have an interest, including those identified below, are conducted at arms’ length and in accordance with the University’s Financial Regulations and usual procurement procedures.
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Income Expenditure Debtor Creditor
£’000 £’000 £’000 £’000
Members of Council
Public Health Wales (Kate Eden) 25 - - -
Coleg Cymraeg Cenedlaethol (Meri Huws) 4 (9) - (9)
Senior Staff Members
UCEA - (Prof Elizabeth T Treasure) - (13) - -
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Ms Aisleen Sturrock, in addition to being a University Trustee, was also a member of the Aberystwyth University Students’ Union.
## **Investment in Aberystwyth University Innovation and Enterprise Campus Limited (AIEC)**
During the year the University invoiced AIEC for expenditure the University had incurred on behalf of AIEC totalling £1,292,056 (2021-22 £765,081) and AIEC invoiced the University £266,188 (2021-22 £150,688). The University also advanced cash to AIEC to the value of £1,370,000 (2021-22 £520,000) which has incurred an interest rate of 3.25% ABR (2021-22 5%). At the year-end, there was a long-term creditor balance from AIEC to the University, which includes cash advances of £668,196 (2021-22 £801,496). The non-controlling interest is £-17,216 (2021-22 £-13,000). AIEC is a 75% owned subsidiary.
## **Aberystwyth University Pension and Assurance Scheme (AUPAS)**
The University runs a payroll service on behalf of AUPAS for which no administrative cost recharges are made. The Pension Scheme debtor during the year-end was £448,785 (2021-22 £383,933) which relates to PAYE payments made by Aberystwyth University on behalf of AUPAS during the year, which is now owed to the University.
## **Aberystwyth Students Union**
Aberystwyth University Students’ Union (AUSU) is a separate entity funded by the University by the provision of a grant. It is administered by elected student officers for the benefit of the students. The University’s grant to AUSU amounted to £936,496 (2021-22 £889,927). The Students Union occupies premises owned by the University for which no rent is charged and received payroll services from the University for which no fee is charged. At the year-end the University owed Aberystwyth Student Union £10,961 (2021-22 £NIL).
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