Company Registration Number 04448389 Charity Registration Number 01179136 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM A COMPANY LIMITED BY GUARANTEE ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## COMPANY INFORMATION |Board of Directors|Al-Karim Haji|| |---|---|---| ||Asif Fancy|| ||Gulzar Khoja
|Resigned on 15 January 2020| ||Rahim Hooda
|Appointed on 28 February 2020| ||Habib Motani|| ||Salimah Currimbhoy|| ||Professor Richard Pring|| |Secretary|Saima Faisal Ali|| |Company Number|04448389|| |Charity Number|01179136|| |Registered Office|Aga Khan Centre|| ||10 Handyside Street|| ||London|| ||NC1 4DN|| |Principal Office|Aga Khan Centre|| ||10 Handyside Street|| ||London|| ||NC1 4DN|| |Auditors|UHY Hacker Young LLP|| ||Chartered Accountants|| ||Quadrant House|| ||4 Thomas More Square|| ||London E1W 1YW|| THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## CONTENTS ||Page| |---|---| |Report of the Board of Directors|1 - 2| |Statement of the Board of Directors’ responsibilities|3| |Independent auditors’ report|4 - 6| |Statement of Comprehensive Income and Expenditure|7| |Statement of Changes in Reserves|8| |Balance sheet|9| |Cash flow statement|10| |Notes to the Financial Statements|11 - 18| ## THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## REPORT OF THE BOARD OF DIRECTORS The Board of Directors is pleased to submit its report and financial statements for the year ended 31 December 2020. ## Legal Status and Principal Activities The Aga Khan University (International) in the United Kingdom (“the University”) was incorporated on 27 May 2002 under the Companies Act 1985 (England and Wales) as a company limited by guarantee. The limit of the guarantees amounts to £2 and is shown in members' funds in the balance sheet (see note 10 to the financial statements). The University is an academic unit of The Aga Khan University (AKU), which is a statutory body corporate in Pakistan by virtue of its Charter granted in 1983 as Pakistan’s first private international university. The University has also registered with the Charity Commission for England and Wales effective 10 July 2018. The objective of the University is higher education through the provision of instruction, training and teaching in any branch of learning. Currently, the University is focusing on strengthening research and education for the purpose of enhancing knowledge of the heritage of Muslim civilisations. The University has established a non-profit corporation in the United States of America, under the name Aga Khan University (U.S.A.) Foundation to create awareness of and solicit funds in the US for AKU’s global activities (including the University as an academic unit of AKU). The non-profit corporation was incorporated in the State of Delaware on 24 December 2014. ## COVID-19 Pandemic The COVID 19 pandemic developed rapidly in 2020. Measures taken by government to contain the virus including lockdowns and social distancing have affected day to day activity. Academic programme schedules were affected with physical classes being suspended to comply with government requirements and online teaching was introduced. The arrival of new students was deferred to 2021. In response to the pandemic, in addition to enhancing health and safety measures for the welfare of staff and students, the University significantly extended its offering of online short courses, delivered its summer programmes online, is introducing language courses and has adopted a number of initiatives to manage costs. The University initiated research on Covid 19 from a social science and humanities perspective, conducted through its Governance Programme, through the work of individual faculty members and through collaboration with other research organisations. ## Results for the Year ## Financial Statements: The results for the year and the University’s financial position at the end of the year are shown in the attached financial statements. ## Sources of Funding: During the year, the University received £1,559,961 (2019: £2,136,534) from The Aga Khan University Foundation, Geneva to meet its funding requirement. Aga Khan Foundation (United Kingdom) supported the University through permitting usage by the University of the Aga Khan Centre, London and Student Accommodation at King’s Cross. This contribution has been recorded as a donation-in-kind having a value to the University of £1,630,779 (2019: £1,600,220). AKU supported the University through the provision to the University of administrative and other services. This contribution has been recorded as a donation-in-kind having a value to the University of £135,783 (2019: £393,033) ## Financial position At the year end the University had net assets of £ 1,316,439 (2019: £ 1,657,052). 1 ## Grants The University secured equivalent to GBP 2.14 million research grants from European Research Council, Mellon Foundation, British Academy and Qatar National Library. ## Board of Directors The Board of Directors who served the University during the year are as follows: 1. Al-Karim Haji 3. Gulzar Khoja – Resigned on January 15, 2020 5. Habib Motani 2. Asif Fancy 4. Rahim Hooda – Appointed on February 28, 2020 6. Salimah Currimbhoy 7. Professor Richard Pring ## Review and the way forward The University offers a Master of Arts in Muslim Cultures. Over the next few years as the University expands in size and scope, faculty members will continue to focus on research, education, publications and outreach. The university plans to continue to disseminate knowledge on heritage of Muslim civilisations through work in the following three interrelated areas: 1. Research; 2. Educational Programmes; and 3. Publications and Outreach. The University has an equal opportunities policy in place to ensure fair consideration of applications made by employees and students. ## Auditors The auditors, UHY Hacker Young LLP, are deemed to be reappointed under section 487(2) of the Companies Act 2006. ## Statement of disclosure to auditors So far as the Directors are aware, there is no relevant audit information of which the University’s auditors are unaware. Additionally, the Directors have taken all the necessary steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to establish that the University’s auditors are aware of that information. The Directors have taken advantage of the small company’s exemptions from preparing a strategic report and consolidated financial statements. On behalf of the Board of Directors 26[th] March, 2021 2 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## STATEMENT OF THE BOARD OF DIRECTORS’ RESPONSIBILITIES In accordance with the Articles of Association, the Board of Directors of the Aga Khan University (International) in the United Kingdom (“the University”) is responsible for the administration and management of the affairs of the University and is required to present audited financial statements for each financial year. The Companies Act 2006 requires the Board of Directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the University and of the results of the University for that year. The Board of Directors is responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time the financial position of the University and to enable it to ensure that the financial statements are prepared in accordance with the Statement of Recommended Practice “Accounting in Further and Higher Education” and relevant accounting standards. In causing the financial statements to be prepared, the Board of Directors has to ensure that: - suitable accounting policies are selected and applied consistently; - judgements and estimates are made that are reasonable and prudent; - applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and - financial statements are prepared on a going concern basis unless it is inappropriate to presume that the University will continue to be in operation. The Board of Directors has taken reasonable steps to: - ensure that there are appropriate financial and management controls in place to safeguard funds; - safeguard the assets of the University and to prevent and detect fraud. The key elements of the University’s system of internal financial control, which is designed to discharge the responsibilities set out above, include the following: - clear definitions of the responsibilities of, and the authority delegated to, heads of academic departments and administrative sections; - a comprehensive medium and short-term planning process, supplemented by detailed annual income, expenditure, capital and cash flow budgets; - regular reviews of academic performance and financial results involving variance reporting and updates of forecast outturns; and - clearly defined and formalised requirements for approval and control of expenditure Any system of internal control can, however, only provide reasonable, but not absolute, assurance against material misstatement or loss. 3 INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## Opinion We have audited the financial statements of The Aga Khan University (International) in the United Kingdom (the ‘University’) for the year ended 31 December 2020 which comprise the Statement of Comprehensive Income and Expenditure, Statement of Changes in Reserves, Balance Sheet, the Statement of Cash Flows and the related notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law, United Kingdom Generally Accepted Accounting Practice (FRS102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland) and the Statement of Recommended Practice “Accounting in Further and Higher Education”. In our opinion the financial statements: - give a true and fair view of the state of the University’s affairs as at 31 December 2020 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (FRS102); and - have been prepared in accordance with the requirements of the Companies Act 2006. ## Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the ‘Auditor's responsibilities for the audit of the financial statements’ section of our report. We are independent of the University in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. ## Conclusions relating to going concern In auditing the financial statements, we have concluded that the Board of Directors’ use of the going concern basis of accounting in the preparation of the financial statement is appropriate. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charitable company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the Board of Directors with respect to going concern are described in the relevant sections of this report. ## Other information The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The Board of Directors’ are responsible for the other information. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. 4 TO THE MEMBERS OF THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## INDEPENDENT AUDITORS' REPORT In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information we are required to report that fact. We have nothing to report in this regard. ## Opinions on other matters prescribed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of our audit: - the information given in the Report of the Board of Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and - the Report of the Board of Directors has been prepared in accordance with applicable legal requirements. ## Matters on which we are required to report by exception In the light of the knowledge and understanding of the University and its environment obtained in the course of the audit, we have not identified material misstatements in the Report of the Board of Directors. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of directors’ remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit. ## Responsibilities of directors As explained more fully in the Statement of the Board of Directors’ Responsibilities, the University’s Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Board of Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Board of Directors are responsible for assessing the University’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intend to liquidate the University or to cease operations, or have no realistic alternative but to do so. ## Auditor's responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. 5 INDEPENDE*T AUDITOILS, REPORT TO THE ￿E￿IBERs OF THE AGA KHAN UNtVERSITY (INTERNATIONAL) IN THE UNrrED klliGDOM (A COMPANY L1￿11TF,D BY GUARANfEE) Irreguiariu￿. induding fraud. are inslances ofn(*KoM￿13nCt iiryth I￿￿$ and res￿ati￿LI. We design proced in line ow responsibilityes. outlined abo%& VJ deted m*riai misslatemmts in rasped of irrebJulari(ies. induding Th¢ utenl to (M]r wKedure5 are ca&Hbl¢ of de*ain8 I￿¢BUlar[ti* indudthg fraud a daailed b¢]ow. Bwd on our und¢]5thnthng ofthe University and the industrj. in wkn'ch it Operat￿ w¢ idmtsfied the principal risk.s Ornon￿OMpli•n￿ W'ith laws re8tsEaucrts rd￿ed to the Ey the unlie￿i￿.. which weff crn¢raT)' to applicthle laws and re8￿atio[L% incluth.￿ fra￿￿ the ￿ent to %hith norbwcompliance mi8h( have a molutji effeci cth the fthancial sthtemenis. We a150 C4￿]deA¢d tlM%e have a direci impac¢on the prcparation ofthe fmaJ)cial suth Is the Companics Ac121KI6. We ci'3luated mano8emwL'5 incentive5 opwriunitses for frawlul•i mfmipulatton of the finanaai sta￿￿*￿ (indudin8 the risk of oVe￿ide of controlsx Ènd deter￿d thatth¢ pnn¢ipd nsks wffe ye1￿¢d w it)fi￿￿ the Untvenity net income ror th¢ ymr. Auth'i procedurts perforn￿d included.. review of the f￿￿£1￿[ slaternfflt disdoswes w ￿￿erlY￿8 supp)rlinB d￿UMen￿l¢￿ review of corr￿[￿￿d￿cC with Try￿rts ￿ the regula￿ts. rei'iffiv ofcorr¢sp(xJdesKe with l¢gol vis0￿, enqwrie5 of n￿ageM￿l aThl revi￿ rf intemal LI￿11 rewts in so fw &8 they rdated to the fIn￿cl ststrm¢nts, and t&%lin8 ofJourn41s and cvaluatsn8 thore w&4 ewid•¢¢ of￿.4$ by the Board of Dir￿ th&¢ represrn*d irisk of Thwsstatemerf due to There are inhErenl lirnilalhon5 in the autht prLKedurrs desr4ibcd abovc thc fwthLY rcmDid n(mrfompli8n with1&Th7 and re￿￿10n3 15 fr￿ the md tranwtions r¢flx*d in the sthler1W￿ the I￿3 likdy we would b¢¢(￿￿ awarE of IL A150. the nsk of Mt de*Ltrtg a muaiai missweM￿I duE ￿ frathl LS h]"8h¢r ¢twi the nsk of not dc¢cctsn¥ o)c rrsuiiing from e￿or. lu fra￿j w invol￿¢ delibN* by. fLY ex&￿14 forBery or IntaJu(￿a] MistwesenWkth￿. or thr(￿#h ¢oUusi￿l A further descripttim of our rtswillbditses the audii of the f￿￿ClaI sthtemthts is the Fin8naai Rcwrting Cowi(il's websL"* *.. h¢w'lMTrvTh'.frc or8 ukIlluth￿rS1￿Pr￿slbll1yC5. Thi"s dc￿lpts¢)n fornu pan ofour auth"lotrs T¢P( Use ofour report This ryrt is tMd¢ ￿lety to th¢ Univewsity's mcmbcr5. a IK#ty. in ac¢orthceMith Chaptet 3 of Part 16 of the Cvmpanies Ad It￿. Ow awlitThorf( has E¢cn so thai wemighisWetoth¢ Universiry's members those n￿lie￿ we art requwed to S￿e w them in an auditsr's re￿ and rto oth¢¥ pur￿￿& To thE fullest ext￿rt punwiied by law.wedonotWor&8swMrespwbiiih. to othwthmthe University 8ndth¢ Utiivu8ity'i member5 as f4 W. for Lnw ￿￿"t￿)Ik. for rep)ti or the we ￿ve fwmr oliTh Wright ISen]oi SthiLrtory Audi￿r) For OD beh￿r•fUHy HAtlttr Y•wg Chutered Att4Junl&ts Staknrtory A￿AitOrS 4 Thotrn8 More Squug L(nduKEIW IYW . 2021 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## STATEMENT OF COMPREHENSIVE INCOME AND EXPENDITURE FOR THE YEAR ENDED 31 DECEMBER 2020 |||Total|Total| |---|---|---|---| |||2020|2019| ||||(restated)| |INCOME|Notes|£|£| |Tuition fees & other income|2|155,496|121,774| |Grants utilized||777,456|560,736| |Investment income||618|782| |||________|________| |Total income before donations||933,570|683,292| |Donations|3|3,326,523|4,129,787| |||________|________| |Total income||4,260,093|4,813,079| |||________|________| |EXPENDITURE|||| |Staff costs|4|1,723,352|1,650,687| |Other operating expenses|5|2,807,823|3,053,870| |Depreciation|7|67,599|67,527| |Interest and other finance costs||1,932|3,121| |||________|________| |Total expenditure||4,600,706|4,775,205| |||________|________| |(Deficit)/surplus before tax||(340,613)|37,874| |Taxation|6|-|-| |||________|________| |(Deficit)/surplus for the year||(340,613)|37,874| |||________|________| |Reconciliation of funds:|||| |Funds brought forward||1,657,052|1,619,178| |||________|________| |Funds carried forward||1,316,439|1,657,052| |||=======|=======| All items of income and expenditure relate to continuing activities. 7 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) STATEMENT OF CHANGES IN RESERVES FOR THE YEAR ENDED 31 DECEMBER 2020 ||Unrestricted|Restricted|Total|Total| |---|---|---|---|---| ||Funds|Funds|2020|2019| |||||(restated)| ||£|£|£|£| |Funds brought forward|1,321,444|335,608|1,657,052|1,619,178| |Total income|3,482,637|777,456|4,260,093|4,813,079| |Total expenditure|(3,873,008)|(727,698)|(4,600,706)|(4,775,205)| ||________|________|________|________| |(Deficit)/surplus for year|(390,371)|49,758|(340,613)|37,874| ||________|________|________|________| |Funds carried forward|931,073|385,366|1,316,439|1,657,052| ||=======|=======|=======|=======| 8 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## BALANCE SHEET AS AT DECEMBER 2020 |||2020|2019| |---|---|---|---| ||||(restated)| ||Notes|£|£| |Non-current assets|||| |Fixed assets|7|95,067|142,450| |Investments|8|1|1| |||________|________| |||95,068|142,451| |||________|________| |Current assets|||| |Debtors|9|520,853|394,861| |Cash and cash equivalents||836,138|1,305,818| |||________|________| |||1,356,991|1,700,679| |||________|________| |Less: Creditors: amounts falling due within one year|10|(135,620)|(186,078)| |||________|________| |Net current assets||1,221,371|1,514,602| |||________|________| |Net Assets||1,316,439|1,657,052| |||=======|========| |Funds|||| |Restricted funds||385,366|335,608| |Unrestricted funds||931,073|1,321,444| |||________|________| |Total Funds||1,316,439|1,657,052| |||=======|========| The financial statements on pages 7 to 18 were approved by the Board of Directors on 26[th] March 2021 and were signed and authorised for issue on its behalf by: Chairman Company Registration No. 04448389 (England and Wales) 9 ## THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## STATEMENT OF CASH FLOWS AS AT 31 DECEMBER 2020 |||2020|2019| |---|---|---|---| ||||(restated)| ||Notes|£|£| |(Deficit)/surplus for the year||(340,613)|37,874| |Adjustment for non-cash items|||| |Depreciation|7|67,599|67,527| |(Increase)/decrease in debtors||(125,992)|88,123| |Decrease in creditors||(50,458)|(21,637)| |Adjustment for investing or financing activities|||| |Investment income||(618)|(782)| |Interest and other finance cost||1,932|3,121| |||________|________| |Net cash (outflow) / inflow from operating activities||(448,150)|174,226| |||________|________| |Cash flows from investing activities|||| |Investment income||618|782| |Payments made to acquire fixed assets|7|(20,216)|(14,921)| |||________|________| |||(19,598)|(14,139)| |||________|________| |Cash flows from financing activities|||| |Interest and other finance cost||(1,932)|(3,121)| |||________|________| |(Decrease)/ increase in cash and cash equivalents in the year||(469,680)|156,966| |||=======|========| |Cash and cash equivalents at beginning of the year||1,305,818|1,148,852| |||________|________| |Cash and cash equivalents at end of the year||836,138|1,305,818| |||=======|========| 10 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## 1. Accounting policies The Aga Khan University (International) in the United Kingdom meets the definition of a public benefit entity under FRS 102. ## a) Basis of preparation and going concern The financial statements are prepared in accordance with the historical cost convention and are prepared in accordance with applicable United Kingdom Accounting Standards, the Statement of Recommended Practice (SORP 2019), “Accounting for Further and Higher Education” and the Companies Act 2006. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy notes. The operations of the University are funded primarily from donations received from The Aga Khan University Foundation, Geneva (‘the Foundation’). The Directors believe that the Foundation will continue to support the University as they have done so in the past. On this basis, the Directors consider it appropriate to prepare the financial statements on the going concern basis. ## b) Group accounts The financial statements present information about the University as an individual undertaking and not about the group. The University and its subsidiary undertaking comprise a small-sized group. The University has therefore taken advantage of the exemptions provided by section 398 of the Companies Act 2006 not to prepare group accounts. ## c) Recognition of income All incoming resources are recognised when the University has entitlement to the resources, the amount can be quantified with reasonable accuracy and it is probable that the income will be received. The following specific policies are applied to particular categories of income. Tuition fees are recognised as income over the period of instruction. Voluntary income received by way of grants, donations and gifts and is included in full in the Statement of Income and Expenditure when the University has an entitlement to the income, the amounts can be quantified with reasonable accuracy and it is probable that the income will be received. Grants, where entitlement is not conditional on the performance of specific requirements by the University, are recognised when the University becomes entitled to the grant and it is probable that the grant will be received. 11 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 Investment income consists of bank interest, which is included when receivable. ## Prior year adjustment – income and deferred income In the year ended 31 December 2020 the University amended its accounting policy for the accounting of donations and grants. Previously donations received that were to be utilised for future expenditure were deferred to the next accounting period as deferred income. In 2020 the University amended its accounting policy to that shown above. This changed resulted in the University recognising restricted and unrestricted funds at the year ends on the statement of comprehensive income and expenditure and balance sheet. ## d) Foreign currencies Transactions in foreign currencies are translated at rates prevailing at the date of the transaction. Monetary assets and liabilities in foreign currencies are translated into sterling either at the rate of exchange prevailing at the year-end or, where there are related forward foreign exchange contracts, at contract rates. The resulting exchange differences are dealt with in the determination of income and expenditure for the year. ## e) Pensions Payments to the University’s defined contribution pension scheme are charged to the income and expenditure account as they become payable. ## f) Tangible fixed assets and depreciation Tangible fixed assets are stated at cost less depreciation. In line with University policy, only items over £160 are capitalised. Depreciation is provided at rates calculated to charge the cost less estimated residual value of each asset over its expected useful life as follows: Computer equipment 33.3% straight line Library books 15% straight line Manuscripts and rare items are accounted for as heritage assets. Any items purchased are capitalised at cost and, as they become obsolete or out of date or unusable, they are scrapped and the original cost is written off to the income and expenditure account in full. The items held therefore maintain high residual values in relation to costs and, due to this, they are not depreciated. The University maintains an appropriate register of manuscripts in order to apply this accounting policy. ## g) Investments Investments are carried at historic cost less any provision for impairment in value. 12 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) ## NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## h) Employee benefits The costs of short-term employee benefits are recognised as a liability and an expense, unless those costs are required to be recognised as part of the cost of stock or fixed assets. The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received. Termination benefits are recognised immediately as an expense when the University is demonstrably committed to terminate the employment of an employee or to provide termination benefits. ## 2. Fees & other income |2.|Fees & other income||| |---|---|---|---| |||2020|2019| ||||(restated)| |||£|£| ||Tuition fees|184,433|202,097| ||Less: Remission
|(152,140)|(150,393)| |||________|________| ||Tuition fees – Net
|32,293|51,704| ||Indirect cost recovery
|88,665|67,171| ||Short courses, contributions, donations and other income
|34,538|2,899| |||________|________| |||155,496|121,774| |||=======|=======| |3.|Donations||| ||Donations from:||| ||The Aga Khan University Foundation, Geneva
|1,559,961|2,136,534| ||The Aga Khan University – donations-in-kind|135,783|393,033| ||Aga Khan Foundation (United Kingdom) – donations-in-kind|
1,630,779|1,600,220| |||________|________| |||3,326,523|4,129,787| |||=======|=======| During the year, The Aga Khan Foundation (United Kingdom) supported the University through permitting usage by the University of the Aga Khan Centre, London and Student Accommodation at King’s Cross. This contribution has been recorded as a donation-in-kind having a value to the University of £1,630,779 (2019: £1,600,220). During the year, AKU supported the University through the provision to the University of administrative and other services. This contribution has been recorded as a donation-in-kind having a value to the University of £135,783 (2019: £393,033). 13 ## THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## 4. Staff costs Staff costs consist of: |Staff costs consist of:||| |---|---|---| ||2020|2019| ||£|£| |Salaries|1,397,824|1,304,567| |Social security costs|161,750|150,531| |Other pension costs|124,519|137,366| |Other staff costs|39,259|58,223| ||________|________| ||1,723,352|1,650,687| ||=======|========| ## Key management personnel Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the University. Staff costs include compensation paid to key management personnel. |personnel.||| |---|---|---| ||2020|2019| ||£|£| |Key management personnel compensation|198,918|198,022| ||=======|========| The figures above represent salary and benefits excluding employer’s pension contributions. The average monthly number of persons employed by the University during the year was: ||2020|2019| |---|---|---| ||Number|Number| |Faculty|12|10| |Support services|14|19| |Visiting lecturers|-|2| |Research fellows|5|1| ||________|________| ||31|32| ||=======|=======| 14 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## 5. Other operating expenses |Other operating expenses||| |---|---|---| ||2020|2019| ||£|£| |Staff related costs|9,674|94,207| |Notional rent (usage cost of AKC) and other notional property expense|1,630,779|1,326,976| |Supplies and subscriptions|1,591|17,178| |Student expenses|118,245|131,602| |Professional fees|65,229|67,937| |Administrative and general expenses|119,494|278,596| |Grant expenditure – restricted costs|727,028|744,341| |Shared support services (note 12.1)|135,783|393,033| ||________|________| ||2,807,823|3,053,870| ||=======|========| |Other operating expenses include:||| |Auditors’ remuneration (included in professional fees)|15,500|15,130| ||=======|=======| ## 6. Taxation The University was established to undertake its activities on a non-commercial basis, funded by grants and donations. On this basis no taxation has been provided in these accounts. 15 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## 7. Tangible fixed assets ||Computer|Library|Manuscripts|Total| |---|---|---|---|---| ||equipment|books||| ||£|£|£|£| |Cost||||| |As at 1 January 2020|313,167|491,391|19,900|824,458| |Additions|20,216|-|-|20,216| |Disposals|(84,867)|-|-|(84,867)| ||________|_______|________|________| |As at 31 December 2020|248,516|491,391|19,900|759,807| ||=======|======|=======|=======| |Depreciation||||| |As at 1 January 2020|215,367|466,641|-|682,008| |Charge for year|58,330|9,269|-
|67,599| |Disposals|(84,867)|-|-|(84,867)| ||________|_______|________|________| |As at 31 December 2020|188,830|475,910|-|664,740| ||=======|======|=======|=======| |Net book value||||| |As at 31 December 2019|97,800|24,750|19,900|142,450| ||=======|======|=======|=======| |As at 31 December 2020|59,686|15,481|19,900|95,067| ||=======|======|=======|=======| 16 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 |8.|Investments||| |---|---|---|---| |||2020|2019| |||£|£| ||Subsidiary company|1|1| |||=======|=======| The University owns 100% of the issued ordinary £1 share of The Institute For The Study Of Muslim Civilisations Limited, a company incorporated in England and Wales with one issued share. The subsidiary has been dormant since its incorporation. A subsidiary of the University exists in the United States of America, to create awareness of AKU’s global activities (including the University as an academic unit of AKU) and to solicit funds in the USA to support the said activities. The subsidiary is a non-profit corporation without share capital and had minimal trading in the year. ## 9. Debtors |Debtors||| |---|---|---| ||2020|2019| ||£|£| |Other debtors|472,575|381,845| |Prepayments|48,278|13,016| ||________|________| ||520,853|394,861| ||=======|=======| Included within other debtors are student loans of £72,539 (2019: 132,699) that are due after more than one year. Included within other debtors is a sum of £200,000 (2019: £nil) due from The Aga Khan University Foundation, Geneva and £nil (2019: £6,195) due from The Aga Khan University, Pakistan. 17 THE AGA KHAN UNIVERSITY (INTERNATIONAL) IN THE UNITED KINGDOM (A COMPANY LIMITED BY GUARANTEE) NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2020 ## 10. Creditors: amounts falling due within one year |Creditors: amounts falling due within one year||| |---|---|---| ||2020|2019| |||(restated)| ||£|£| |Trade payables|19,642|57,040| |Amounts owed to subsidiary undertaking|1|1| |Deposits held|124|7,066| |Taxation and social security|89,988|82,243| |Accruals and deferred income|25,863|39,726| |Members’ funds|2|2| ||________|________| ||135,620|186,078| ||=======|=======| Included within trade payables is a sum of £8,227 (2019: £nil) due to The Aga Khan University Pakistan. ## 11. Control The limit of the total guarantees of the members of the University amounted to £2 at the beginning and end of the year. The guarantees are provided as to £1 by Aga Khan University and as to £1 by Aga Khan Education Services S.A. ## 12. Related party transactions Parties related to the University are The Aga Khan University, Pakistan, Aga Khan Education Services S.A and Aga Khan Foundation (United Kingdom). i) Outstanding balances arising from transactions carried out with other related parties are as follow: ||2020|2019| |---|---|---| ||£|£| |Receivable from / (Payable to):||| |Aga Khan University Foundation, Geneva|200,000|-| |Aga Khan University Pakistan|(8,227)|6,195| ||=======|=======| During the year, AKU supported the University through the provision to the University of administrative and other services. This contribution has been recorded as a donation-in-kind having a value to the University of £135,783 (2019: £393,033). During the year, The Aga Khan Foundation (United Kingdom) supported the University through permitting usage by the University of the Aga Khan Centre, London and Student Accommodation at King’s Cross. This contribution has been recorded as a donation-in-kind having a value to the University of £1,630,779 (2019: £1,600,220). 18 Tllb: ACA KHAN UNIVb:RSII'Y InAtiiuie. ftsT Ihc 4ludy hluslim CiviliJtttiOn5 UHY Hacker Young LLP Chartered Accountants Quadrant House 4 Thomas More ￿uare LONDON Elw IYW 26th March 2021 DeaT Sirs Representations in respert of the fjnancial statements for the year ended 31 December 2020 We acknowledge a5 directors. and confirni that we have fulfilled, our responsibility for the preparation of finanaal statements For the year ended 31 tkcember 2020 that show a true and fair view and arL' in accordance with Uniled Kingdom senerally accepted accountins practiL and the Companies Act 2006. We a150 acknowled8e a5 directors our responsibility for the desisn and implementation of internal control to prevent and detect both em)r and fraud. We confirni to the best of our knowledge and belief, and havin8 made appropriate enquiries of other directors and officials of the University, the followin8 Tepresentation5 siven to you in connection with your audit of the University's finanoal statements for the year ended 31 DeceTnEer 2020. We have provided you with: Access to all information of W￿"¢h we are aware that is relevant to the preparation of the finanaal statements such as records, d(Kumentation 4)nd other matters; Addltional infotmation that you have requested from us for the purpose of the audit; Unrestricted acce55 to persons within the entity from whom you deterniined it necessary to obtain audit evidence. Specifically we confirm that: Atl accounting records have been made available to you for the PUTFrf)se of your audit. .4Ra ￿e￿Ire. lOHtth.sths￿eI. A'lf 4D. lèL" +44 {0120 7380 3W *44 I￿.11&311 1th￿ed￿Tr guarnM•r ,I&IR3 All other records and ￿lated lnf0nnatio￿ induding minut*￿ of all board meetings in the I)eTi￿ l January 2020 to date have IEen made available to you. fac untin All the transadions undertaken by the University have Feen Pro￿TlY reflected and recorded in the ac¢ounlin8 records. and in the finanaal statements. and int In preparing the financial statements the board has made the following significant judgments reliK ting lo amounts included in or disclosed in the financial statements: the Univer5ityrfs loans made 10 students, outstanding and nel of provisions as al 31 De￿lmL￿)r 2020 ()f £267,487, is considered fully rLKoverable. SFE(llfically, those balances that are overdue and have not been PTovided against of £44J99 are fully recoverable. we ￿lIeve that there will be a sufficient numirr of successful applicants for Master programrnes in the coming years and that the overall academic profile of the University is sufficiently strong lo enable it to continue as a going coneern for the foreseeable futhre. We have no plans or intentions that would. if taken into account, materially alter the carrying value or classification of assets and liabilities refiected in the finanaal statements. Aside from normal commercial constraints, we are not awaTe of any factor that will significantly redu￿ the likelihcK)d of the University achieving those of its plans or intentions that are material to the deterniination of the cJryin8 value or cla.isification of a￿tS and liabilities reflected in the financial statements. We confimi that any excess of income over exp￿ditUre should be deferred into the following accounttng periiKI. We confirn) that the aEove repre5entalions are our inlentions on these matters and that we consider them reasonable. There were no errors identified during the course of the audit that were aEove our level of materiality and Iherefore no adiustments made to the financial statements. liance with talu ation includin taxl lati We are not awa￿ of any instan￿5 of possible non-compliance with statutory or resulatory obligations or tax lesi51ation which could have a material effect on the financial statements. TeL. MI {OJ20 7MTr3W FaL (0)20 T￿,9&10 F.Jry￿. reem We hKive disclosed to you all the agreements and commitments land any related side letters) that the University has entered into Ihat could have a material impact on the amount5 or disc105ures included in the finanaal statements. or are relevant lo an assessment of whether the University Trmains a goins conL*rn. We are not aware of instances of non<0mplian￿ with our contractual obligations which could have a material effect on the finanoal statements. ontin includin liti aim niv and All material LThtingencies (including all known, actual or w)lential liti8ation or elaims against the University} that arL' more likely than not lo result in a loss lo the University have been provided for in the financial statements. Except for mattets for which there is only a remote p055ibility of occurren￿, the University is T401 iiffected by any suth continbyency whith existed at the balance sheet date and whid) could possibly result in malerial105s lo the University. There have been no events Since the balance sheet date ivhich nÉressitale revision of the figures included in tho financial Sta￿.MentS or inclusion of a note thereto. Should any 5uth events occur, we will advise you accordingly. ir We aeknowled8e that the University's financial staternents are requiTed by the Companies Act 2006 and the applicable accounting standard lo indude specified disdosure of the nature. extent and amount of it5 transactions that are with, or for t1￿ Eeneh't of. any of its directors lor, in certain circumstances, Members of their families and trusts parknerships and other companies in which they have an interest). We have identified and diSc￿ssed with you all the transactions of the University with its directors and their cutu￿￿ed perwLS. CorLsequent upon these PTOL-edures. we are able to make the following representation. The University has at no time during the year granted any adVan￿S or credits to, nor entered into any guarantees of any kind on FEhalf of. any of its dirKtors or per￿)r6 connected with Iheiii eX￿p1 as disdosed in nutLS 4 and 15 tci the financicil statements. Apart from remuneration attangements, the UnÈver5ity has had at no time during the year Ago rtmre. iw¥hn. ,vir 4D.Ir entered into any other transartions with its directors or Fer￿XIS conneded with them eX￿pt as disclosed in nOtL￿ 4 and 15 to the fmanaal statements and eX￿pt for transacttons that are immateTial to both the diTectOTS (and any relevant corn)ected person) and the University linancial statements. ther than the direct We acknowledge that. subiect to ￿rta]ll s￿1￿C exemptions, the University's finanaaI slalements are requirlxt lo disclose comprehensive details of transactions and relationships with ils'relaled parties- in order to give a tNe and fair view. Accordingly we confimi that We have disclosed to you the identity of the entity's related parties and all the related party relationships and transactions of which we are awaTr,' and bl We have Pro￿TlY accounled for and discl(6ed all such relationships and transactions in the financial 51atemenls. In making that confirniation we acknowledge: the following broad definition of related parties, Eein8'. th(6e individuals, companie5 and other entities connected or link£￿ wilh the University or its directors in suth a way as lo make feasible the negotialion of mutual contracts on a non-am)s length basis. and b) the Formal definition of. related parties" given in the applicable accountin8 Standard. For the avoidance of doubt. we confirni that the University has the following related parties, in addition to the dir£rtors Fersonally. these additional related parties are". A8a Khan University A8a Khan Education Services S.A. A8a Khan Foundation, UK io. niv The Board of Trustee5 of Aga Khan Univcrsity has control in relation to, and the 15maili Jmamat is pL?rson with significant control in relation to, the University. and all We acknowledge as diredors our resFK>nsibiIity for the dest￿ and implementation of intemal control to prevent fraud. We have di*10sed to you the results of our assessment of the risk that the financia] statements may be materially misstated a5 a result of fraud. A80 Kknftnlre. 10 Hwth.stdv.ftre¢i. l.o•thrt ,Yir4D. ¥é1.. +41 (Ogo 73W.7WP fOJ20 7MI.TIR71) UJTrW@tiknLedu We are not aware of fraud (or st]specled fvaud) affecling the University involving.. the directors; or ser)ior management and Ot￿r employees that have significant roles in internal control,. or others where the fraud (or SUSF*ded fraud) could have a material effect on the finanaal statements. We are not aware of allegations of fvaud lor suspe(ted fraud) affecting the UniVersit￿S financial statlments communicated by employe￿. fonneT employees, or others. Yoiirs Eaiihfullv (Signed on Eehalf of the EK)ard of directors) Alkm C entre. 10 HuNlbyide Streei. Lon*R.VII" 4D.I' Itl.. 444 (0320 7W•38￿ (0120 i3&J.I&IO F.ffl￿. tsYrtr.tskn4rd