COLLEGE WORKING MEN'S COLLEGE CORPORATION A company limited by guarantee and not having a share capital Report and Financial Statements for the year ended 31 July 2021 Company registration number.. Charity registration number. 8894 312803 WORKING MEN'S COLLEGE CORPORATION Contsnts Key Management Personnel and Professional Advisors Members, Report including the Strategic Report Statement of Corporate Governan￿ and Intemal Control Statement of Regulanty, Propriety and Compliance 27 Statement of the Responsibilities of the Govemors of the Corwration 28 Independent Auditorfs Report to the Members of the CofjK>rakn"on of Working Men's College 29 Reporting A¢countanY5 Assuran￿ Report on Regulanty to the Govefflors of the Corporation of Working Men's College and the Secretary of State for Education acting through the Department for Education 33 Slalement of Comprehensive Income 35 Stslement of Changes in Reserves 36 Balance Sheet 37 Cashflows 38 Notes to the Accounts 39 WORKING MEN'S COLLEGE CORPORATION KEY MANAGEMENT PERSONNEL AND PROFESSIONAL ADVISORS for the year ended 31 July 2021 Professional Advisors Financial Statements & Regularfty Audllor: Buzzacott LLP 130 Wood Street London EC2V 6DL Internal Audito Scmtton Bland Fitzroy House Crown Street Ipswch, Suffolk IP13LG Banker5: Investment Managers: BNY Mellon Limited Mellon Financial Centre 160 Queen Victoria Street London EC4V 4L4 Lloyds Bank Education Mid Markets 4" Floor, 25 Gresham Street London EC2V 7HN Loan Finance: Loan Finance". Lloyds Bank Education Mid Markets 4 Floor, 25 Gresham Street London EC2V 7HN Barclays Bank Education Team Level 27, 1 Churchill P12¢e London E14 5HP Key Nlanagement Personnel Key management personnel are defined as members of the College's Execub"ve Management Group. For 2020121 the members were.. Helen Hammond - Principal and CEO, Accounb"ng Officer Maria Rosenthal- Deputy Principal Martin Jones- VI￿ Principal Diana Teesdale - Director of Leaming Lisa Marklew - Director of Leaming Caroline Poole - Director of Leamer Services Claudia Forbes - Head of MIS Julie Paterson - HR Manager Board of Governor5 A full list of Governors is given on page 20 of the finanaal statements. The position of Clerk to the Corporalion vrds held by Bill BaTker {0.5 f.t.e. appointmenll WORKING MEN'S COLLEGE CORPORATION MEMBERS. REPORT INCLUDING THE STRATEGIC REPORT for the year ended 31 Juty 2021 The Board of Governors. who are directors for the PL5rposes of the Companies Act and trustees for the purposes of the Charities Act, hereinafter referred tri as the Corporation, present their annual report and the audited financial statements of the Working Men's College Corporation {"the College" or 'WM College") for the year ended 31 July 2021. NATURE, OBJECTIVES AND STRATEGIES Legal Status The Working Men's College Corporation is a'specialist Designated Institution, (SDI}, now known as an Institute of Adult Leaming IIALI, under the Further and Higher Education Act 1992. It is also a company limited by guarantee not having a share capital and it 15 a registered charity. The College is subject to the legal framewoTk governing the Further Education sector. including the rules set from lime to lime by the Government departments and agencies with responsibility for the sector. DL6ring 2020121 these were the Department for Education IDfEI and the Educats"on and Skills Funding Agency IESFAI together with the Greater London Authority {GLAI who provided funding to the College from 1 August 2019 under devolved funding arrangements. The College is a150 subiect to the requirements of the Companies Act and the Charities Act. The College's financial affairs are govemed by Funding Agreements with the EFSA and the GLA. In addition, the College, as a charitable company limited by guarantee. is governed by the charitable company's memorandum and articles of associats"on. The College also meets the definrtion of a charitable company for UK corporation tax Purposes as set out in Paragraph 1 Schedule 6 of the Finance Act 2010. Accordingly, the College is potentially exempt from taxation in ￿pect of income or capital gains Covered by the relevant legislation. provided that they are applied lo exclustvely chantable purposes. Mlsslon The Corporation keeps the mission statement and strategic objective5 under regular review. The mission statement was updated in 2015116 and reviewed in 2019r20 without further amendment. The current mission statement adopted is.. "To provide dNerse, enriching and enjoyable lifelong leaming including skills for work, in a supportive environment for adults in Camden and the local area.. Strategic Plan College Govemors and managers develot*d a new 3-year strategic plan during 2018119 which was approved by the Corporation in July 2019. The plan covers the period from 2019 to 2022 and the strategic objectives adopted are set out below. Excellence for a51. We will Provide an enriching leaming experience that raises aspirabons, celebrates success and promotes inclusion and diversity. Ensure all leamers are supported and inspired to meet and exceed their individLtal aims and objectives and progre55 towards bng temi goals. Enable learning that leads to improved physical and mental hearth and social and emots.onal well- being as well a5 improved employment prospeGts. Support leamers to become expert learners through teaching and learning that tskes place beyond the classroom and develop5 their digital skills. WORKING MEN'S COLLEGE CORPORATION MEMBERS, REPORT INCLUDING THE STRATEGIC REPORT for the yearendgd 31 July 2021 Effecb"ve and sustainable. We will Optimise leaming opportunities by deploying the College's physical, human and virtual resources to provide greater efficiency for the College. Provide IT infrastructure and leaming Materials to facilitate and eTrhan￿ both classroom and digital learning eXperien￿S. Develop systems, pmcesse5 and resources to eliminate unnecessary bureaucracy and provide online access to core infomiation on a timely basis. Idenlrfy relevant new funding and commercial income opportunitFes, pursuing those that will support sustainable new activities or expand existing provision. Workin T ether. We will Work in partnership with the GLA and London IALS for the benefft of all adult learners. Take Seaming into the local eommunity to ensure Ihat there are no barriers to access learning opportunities. Develop partnerships w¢th other providers to proV￿e opportunities for leaming that complement or extend WMC studies. Publlc Benefft The College is a registered charity and foltowing the machinery of Govemrnent changes in July 2016, Is regulated by the Secretary of State for Education as Principal Regulator for all Further Education Corporations in England. The Govemors of the Corpora*"on, who are tnjstees of the charity, are disclosed on page 20. In setting and reviewing the College's strategic objectives. the corporab.on has had due regard for the Charity Commission's guidan￿ on public benefit and particulady upon its supplementary guidance on the advan￿Ment of education. The guidanee sets out the requirement that all organisalions wishing to be recognised as charities must demonstrate, explicitly, that their aims are for the public benefit. In delivering its missron, the College provides the followng identifiable public benefits through the advancement of education". H￿h quality leaching and learning- Widening participab'on and tackling social exclusion.. Excellent employment record for students- Strong student support systems. Links with employers in industy and Commer￿.. and Links with Local Enterprise Partnerships. Further inft)rmalion and examples of the delNery of public benefft are covered throughout the remainder of the Members, Report including the Strategic ReporL General Financial Objectives The College's general financial objectives were revised in 2017 and reviewed regularly, bul not changed, since then. The existing objectives approved by Govemors in June 2017 are to maintain." Cash days of not less than 40 nor greater than 65 An adjusted Current rab'o in the range of 2.0'.1- 2_5'.1 Earnings Before Interest Taxation Depreciation and Amorbsation IEBITDA}, using ESFA education specific definition, of be￿een 4% and 6% of income Borrowing as a percentage of non-endowment reseNes of less than 15% Staff costs {excluding restructuring costs) belween 64% and 68.kn of income. Financial heatth of "Good. with a score of at teast 200 poinls WORKING MEN'S COLLEGE CORPORATION MEMBERS, REPORT INCLUDING THE STRATEGIC REPORT for the year endod 31 July 2021 In 2020121, largely as a consequence ol the impact of coV￿-19, only 3 of the 6 financial objectives were met.. Ob"ectTve Cash days of not less than 40 nor 9￿ater than 65 An adjusted current ratio in the range of 2.0-1 _ 2.5-1 EBITDA, using ESFA educats.on SFecffic definrtion. of between 4% and 6°k of income Borrowing as a '/oage of nonendowment ￿serveS of less than 15% Staff costs (excluding restructuring costs} betsveen 64.kn and 68¥0 of income Financial heatth of'Good' with a score ot at least 200 points 2020121 Met Mel Not Met 0.97 4.1% Met 6.3% Mel 70% Not Mel Requires Improvement Not Mel As explained in more detail in the financial review Section below. the College eXperien￿d a second ye2r of shortfalls in fee income and investment income. due to the national lockdown and economic impact on businesses resulting from the Covid-19 pandemic. Consequenuy, the EBITDA was lower and staff costs were a highef proportion of income than usual. The financial health is a function of achievement of the other objecb.ves so rernained at -requires improvemenf for a second year. Governors and managers have carefully interrogated the informab.on and remain confident that the underlying position and perfomance of the College remains robust and fully expect lo retum lo meeting the objectives once operations return to a more nomial ststus post-pandemic. If the budget for 2021122 is met, the College should retum lo"Good" financial health in summer 2022_ Investment Fund Objectives The College's investment ftjnd financial objecb.ves were revised in February 2014 and are as follows-. To review fvnd management objectives at regular intervals and in response to changing rna￿et conditions. To achieve a balance between income and capital growth. To achieve a totsl relum of°inflation plus 4%". To seek to invest the funds in the following proportions-. All in Newton's Global Growth and Income Fund ft)r Charrties IGGIFCI. At 31 July 2021, the proporbons of investrnents by type were as follows.. 1 OOOA in the Newton Global Growth and Income Fund for Charities. At 1 August 2020 the investment portfolio was valued at £4.862 million. The investment income received dLJring the year was £114,000 wh￿h eqLFates lo 2.30￿ ol the opening valuation. The portfolio value increased to £5.799 million by 31 July 2021 representing an annual growth of 19 3,/0 and recovering the significant decline of 2019120. These perfomiances exceed the total return objective sel and reflect the global market movements fo1lowng.8￿xrf and during the coronavirus pandemic. Aceommodatlon Strategy In November 2020 the College achieved practical completion on the major capital project lo replace the entire College heating system and to install a mixed mode ventilation system in the Victorian, grade 11 listed building in Crowndale Road. The heating system uses efficient modern boilers to reduce the College's use of fossil fuels. whilst the ventilabon scheme design uts'lises features of the existing structure of the Victorian building and is sympathetic to its grade 11 listed features and also adopts an environmentally sustainable approach. The system utilises reflective window blinds and secondary double glazing lo reduce initial solar gain, the thermal mass of the walls and night cooling to help keep the room air temperatures from rising and natural air circulats.on routes to avoid the need for any WORKING MEN'S COLLEGE CORPORATION MEMBERS, REPORT INCLUDING THE STRATEGIC REPORT forthe year ended 31 July 2021 mechanical cooling of air. This has been particularly beneficial in enabling good ventilation to be maintsined in line with guidance on mib"gating the spread of Covid-19_ The College carried out a major refurbishment of levels of the Crowndale Road sile resulting in a significant improvement to the teaching and learning environfflenL The works were funded in part by Govemment capitsl grant. PERFORMANCE INDICATORS Otsted Inspection Working Men's College's most recent inspection took place in November 2018 and the Corporation and staff were very pleased the report from Ofsted which graded the College as 'Good° in every assessed area. The College's grades awarded by Otsted were.. Overall Effectiveness Effectiveness of Leadership 2nd Management Adult Leaming Programmes Quality of Teaching, Leaming and Assessment Personal Developrnenl, Behaviour and We￿a Outcome for Learners Grant Funding The College's perfomiance against the Education and Skills Funding Agency's IESFAI revenue and learner number tsrgets in 2020121 is set out below". Funding for Adults Funding Category Target {allocation) A¢lual Outturn {GLAIESFA contracts) (Final Claim) Perfomance Adult {19+l Leamer- ResF)onsive Funding Adult EduCat￿n Budget IAEB) £4.333.000 £4,055,000 93.6 % Under ESFA funding rules, Ihe College can expect to receive the lower of the final actual outtum or the funding allocation, subject to a.reconciliation threshold.. For 2020121, the ESFA confirmed that due to the impact of the pandemic on College activities, the threshold would be sel al 90010, meaning the College is not subject to reconciliation and clawback of funding for 2020121 and the College accounts recognise the full funding allocation as income in the year. Funding for 16-19 Year Olds Funding Category Target lallocab.onl Actual OLTrtturn IESFA contract) (Final Claim} 40 30 Perfomiance 16-18 Leamer- Responsive Funding Leamer Numbers 750 Funding Value £187.083 £ 143,524 770 Under the ESFA lagged funding rules. the College will receive the target funding value for the year and any over or under performance will be taken into account in funding allocations for future years. The College considers the overall performan￿ against funding lo be satisfactory given the scale of disruption to delivery caused by Covid-19. WORKING MEN'S COLLEGE CORPORATION MEMBERS, REPORT INCLUDING THE STRATEGIC REPORT forthe year ended 31 July 2021 other Incomg The table below shows the proportion of the Col*e's income received in the form of direct fvnding body grants for the last five years: Year Direct Grants Total Income £'ooo £'ooo 2016117 4,585 5,767 79% 2017118 4,679 5.883 81% 2018119 4,678 5,789 800A 2019120 4,765 4,977 5,373 5,634 89% 2020121 The proportion of College income derived from direct grant funding has remained in a narrow range between 780/0 and 81Qk dunng the period from to 2018119. The proportion increased markedly in 2019120 and 2020121 as a consequence of the Covid-19 pandemic because funding income was largely preserved, but fees and other non-funding income fell signtficantly. Nevertheless. the College remains committed lo reducing its dependence on direct fvnding body grants where possible. Learner tuition fees decreased again year on year from £424,000 in 2019120 10 £348,000 in the current year reflecting the full year impact of the coronavirus pandemic including a "lockdown. from January lo March 2021 preventing the College from running COUTses that required studio resources in the College buildings. The amounts re￿IVed by the College through adult leaming loans, for learners aged 19 or over who are studying at level 3 or higher, are induded within fee income. These have generally not proved popular with leamers and contributed only £38,000 of fee income in 2020121 12019120 £62,000) The College keeps the level of fees under constant and careful review in order to optimi5e income while ensuring that adult education remains accessible to as many people as possible. Leamer Nurnbgrs In 2020121 there were 2,502 unique leamets of which 1.833 were female and 669 male and 6.443 enrolmenls in the College. mostly on part time courses ranging from one 2 hour session lo a full 3 days per week and including the leamers enrolled on courses in the community- Overall learner numbers decreased by 670 and enrolmenls by 10 in the awredited provision and by 772 on non-aecrediled courses. This was due to a combination of the impact of Covid-19 and changes to the ¢ourse structu￿. Leamer Perfonnance Compared to 2019-20, the College made a ￿markable recovery in bringing achievement rates back lo pre-covid levels despite a complete lockdown in term 2 of 2020121. On accredited courses retention was 4 % above the previous two years at 94QA {1 % above college target} and pass rates were 8Va above 2019120 and only 5Yo below 2018119, compared to 14% down in the previous year. Overall achievement was only 1 OA below 2018119 at 850k compared to 74Qk in 2019120. Non- accredited courses were strong with achievement slightly above 2018119 at 92%. Although overall achievement across the College did not hrt College targets, they were sel at the same level as 2018119 as the uncertainty of the pandemic made it impossible to predict with any certainty". therefore they were less meaningful. WORKING MEN'S COLLEGE CORPORATION MEMBERS, REPORT INCLUDING THE STRATEGIC REPORT for the year ended 31 Juty 2021 The table below shows student overall achievement ft)r all Col*e courses. as reported in the College self-assessment reporL Accredited Learners1746 leamers with 1.353 enrolmentsl Year Retention Pass rate Overall A¢hievement Attendance 2019120 Actual 91% 82% 74% 880 2020121 Target 2020121 Actual 92% 90% 83% 88 9/. 91% 85% 900 Percentage point change 2020121 over 2019120 +11 Non-Accredlted Learngrs12,288 leamers 5.090 enrolments) Year Retentlon Pass rate Overall Achievement Attendance 2019120 Actual 91% 99% 89Yo 900 2020121 Target 2020121 Actual 95° 99% 90% 940 99% 92% 890 Percentsge F)oinl change 2019120 over 2018119 No change Other External Perforniance Indlcators The College is committed to observing the importance of sector measures and indicators and uses the FE Choices data available on the GOV.UKwebsite which looks at rneasures such as overall achievement rates. The College is required lo complete the annual Finan￿ Record for the Education and Skills FLJnding Agency IESFAI. The Finance Record prcmjuces a financial health grading. Under the ESFA'S new methodology for calculating the grade, the College achieve5 2 "Requires Improvement. rating for 2020121 and Good. for the 2021r22 budget. This is a Consequen￿ of the reduced EBITDA in 2020121 resulting from the impact of Covid-19 on the income and operating perfomiance and the associated impact on cash holdings and the current rab"o. Up until July 2019. the College held an 'Oulstanding" financial health grade and Governors are confident that the financial Strategy and plans will return the College to a 'Good' rating by July 2022. In summer 2018. Working Men's College becarne the first college in London and the first adult college nationally lo be awarded chartered membership of the Chartered InsJ"tub"on for Further Education. The College's Principal was recognised with fellowship of the jnstitub.on in summer 2019. STRA TEGIC REPOR T FINANCIAL POSITION Financial Results Although the College reported a second year of operating deficit at £94,000 for the year to 31 July 2021 12020 - deficrt of £47,000), this is considered to be a sabsfactory result in light of the disrupb'on caused by Covid-19 and the resulting loss of fee income and other non-grant funded income and is better than the budget approved by Corporation for the year. The College "furtoughed" some staff during the national lockdown between January and April 2021 and, where they qualified, claim5 were made lo the Government's Coronavirus Job Retention Scheme which helped mFkngate the defrcit. WORKING MEN'S COLLEGE CORPORATION MEMBERS. REPORT INCLUDING THE STRATEGIC REPORT for the year ended 31 July 2021 The capitsl project to replace the entire heating system in the College building at Crowndale Road and introduce a mixed mode ventilation system reached practical completion during the year with £3 02m of work in progress transferred to building improvements in fixed assets wth an expeeled useful life of 25 years adopted for depreciation purposes. The College purchased £849,000 of other new tangible fixed asset addib.ons during the year, ofwhich £266.000 was computer equipment and £455,000 related to other building irnprovemenls, fvmilure. fixtures and fittings with £128,000 being work in progress relating to upgrading of the College's IT infrastructure undertaken across spring and summer 2021. At the end of the year, the College owned tangible fixed assets with a net book value of £9.094 million of which £8.574 million related to buildings and building improvements. £368,000 related to computer and other equipment. fixtures and fittings and £128.000 to the IT infrastructure upgrade in progress at the year end. Investments The College's perf0mlan￿ on its endowment investment portrolio is set out in note 12 to the accounts. The portfolio generated an income retum of £114,000 during the year and increased in value by £937,000. The portfolio had a market value of £5.799 million at the balance sheet date12020 - £4.862 Total comprehensive income in 2020f21, slated after investment gains. was a surplus of £933,000 12019120 - deficit of £645,000) ReseNes The College has no ft)rmal reserves policy but recognises the imwrtance of reserves in the financial stability of any organisalion and stn.ves to ensure that there are adequate reserves to support the College's core activities. As at 31 July 2020. general income and expenditure funds totalled £8 068 million compared lo the 2020 total of £8.101 million. The College also held reslncted funds and endowments totalling £5.644 million 12020. £4.680 millior4} These funds have been given to the College for particular purposes specified by donors and therefore are not available to the Corporation for general use although some of the endowments are classified as expendable. It is the inlentson of the Corporation to maintain a balance in the level of reseNes between providing adequate levels of contingency and investing in projects that will develop the College and support delivery of the strategie p18n. The Corporation is formulating a medium term strategic financial plan to replenish the reserves utilised in 2019120 and 2020121 during the coronavirus pandemic. CURRENT AND FUTURE DEVELOPMENT AND PERFORMANCE Financial Plan The College Governors approved a financial plan in July 2021 which sets objectives for the period lo July 2022 and demonstrates financially how the College can expect lo deliver ils strategic plan and objectives. Because of the continuing impact of Covid-19 and related uncertainties about how il will affect College OF)eralions during that periijd, the plan has more elements of estimation and risk outside the College's control than in other years. The plan has an operating surplus of £94.000 and the Govemors evaluated the plan carefully and consider that the undertying business remains strong and expect to maintain 8nnual budgets that are in surplus after the pandemic is over. Addib"onally, il was noted that the cashflow associated with the budget was cash generative and so helps improve the College's cash reserves and current ratio which is currenly signtheantly below the financial objective largeL WORKING MEN'S COLLEGE CORPORATION MEMBERS, REPORT INCLUDING THE STRATEGIC REPORT for the year ended 31 July 2021 Treasury Policies and Objeclives Treasury management is the management of the College's cash flows, ils banking, money mart(et and capital market Iransaclions, the effective control of the risks associated with those activities and the pursuit of optimum perfomance consistent with those risks. The College has a separate treasury and investment management policy in place. Cash Flows and Liquidity There wa5 a net cash inffow for the year of £50.00012020'. outt5ow of £1,534,000). In 2019120, this is a consequence of the expendrture on the new heatsng and ventilation project, funded from accumulated surpluse5 of previous years. The undertying position from net operating activities was a cash inflow of £915.00012020. £152,000). Long Terni Loans The College has existing long term loans al fixed rates of interest." one with Lloyds Banking Group for £1,000,000, drawn down in July 2007 and the other wrth Barclays for £500,000, drawn down in July 2008. Both loans were taken out lo support the major capital building improvement worlMeetings|Attended|Attendance| |Paul Smith (Chair)||3|3|100%| |Kate Bell|1 April 2021|2|2|100%| |Chris Percy|31 Dec 2020|1|1|100%| |Neil Garner||3|3|100%| |Max Silver|31 March 2021|1|1|100%| The Audit Committee meets at least three times during the year and provides a forum for reporting by the College’s internal and financial statements auditors, who have right of access to the Committee for independent discussion, without the presence of College management. The Committee also receives and considers reports from the Education and Skills Funding Agency as they affect the College’s business. Management is responsible for the implementation of agreed audit recommendations and internal audit undertakes periodic follow-up reviews to ensure such recommendations have been implemented. The Audit Committee appoints the internal auditors and advises the Corporation on the appointment of financial statements auditors and their remuneration for both audit and non-audit work as well as reporting annually to the Corporation. The appointment of financial statements auditors is an annual item of business for the full Board of Corporation. 23 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL for the year ended 31 July 2021 Internal Control Sco e ofRes onsibili The Corporation is ultimatety responsible for the College's system of intemal control and for reviewing its effectiveness. However, such a system is designed lo manage rather than eliminate the risk of failure lo achieve business objectives, and can provide onty reasonable and not absolute assurance against material misstatement or loss. The Corporation has delegated the day to day responsibility to the Principal, as Accounbng Officer, for maintaining a sound system of internal control that supports the achievemenl of the College's policies, aims and objectives, whilst safeguarding the public funds and assets for which she is personally responsible, in accordance with the responsibilities assigned lo her in the Funding Agreements be￿een the College and the Education and Skills Funding Agency and Ihe College and the Greater London Authority. She is also responsible for reporting to the Corwration any material weaknesses or breakdowns in internal control. The Pu ose of the S stem of Intemal Contn)I The system of internal control is designed to manage risk to a reasonable level rather than lo eliminate all risk of failure to achieve policies, aims and objectives,. it can therefore only provide reasonable and not absolute assurance of effectiveness. The system of intemal control is based on an ongoing process designed lo identify and prioritise the risks to the achievement of College policies, aims and objectives. to evaluate the likelihood of those risks being realised and the impacl should they be realised, and to manage them effieienlly, effectively and economically. The system of interr¢al control has been in place within Working Men's College for the year ended 31 July 2021 and up to the date of approval of the Annual Report and Financial Statements. Ca 8CIt lo Handle Risk The Corporaty'on has reviewed the key risks to which the College is exposed, together with the operating, financial and compliance controls that have been implemented to mitigate those risks The Corporation is of the view that there is a fom)al ongoing process for identifying, evaluating and managing the College's significant risks that has been in place for the peri(xl ended 31 July 2021 and up to the date of approval of the Annual Report and Financial Staternenls. Risks are allocated to the m05t appropnate committee, reviewed at each meetrng, and reported lo the next full CorFX)ration meeting. A full review of the risks and the annual report on risk management is tjndertaken by Audtt Committee each autumn and ￿ported lo the full Corporation in December prior lo the approval of the financial stslements_ The Risk and Control Framewo The system of inlemal control is based on a framework of regular management inforfflakn"on, administrative procedures including the segregation of duts"es, and a system of de￿atIOn and accountability. In particular, it includes". comprehensive budgeb.ng Systems wlh an annual budget. which is reviewed and agreed by the Governing Body, regular reviews by the Governing Body of periodic and annual financial reports which indicate financial perfomiance against forecasts., setting targets to measure financial and other performance-, clearly defined capital investrnent contro5 guKlelines". and the adoption of fomal project management disciplines, where appropriate. 24 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL for the year ended 31 July 2021 Working Men's College has internal audit arrangements, which operate in accordance with the requirements of the ESFA'S Post-16 Audit Code of Pracb"ce. The work of the internal audit providers is informed by an analysis of the risks to which the College is exposed and annual inlemal aLtdit plans are based on this analysis. The analysis of risks and the intemal audrt plans are eridorsed by the College's Governing Body on the recornmendalion of the Audit Cofflrnittee. Internal audit services provide the Audit Committee with reports on each internal audit activity in the College. Where appropriate, each report includes their independent opinion on the adequacy and effectiveness of the College's system of intemal control, risk management controls and governance processes. induding intemal financial control insofar as it is impacted by the area being reported on. Review ofEffectiveness As Accounbng Officer. the Principal has responsibility for reviewng the effectiveness of the system of internal control. The Principal's review of the effectiveness of the system of irilemal control is infomied by". the work of the intemal audit providers.. the work of the eXeC￿1ve managers within the College who have responsibiltty for the development and maintenance of the intemal control framework'and comments made by the College's financial statements auditors and the regularity auditors in their management letters and other reports_ The Accounting Officer has been advised on the implications of the result of her review of the effectiveness of the system of inlemal control by the Audit Committee which oversees the work of the intemal audit providers and other sources of assuran￿ and a plan to address weaknesses and ensure conb"nuous improvement of the system is in place. The College's Executive Management Group {EMGI receives reports setting out key perform8nee and risk indicators and considers possible control issues brought to Iheir attention by eaty waming mechanisms, which are embedded within the departments and reinforced by risk awareness training. The EMG and the Audit Committee also receive regular reports from the internal audit providets, which include recommendations for improvement. The Audit Comrnittee's role in this area is confined to a high-level review of the arrangements for internal control. The Corporation's agenda includes a regular item for consideration of risk and control and receive5 reports Ihereon from the EMG and the Audtt Committee. The emphasis is on obtaining the relevant degree of assurance and not merely reporting by exception. Each committee of Corporation receives 8 report on risk management at every meeting including the latest extract of the College's risk register covering the risks for which it has responsibility, as feviewed and upyated by Ihe Executive Management Group. Thus, any new risks are identified and controls on existif7g identrfied risks are reviewed on an ongoing b851S. The Corporation reviews and approves the Risk Register annually and delegates monitoring of the risks listed to the most appropriate cornmittee who consider them at each meeting. At its December 2021 meeting the Corporation will cary out the annual assessment for the year ended 31 July 2021 by considering documentation from the EMG, Audrt Commrttee and intemal audr( providers and taking a￿Ount of events since 31 July 2021. The Board also considers at its December meeting the Annual Report of the Chair of the Audit Committee, which includes advice lo the board on the adequacy and effecb-veness of the College's systems of internal control and its arrangements for risk management. control and govemance pr(Kesses, and on securing economy, efficiency and effectiveness Ivalue for moneyl. The report advises the Board of any significant matters arising from the work of the College'5 Intemal Audit Service IIASI and financial statements and regularity auditors appointed by the Board, and of the Funding Auditors appointed by the ESFA as applicable. 25 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL for the year ended 31 July 2021 The Corporation also receives, in December, the A¢counting Officefs Annual report on risk management which slates the view that the College's practices have enabled rt to effectivety identify, evaluate and control risks in order to eliminate, reduce. contain or transfer them. Based on the advice of the Audrt Committee and the Accounting Officer, the Corporation is of the opinion that the College has an adequate and effect.ve framework for g0veman￿. risk management and control, and has fU￿Illed Its slattjtory responsibility for'the effective and use of resources. the solvenGy of the institution end the body and the safeguarding oftheir assets.. Going Concern After making appropriale enquiries, the Corporation consider5 Ihat the College has adequate ￿OurCeS lo continue in OF)erational existence for the foreseeable fvjture. For this reason it continues to adopt the going concem basis in preparing the financial ststements. Approv by order of the Govemors of the CorF)orab"on on 15 December 2021 and signed on its behalf by." Guy Shackle Chair Helen Hammond Accounting Officer 26 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF REGULARITY, PROPRIETY AND COMPLIANCE for the year ended 31 July 2021 The Corporation has considered its responsibility to notify the Education and Skills Funding Agency IESFAI of material irregularity, irnpropriety and non-compliance with terms and conditions of funding, under the College's grant funding agreements and contracts with the ESFA. As part of tts consideration the Corporation has had dLte regard to the requirements of grant funding agreements and contracts with the ESFA. We confirm, on behalf of the Corporalron, that after due enquiry and to the best of Our knowledge, corpO￿tion members expect to be able to identify any material irregular or improper use of funds by the College, or material non-compliance with the temis and conditions of funding under the College's grant funding agreements and contracts with the ESFA. We further conffmi that no instances of material irregulartty. impropriety or funding non-compliance have been discovered lo date. If any instan￿$ are identified after the date of this ststement, these will be notified lo the ESFA. ned Guy Chair ackle Helen Harnmond Accounting Officer 15 December 2021 27 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF THE RESPONSIBILITIES OF THE GOVERNORS OF THE CORPORATION for the year ended 31 July 2021 The Govemors of the Corporation (who are trustees for the purrKJses of the Charitres Act and whose Appointed Governors are also the directors of the company for the purposes of the Companies Actl are required to present audited finan￿al statements for each financial year. Within the terms and colldib'ons of the College's grant funding agreemen15 and contract5 With the Education and Skills Funding Agency IESFAI and the Greater london Authorty IGLAI, the Corporation, through its A¢counb"ng Officer, 15 required to prepare financial statements and an operating and financial review for each financial year in accordance wth the Statement of Recommended Practice- Accounting for Further and Higher Education, the UK'S Generally Accepted Accounting Practice IGAAPI, the 'College Accoun15 Direction 2020 to 2021° issued by the ESFA and which give a true and fair view of the stale of affairs of the College and its surplus or deficit of income over expenditure for that year. In preparing the financial statements, the Corporats'on is required to: select suitable accounting policies and apply them consistenty.. make judgement5 and esb"mates that are reasonabÈ and prudent.. stale whether applicable UK Accounts"ng Standards have been followed. SUbj￿t to any material departures disclosed and explained in the financial statements". assess whethef the Corporation is a going con￿M. noting the key supporting assumptions, qualifications or mrtigating actions as appropriate., and prepare financial statements on the going concem basis unless rt is inappropriate to assume that the College wll continue in operation. The Corporation is also required to prepare a Members, Report incorporating a Strategic Report, which describes what it is tying lo do and how rt is going about it, including information about the legal and adminislrab've status of the College_ The Corporation is responsible for keeping proper accounting records which disclose, V￿th reasonable accuracy at any tirne, the financial position of the College and which enable it lo ensure that the financial statements are prepared in accordance wlh relevant legislation including the Further and Higher educab'on Act 1992. Charities Act 2011, the Companies Act 2006 and relevant accounting standards. 11 is responsible for taking steps that are reasonably open to it in order lo safeguard the assets of the College and lo prevent and delect fraud and other irregularities. The maintenance and integrity of the Working Men's Coltege website is the responsibilty of the Goveming Body of the College.. the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors a￿pt no responsibility for any changes that may have occurred lo the financial statements since they were initially presenled on the website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdicts"ons. Govemors of the Corporation are responsible for ensuring that expenditltre and income are applied for the purposes intended by Partk8ment and that the financial transactions confomi to the authorities that govern them. In addition they are responsible for ensuring that funds from the ESFA and GLA and any other public funds are used only in accordance with the ESFA'S and GLA'S grant funding agreements and contracts and any other conditions that may be prescribed from time to time by the ESFA. GLA or any other public fvnder. Govemors of the Corporation must ensure that there are appropriate frnancial and management controls in place in order to safeguard public and other funds and lo ensure they are lJ5ed property. In addition, Govemors of the Corporation are responsible for securing economical, efficient and effective management of the College's resourcès and expenditure. so that the benefits that should be derived from the applicab.on of public funds from Ihe ESFA and GLA are not put at risk. Approved by the Governors of the CorF¥)rats'on on 15 December 2021 and signed on their behalf by.. Guy Shackle Chair 28 WORKING MEN'S COLLEGE CORPORATION INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WORKING MEN'S COLLEGE for the year ended 31 July 2021 Oplnlon We have audited the financial statements of Working Men's College (the 'College'} for the year ended 31 July 2021 which comprise the statement of comprehensive income. the stalement of changes in reserves, the balance sheet, the stalernent of cash flows, the principal accounting policies and the notes to the financial statements. The financial repotting framework that ha5 been applied in their preparation is applicable law and UnÉted Kingdom Accounting Standards, including Financial Reporting Stsndard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland. {United Kingdom Generally Accepted Accounting Practice). In our opinion. the financial stalemenls. give a true and fair view of the state of the College's affairs as at 31 Juty 2021 and of it5 deficit of income under expenditure for the year then ended- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice". and have been prepared in accordance the requirements of the Companies Act 20(k%. Basis for opinion We conducted our audit in accordan￿ lntemab.onal Standards on Auditing {UK) IISAS IUKII and applicable law. Our responsibilities under those standards are further described in the Auditr)r's responsibilities for the audit of the financial statements secb.on of our report. We are independent of the College in accordance with the elhical requirements that are relevant to our audit of the financial statements in the UK, including the FRC'5 Eth6cal Standard, and we have fulfilled our other ethical responsibi5ilies in accordance wrth these requirements. We believe that the audit evidence we have obtsined is sufficient and appropriate lo provide a basis for our opinion. Conclusions relatin9 to going concern In auditing the financial ststements, we have concluded that the membets of the Corporation's use tsf the going concern basis of accounting in the preparats.on of the financial statements is appropriate. Based on the work we have perfomied. we have not identified any material uncertainties relating lo events or conditions that, individually or collecttvety, may casl significant doubt on the College's ability lo continue as a going concem for a perod of al least ￿e1ve months from when the financial statements are authorised for issue. Our responsibilities and the responsibilities of the members of the Corporation wrth respect to going concern are described in the relevant sections of this report. Other infomiation The other information comprises the infomialion included in the annual report other than the financial statement5 and our auditorfs report thereon. The Governors are responsible for the other information contained within the annual feport. Our opinion on the financial statements does not cover the other information and, except to the extent otheThvise expliatty stated in our report, we do not express ar>y fomi of assurance conclusion thereon. 29 WORKING MEN'S COLLEGE CORPORATION INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WORKING MEN'S COLLEGE (continued) for the year ended 31 July 2021 Other infO￿atiOn Icontinuedl Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial slatements or our kn￿edge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misslalements, we are required to determine whether this gives rise lo a material misstatement in the financial 51atemenls themselves. If. based on the work we have performed, we conclude that the￿ is a material misstatement of this other information. we are required to report that fact. We have nothing to report in this regard. Opinlons on other matters prescrlbed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of the audrt". the infomiation given in the Govemors. ￿pOrt, which is also the Directors. report for the purposes of company law and includes the strategic report for the financial year for which the financial statements are prepared is consistent wrth the financial statements," and the Governors, report, which is also the Directors. report for the purposes of company law and includes the strategic rewrt has been prepared in accordan￿ applicable legal requirements. Matters on which we are requlred to report by exception In the light of the knowledge and understanding of the College and its environment obtained in the course of the audit. we have not identffied material misstatements in the Govemors, report including the strategic report. We have nothing to report in respect of the follow￿ng 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 retums 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 relums.. or certain disclosures of Governors, remuneration s>￿￿fied by law are not rnade., or we have not received all the infomation and explanab.ons we require for our audit. Responsibillttes of Governo A$ explained more fully in the statement of responsibil￿eS of the Governors. of the Corporation. the Governors are responsibSe for the preparation of the financ¢al statements and for being satisfied that they give a true and fair view, and for such internal control as the Governors delerrnine io necessary lo enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Governors are responsible for assessing the College's ability to conb'nue as a going concern, disclosing, as applicable, matters related to going concem and using the going concern basis of 2ccounb.ng ullless the Governors either intend to liquidate the College or to cease operatsons, or have no realistic a￿ernats"¥e but to do so. 30 WORKING MEN'S COLLEGE CORPORATION INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WORKING MEN'S COLLEGE (continued) forthe yearended 31 July 2021 AuditoV$ responslbilllies for the audit of the ffinanclal statements Our objectives are lo obtain reasonable assurance about whether Ihe financial statements as a whole are free from material misstatement, whether due lo fraud or error. and lo issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assuranc£. but is nol a guarantee that an audit conducted in accordance wth ISAS IUK) wll a￿vaYS detect a material misststemenl when it exist5. Misstslemenls 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 ststements. Irregularities, including fraud. are instances of non-copmpliance wth laws and regularbons. We design procedures in line with our reswnsibililRs, OU￿1ned above, to delecl material misststemenls in respect of irreguladities, including fraud. The extent to which Our proCedU￿S are capable of delecling irregularities, including fraud, is detsiled below". Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulth"ons. was as folbws.. The Senior Statutory Auditor ensured that the engagement team collectively had the appropriate competence, capabilities and skills to idenb.fy or recognise non-compliance with applicable laws and r￿ulatiOnS., We identified the laws and regulations appli¢2ble to the College through discussions with management and from our knowledge and experience of the sector. We focussed on specffic laws and regulations which we considered may have a direct material effect on the finanaal statements or the operations of the College. including the Further and Higher Education Act 1992, Cornpanie5 Act 2006, ftjnding agreements with the ESFA and associated funding rules, ESFA regulations, data protection legislabon, anti-bribery, safeguarding, employment, health and safety legislation; We assessed the extent of compliants wth the laws and regulations identified al)ove through making enquiries of management and inspecting legal Corresponden￿.. and Identified laws and regulations were communicated within the audrt team regulaty and the team remained alert to instar¢ces of non-coMpl￿nCe throughout the audrL We assessed the sus￿p￿bility of the College'5 financial statements to malefial misstatement, including obtsining an understanding of how fraud might o¢¢ur, by: making enquiries of management as to where they considered there was susceptibilty to fraud, their knowlewdge of actual, suspected and alleged fraud" and," considering the intemal controls in pl￿ to mttigate risks of fraud and non-compliance wth laws and regulations. To address the risk of fraud through management bias and ovrride of controls. we." perfomied analyts.cal procedures to ider¢ty"fy any unusual or unexpected relationships". tested journal entries to tdentsfy unusual transactions.. and assessed whether judgements and assumpb"on5 made in deterynining the accounting eslimales set out In the accounting pO1￿cleS were indicatNe of potential bias. 31 WORKING MEN'S COLLEGE CORPORATION INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF WORKING MEN'S COLLEGE (continued) for the year ended 31 July 2021 Auditors responsibilities for the audit of the financial statements (continued) In response lo the risk of irregularities and non-complian￿ vth laws and regulations. we designed procedures which included. but were nol limited lo.. agreeing financial statement disclosures to undetying supporting documentation., reading the minutes of Corporation meetings", enquiring of management as to actual and wtential litsgalon and claims. and reviewing any available correspondence with HMRC and the College's legal advisors laf(hough none was noted as being received by the College). There are inherent limitations in our aud7t pr[￿edureS described above. The more removed that laws and regulations are from financial transacions, the less likely it is that we would become aware of non- ¢ompliance. Auditing standareds also limit the procedures required to idenbfy non-compliance with laws and regulations lo enquiry of the members of the Corporation and other management and the inspection of regulatory and legal correspondence, rf any. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council'5 website at ww.frc.org_uklaudrtorsresponsibililies. This description forms part of Our auditor's report. Use of our Report This report is rnade solety to the Corporation. a5 a b(NJy, in accordance wrth Chapter 3 of Part 16 of the Companies Act 201x5. Our audit work has been undertaken so that we might stale lo the Corporation's members those matters we are wuired to state to them in an auditorfs report and ftir rio other purpose. To the fullest extent permitted by law, we do not accept or assume responsibiltty to anyone other than the College and the Corporation members as a iM)dy, for our audit work, for this report, or for the opinions we have formed. Shachi Blakemore (Senior Ststutory Auditor) for and on behalf of Buzzacott LLP, Statutory Audltor 130 Wood Street London EC2V 6DL 16 December 2021 32 WORKING MEN'S COLLEGE CORPORATION REPORTING ACCOUNTANT'S ASSURANCE REPORT ON REGULAR1￿ TO THE GOVERNORS OF THE CORPORATION OF WORKING MEN'S COLLEGE AND THE SECRETARY OF STATE FOR EDUCATION ACTING THROUGH THE EDUCATION AND SKILLS FUNDING AGENCY (the ESFA) for the year ended 31 Juty 2021 In accordance with the tems of our engagement letter dated 31 May 2019 and fLtrther to the requirements and conditions of funding in the Education and Skills Funding Agency's Grant Funding Agreements and conlracls, including those of the Greater London Aulhority IGLAI, we have Carried out an engagement lo obtain limtted assurance about whether anything has come to oui attention that would suggest that, in all material respects, the expenditL5re disbursed and income received by the Working Men's College during the period 1 August 2020 to 31 July 2021 has not been applied lo the purposes idenbfied by Padiament and the financial transaction5 do not conform to the authoritie5 which govern them. The framework that has been applied is set OLrt in the Post-16 Audrt Code of Practice (the Code) issued by the ESFA and in any relevant condrlions of funding conceming adult education nob.fied by the GLA or other relevant funder. In line wth this framework. our work has specifically not considered income re￿iVed from the main funding grants generated through the Individualised Learner Record IILRI data ￿turnS, for which the ESFA has other assurance arrangements in place. This report is made solely lo the Corporation of Working Men's College and the ESFA in accordance with the temis of our engagement letter. Our work has been undertaken so that we might state to the Corporation of the Working Men's College and the ESFA those matters we are required lo slate in a report and for no other purpose. To the fullest exlenl pemiitted by law, we do not ac￿p1 or assume responsibilty lo anyone other than the Corporation of Working Men's College and the ESFA, for our work. for this report, or for the conclusion we have formed. Respective Responsibilities of Working Men's College and the Reporting Accountant The Corporation of Wothing Men's College is responsible. under the requirements of the Further and Higher Educab'on Act 1992, subsequent legislation and relate¢Y regulattons and guidance, for ensuring that expenditure disbursed. and income r￿1ved, are applied for the pu¥poses intended by Parliament and the financial transactions conform lo the authorities which govern them. Our responsibilities for this engagement are established in the United Ktngdom by our profession's ethical guidan￿ and are lo obtain limited assurance and feport in accordance with our engagement letter and the requirements of the Code. We ￿port to you whether anything has come to our attenb.on in carying out our work which suggests that in all material respects, expenditure disbursed and income reTrived during the period 1 August 2020 to 31 July 2021 have not been applied to purposes intended by Parliament or that the financial IransactN)ns do not eonfom to the authortlies whic govern them. Approach We conducted our engagement in accordan￿ wrth the Code issued by the ESFA We performed a limited assurance engagement as defined in that framewotk_ The objective of a limrted assurance engagement is to perfom such procedures as lo obtain infomialion and explanations in order lo provide us with sufficient appropriate evidence lo express negative conclusion on ￿￿1allty. 33 WORKING MEN'S COLLEGE CORPORATION REPORTING ACCOUNTANT'S ASSURANCE REPORT ON REGULARITY TO THE GOVERNORS OF THE CORPORATION OF WORKING MEN'S COLLEGE AND THE SECRETARY OF STATE FOR EDUCATION ACTING THROUGH THE EDUCATION AND SKILLS FUNDING AGENCY (the ESFA) for the year end•d 31 July 2021 A lirnited assurance engagement 15 more limited in scope than a reasonable assurance engagement and consequently does not enable us lo obtain assurance that we would become aware of all significant matters that might be identified in a reasonable assurance engagement. Accordingly we do not express a positrve opinion. Our engagement includes examination, on a test basis. of evidence relevant to the regularity of the College's income and expenditure. The worf( undertaken to draw our conclusion includes". An assessment of the risk of malenal irregulanty and impropriety across all of the College's activities., Further testing and review of the areas identrfied through the risk assessment including enquiry, idenkn'fication of control processes and examinatr.on of supporting evidence across all areas identified as well as additional verification work where considered necessary,. and Consideration of eviden￿ obtained through the work detailed above and the work completed as part of otjr financial statements audrt in order to support the regularity conclusion. Con¢lu$ion In the course of our work, nothing has ¢ome to our attentson which suggests that. in all material respects, the expenditure disbursed and income received during the period 1 August 2020 10 31 July 2021 has not been applied to pury)ose5 intended by Partiament and the financial transactions do not conform lo the authorities which govern them. Buzzacott LLP Chartered Accountants and Statutory Auditors 130 Wood Street London EC2V 6DL 16 December 2021 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF COMPREHENSIVE INCOME for the year ended 31 July 2021 Note 2021 2020 £'ooo £'ooo INCOME Funding boty grants Tuition fees and education contracts Other income Endowment and investment income 4.977 354 188 115 4,765 426 65 117 Total Income 5.634 5.373 EXPENDITURE Cost of generating funds Staff costs Fundamental restructuring costs Other operating expenses Depreciation Interest and other finance costs 3,958 3.813 43 1,146 362 47 1,084 640 43 Total expenditure S.728 5,420 Operallonal defictt before other galns and losses and before tsx 1471 GainsllLosses} on listed investments GainllLossl on investment propety 12 13 937 90 1508} 1901 Surplusl{Deficrt} before tax 933 16451 Taxation 10 Total Comprehensive In¢ome for the Year 933 {64S} Rep￿sented by-. Restricted comprehensive incomellexpenditLtrel Endowment fund incornellexpenditurel Unreslricled comprehensive expenditure 592 374 {331 12181 12021 {2251 933 16451 The statement of CoMprehen￿ve income is in respect of conkn"nuing a￿"￿ti.e5. 35 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF CHANGES IN RESERVES for the year ended 31 July 2021 Income and Expenditure reserie £'ooo £'ooo Restricted reserves £YJoo £'ooo Endowmgnts Total roserves £'ooo £'ooo rooo £'ooo Balance at 1 August 2019 8.326 2.956 2,144 13.426 Deficit from the income and expenditure account Transfers betsyeen restricted and income and expenditure reserves (1631 12801 1202} (6451 {621 62 Totsl c¢)mprehensive income for the year {225) 12181 12021 16451 Balancg at 31 July 2020 8.101 2,738 1,942 12,781 Surplus from the income and expenditure account Transfers be￿een restricted and income and expenditure reserves 31 528 374 933 {641 Total cornprehensive income for the year {33} 592 374 933 Balance at 31 July 2021 8,C68 3,330 2.316 13,714 Includ￿ wlhin restricted reserves al the balan￿ Sheet date is an amounl of £205.049 which relates to the assets of the Francis Martin College Charitable Foundation. The Working Men's College Corpor*ion is the sole trustee of the Francis Martin College chanty Ire9iStered chanty number 3128021 and looks after the assets on its behalf. The assets are invested in the Newton Growth and Income Fund f￿ Charities alongside the investments of the Working Men's College Corporation. 36 WORKING MEN'S COLLEGE CORPORATION BALANCE SHEET as at 31 July 2021 Note 2021 £'ooo 2020 £'ooo £'ooo £'ooo NON£URRENT ASSETS Tangible fixed assets Listed Investments Inve51menl Property 11 12 13 9,094 5.799 1,650 8.885 4,862 1.560 16.543 15.307 CURRENT ASSETS Trade and other re￿1Vable$ Cash and cash equivalents 14 180 810 192 760 990 952 CREDITORS: Amoupifs FALUNG DUE WITHIN ONE YEAR 15 11.2851 {1,248) NET CURRENT LIABILITIES {2951 12961 TOTAL ASSETS LESS CURRENT LIABILITIES 16.248 15,011 CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR 16 {2,5341 {2,2301 TOTAL NET ASSETS 13.714 12,781 ENDOWMENTS Permanent Expendable 18 18 305 2.011 256 1,686 2,316 1.942 RESTRICTED RESERVES Restricted reserves 3,330 2.738 UNRESTRICTED RESERVES Income and expenditure account 8,068 8.101 TOTAL RESERVES 13,714 12,781 The financial statements on pages 35 to 53 were approved and aulhorised for issue by the Corporation on 15 December 2021 and were signed on its behalf on that date by-. Guy Shackle Chaif Helen Hammond Accounts"ng Officer 37 WORKING MEN'S COLLEGE CORPORATION STATEMENT OF CASHFLOWS for the year ended 31 July 2021 Note 2021 £'ooo 2020 £'ooo £'ooo £'ooo Cash inflow from operatlng actlvllies SurplusllDeficitl for the year Ad uslment for non-cash items IGainsllLosses on investments Depreciation Decrease In debtors Decrease in Creditors due wthin one year Release of capitsl grants 933 16451 {1.0271 640 12 {301 11281 598 362 194 12241 1631 14 15 18 Ad uslments for investin or financin Investment income receivable Interest receivable Interest payable activiti.es 11141 {11 43 11131 141 47 Net cashflow from operating activities 328 152 Ca$hflows from investing activities Income from investments and endowments Other interest received Payments lo acquire tangible fixed assets Receipts of new capital grants 113 18491 585 11,6751 11491 11,5581 Cashflows from financing activities Interest payable Capitsl element of bank loan repaymellts {431 {861 1471 1811 17 (129) 11281 IncreasellDecreasel in cash and cash equivalents In the year 60 11.5341 Cash and cash equivalents at 1 August 760 2,294 Cash and cash equivalents at 31 Juty 810 760 In this statement, figures in brackets refer lo cash ouffiow5 and all other figures are cash inflows lo the College. 38 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 STATEMENT OF ACCOUNTING POLICIES AND ESTIMATION TECHNIQUES The following accountin9 policies have been applied consistenly in dealing with items which are considered material in relation to the financial Statements. Basis of preparation These financial statements have been prepared in accordance with the Statement of Recommended Practice". Accounting for Further and Higher Educab"on 2015 (the SORPI, the College Accounts Direction for 2020-21 and in accordance with Financial Reporting Standard 102". 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland" IFRS1021. The College is a public benefit entity and has therefore applied the relevant public benefit requirements of FRS102. The preparation of financial ststements in Complian￿ wth FRS102 requires the use of certain critical accounting estimates. 11 also requires management to exercise judgemeftl in applying the College's accounting policies. Without limib.ng the informab.on given. the financial statements meet the accounting and disclosure requirements of the Companies Act and accounting standards issued or adopted by the Accounting Standards Board so far as those requirements are appropriate. In order to present a true and fair view, the College has not followed the provisions of the Companies Act 2006 regarding the formal of the financial ststemenls where these are not appropriate to the College's activib"es. Basis of accounting The financial statements are prepared in accordance ￿ the historical cost convenb'on modified by the revaluation of listed investments and the investment proFerty. Going concern The activities of the College, together wtth the factors likety to affect its future development and performance are set out in the Members. Report including the Strategic Report. The financial position of the College, its cashflow. liquidity and borrowngs are described in the financial statements and accompanying notes. The Covid-19 pandemic has impacted the College finances through loss of fee income and other non- grant funded acts"vity, resulb.ng in the deficits rep)rted for 2019120 and 2020121. The balance sheet also shows nel current liabiliites at 31 July 2021 atthough these ￿Vert to net current assets when non-cash ilems in creditors, such as deferred ￿pital grants, are eliminated. The budget for 2021122 is cash genewtive and the College cashflow forecasts demonstrate Ihal il has sufficient cash resources, including an adequate buffer for unforeseen variances, to meet ils liabilitr.es as they fall due. In addition, the listed invesknents could be liquidated at short notice rf necessary. The College currently has £719,000 of loans outstanding bankers on tenns negotiated in 2007. The terms of the exisb.ng agreement are for up to another 7 years. The College's forecasts and financial projections indicate that it will be able lo operate within this existing facility and covenants for the foreseeable future. Accordingly the College has a reasonable expectatron that it has adequate resources lo continue in operational existence for the foreseeable future, and for this reason will continue to adopt the going concern basis in the preparats.on of ils financial statements. 39 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 STATEMENT OF ACCOUNTING POLICIES AND ESTIMATION TECHNIQUES Icontinuedl Re¢ognition of income Turtion fee income is recognised in the period for which r( is received and includes all fees chargeable lo students. Income from grants. contracts and other services rendered is included to the extent of the completion of the contract or service concemed. All income from short-tem deposits is credited to the income and expenditure account in the period in which it is eamed. Funding body recurrent grants are recognised in line vAth best estimates for the period of what is receivable and depend on the particular income stream involved. Any under achievement for the AdLJIt Education Budget is adjusted for and reflected in the level of recurrent grant recognised In the income and expenditure account. The final grant income is nomially detemined wtth the conclusion of the year end reconciliation process wtth the funding body al the end of November following the year end and the results of any funding audrts. 1&18 learner-responsive funding is not nomially subject to reconciliation and is therefore not subjecl to contract adjustsnents. Where part of a non-recurrent govemment grant from the ESFA or other body is deferred and amortised in line with depreciabon over the life of the associated assets funded. the defewed element is recognised as deferred income within creditors and allocated betsveen creditors due within one year and creditors due after more than one year as appropriate. Government capital grants are capitalised, held as deferred income and recognised in income over the expected usefvl Itfe of the asset, under the accrual rnodel as permrtted by FRS102. Other, non- governmental, capital grants are recognised in income when the College is entslled to the funds. subject to any performance related condibons being met. Income received in advance of perfom)ance related conditions being rnet is recognised as deferred incorne v￿thin creditors on the Balance Sheet and released to income as condrtions are met. Post4mployment Beneffts Post-employment benefits to employees of the College are prOV￿ed by the Teachers, Pension Scheme ITPSI and a group personal pension scheme. Contributions to the TPS, wh￿h is a final salary scheme. are calculated so as to Spread the cosl of pensions over employees, working lives with the College in such a way that the pension cost is a subslanlially level percentage of current and future pensionable payroll. The contributions are determined by qualified actuaries on the basis of quinquennial valuations using a prospective benefit rnethod. As slated in Note 19, the TPS is a mulb"employer Scheme and there 15 insufficient infomiation available to use defined benefrt accounts'ng. The TPS is therefore treated as a defined conlributron plan and the contributions recognised a5 an expense in the comprehensive income statement in the periods during which services are rendered by employees_ Contributions to the group personal pension scheme, which is not a final salary scheme, are a fixed percentage of salary and are charged to the statement of compreherTrsive income on an accruals basis. 40 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 Juty 2021 STATEMENT OF ACCOUNTING POLICIES AND ESTIMATION TECHNIQUES (continued) Endowmgnts and reserves Pernanent endowments comprise monies which musl be held indefinitely as capital and expendable endowments represent capital monies which can be drawn upon if required. Income therefrom is credited lo the stslement of comprehensive income and applied for genetal purposes unless under the terms of the endowment such income must be used for spectfic purposes ir¢ which case il is credited to restricted reserves. Restricted reserves comprise monies raised for, or their use restricted to, a specific purpose, or contributions subject lo donor imposed condibons. At the balance sheet date. £2.903m of these related lo funds connected with the College's former plawng fields, including the sale proceed5. A further £205,000 represents the funds of the Francis Martin College Pfeiffer Twsl scheme and the remaining £222.000 relates tr) equipment reserves. The College is reviewng the ongoing appropriateness of the restrictsons and assets allocated to the funds. Tangible flxed assets Land and buildings and improvements to buildings are stated in the balan￿ sheet at cost. Individual items of equipment costing g￿ater than £500 and wrth an expected useful lrfe ex￿edIng one year are capitalised at cost. Freehold land is nol depreciated as tt is considered to have an infinite useful Tangible fixed assets are depreck8ted over their useful economic lives. on a straight line basis, as ft)Ilows'. Freehold buildings 2% per year for new buildings, per year for existing building5 4%- 10% per year 25% per year 33'13ih> per year 33,130/0 per year 16 13% per year Building improvements Technical equipment Computer hardware Computer soffvlare Furniture, fixtures and fittings Assets under construction are accounted for al cost. based on the value of architects, certificates and other direct costs, incurred lo the balance sheet date. They are not depreciated until they are brought into use. Where equipment is acquired wrth the aid of specthc grants. it is capitalised and depreciated in accordance with the above policy, with the related grant being cred¥ted to a deferred capital grant account and released to the income and expenditure account over the expected useful economic life of the related equipment. Where significant expenditure is incurred on tangible fixed assets it is charged to the income and expenditure account in the peri(xl it Is incurred. unles5 It meets one of the following criteria. in which case rt is capitalised and depreciated on the relevant basis.. Market value of the fixed asset has subsequenty improved; Asset capacty increases" Subslanlial improvement in the qualty of output or reduth.on in operats.ng costs.. or Significant extension of the asseys life beyond that conferr&J by repairs and maintenance. 41 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the ygar ended 31 July 2021 STATEMENT OF ACCOUNTING POLICIES AND ESTIMATION TECHNIQUES l¢ontinued) Tangible flxed assets Icontlnuedl A review for impairment of a fixed asset is carried out rf events or changes in circumstances indicate that the carrying value of any fixed asset may not be recoverable. Shortfalls betsV￿n the carrying v81ue of fixed assets and their recoverable amounts are recognised as impaitmenls. Impaimient losses are recognised in the statement of comprehensive income. Lea$ed assets Costs in respect of operating leases are charged to statement of comprehensive income on a straight- line basis over the lease term. Cash and Cash Equivalents Cash includes cash in hand, depostts repayable on demand and overdrafts. Deposits are repayable on demand if they are in pracliee available within 24 hours without penalty. Cash equivalents are short tem, highly liquid investments that are readily convertible to known amounts of cash with insignificant risk of change in value. An inveslrnent qualifies as a cash equivalent when il has a maturity of 3 months or less from the date of acquisition. Financial Liabllities and Equity Financial liabilities and equity are cla55ffied according to the substance of the financial instrument's conlraclual obligab"ons, rather than the financial instrument's legal fomi. All loans, investments and short tem) deposits held by the College are classified as basic financial instruments in accordance with FRS 102. These instruments are initially recorded at the Iransacb'on price less any transaction costs (historical costl. FRS 102 requires that basic financial instruments are subsequently measured al amottisied cost. However the College has calculated that the difference be￿een the historical cost and amortised cost basis is nol material and so these financial instruments are staled on the balance sheet at historical cost. Loans and investments that are payable or receivable within one year are not discounted. Investrngnts including endowment assets Investments are included on the balance sheet at their market value, as provided by the investment manager, at the end of the financial ￿riod. Realised and unrealised gains lor losses) are credited lor debited) lo the stslement of total gains and losses in the year in which they arise. Investment Property The investment pro￿rty is included at estimated market value at the balance sheet date. Maintenance of premises The cost of routine corrective maintenance is charged to the income and expendrture account in the period il is incurred. Taxation The College is considered to pass the tests set out in Paragraph 1 Schedule 6 of the Finance Act 2010 and therefore rt meets the definition of a charitable company for UK ￿rpOration tsx purposes. Accordingly, the College is potentially exempt from taxation in respect of injcome or capital gains received within categories covered by Chapter 3 Part 11 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent Ihat such income or gains are applied exclusively to charitable purposes. 42 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 STATEMENT OF ACCOUNTING POLICIES AND ESTIMATION TECHNIQUES Icontinuedl Taxallon Icontlnued} The College receives no similar exempts'on in respect of Value Added Tax. For this reason the College is generally unable to recover input VAT it incurs on goods and services purchased. Non-pay expenditure is therefore shown inclusive of VAT with any partial recovery netted off against these figures. Provlslons and Cont5ngent Llabllllies Provisions are recognised when the College has a present legal or construcb.ve obligation as a result of a past event, it 15 probable that a transfer of economic benefit will ￿ required to settle the obligabon and a reliable estimate can be made of the amount of the obligation. Where the effeel of the time value of rnoney 15 rnalerial, the amount expected to be required to settle the obligation is recognised at present value using a pre-discount rate. The unwinding of the discount is recognised a5 a finance cost in the statement of comprehensive income in the period it arises. A contingent liability arises from a past event that gives the College a possible obligation whose existence will only be confirmed by the occuirence or othe￿iS& of uncertain future events not wholly within the control of the College. Conlingenl liabilities also arise in circumstances where a provision would olhewse be nTrade but efther rt is not probable that an outhow of resourc5 wll be required or the amount of the obligatson cannot be measured reliably. Conlingenl liabilities are not recognised in the balance sheet but are disclosed in the notes to the accounts. Agency Arrangements The College acts 35 an agent in the collection and payment ol certain discretionary support funds from the ESFA or Department for Educab"on. Related payments received from the funding bodies and subsequent disbursements to leamers are excluded from the incorne and expenditure of the College where the College is exposed to minimum risk or enjoys minimal economic benefit related to the Iransaclion. Judgements in Applying Accountlng Pollcies and Key Sources of Estimation Uncertainty In preparing these financial stslements, management has made the following judgements". Determined whether leases entered intr) by Ihe College etther as les50r or lessee are operating or finan￿ leases. These decisions depend on an assessment of whether the risks and rewards of ownership have been transferred from the lessor to the lessee, on a lease by lease basis. Delemined whetr*er the￿ are indicator5 of impairment of the College'5 tangible assets. Factors taken into considerat￿n in reaching sueh a decision indude the economic viability and expected future financial performance of the asset and. where it is a component of a larger cash-generating unit. the viabiity and expected future perforrnan￿ of that unit. Other key sources of estimation uncertainty Tangible fixed a5set5 Tangible fixed assets, other than invesbnent properties, are depreciated over their useful lives taking into account residual values where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In reassessing asset lives, factors such as technological innovation and maintenance programmes are taken into account. Residual value assessments consider issues such as future market condrtions. the remaining life of an asset and projected disposal values. 43 **WORKING MEN'S COLLEGE CORPORATION** ## **NOTES TO THE ACCOUNTS** **for the year ended 31 July 2021** ## **1 STATEMENT OF ACCOUNTING POLICIES AND ESTIMATION TECHNIQUES (continued)** ## **Judgements in Applying Accounting Policies and Key Sources of Estimation Uncertainty (continued)** ## l **Covid-19** Management has estimated the impact of the Covid19 pandemic on the College’s finances for the purposes of preparing budgets and cash flow forecasts for the years ending 31 July 2022 and 2023. The full impact following the emergence of the coronavirus pandemic is still unknown. It is therefore not currently possibly to evaluate all the potential implications for the College’s activities, beneficiaries, funders, suppliers and the wider economy. ## **2 FUNDING COUNCIL GRANTS** |**Recurrent grants**
Education and Skills Funding Agency - adult
Greater London Authority - adult
Education and Skills Funding Agency - 16-18
**Specific grants**
Teachers' Pension Support Grant
Other specific grants
Release of government capital grants
**3**
**TUITION FEES AND EDUCATION CONTRACTS**
Adult education fees
Fees for FE loan supported courses
**Total tuition fees**
Education contracts
**4**
**OTHER INCOME**
Government Job Retention Scheme
Non-funding body grants
Property rental income
Other income
**5**
**ENDOWMENT AND INVESTMENT INCOME**
Income from restricted asset investments
Income from endowment and unrestricted investments
Other interest receivable|**2021**
**£'000**
53
4,403
187
150
56
128
4,977
**2021**
**£'000**
310
38
348
6
354
**2021**
**£'000**
90
25
56
17
188
**2021**
**£'000**
64
50
1
115|**2020**
**£'000**
45
4,358
164
132
-
66
4,765
**2020**
**£'000**
362
62
424
2
426
**2020**
**£'000**
-
-
44
21
65
**2020**
**£'000**
62
51
4
117
44| |---|---|---| **WORKING MEN'S COLLEGE CORPORATION** ## **NOTES TO THE ACCOUNTS** **for the year ended 31 July 2021** ## **6 STAFF COSTS** The average number of persons (including key management personnel) employed by the College during the year, described as headcount (no.) and as full-time equivalents (f.t.e) was: **----- Start of picture text -----**
|||||| |---|---|---|---|---| |2021|2021|2020|2020| |No.|f.t.e.|No.|f.t.e.| |Teaching staff|122|54|130|53| |Non-teaching staff|57|44|47|40| |179|98|177|93| |The total staff costs for the above persons were:| |2021|2020| |£'000|£'000| |Wages and salaries|3,149|3,033| |Social security costs|282|249| |Other pension costs (note 19)|478|459| |Payroll sub total|3,909|3,741| |Contracted out staffing services|49|72| |3,958|3,813| |Fundamental restructuring costs -|contractual|-|36| |non-contractual|-|7| |Total staff costs|3,958|3,856| **----- End of picture text -----**
## **Fundamental Restructuring Costs** The 2020 staff restructuring costs relate to the implementation of the College's continual reorganisation programme which ensures the College staffing structure remains fit for purpose, responsive to changes in funding priorities and achieves efficiencies necessary for continued financial viability. The restructuring costs were approved by Governors. ## **7 EMOLUMENTS OF KEY MANAGEMENT PERSONNEL AND OTHER HIGHER PAID STAFF** Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the College and are represented by the Executive Management Group which comprises the 8 posts of Principal, Deputy Principal, Vice Principal, 2 Directors of Learning, Director of Learner Services, Head of MIS and HR Manager. The post of MIS Director was made redundant in August 2019 and the post of Assistant Principal was made redundant at the end of April 2019. Staff costs include compensation paid for loss of office for these posts in the current and prior year respectively. **----- Start of picture text -----**
|||| |---|---|---| |2021|2020| |No.|No.| |The number of key management personnel including| |the Accounting Officer was:|8|7| **----- End of picture text -----**
Names of the key management personnel and their periods of employment are set out on page 2. 45 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 EMOLUMENTS OF KEY MANAGEMENT PERSON14EL AND OTHER HIGHER PAID STAFF continu9d The number of key management personnel and other staff who receive(l annual emoluments, excluding pension contributions and employers national insLArance contn"butions, but induding benefits in kind, in the followng ranges was". mana ement rsonnel Other staff 2021 No. 2020 No. 2021 No. 2020 No. £ 50,001 10 £ 55,tKIO per annum £ 55,001 10 £ 60.wo per annum £ 60,001 10 £ 65,￿0 per annum £ 70.001 10 £ 75.001 per annum £ 75,001 10 £ 80,000 per annum £ 80.001 to £ 85.000 per annum £110,001 to £ 115,￿0 per annum nla nla nla nla Key management personnel compensation is made up as follows". 2021 £'ooo 2020 £'ooo Salaries Benefits-ir￿klnd 569 484 569 484 Pension contributions 90 83 Total key management pet50nnel compensation 659 567 The￿ were no amounts due to key management personnel that were waived in the year, nor any salary sacrrfice arrangements in ￿ace. The above compensats.on includes amounts payable to the Principal, who is the Accounting Officer and who was also the highest paid member of staff, ofr 2021 £'ooo 2020 £'ooo Salaries BenefitS-in-kirKI 112 112 112 112 Pension contributions 27 26 The pension contributions for the Accounting Officer and three other key management personnel are in respect of emplgyerfs contributions lo the Teachers. Pension Scheme and for the other four 12020 three) key management personnel are in respect of the College's Group Personal Pension Scheme. The employer contribubons are paid at the same rate as for other employees and the pension enlitlemenls accrue in the scheme on the same basis as for other employees. 46 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 EMOLUMENTS OF KEY MANAGEMENT PERSONNEL contlnued The Governing Body adopted Aoc's Senior Staff Remunerati¢￿ Code in March 2019 and will assess pay in line vthh its principles in fuiure. The remuneration package of Key Management Personnel, induding the Principal, is subject lo annual review by the Remuneration Committee of the goveming body who use benchrnarking and other appropriate information to help to provide objective guidance. The Principal reports to the Chair of CorrKJration stho undertakes an annual ￿￿eW of her performance against the College's overall objethves using both qualitab.ve and quantitative meaSU￿S of performance. Relationship of Principal's pay and remuneration expressed as a multlple 2021 £'ooo 2020 £'ooo Principal's basic salary as a mU￿PIe of the median of all staff Principal's totsl remuneration as a muth'ple of the median of all staff Compensation for 105s of office paid to former Key Management Personnel 2021 2020 Compensatron paid to one former post holder 6,825 The severance payment was approved by College Go¥emors. The members of the Corporation, othei than Ihe Accounting Officer and slaff govemors, Llid not receive any payment from the College, other than reimbufsemenl of travel and subsistence expenses incurred in the course of their dLrtie5. OTHER OPERATING EXPENSES 2021 £'ooo 2020 £'ooo Teaching costs Non-teaching costs Premises costs 85 499 500 106 601 439 1,084 1.146 Included in the total of other operating expenses are: 2021 2020 rooo Auditors, ￿mUneration". Financial Statements and Regularity audit Intemal audit Other services provided by the Financial Statements Auditor for Teachers, Pension audtt Hire of assets under operating leases 20 16 47 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 INTEREST AND OTHER FINANCE COSTS 2021 £'ooo 2020 £'ooo Interest payable on bank loans repayable wholly or partly in more than five years 43 47 43 47 10 TAXATION The College has charitable status for taxation purposes and the members of the Corporation consider that 811 the activities of the College during the currenl and preceding years fell wtthin qualifying ¢alegories and no Corporation Tax arises. Accordingly no provision for corporation tsx is made in the accounts in either year. 11 TANG18LE FIXED ASSETS Freehold Building Computsr Land and Improve- Equipment Buildings ments FumItU￿ Assets in Fixtures Course of and Fittings'.onstructJon £'ooo £'ooo Total £'ooo £'ooo Cost or valuation Al 1 August 2020 Additions Transfers Disposals 6.711 1.294 430 3,020 1.203 266 115 535 25 3,159 128 {3,1351 12,902 849 At 31 July 2021 6,711 4,744 1,584 560 152 13.751 Depreciation Al 1 August 2020 Charge for the year Disposals 1,671 131 814 265 1,076 456 38 4.017 640 At 31 July 2021 1.802 1.079 1.282 4,657 Net book value Al 31 July 2021 4,909 3,665 302 152 9.094 Al 31 July 2020 480 127 79 3,159 8,885 Assets in the course of ¢￿strUth"On at 31 July 2020 represented £3.04m for the replacement of the heating system and instsllalion of a mixed rnixle venlilats.on system in the College's Crowndale Road site and £115k related to the new HRJPayroll system. Practtcal compleb.on was achieved on the heating and ventilation system in autumn 2020 and the asset transferre(I to Building Improvements The HRlpayroll system implementstion was complete(1 and went "live" in November 2020 and the as5el was transferred to Computer Equipment. During spllng and summer 2021. the College's IT infrastruture undeTwenl a major upgrade and the value of works lo the balance sheet date afe I￿￿ded in assets in the course of construction.. the works were completed in September 2021. 48 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 12 LISTED INVESTMENTS Unrestrieted Restricted Endowment Assets Assets Assets £'OOD £'ooo Total £'ooo Market value of listed investrnents Al 1 August 2020 Depreciation in value of investsnents 183 129) 2.737 592 1.942 374 4,862 937 Total portfolio value at 31 July 2021 3,329 2,316 5,799 Cost of listed investments at 31 July 2021 138 2.058 1.480 3,656 Total nel unrealised gains at 31 July 2021 included above 16 1.271 856 2,143 Anatysis of total portlolio value Pooled investment vehicles 5,799 Al 31 July 2021, listed investments included the fdlwNJ holding deeme(I material when compared with the overall portfolio valuab.on as al that date.. Market value £'ooo %of portfolio value 100% Newton Growth and Income Fund for charities 5.799 13 INVESTMENT PROPERTY 2021 £'ooo 2020 £'ooo Al 1 August 2020 1.560 1,650 Revaluation of investment property 90 1901 Al 31 July 2021 1,650 1,560 The College the freehold of the property immediately adjacent to the main college building in Crowndale Road. The building is nol used for the delivery of education and is let out as re&dential accommodation on 8 commeraal basis. The net revenue generated is applied to Ihe charitable purposes of the College. 49 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year endgd 31 July 2021 14 TRADE AND OTHER RECEIVABLES 2021 £'ooo 2020 £'ooo Amounts falllng due wlthln ong year Tralle receivables Prepayments and accrued income Other debtors 31 141 50 141 180 192 15 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR 2021 £'ooo 2020 £'ooo Bank loans Inole 171 Payments received in advan Trade payables Other taxation and social security Accruals and deferred income Deferred income- government capttal grants Amounts owed to funding bodies Other creditors 91 114 325 74 197 125 272 87 71 278 77 232 63 374 67 1,285 1,248 16 CREDITORS: AMOUNTS FALUNG DUE A￿ER ONE YEAR 2021 £'ooo 2020 £'ooo Bank loans Inole 171 Deferred income- govemment capital grants 628 1,906 719 1.511 2,534 2,230 17 MATURITY OF DEBT 2021 £'ooo 2020 £'ooo Bank loans are repayable as follows- In one year or less Be￿n one and tsyo years Befften and five years In five years or more 91 96 320 212 86 91 303 325 719 805 The College look out an unsecure(J loan in 2007 to support phase 1 of the Crowndale Road building furbishment. The loan is at a fixed interest rate of 5.485% and repayable by equal quartedy instalments from 3 December 2007 to 1 December 2027. A second unsectjred loan was taken oth in 2011 to support the second phase of the Crownclale Road building furbishmenl. The loan is at a fixed interest rate of 5.73% and repayabée ty equal quarterfy instalments from 14 November 2011 to 14 August 2028. 50 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the ygar gnded 31 July 2021 18 ENDOWMENTS Pem)anent Expendable £'ooo £'ooo Total £'ooo Al 1 August 2020 Appreciation of endowTnent asset investments 256 49 1,686 325 1,942 374 At 31 July 2021 305 2,011 2.316 Representing.. Prize funds Library funds other funds 101 159 101 159 2,055 2,011 304 2,011 2,315 Pernianent Expendable £'ooo £'ooo Total £'ooo Al 1 August 2019 Appreciation of endowment asset investments 282 1261 1.862 1176} 2,144 12021 Al 31 July 2020 256 1.686 1,942 Represents'ng.. Prize funds Library fvnds Other ftjnds 85 134 37 85 1.686 1.723 256 1,686 1,942 19 DEFINED BENEFITOBUGATIONS Most of the College's employees are members of one of the tsvo principal post employment benefit plans.. the Teachers, Pension Scheme England and Wales ITPSI for academic and related staff and a College Group Personal Pension Stheme for non-leaching stsff which is managed by Aviva. The TPS is a mult1-employer defined benefit scheme and the group personal pension scheme is a defined contribub.on scheme. No defined benefit pension liability arFses as a result of contributs'ons lo the Group Personal Pension Scheme. The TPS pension costs are assessed in accordance %wth the ad￿￿ of independent qualifie(S actuaries. The lalesl fomial actuarial valuation of the TPS was 31 March 2019 bul the outcome is not yet published. The total pension cost for the yeaf W8S- 2021 £'ooo 2020 £'ooo Teachers. pension scheme- contiibutions paid Group personal pension scheme - contributions paid 415 63 402 57 Total pension cost for the year wthin S&￿ costs {note 6) 478 459 Contributions amounting lo £ 53,00012020 - £ 54.0001 for the TPS and £ 8,00012020- £ 7.000 I for the group personal pension scheme We￿ payable to the scheme at 31 July and are included in creditors. The liabilities were paid to the relevant schemes in the new financial year. 51 WORKING MEN'S COLLEGE CORPORATION NOTES TO THE ACCOUNTS for the year ended 31 July 2021 19 DEFINED BENEFIT OBLIGATIONS contlnued Teachers. P•n$lon S¢hemg The Teachers, Pensron Scheme ITPS} is a ststutory. contn"butory, defined benefit scheme, governed by the Teachers. Pension Scheme Regulations 2014. These regulations apply to teachers in schools. colleges and other educational establishments. Membership is automati¢ lor teachefs and lecturers at eligible institutions. Teachers and lecturers are able to opt out of the TPS. The TPS is an unfunded scheme and members contn"bLrte on a 'pay as you go,. basis - these contributions, along with those made by employers, are credited to the Exchequer under arrangements governed by the Superannuation Act 1972. Retsremenl ar￿ other pension benefits a￿ paid by public funds provided by Parliament. Under the definitions set out in Financial Reporting Stsndard IFRSI 102128.111, the TPS is a multi-employer pension plan. The College is unable to identrfy ils Sha￿ of the underfying assets and liabilities of the plan. Accordingly, the College has taken advantage of the exemption in FRS 102 and has accounted for ils contributions to the scheme as if it were a define&contribtrtion plan. The Co15ege has sel out above the informat'on available on the ￿heme and the implications for the College in terms of the anticipated Contribution rates. The actuarial vauation of the TPS is carried out in line wulations made under the Public Service Pension Act 2013. Valuations ¢redit the teachers. pension account wth a real rate of retum, assuming funds are invested in nob.onal investments that produce that real rale of retum. The latest actuarial review of the TPS was carried out as at 31 March 2016. The v8lu8tion report was published by the Department for Educatron {the Department) in April 2019. The valuab.on reported total scheme liabilities (pensions cul￿ntlY in paymenl and the estr"mated costs of future benefits) for service lo the effective dale of £218 billion and notional assets lestimated fulure conributions together wth the notional investments held at valuation datel of £198 billion. giving a notional past service deficit of £22 billion. As a result of the valuation, new employer conth"button rates were sel al 23 68% of pensionable pay from September 2019 onwards compared to 16.48% during 2018119. The DfE has agreed lo pay a teacher pension employer contribution grant lo wier the addibonal costs during the 2020121 academic year and up to July 2022_ A full copy of the valuats.on report arbd supporbng documentation CAn be found on the Teachers, Pension Scheme website. The pension costs paid lo TPS in the year amounted to £415,0(KS {2020.' £402.000) FINANCIAL COMMrrMENTS 2021 £'ooo 2020 £'ooo Capltal ¢ommltments Contracted for bLrt not provided at 31 Juty 214 48 Authorised but not yet contracted for * 31 July 52 **WORKING MEN'S COLLEGE CORPORATION** ## **NOTES TO THE ACCOUNTS** ## **for the year ended 31 July 2021** ## **21 EVENTS AFTER THE REPORTING PERIOD** There are no events after the reporting period which would have a material impact on the financial statements and require either adjustment or disclosure. ## **22 RELATED PARTY TRANSACTIONS** Due to the nature of the College's operations and the composition of the Corporation, being drawn from local public and private sector organisations, it is inevitable that transactions will take place with organisations in which a member of the Corporation may have an interest. All transactions involving such organisations are conducted at arm's length and in accordance with the College's financial regulations and normal procurement procedures. No transactions were identified during the year which should be disclosed. The total expenses paid to or on behalf of the Corporation members during the year were £ nil (2020 - £388 relating to two governors). This represents travel and subsistence expenses and other out of pocket expenses incurred in attending Governor meetings or Governor training events. No Governor has received any remuneration or waived payments from the College during the current or previous year. ## **23 DIRECTORS' AND OFFICERS' LIABILITY INSURANCE** The College has purchased directors' and officers' liability insurance. The insurance premium paid by the College for the year ended 31 July 2021 was £3,492 (2020 - £2,775) and provides cover of up to a maximum of £2 million for all claims during a year. ## **24 MEMBERS' LIABILITY** Every member of the Corporation undertakes to contribute to the assets of the College in the event of it being wound up while he/she is a member such amount as may be required, but not exceeding five pence. ## **25 AMOUNTS DISBURSED AS AGENT** |Unspent balance at 1 August
Repaid to EFSA in year
Loans bursary fund
Disbursed to Students
Area uplift re Adult Learning Loans
Balance unspent at 31 July included in creditors|**2021**
**£'000**
48
-
12
60
-
(7)
(7)
53|**2020**
**£'000**
97
(51)
24
70
(12)
(10)
(22)
48| |---|---|---| Funding body grants are available solely for students. In the majority of instances, the College acts only as a paying agent. In these circumstances, the grants and related disbursements are therefore excluded from the Statement of Comprehensive Income. 53