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2022-07-31-accounts

Annual Report and Financial Statements July 2022

For the lives we can lead

Contents

1 Introduction from the Chair ........................................................... 1
2 Who we are .................................................................................... 2
3 Review of the year ......................................................................... 3
4 Financial review ........................................................................... 16
5 Governance and structure ........................................................... 19
6 Statement of Trustees’ responsibilities ....................................... 24
7 Independent Auditor’s Report ..................................................... 25
8 Financial statements .................................................................... 28
9 Notes to the financial statements ............................................... 31

Annual Report 2020-21

For the lives we can lead

Introduction

1 Introduction from our Chair

The year covered by this report saw the world emerge from a period defined by Covid-19. Our office doors reopened to staff and visitors, students on our scholarship programmes were able to come together in person, and crossborder travel cautiously resumed.

Particularly significant for us were a series of major international summits – from the UN Climate Change Conference in November to the Commonwealth Heads of Government Meeting in June – some of which had been postponed for several years. The gravity of the agenda for these events was a reminder that while the pandemic put the brakes on our ways of life, the challenges facing the world gathered at speed – from the accelerating climate crisis to growing gaps in wealth, opportunity, and healthcare.

Higher education’s pivotal role in the search for solutions to these challenges underpinned our clarion call to world leaders, education ministers, and global stakeholders throughout the year. On behalf of our international community of members, we called for far greater recognition of universities’ vital contribution to sustainable development and for improved access to – and investment in – higher education. And we are proud of what we achieved: a closing statement issued by the Conference of Commonwealth Education Ministers, for example, directly recognised for the first time higher education’s contribution to social and economic development and the urgent need to widen access to the opportunities that universities provide.

It was also a year for the ACU and our members to consolidate what we have learned from the pandemic to become more resilient and agile, including ongoing opportunities for virtual collaboration and exchange, a series of webinars exploring the ways in which university librarians can reconnect with their users, and a ‘new ways of working’ framework for our staff. Meanwhile, our pioneering PEBL programme for online and blended learning – which proved invaluable to many universities during the pandemic – launched a new

partnership in west Africa to improve access to higher education in regions where demand outstrips supply.

At the heart of these activities, and the many examples outlined in this report, is our belief that international cooperation elevates everything that is vital and valuable about higher education. To this end, the Commonwealth continues to provide a crucial framework for the interchange of people, knowledge, and ideas – from collaborative research to opportunities for students to live and learn in a diverse range of countries and cultures.

This belief in the Commonwealth as a force for good is one we were proud to share with our late Patron, Her Majesty The Queen, whose death in September brought with it not just expressions of sadness but of deep respect and admiration for her life of service. The ACU are proud custodians of the Queen Elizabeth Commonwealth Scholarships, which were named after Her Majesty in 2019 in honour of her commitment to the Commonwealth and longstanding dedication to education and youth. In Her Majesty’s name, these unique scholarships will continue to bring students from all over the Commonwealth to study at universities in low and middle income countries, helping to ensure the two-way exchange of knowledge that characterises the Commonwealth’s open, autonomous, and valuable network of nations.

With the modern Commonwealth and its ideals as a cornerstone of our work – and the passion and commitment of our staff, scholars, and member universities – we look forward to a new year of connections, collaboration, and opportunity.

Professor Cheryl de la Rey Chair of the Council

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Annual Report 2020-21

For the lives we can lead

Mission, Vision, Values

2 Who we are

The ACU is an international organisation dedicated to building a better world through higher education.

We believe that international collaboration is central to this ambition. By bringing universities together from around the world – and crucially the people who study and work within them ‒ we help to advance knowledge, promote understanding, broaden minds, and improve lives.

We champion higher education as a cornerstone of stronger societies, supporting our members, partners, and stakeholders as they adapt to a changing world.

----- Start of picture text -----
Our Mission
To build a
better world
through higher
education
Our Vision
A world in which higher
education transcends borders,
strengthens societies, fosters
innovation, and lifts the lives of
people throughout the
Commonwealth and beyond
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Our values

Our strategic priorities

The road to 2030

Universities make a critical contribution to sustainable development across the Commonwealth and beyond.

Our strategic plan – 'The road to 2030' – reinforces our fundamental belief that global challenges can only be solved through international collaboration, and our collective commitment to achieving the UN Sustainable Development Goals through higher education.

Annual Report 2021-22

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Review of the year

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3 Review of the year

This section summarises our performance against the five objectives outlined in our strategic plan.

1. To champion the power of higher education to improve lives

Our accredited status and global partnerships enable us to influence policymaking in higher education and raise the profile of universities’ contribution to building a better world. Updates from 2021-22 include:

The 26th United Nations Climate Change Conference (COP26 ) in November 2021 was the focus for a series of activities profiling the vital role that universities play in delivering climate action. These included:

In January 2022, the ACU and British Council published a major new report on the role of international higher education partnerships in contributing to the UN Sustainable Development Goals (SDGs). The report showed that international higher education partnerships are highly effective both at devising and delivering solutions to global challenges and harnessing the potential of multisectoral and multidisciplinary partners, as well as adding value to donor investment. 185 attendees joined an online launch event, which featured an expert panel discussion on the findings. The report’s recommendations were also presented at external events, such as The PIE Live and the ‘Future of Internationalisation’ conference at the University of Glasgow.

In March 2022, as part of our ongoing partnership with the Government of Antigua and Barbuda and the University of the West Indies to support the development of a Centre of Excellence for Oceanography and the Blue Economy in the region, the ACU and partners joined a scoping visit to Antigua. The ACU made a presentation to the Cabinet of Antigua and Barbuda, who endorsed the project and its progress to date. The ACU’s Secretary General joined a post-Cabinet press briefing on national television and gave interviews to various media outlets on the project's development.

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In April 2022, the ACU represented Commonwealth and global higher education at the Conference of Commonwealth Education Ministers (CCEM) in Kenya. Highlights included:

In May 2022, the ACU took part in the UNESCO World Higher Education Conference, representing our members and advocating the key role that higher education plays in achieving sustainable development. ACU members were also able to join the event online. The ACU’s contributions to the conference fed into UNESCO’s resulting roadmap for higher education, and included:

In June 2022, the ACU attended the Commonwealth Heads of Government Meeting (CHOGM) in Rwanda, championing higher education’s critical contribution to sustainable development, outlining policy priorities for higher education, and shaping the agenda on behalf of our members. Highlights included:

In July 2022, we played an active part in the UN High-Level Political Forum – the main United Nations platform reviewing progress towards the Sustainable Development Goals. Highlights included:

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July also saw the ACU join forces with the UK Department for International Trade to lead a high-profile event at UK House in Birmingham to coincide with the 2022 Commonwealth Games. Titled ‘ International collaboration for global challenges – translating university expertise into action ’, the event brought Commonwealth leaders, policymakers and researchers together to explore how universities can work with governments, industry, and civil society to translate knowledge into action on food security, climate change, biodiversity loss, and more. In an opening address, the Commonwealth Secretary General, Baroness Scotland, endorsed the ACU’s work and praised our programmes bridging academic expertise and policymaking.

The ACU continued to call attention to the importance of sustainable urbanisation in tackling climate change through the Commonwealth Sustainable Cities Initiative , alongside partners such as the Commonwealth Association of Architects, the Commonwealth Association of Planners, and the Commonwealth Local Government Forum. The collaboration aims to raise the profile of sustainable urbanisation in the Commonwealth political agenda and to generate new initiatives to address to climate-related challenges. Updates from 2021-22 include:

A series of thought leadership articles in the media and beyond continued to highlight higher education’s vital contribution to society and the issues that matter to ACU members. These included:

The ACU Review , our online and print magazine, is a meeting place for ideas and diverse perspectives from across the Commonwealth. Each issue explores a different topical theme, chosen to highlight the value of higher education to society, and to reflect the diversity and shared challenges that characterise the ACU's global network. In the period covered by this report:

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The magazine’s online platform received 36,839 unique page views over this financial year, with readers from over 150 countries, and attracted 28,676 new users to our website.

2. To support the long-term vitality of universities

We continued to lead and manage a range of innovative projects and platforms that connect universities across borders to help meet demand, enable vital research, and strengthen higher education systems across the Commonwealth: The Climate Impacts Research Capacity and Leadership Enhancement (CIRCLE) programme worked to strengthen climate change research in subSaharan Africa through an innovative dual approach: supporting individual researchers to develop relevant local solutions, while working with universities to strengthen their capacity to support research. The programme was funded by the UK Foreign, Commonwealth and Development Office (FCDO) and formally ended in 2022. Updates include:

sought to interrogate and validate the proposed indicators with stakeholders and experts.

The Commonwealth Futures Climate Research Cohort supported 26 rising-star researchers across ACU member universities to bring local knowledge to a global stage in the lead-up to the 26th UN Climate Change Conference (COP26). In the period covered by this report, the ACU, alongside partners the British Council, continued to support the Cohort to share their research and ideas with governments and policymakers, including at COP26 in November, the British Council Climate Summit in March, and the Commonwealth Heads of Government Meeting in June. In addition:

The LEAP4FNSSA project aims to establish a platform for research collaboration between European and African institutions to support research and innovation in the fields of food and nutrition security and sustainable agriculture. Throughout this financial year, the ACU continued to be a task lead in monitoring, evaluation, and impact assessment of the AU (African Union) and EU (European Union) Partnership on Food and Nutrition Security and Sustainable Agriculture and contributed to the overall programme strategy.

The Partnership for Enhanced and Blended Learning (PEBL) was designed in response to the challenges reported by a number of African universities in meeting demand for higher education as a result of academic staff shortages and soaring student numbers. PEBL aims to rapidly and sustainably scale-up capacity in the design and use of blended learning – a combination of face-toface and digital learning – through expert-led training, collaboration, and the development of quality assured, credit-bearing blended courses that can be shared between institutions. Updates from 2021-22 include:

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Physics research and innovation in sub-Saharan Africa , and the challenges affecting its growth and development, were the theme of a new study published by the ACU in partnership with the Institute of Physics. Drawing on the experiences of more than 50 universities and research facilities in subSaharan Africa, as well as interviews and focus groups, the report argues that investment in physics in the region – including strengthened training, research, and infrastructure – would help create the conditions for the discipline to thrive and deliver innovative solutions to global challenges.

ACU Gender Grants fund initiatives that boost gender equity on campus. The grants, which are awarded annually to member universities, can be used to support a range of projects, workshops, and events. In 2021-22:

The Martha Farrell Memorial Fellowships offer specialist training and practical support to tackle sexual harassment on campus and are hosted by the Martha Farrell Foundation in India. In 2021-22, three virtual fellowships were awarded.

Aligned with our ongoing work to promote equitable research partnerships in higher education, the ACU and International Association of Universities led a - joint webinar in November 2021 on Language based equity in African health research , exploring the extent to which the use of English as the dominant language of science contributes to wider structural inequalities within health science research.

On International Women’s Day in March 2022, a live online event on our social media channels brought a group of female leaders working in higher education together to discuss how to ‘break the bias’ in higher education and beyond.

In October 2021, a PEBL webinar , open to all, shared achievements and lessons learned from the Partnership for Enhanced and Blended Learning (PEBL) project in East Africa, drawing on an external evaluation report of the project’s impact. Meanwhile, 26 credit-bearing online learning modules developed as part of the project remain available for universities around the world to download and use, covering topics in ICT, health and applied sciences, education, and business.

Between April and August 2022, the ACU worked with partner institutions to conduct an impact analysis of research projects funded by the African Union and European Union in the field of food and nutrition security and sustainable agriculture. The findings of this analysis – which was conducted in partnership with the Association for Strengthening Agricultural Research in Eastern and Central Africa, the International Institute of Tropical Agriculture, and the

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University of Greenwich – will support and guide the design and funding of future research and innovation programmes.

A guide to best practice in mentorship , produced by participants of the ACU’s CIRCLE programme (see 2.1) was shared with members of the ACU’s Supporting Research Community.

3. To engage and connect universities across borders, and promote collaboration

ACU member universities are a vibrant global community with a shared commitment to building a better world through higher education.

The ACU’s five thematic networks and communities of practice enable universities to collaborate on joint initiatives, share best practice, and come together to influence policy agendas within and beyond the sector. 69% of all members across 40 countries are now represented in our networks and communities, which are as follows:

The ACU Commonwealth Climate Resilience Network brings universities together to share practical expertise and experience of building resilience to climate change and natural disasters and contribute to policymaking in this area. Updates from 2021-22 include:

The ACU Higher Education and the SDGs Network is a forum for staff at ACU member universities who are directly engaged with the Sustainable Development Goals agenda, including integrating sustainable development into their teaching, research, operations, and strategies. Updates from 2021-22 include:

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The ACU HR in HE Community is a forum for staff working in university human resources. The Community champions the strategic importance of HR professionals in universities and their unique contribution to the university’s mission. Updates from 2021-22 include:

The ACU Peace and Reconciliation Network is an interdisciplinary collective of academics, researchers and professional staff working in the fields of peace, justice, truth-telling, and reconciliation. Updates from 2021-22 include:

The ACU Supporting Research Community is a forum for all staff at ACU member universities involved in supporting the research process – including research management and administration, research impact and uptake, and library services. Updates from 2021-22 include:

ACU Ambassadors are nominated points of contact within member universities. They help us to deepen our engagement with member institutions by improving the flow of communication and opportunities and by disseminating information to relevant people in their institution. Updates from 2021-22 include:

Annual Report 2021-22

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The ACU’s seven regional committees continued to ensure that the ACU responds to the differing regional needs of its members. The committees oversee regional activity, give feedback on membership priorities, inform the ACU’s policy work, and provide a window to broader regional developments. There is one committee for each of the following regions: East & Southern Africa, East Asia, South Asia, West Africa, Europe, the Pacific, and the Caribbean & Americas. Regional committees meet twice a year, and in 2021-22, an ACU delegation met with Pacific regional committee members in person in Canberra, with support from our regional office at the Australian National University.

ACU Measures , our flagship member benchmarking service, was relaunched in March 2022 following a wholescale review. This valuable service enables member universities across the world to compare practices and policies with their peers in non-competitive and confidential way, promoting the exchange of expertise and good practice between members and supporting institutional planning and decision-making. The first survey looked at how universities are supporting research in their institutions, with a 20% response rate to date . Bespoke reports using aggregated and analysed data collected from the survey will be shared with universities from September 2022.

The ACU is committed to delivering educational opportunities that make a positive and lasting difference. One of the ways we do this is through the management of world-class international scholarship schemes that build enduring international connections and understanding between individuals, institutions, and nations. We manage the UK government’s three major scholarship programmes: Chevening, Commonwealth, and Marshall Scholarships, as well as the Queen Elizabeth Commonwealth Scholarships, and are custodians of the Commonwealth Scholarship and Fellowship Plan. In late 2021, we also became a lead delivery partner in the Turing Scheme. This section provides updates on all the above. Chevening is the UK government’s flagship international awards programme aimed at developing global leaders. Funded by the Foreign, Commonwealth and Development Office and partner organisations, and administered by the ACU, Chevening enables tomorrow’s leaders to study in the UK and join a global community of professionals who are creating positive change. Updates from 2021-22 include:

4. To deliver educational opportunities that make a positive and lasting difference

The ACU continued to be custodians of the Commonwealth Scholarship and Fellowship Plan (CSFP) – a unique international framework through which Commonwealth countries offer university scholarships and fellowships to citizens of other member nations, forging lasting links across the Commonwealth and creating valuable opportunities for cultural and academic exchange. The

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Commonwealth Scholarship Commission and the Queen Elizabeth Commonwealth Scholarships – both detailed below – operate within this framework. In April 2022, a report on the CSFP was presented to the Conference of Commonwealth Education Ministers in Kenya – see 4.3.

The Commonwealth Scholarship Commission in the UK (CSC) is the main UK government scholarship scheme led by international development objectives. Sponsored by the Foreign, Commonwealth and Development Office and managed by the ACU, the CSC combines sustainable development with UK national interests by supporting innovators and leaders of the future from across the Commonwealth and attracting outstanding talent to Britain’s universities. Updates from 2021-22 include:

alumni can share their work) and Research Impact Awards (which recognise how research conducted by CSC scholars and alumni is supporting sustainable development). The Alumni Community Engagement Fund, which supports alumni in raising awareness of development issues at the community level, focused on climate action and girl’s education during 2021-22.

Marshall Scholarships enable young Americans of high ability to study for a degree in the UK. As future leaders, Marshall Scholars strengthen the enduring relationship between the British and American peoples, their governments, and their institutions. Marshall Scholarships are mainly funded by the Foreign, Commonwealth and Development Office and overseen by the Marshall Aid Commemoration Commission, administered by the ACU. Updates from 2021-22 include:

The Queen Elizabeth Commonwealth Scholarships (QECS) offer the chance to study for a two-year Master’s degree in a low or middle income Commonwealth country. Funded by Commonwealth governments, the scholarships are aimed at students who are committed to creating change in their communities. Updates from 2021-22 include:

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The Turing Scheme is the UK’s global programme for studying, working, and living abroad. In November 2021, the ACU was appointed principal partner in the scheme, leading on the assessment of applications and supporting with monitoring and evaluation. A new team was in place to deliver these activities in time for applications opening in early 2022.

4.2Seek to create and expand educational opportunities

In addition to government-funded schemes, the ACU’s own range of grants and fellowships continue to support the interchange of students and staff between member universities. We also work actively to increase the number of such opportunities available.

The ACU’s Challenge Grants , now in their second year, are specifically for members of the ACU’s five thematic networks and communities of practice. These networks enable universities to share best practice, collaborate on joint activities, and influence policy agendas in areas of strategic importance. The grants – detailed under 3.2 – fund projects that further the networks’ aims and promote collaboration between their members.

The ACU supports early career researchers at its member universities through two types of grant:

ACU Fellowships promote the exchange of knowledge, skills, and ideas between universities and countries of the Commonwealth. Available to both academic and professional staff, the Fellowships enable collaborative research and partnership-building, as well as opportunities to observe and exchange different techniques and practice. The 2021-22 Fellowships will be announced in October 2022.

The Medical Student Virtual Mobility Grants aim to widen medical students’ knowledge of global health and build their intercultural skills. The grants fund virtual mobility projects delivered in partnerships between medical schools in different countries. In 2021-22, two grants were awarded to member institutions in Sri Lanka and India

The Routledge/Round Table Commonwealth Studentships support PhD research projects on Commonwealth-related themes. Two successful applicants will be awarded grants in September 2022.

The ACU Summer School brings Commonwealth students together to discuss global challenges through a dynamic programme of workshops, field trips, and group work. Bursaries are offered to enable students from all parts of the Commonwealth to take part, with each year hosted by different country – including Botswana, Cameroon, Canada, Ghana, Hong Kong, Malaysia, Mauritius, Rwanda, and the UK to date. Updates from 2021-22 include:

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Our Virtual Mobility Project Grants provide funding for ACU member universities to deliver a virtual mobility project – such as an online summer school – in partnership with another member university. In 2021-22, four grants were awarded to universities in India, Malaysia and the UK for projects aimed at enhancing students’ intercultural skills and global knowledge without the need for physical travel. This year’s grants will fund projects such as a collaborative student initiative to help students develop their digital skills and a virtual event on education for sustainable development.

In April 2022, we presented a report to ministers at the Conference of Commonwealth Education Ministers on the impact of the Commonwealth Scholarship and Fellowship Plan (CSFP) of which the ACU are custodians, renewing our call for Commonwealth governments to support the growth and continued future of the CSFP through investment and by hosting scholarships in their countries and institutions.

5. To uphold the ACU’s reputation for excellence and demonstrate its impact

Our work to enhance our standing as an employer of choice, and to attract, develop, and retain the best talent continued, including:

Annual Report 2021-22

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Gender pay gap

The ACU employs fewer than 250 staff and is therefore not required by law to publish an annual gender pay gap report. However, the ACU voluntarily provides this information.

At 5 April 2022, the ACU mean and median hourly pay gap was 0.2% and 5.4% respectively with females earning more than males on both measures. National gender pay gap among all employees was 15.4% in 2021.

To continue to attract the most suitable candidates, we updated our recruitment processes and procedures, including streamlining recruitment and selection through digitised processes, the creation of a hiring managers guide, and updates to the ACU’s ‘Work with Us' web page. We also launched an ACU LinkedIn page.

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Median hourly pay rate £35
Men Women
We remain committed to having a diverse workforce :
£1.05 £1.06
£1.00 £1.00 £1.00 £30 0.2%
Our colleagues Our Leadership Team
£0.85
5.4%
£25
BAME
BAME
22%
30% £20
White
White
70%
78% £15
£10
Male Male £5
26% 33%
Female
Female 67% £0
74% Mean Pay Median Pay
Men Women
22 21
ACU April ACU April National April 21
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Annual Report 2021-22

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Review of the year

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Established in 2021, the ACU’s new Research and Insight directorate monitors and evaluates the full range of the ACU’s work to show how it is having an impact and helping to build a better world through higher education. Highlights from 2021-22 include:

Our belief in the value of collaboration extends to every aspect of our work. Working with organisations whose values and aspirations align with our own helps us to share knowledge and ideas, extend our reach, and achieve common goals. Highlights from 2021-22 include:

Annual Report 2021-22

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For the lives we can lead

Financial Review

4 Financial Review

Financial Performance Review

The ACU aims to generate a small surplus from its unrestricted general activities and this year achieved a surplus of £12k before actuarial gains and transfers between funds. Unrestricted funds at 31 July 2022 stands at £5,994k.

The Statement of Financial Activities (SOFA) for the year is set out on page 28. A summary of the activities and the financial results is given below.

Unrestricted Funds - General

Membership fee income has increased by £28k (2%) to £1,215k. In 2021/22, in recognition of the impact on COVID-19 on our members, we maintained our fee at the 2019/20 level. We welcomed 19 new members in the year with the overall membership total increasing by 2.

External administration fees increased by £565k to £7,257k. In late 2021, we also became a delivery partner in the T2 phase of the Turing Scheme and would welcome an opportunity to participate in the next phase of the program.

Investment income declined by £4k to £403k. Market value of investments declined by £360k. Growth in the early part of the year was reversed with a resulting decline due to the interest-rate increases and the war in Ukraine. This has been partly offset by a £217k realised gain on disposal.

Total resources expended increased by £603k to £8,945k, mainly relating to the new sources of income. This has been offset by the increased income from external administration.

Other costs increased by £446k to £2,589k.

Membership income
External administration
Investment income / interest
Other Income
Total Income
Total Expenditure
Net operating income as per SOFA
(Loss) / Gain on investments
Actuarial gains on defined benefit pension
schemes
Net movement in funds
Funds brought forward
Transfer to Designated Funds
Funds carried forward		 2021/22
£’000
1,215
7,257
403
82
8,957
8,945
12
(143)
66
(65)
6,669
(610)
5,994		 2020/21
£’000
1,187
6,692
407
70
8,356
8,342
14
1,408
36
1,458
6,411
(1,200)
6,669

Employment costs for unrestricted activity increased by £157k to £6,356k. The average headcount charged to General Funds has decreased by 6 to 116.

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Financial Review

Unrestricted Funds - Designated

The Trustees have set aside two Designated Funds:

Closing balance of Designated funds is £2,150k (2021: £2,794k). Note 11 shows the movements during the year in each fund.

15 lists the amount awarded in grants.

In the year £100k was received from the estate of Francis & Philip Turner. This is being used to support the CSFP Scholarships.

The value of the Permanent Endowments stood at £17,608k (2021: £17,813k). The value of Expendable Endowments stood at £7,766k (2021: £7,868k).

Closing balance of the endowment funds is £25,374k (2021: £25,681k).

Investment Policy and returns

Investment objectives

The investment objective of the ACU’s portfolio is to seek long term real growth without taking undue risks, consistent with a reasonable level of income. The specific investment objective of the fund invested with Newtons is to maximise returns through capital growth and income. The specific investment objective of the funds invested with CCLA is to achieve an average annual total return of inflation plus 5% over the long term and control volatility to 75% of that of the UK equity market.

Investment Performance

Restricted Funds

The range of Restricted Funds administered by the ACU is shown in note 13. Note 15 provides an analysis where applicable of the value and number of scholarships and grants awarded from Restricted Funds.

Note 8 has an analysis of movements in investment values. The net cumulative return from the average charity (ARC Charity Indices Steady Growth) was (2.7%) for the 12 months to 31 July 2022.

Endowment Funds

The Permanent and Expendable Endowment Funds along with associated Restricted Funds generated £561k (2021: £529k) of investment income during the year. All the endowment income was credited to the relevant Restricted Funds. The market value of investments reduced by £341k to £25,699k. Note

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For the lives we can lead

Financial Review

The ACU has 9 investment portfolios.

The ACU has 9 investment portfolios.
Fund / Purpose of Fund Permanent /
Expendable		 Investment
Manager		 Value at
31 July 22
£’000		 Actual
Performance
%
CSFP Anniversary
Queen Elizabeth Commonwealth Scholarships		 Permanent Newton 10,742 (1.3%)
CSFP Anniversary
Queen Elizabeth Commonwealth Scholarships		 Restricted Newton 372 (1.3%)
QECS Scholarships
Queen Elizabeth Commonwealth Scholarships		 Expendable Newton 6,137 (1.3%)
QECS Frances & Philip Turner
Queen Elizabeth Commonwealth Scholarships		 Permanent Newton 614 (1.3%)
ACU Main fund
Investment of ACU reserves		 Permanent CCLA 8,236 (1.6%)
ACU Endowment
ACU Development Fellowships		 Permanent CCLA 5,940 (1.6%)
Edward Boyle
Edward Boyle medical electives		 Permanent CCLA 154 (1.6%)
Annenberg
Marshall Aid Commemoration Commission scholarships		 Permanent CCLA 739 (1.6%)
Marshall Sherfield
Post-doctoral fellowship for US students		 Expendable CCLA 1,003 (1.6%)

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For the lives we can lead

Governance and structure

5 Governance and Structure

Structure

The Association of Commonwealth Universities (ACU) was founded in 1913 and is a registered charity (number 314137 in England & Wales), regulated by the Charity Commission. It is controlled by its member institutions through an elected Council.

The ACU was granted its Royal Charter in 1963 and is governed by the Royal Charter, Bye-Laws and Regulations dated 17 June 1963 and last amended on 13 October 2010.

Governance and management

Nominations to the Council are made by Executive Heads of member institutions in four constituencies representing all regions of the Commonwealth. There are up to 20 elected Council members who may co-opt two further members if they conclude this is desirable to ensure balanced geographical and gender representation of the Council. An additional member may be co-opted if the Honorary Treasurer is not appointed from the elected Council members.

Council members are the Trustees of the ACU under UK charity law. Trustees are introduced to the role by briefings on UK charity governance and accounting, investment management and the diverse work of the ACU. The Council meets face-to-face twice each year, with any additional business conducted electronically in between meetings as necessary. During the year both meeting were held virtually. The officers and committees of the ACU report to the Council. The Council is responsible for approving new members, electing the ACU’s office bearers, appointing members of the Executive Committee, amending the Charter and Statutes, making and amending Byelaws, setting policy and strategic direction, and overseeing their implementation. Between Council meetings the other powers of Council are delegated to its Executive Committee.

The ACU’s committees, which are established by Council, are the Executive Committee, the Audit and Risk Committee and the Remuneration Committee.

The Executive Committee is elected by the Council and consists of the Chair, the Vice-Chair, the Honorary Treasurer, and up to five other Members of Council. The Chair of the Executive Committee has the power to co-opt an additional member should the need arise.

The Audit and Risk Committee met twice in 2021/22. It consists of five members, four (including the Chair) of whom are serving members of Council. The fifth place is filled by an independent member. The Honorary Treasurer is also in attendance for the finance related agenda items. The Chair of the Audit and Risk Committee is appointed by Council, from its members, and has the power to co-opt additional members should the need arise.

The Remuneration Committee consists of the Honorary Treasurer (Chair), two Vice-Chancellors from UK member institutions and one independent member with UK professional human resources knowledge.

The Trustees comply with the Charity Governance Code published in 2017 which sets out the principles and recommended practice for good governance within the sector. The Charity conducts triennial reviews of its governance arrangements, with the next review planned for 2023. This will involve external expert advice in how best to apply the principles within the code. The Council will then address any issues raised where required.

The ACU had no fundraising activities requiring disclosure under S162A of the Charities Act 2011.

Risk management

The Trustees have responsibility for risk management. Risks are identified by the Senior Executive Team and reviewed, assessed and appropriate action incorporated as part of the annual budget and planning process. Thus, risk is an integral part of the budget and plan reviewed and approved by the Trustees.

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For the lives we can lead

Governance and structure

The principal risks and uncertainties facing the charity are:

A series of systems operate to identify and mitigate risk. These systems include:

Unrestricted Reserves Policy

The ACU’s reserves policy is to hold free reserves (unrestricted general funds minus fixed assets) equivalent to 4 to 6 months unrestricted expenditure. Free reserves of £5.7m (2021: £6.7m) is £1.2m (2021: £2.5m) above the upper limit.

The Trustees recognise we are holding reserves above our upper limit. The Trustees will approve further drawdown for investment activity.

Public Benefit

In shaping our objectives for the year and planning our activities, the Trustees have considered the Charity Commission’s guidance on public benefit. In broad terms, the people of the Commonwealth (and other countries) benefit from the ACU’s support for the extension, improvement, and strengthening of higher education through our member institutions and through our activities. Our charitable objects for the public benefit – as expressed in our Royal Charter – and the activities which achieve them are summarised in the Review of the Year.

With around 500 members in 50 countries, we are expanding to be fully representative of the range of public and private universities throughout the Commonwealth. Our universities share Commonwealth values, including freedom of expression, a common language and many similarities in organisation and management. The ACU forms an extensive network to facilitate internationalisation and for a sharing of problems, solutions and best practice across a variety of higher education environments.

ACU Trading Limited

ACU Trading Limited (Company number: 9119389) is a wholly owned subsidiary of ACU and its results for the period have been consolidated into Group Financial Statements of ACU. The principal activity of ACU Trading Limited is the provision of staff services to the ACU.

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Governance and structure

Council Members

Professor Cheryl de la Rey Professor Colin Riordan

University of Canterbury, New Zealand Cardiff University, UK

Professor Feridun Hamdullahpur

Formerly the University of Waterloo, Canada

Professor Amanda Broderick University of East London, UK Dr Rhonda Lenton York University, Canada Professor Md. Akhturazzmaan University of Dhaka, Bangladesh Professor Wim de Villiers Stellenbosch University, South Africa Professor Pal Ahluwalia University of the South Pacific, Fiji Professor Shalini Bharat Tata Institute of Science and Technology, India Professor Suhas Raghunath University of Mumbai, India

Professor Suhas Raghunath Pednekar

Professor Sandeep Sancheti Professor Francis W. O. Aduol Professor Tawana Kupe Professor Barnabas Nawangwe

SRM University, India Technical University of Kenya, Kenya University of Pretoria, South Africa Makerere University, Uganda

New member (from 01/08/2022)

Professor Abiodun H. Adebayo Covenant University, Nigeria Professor Sir Hilary Beckles The University of the West Indies, Jamaica Professor Barney Glover AO Western Sydney University, Australia Snr. Professsor Sudantha Liyanage University of Sri Jayewardenpura, Sri Lanka

Professor Wendy Thomson

University of London, UK

Professor Dato’ Ir Dr. Mohd Hamdi University of Malaya, Malaysia Abd Shukor

Departing members (to 31/07/2022)

Professor Deep Saini Professor Ahmed Bazai

Dalhousie University, Canda

Balochistan University of Information Technology, Engineering and Management Sciences, Pakistan

Professor Mamokgethi Phakeng Professor Dhanjay Jhurry Professor Gabriel Ayem Teye Professor Suhas Pednekar

University of Cape Town, Sout Africa University of Mauritius, Mauritius

The University for Development Studies, Ghana

University of Mumbai, India

Audit and Risk Committee

Remuneration Committee

Amanda Broderick Wim de Villiers Graeme Appleby Engr Ahmed Farooq Bazai Professor Dhanjay Jhurry Professor Tawana Kupe

Feridun Hamdullahpur Julia Buckingham Alison Johns Shearer West

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Governance and structure

Trustee Training

Council members are the Trustees of the ACU under UK charity law. Trustees are introduced to the role by briefings on UK charity governance, from the ACU and its professional advisers; including Charity Trustee responsibilities; the Charity Governance Code; safeguarding and serious incident reporting; investment management; risk management, budgets and management accounts; and the ACU’s mission, vision, values and strategic priorities.

Day to day management

The Senior Executive Team (SET) is responsible for the day-to-day running of the ACU under authority delegated to the CEO by the Trustees. The SET is supported by the Senior Leadership Team (SLT) which comprises of six Directors.

The SET members are:

Chief Executive and Secretary General Dr Joanna Newman MBE FRSA Chief Finance Officer Caroline Harrison Chief Operating Officer Sharon Memis

COVID-19 Disclosure

scholars coming to the UK with some studying remotely. Working closely with our partners at the Foreign, Commonwealth and Development Office (FCDO) and our scholarship teams, we will continue to support our scholars during these unprecedented times, maintaining the excellent levels of service for which the ACU is known

The Trustees have reviewed the three year budget plan. Taking into account the balance sheet position and the impact of market volatility, the Trustees remain of the opinion that the going concern assumption remains appropriate and the financial statements continue to be prepared on this basis.

The COVID-19 pandemic has had a significant impact on the ACU’s operations, which we have adapted to, in order to reduce the impact. The SET are constantly monitoring the situation and have considered the following risks and mitigation:

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Governance and structure

Legal and administrative details

Principal place of business: Bankers Woburn House National Westminster Bank plc 20-24 Tavistock Square PO Box 83 London WC1H 9HF Tavistock House Tavistock Square www.acu.ac.uk London WC1H 9XA

Investment Managers: Newton Investment Management CCLA 160 Queen Victoria Street 85 Queen Victoria Street London EC4V 4LA London EC4V 4ET

Auditors Crowe U.K. LLP 55 Ludgate Hill London EC4M 7JW

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Statement of trustees’ responsibilities

For the lives we can lead

6 Statement of Trustees’ Responsibilities

The Trustees are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and regulations.

Charity law requires the trustees to prepare financial statements for each financial year in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards) and applicable law.

Under charity law the trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the charity and of its net incoming resources for that period. In preparing these financial statements, the trustees are required to:

Trustees’ Confirmatory Statement

The Trustees confirm that these Accounts comply with current statutory requirements, the requirements of the ACU’s governing document and the requirements of the Statement of Recommended Practice – Accounting and Reporting by Charities.

These Annual Report and Accounts were approved by the Council and are signed on their behalf by

Professor Cheryl de la Rey Chair of the Council

23[rd] November 2022

The trustees are responsible for keeping proper accounting records that are sufficient to show and explain the charity’s transactions and disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Charities Act 2011. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

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Auditors Report

7 Independent Auditor’s Report to the Trustees of the Association of Commonwealth Universities

Opinion

We have audited the financial statements of the Association of Commonwealth Universities (‘the charity’) and its subsidiaries (‘the group’) for the year ended 31 July 2022 which comprise the Group Statement of Financial Activities, the Group and Charity Balance sheets, the Group Cash Flow Statement and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice). In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We

believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

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

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

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

Other information

The trustees are responsible for the other information contained within the annual report. The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements, or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of

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For the lives we can lead

Auditors Report

this other information, we are required to report that fact. We have nothing to report in this regard.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 requires us to report to you if, in our opinion:

Responsibilities of trustees

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

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

Auditor’s responsibilities for the audit of the financial statements

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

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

Details of the extent to which the audit was considered capable of detecting irregularities, including fraud and non-compliance with laws and regulations are set out below.

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

Extent to which the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We identified and assessed the risks of material misstatement of the financial statements from irregularities, whether due to fraud or error, and discussed these between our audit team members. We then designed and performed audit procedures responsive to those risks, including obtaining audit evidence sufficient and appropriate to provide a basis for our opinion.

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Auditors Report

We obtained an understanding of the legal and regulatory frameworks within which the charity and group operates, focusing on those laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements. The laws and regulations we considered in this context were the Charities Act 2011 together with the Charities SORP (FRS 102). We assessed the required compliance with these laws and regulations as part of our audit procedures on the related financial statement items.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance with which might be fundamental to the charity’s and the group’s ability to operate or to avoid a material penalty. We also considered the opportunities and incentives that may exist within the charity and the group for fraud. The laws and regulations we considered in this context for the UK operations were General Data Protection Regulation (GDPR), employment legislation and taxation legislation.

Auditing standards limit the required audit procedures to identify non-compliance with these laws and regulations to enquiry of the Trustees and other management and inspection of regulatory and legal correspondence, if any.

We identified the greatest risk of material impact on the financial statements from irregularities, including fraud, to be within the recognition and classification of income and the override of controls by management. Our audit procedures to respond to these risks included enquiries of management, and the Audit Committee about their own identification and assessment of the risks of irregularities, sample testing on the posting of journals, reviewing accounting estimates for biases, reviewing regulatory correspondence with the Charity Commission and reading minutes of meetings of those charged with governance.

Owing to the inherent limitations of an audit, there is an unavoidable risk that we may not have detected some material misstatements in the financial statements, even though we have properly planned and performed our audit in accordance with auditing standards. For example, the further removed noncompliance with laws and regulations (irregularities) is from the events and transactions reflected in the financial statements, the less likely the inherently limited procedures required by auditing standards would identify it. In addition,

as with any audit, there remained a higher risk of non-detection of irregularities, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. We are not responsible for preventing non-compliance and cannot be expected to detect non-compliance with all laws and regulations.

Use of our report

This report is made solely to the charity’s trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charity’s trustees those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.

Crowe U.K. LLP Date 21 February 2023 Statutory Auditor 55 Ludgate Hill London, EC4M 7JW

Crowe U.K. LLP is eligible for appointment as auditor of the charity by virtue of its eligibility for appointment as auditor of a company under section 1212 of the Companies Act 2006.

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For the lives we can lead

Financial Statements

– Group Statement of Financial Activities year ended 31 July 2022

Note
Income and endowments from:
Grants & donations
2
Membership income
External administration
3
Investment income/interest
4
Other
Total Income
Expenditure on charitable activities:
Project grants
Membership engagement
Scholarships, grants and awards
External and fund administration
Expenditure on other activities:
Investment management
Total Expenditure
5
Net income / (expenditure) before
gains / (losses) on investments
(Losses) / Gains on investments
8
Net (expenditure) / income before
transfers
Transfers between funds
11
Net income before other
recognised gains and losses
Actuarial gains on defined benefit
pension schemes
20
Net movement in funds
Funds brought forward
Funds carried forward
11 –
13		 Unrestricted Funds
General
Designated
£’000
£’000
8
-
1,215
-
7,257
-
403
-
74
-
8,957
-
-
-
1,202
611
127
7
7,514
636
102
-
8,945
1,254
12
(1,254)
(143)
-
(131)
(1,254)
(610)
610
(741)
(644)
66
-
(675)
(644)
6,669
2,794
5,994
2,150		 Restricted
Funds
£’000
815
-
-
561
-
1,376
899
-
660
-
181
1,740
(364)
(35)
(399)
-
(399)
-
(399)
688
289		 Endowment
Funds
£’000
100
-
-
-
-
100
-
-
100
-
-
100
-
(307)
(307)
-
(307)
-
(307)
25,681
25,374		 Total
2022
£’000
923
1,215
7,257
964

74
10,433
899
1,813
894
8,150
283
12,039
(1,606)
(485)
(2,091)
-
(2,091)
66
(2,025)
35,832
33,807		 Total
2021
£’000
993
1,187
6,692
936
61
9,869
1,026
2,193
677
6,761
264
10,921
(1,052)
4,968
3,916
-
3,916
36
3,952
31,880
35,832

None of the above activities were acquired or discontinued during the year.

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For the lives we can lead

Financial Statements

Group and Charity Balance Sheet as at 31 July 2022

Note
Fixed assets
Intangible assets
7a
Tangible assets
7b
Investments
8
Total Fixed Assets
Current assets
Debtors
9
Cash at bank and in hand
Total Current Assets
Liabilities
Creditors amounts falling due within one year
10
Net Current (Liabilities) / Assets
Net assets excluding pension liability
Defined benefit pension scheme liability
20
Total Net assets
Funds
Unrestricted funds: General
11
Designated
11
Endowment funds
12
Restricted funds
13
Total funds		 Group
2022
2021
£’000
£’000
148
296
299
388
33,935
35,419
34,382
36,103
591
992
1,627
2,208
2,218
3,200
(2,424)
(3,036)
(206)
164
34,176
36,267
(369)
(435)
33,807
35,832
5,994
6,669
2,150
2,794
25,374
25,681
289
688
33,807
35,832		 Charity Charity
2022
£’000
148
299
33,935
34,382
591
1,627
2,218
(2,424)
(206)
34,176
(369)
33,807
5,994
2,150
25,374
289
33,807		 2022
£’000
148
299
33,935
34,382
588
1,517
2,105
(2,311)
(206)
34,176
(369)
33,807
5,994
2,150
25,374
289
33,807		 2021
£’000
296
388
35,419
36,103
991
1,944
2,935
(2,771)
164
36,267
(435)
35,832
6,669
2,794
25,681
688
35,832

These financial statements were approved and authorised for issue by the Council on 23[rd] November 2022 and signed on their behalf by:

Professor Cheryl de la Rey Chair of the Council

Dr Joanna Newman MBE Secretary General

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Financial Statements

Group Cash Flow Statement for the year ended 31 July 2022

Cash flows from operating activities:
Net cash used in operating activities
Cash flows from investing activities:
Investment Income and Interest
Purchase of tangible assets
Proceeds from sale of investments
Net cash provided by investing activities
Cash flows from financing activities:
Receipt of endowment
Net cash provided by financing activities
Change in cash and cash equivalents in the reporting period
Cash and cash equivalents at the beginning of the reporting period
Cash and cash equivalents at the end of the reporting period
Reconciliation of cash flows from operating activities:
Net (expenditure) / income for the reporting period
Adjustments for:
Amortisation and depreciation charge
Losses / (Gains) on investments
Investment income received
Decrease / (Increase) in debtors
(Decrease) / Increase in creditors
Pension changes
Receipt of endowment
Net cash used in operating activities
ANALYSIS OF CASH AND CASH EQUIVALENTS
Cash at bank and in hand		 Note
4
7
Opening
balance
£’000
2,208
2,208		 2022
£’000
(2,645)
964
-
1,000
1,964
100
100
(581)
2,208
1,627
2022
£’000
(2,025)
237
485
(965)
401
(612)
(66)
(100)
(2,645)
Cash
Flow
£’000
(581)
(581)		 2021
£’000
(1,520)
936
(96)
1,021
1,861
-
-
341
1,867
2,208
2021
£’000
3,952
281
(4,968)
(936)
(598)
785
(36)
-
(1,520)
Closing
balance
£’000
1,627
1,627

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For the lives we can lead

Notes to the accounts

9 Notes to the financial statements year ended 31 July 2022

1. Accounting policies

(a) Accounting convention

ACU is a Public Benefit Entity registered as a charity in England and Wales on 26 November 1965 (charity number 314137). Its registered office is: Woburn House, 20-24 Tavistock Square, London, WC1H 9HF.

The consolidated financial statements have been prepared in accordance with the Financial Reporting Standards applicable in the UK and Republic of Ireland (FRS 102), the Charities Act 2011 and the Statement of Recommended Practice on Accounting and Reporting applicable to charities preparing their accounts in accordance with FRS 102 (“The Charities SORP 2015”).

The accounts consolidate those of the Charity and its wholly owned trading subsidiary ACU Trading Limited.

The accounts are drawn up on the historical cost basis of accounting, as modified by the revaluation of certain assets including investments.

The functional currency of the Group is GBP, the currency of the primary economic environment in which it operates.

Critical accounting judgements and key sources of estimation uncertainty

In the application of the Group’s accounting policies, the Council are required to make judgments, estimates, and assumptions, about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects the current and future periods. The key sources of estimation uncertainty that have a significant effect on the amounts recognised in the financial statements are described in the accounting policies and are summarised below:

(b) Income

All incoming revenues are included in the SOFA when the ACU is legally entitled to the income and the amount can be measured with reasonable certainty. Income is deferred only when the ACU has to fulfil conditions before becoming entitled to it or where the donor has specified that the income is to be expended in a future period.

(c) Expenditure

All expenditure has been accounted for on an accruals basis and has been classified under headings which are consistent with the activities of the ACU. Where costs cannot be directly attributed to particular headings, they have been allocated to activities on a basis consistent with the use of the resource. Central overheads

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Notes to the accounts

such as accommodation, IT, Communications, HR and Finance have been allocated on usage or staffing basis. Irrecoverable VAT is charged to the relevant grant or project, or to central overheads if not an eligible cost for a grant.

(d) Termination Payments

Termination benefits are payable when employment is terminated before the normal retirement date, or whenever an employee accepts voluntary redundancy in exchange for these benefits. ACU recognises termination benefits when it is demonstrably committed to either (i) terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or (ii) providing termination benefits as a result of an offer made to encourage voluntary redundancy.

(e) Grants

ACU makes grants in line with funders’ and donors’ aims and wishes. This contributes to ACU’s objective of facilitating the interchange of students and teachers between Commonwealth universities and between them and the universities of foreign countries.

(f) Governance costs

These represent costs incurred by the Secretary General’s office and other key management which are attributable to the management of the ACU’s assets, organisational administration and compliance with constitutional and statutory requirements. Governance costs have been allocated to charitable activities as a separate component of support costs on the same basis as noted in (c) above.

(g) Intangible and tangible assets – capitalisation, depreciation and amortisation

All assets costing more than £7,500 are capitalised. Depreciation is provided on all tangible fixed assets at rates calculated to write-off the cost on a straight-line basis over their expected useful lives as follows:

Leasehold property - Over the life of the lease.
Computer equipment - 3 years
Office equipment - 3 years
Furniture and fixtures - 5 years
Computer software (intangible) - 3 years

(h) Investments

Investment assets are valued at market value at the balance sheet date. Gains on investment assets are the net of realised gains and losses and unrealised gains and losses. Realised gains and losses on investments are arrived at by comparing the net sale proceeds with the market value at the end of the previous financial year or cost if acquired in the year; unrealised gains and losses represent the difference between the market value of investments still held at the end of the financial year with their value at the beginning of the year or with their cost if purchased subsequently.

Investment income from cash at bank is accrued at the year end. Income generated from investments and cash held by Fund Managers is credited to income as received.

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Notes to the accounts

(i) Fund accounting

Funds held by the ACU:

General Funds

Unrestricted funds comprising accumulated surpluses and deficits after transfer to or from designated funds.

Designated Funds

Unrestricted funds set aside out of general funds and designated for specific purposes by the Trustees.

Restricted Funds

Funds which are subject to donor-imposed conditions as to their use.

The Permanent Endowment Funds

Generate income which is transferred to the ACU Development Fellowship Fund, Queen Elizabeth Commonwealth Scholarship and Fellowship Plan, the Edward Boyle (Medical Electives) Fund and the Annenberg Foundation Scholarship Fund, which are Restricted Funds. The capital of these funds must be retained.

The Expendable Endowment Funds

Generate total returns which fund the Queen Elizabeth Commonwealth Scholarship, Marshall Sherfield postdoctoral fellowships. The capital of these funds will be retained until the Trustees choose to spend the capital. There is currently no such intention.

(j) Operating leases

The rents payable under operating leases, where substantially all the benefits and risk of ownership remain with the lessor, are charged to the SOFA as incurred. Where there are rent free periods, the cost is spread over the period to the first rent review.

(k) Financial Instruments

ACU has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are recognised as:

(l) Pension schemes

The ACU participates in both the Universities Superannuation Scheme (USS) and the Superannuation Arrangements of the University of London (SAUL).

USS

Significant accounting policies

The institution participates in Universities Superannuation Scheme. The assets of the scheme are held in a separate trustee-administered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The institution is therefore exposed to actuarial risks associated with other institutions’ employees and is unable to identify its share of the underlying

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Notes to the accounts

assets and liabilities of the scheme on a consistent and reasonable basis. As required by Section 28 of FRS 102 “Employee benefits”, the institution therefore accounts for the scheme as if it were a defined contribution scheme. As a result, the amount charged to the profit and loss account represents the contributions payable to the scheme. Since the institution has entered into an agreement (the Recovery Plan) that determines how each employer within the scheme will fund the overall deficit, the institution recognises a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) with related expenses being recognised through the profit and loss account.

Critical accounting judgements

FRS 102 makes the distinction between a group plan and a multi-employer scheme. A group plan consists of a collection of entities under common control typically with a sponsoring employer. A multi-employer scheme is a scheme for entities not under common control and represents (typically) an industry-wide scheme such as Universities Superannuation Scheme. The accounting for a multi-employer scheme where the employer has entered into an agreement with the scheme that determines how the employer will fund a deficit results in the recognition of a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) and the resulting expense in profit or loss in accordance with section 28 of FRS 102. The directors are satisfied that Universities Superannuation Scheme meets the definition of a multi-employer scheme and has therefore recognised the discounted fair value of the contractual contributions under the recovery plan in existence at the date of approving these financial statements.

Key sources of estimation uncertainty

The USS liability is based on a deficit recovery plan to 30 April 2038, a deficit contribution rate averaging 6.3%, staff salary inflation 2.0%, and a discount rate of 3.31%.

SAUL

The ACU participates in the Superannuation Arrangements of the University of London (“SAUL”), which is a centralised defined benefit scheme within the United Kingdom and was contracted out of the Second State Pension (prior to April 2016).

SAUL is an independently-managed pension scheme for the non-academic staff of over 50 colleges and institutions with links to higher education. Pension benefits accrued within SAUL currently build up on a Career Average Revalued Earnings (“CARE”) basis.

The ACU is not expected to be liable to SAUL for any other current participating employer’s obligations under the Rules of SAUL, but in the event of an insolvency of any participating employer within SAUL, an amount of any pension shortfall (which cannot otherwise be recovered) in respect of that employer, may be spread across the remaining participating employers and reflected in the next actuarial valuation.

Funding Policy

SAUL’s statutory funding objective is to have sufficient and appropriate assets to meet the costs incurred by the Trustee in paying SAUL’s benefits as they fall due (the “Technical Provisions”). The Trustee adopts assumptions which, taken as a whole, are intended to be sufficiently prudent for pensions and benefits already in payment to continue to be paid and for the commitments which arise from Members’ accrued pension rights to be met.

The Technical Provisions assumptions include appropriate margins to allow for the possibility of events turning out worse than expected. However, the funding method and assumptions do not completely remove the risk that the Technical Provisions could be insufficient to provide benefits in the future.

A formal actuarial valuation of SAUL is carried out every three years by a professionally qualified and independent actuary. The last actuarial valuation was carried out with an effective date of 31 March 2020. Informal reviews of SAUL’s position, reflecting changes in market conditions, cash flow information and new

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Notes to the accounts

accrual of benefits, are carried out between formal valuations.

The funding principles were agreed by the Trustee and employers in June 2021 and are due to be reviewed at SAUL’s next formal valuation in 2023.

At the 31 March 2020 valuation SAUL was 94% funded on its Technical Provisions basis. However, market movements following the valuation date were positive and the Trustee and the Employers agreed to allow for post-valuation experience up to 30 April 2021. As SAUL was in surplus on its Technical Provisions basis at that date, no deficit contributions were required. However, the Trustee and the Employers have agreed that the ongoing Employers’ contributions will increase from a rate of 16% of CARE Salaries to 19% of CARE salaries from 1 April 2022 and to 21% of CARE Salaries from 1 January 2023.

Accounting Policy

The ACU is a Participating Employer in SAUL. The actuarial valuation applies to SAUL as a whole and does not identify surpluses or deficits applicable to individual employers. As a whole, the market value of SAUL’s assets at 31 March 2020 was £3,612 million representing 94% of the liabilities. The market value of SAUL’s assets at 30 April 2021 was £4,369 million representing 109% of the estimated liabilities.

It is not possible to identify an individual Employer’s share of the underlying assets and liabilities of SAUL. The ACU accounts for its participation in SAUL as if it were a defined contribution scheme and pension costs are based on the amounts actually paid (i.e. cash amounts) in accordance with paragraphs 28.11 of FRS 102.

As there was a Technical Provisions deficit at 31 March 2020, allowing for post valuation experience to 30 April 2021, SAUL had a Technical Provisions surplus. Therefore, no deficit contributions were required following the 2020 valuation and there is no defined benefit liability (i.e. the present value of any deficit contributions due to SAUL) to be recognised by ACU.

See note 20 for more details.

(m) Foreign currencies

Transactions are translated on the date of transaction and balances on the year end date with any gain or loss taken to finance support costs.

(n) Going Concern

The ACU meets its ordinary working capital requirements through its cash held in the bank. The Senior Executive Team (SET) prepare 3 year budgets and annual forecasts in order to ensure sufficient cash balance to meet medium term requirements.

Based on ACU’s 3 year budgets, reserve levels, cashflow and investment levels, the SET believe it appropriate to adopt the going concern basis of accounting in preparing the financial statements.

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Notes to the accounts

2. Grants and donations received

Grants from UK Government
Foreign, Commonwealth and Development Office – CIRCLE
Foreign, Commonwealth and Development Office – PEBL SPHEIR Project
Foreign, Commonwealth and Development Office – Digital Africa
Foreign, Commonwealth and Development Office – COP26
Grants from other Agencies
Australian Government - Department of Foreign Affairs and Trade
European Commission – L4F
Other
Legacies and Grants from charitable foundations
Marshall Sherfield Fellowship Foundation
F&P Turner Endowment
Donations
Other		 2022
£’000
146
308
-
43
497
259
27
8
294
32
100
132
-
-
923		 2021
£’000
187
518
39
149
893
-
50
20
70
25
-
25
5
5
993

3. External administration fees

Chevening Scholarships
Commonwealth Scholarship award schemes
Marshall Scholarship scheme
Staff & Educational Development Association
Turing Scheme
Other schemes		 2022
2021
£’000
£’000
4,030
4,058
2,436
2,243
237
240
108
128
422
-
24
23
7,257
6,692

4. Investment income and interest

Investment income
Bank interest		 Unrestricted
Funds
£’000
402
1
403		 Restricted
Funds
£’000
561
-
561		 Total
2022
£’000
963
1
964		 Total
2021
£’000
936
0
936

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Notes to the accounts

5. Analysis of total resources expended

Charitable activities:
Project grants
Membership services
Scholarships, grants and awards
External and fund administration
Fundraising activities:
Investment management costs		 Staff
costs
£’000
294
617
127
4,468
-
5,506		 Grants
Paid
£’000
49
17
706
6
-
778		 Direct
Costs
£’000
556
350
61
893
283
2,143		 Support
costs
£’000
-
829
-
2,783
-
3,612		 Total
£’000
899
1,813
894
8,150
283
12,039

Support Costs

Staff Costs
Consultants
Office and Facilities
IT
Governance
Other		 Membership
Services
£’000
437
96
188
89
5
14
829		 External and
fund admin
£’000
1,468
324
630
299
15
47
2,783		 Total
£’000
1,905
420
818
388
20
61
3,612

Where appropriate direct expenditure, including staff costs, has been allocated to the above activities. Support costs which could not be directly allocated, have instead been allocated on the following bases:

Net incoming resources for the year are stated after charging:

2022 2021
£’000 £’000
Audit fees – ACU 17 16
Audit fees – ACU Trading Ltd 3 3
Other non-audit work 4 0
Council Meetings 0 0
Depreciation and amortisation 238 281

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Notes to the accounts

6. Staff costs

(a) Staff costs

Wages and salaries
Social security costs
Pension costs
Agency staff
Recruitment
Training and welfare		 2022
£’000
5,417
631
669
520
176
122
7,535		 2021
£’000
5,439
567
635
166
64
81
6,952

Realigning the ACU’s staff structure to meet the requirements of the Road to 2030 strategy has resulted in termination payments funded from Designated Funds. All off the £116k (2021: £110k) expensed in the year has been paid.

The Senior Executive Team (SET) are regarded as the Charity’s key management personnel. The total earnings, including benefits, employer pension and employer NI contributions received by SET members totalled £460k (2021: £453k).

The number of employees whose total earnings in the year (including benefits and termination payments but, excluding employer pension contributions) fell into the bands below were:

£60,001 to £70,000
£70,001 to £80,000
£80,001 to £90,000
£90,001 to £100,000
£100,001 to £110,000
£110,001 to £120,000
£140,001 to £150,000		 2022
Number*
2
-
1
1
2
-
1
7		 2021
Number
3
-
1
2
1
1
8

Of the above higher paid employees, 4 (2021: 3) were accruing benefit during the year, and 3 at the end of the year, in respect of membership of a defined benefit pension scheme.

The average headcount during the year was 130 (2021: 133).

(b) Trustees remuneration and expenses

No Trustee received any remuneration in the year (2021: £nil). No Trustees, or their institutions, were reimbursed for travel expenses incurred during the year (2021: £nil).

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Notes to the accounts

7. Group and Charity Assets

In 2019-20 the majority of the computer software assets were under construction and included in Tangible Assets. On completion these assets have been transferred to Intangible Assets.

a) Intangible Assets

Cost
At 31 July 2021
At 31 July 2022
Amortisation
At 31 July 2021
Charge for year
At 31 July 2022
Net book value
At 31 July 2022
At 31 July 2021		 Computer
software
£’000
668
668
372
148
520
148
296

b) Tangible Assets

Cost
At 31 July 2021
At 31 July 2022
Depreciation
At 31 July 2021
Charge for year
At 31 July 2022
Net book value
At 31 July 2022
At 31 July 2021		 Computer
equipment
£’000
131
131
129
2
131
-
2		 Office Re-
configuration
£’000
787
787
401
87
488
299
386		 Total
£’000
918
918
530
89
619
299
388

At 31 July 2022 there were no capital commitments.

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Notes to the accounts

8. Group Investments

a) Movements in quoted investments

Market value, 1 August
Disposals at opening market value
Unrealised (losses) / gains on revaluation
Market value, 31 July
Cost, 31 July		 Unrestricted
funds
2022
2021
£’000
£’000
9,379
8,971
(1,000)
(1,000)
(143)
1,408
8,236
9,379
6,371
7,154		 Restricted &
Endowment funds		 Restricted &
Endowment funds
2022
£’000
9,379
(1,000)
(143)
8,236
6,371		 2022
£’000
26,040
-
(341)
25,699
11,250		 2021
£’000
22,501
(21)
3,560
26,040
11,250

b) Analysis by type

Quoted investments
Cash held for
investment purposes		 Unrestricted
funds
£’000
8,236
-
8,236		 Restricted
funds
£’000
340
-
340		 Endowment
funds
£’000
25,359
-
25,359		 Total
2022
£’000
33,935
-
33,935		 Total
2021
£’000
35,419
-
35,419

9. Debtors and prepayments

Trade debtors
Sundry debtors
Accrued Income
Prepayments		 Group
2022
2021
£’000
£’000
432
864
9
20
15
-
135
108
591
992		 Charity Charity
2022
£’000
432
9
15
135
591		 2022
£’000
432
6
15
135
588		 2021
£’000
864
19
-
108
991

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Notes to the accounts

10. Creditors: amounts payable within one year

Trade creditors
Deferred income
Income Tax and NI contributions
Value Added Tax
Sundry creditors
Accruals
Amounts due to ACU Trading Limited		 Group
2022
2021
£’000
£’000
174
246
1,476
1,755
168
153
280
417
58
58
268
407
-
-
2,424
3,036		 Charity Charity
2022
£’000
174
1,476
168
280
58
268
-
2,424		 2022
£’000
167
1,476
35
280
8
134
211
2,311		 2021
£’000
235
1,755
35
417
12
273
44
2,771

Deferred income

Deferred income
Membership Income
DFAT
External administration fee
Other		 Opening
Balance
£’000
8
1,083
643
21
1,755		 Released
in year
£’000
(8)
(259)
(643)
(21)
(931)		 Deferred
in year
£’000
7
-
611
34
652		 Closing
Balance
£’000
7
824
611
34
1,476

11. Designated and General Funds

2022
ACU office
Road to 2030
Designated Funds
General Funds		 Brought
Forward
£’000
386
2,408
2,794
6,669
9,463		 Income
£’000
-
-
-
8,957
8,957		 Expenditure
£’000
(87)
(1,167)
(1,254)
(8,879)
(10,133)		 Gains
£’000
-
-
-
(143)
(143)		 Transfers
£’000
-
610
610
(610)
-		 Carried
forward
£’000
299
1,851
2,150
5,994
8,144

Council approved a further transfer of £0.6m from General Funds to Designated Funds to support a minor office refurbishment and an innovation fund to support the Business Development Team .

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Notes to the accounts

2021
ACU office
Road to 2020
Road to 2030
Designated Funds
General Funds		 Brought
Forward
£’000
463
65
1,870
2,398
6,411
8,809		 Income
£’000
-
-
-
-
8,356
8,356		 Expenditure
£’000
(77)
(65)
(662)
(804)
(8,306)
(9,110)		 Gains
£’000
-
-
-
-
1,408
1,408		 Transfers
£’000
-
-
1,200
1,200
(1,200)
-		 Carried
forward
£’000
386
-
2,408
2,794
6,669
9,463

12. Endowment funds

2.
Endowment funds
2022
Opening
funds
£’000
Permanent endowments
CSFP Anniversary
10,884
ACU
6,028
Edward Boyle
152
Annenberg Foundation
749
17,813
Expendable endowments
Queen Elizabeth
Commonwealth
Scholarships
6,228
Marshall Sherfield
1,017
F&P Turner
623
7,868
Total endowments
25,681		 Income
£’000
-
-
-
-
-
-
-
100
100
100		 Expenditure
£’000
-
-
-
-
-
-
-
(100)
(100)
(100)		 Gains on
investment
£’000
(108)
(85)
(2)
(10)
(205)
(79)
(15)
(8)
(102)
(307)		 Closing
funds
£’000
10,776
5,943
150
739
17,608
6,149
1,002
615
7,766
25,374

The CSFP Anniversary and the Queen Elizabeth Commonwealth Scholarships endowments enable people from around the Commonwealth to study in low and middle income countries at ACU member institutions. The F&P Turner endowment is a legacy grant with no restrictions. Together, the three funds support the Queen Elizabeth Commonwealth Scholarship awards.

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Notes to the accounts

The ACU Endowment funds ACU Development Fellowships.

Income from the Edward Boyle (Memorial) Endowment funds the Medical Elective Bursaries for UK students.

The Annenberg Endowment funds Marshall scholarships, its income being transferred to the Marshall Aid Commemoration Commission.

The Marshall Sherfield Endowment funds post-doctoral fellowships for US students. Funds are drawn down from the Endowment as required, up to a maximum of 5% of the original investment per year and are supplemented by grants from the Marshall Sherfield Fellowship Foundation in the US.

2021
Permanent endowments
CSFP Anniversary endowment
ACU endowment
Edward Boyle endowment
Annenberg Foundation endowment
Expendable endowments
Queen Elizabeth Commonwealth
Scholarships endowment
Marshall Sherfield endowment
F&P Turner Endowment
Total endowments		 Opening
funds
£’000
9,434
5,174
130
643
15,381
5,392
873
539
6,804
22,185		 Expenditure
£’000
(13)
-
-
-
(13)
-
-
-
-
(13)		 Gains on
investments
£’000
1,463
854
22
106
2,445
836
144
84
1,064
3,509		 Closing
funds
£’000
10,884
6,028
152
749
17,813
6,228
1,017
623
7,868
**25,681 **

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Notes to the accounts

13. Restricted Funds

2022
ACU Development Fellowships1
CSFP Anniversary Fund1
Queen Elizabeth CSR1
F&P Turner1
Marshall Sherfield Fellowships1
Annenberg1
Edward Boyle (Medical Electives)1
HW Paxton Legacy
Symons Medal
Climate Impacts Research Capacity and Leadership
Enhancement2
Partnership for Enhanced & Blended Learning (East Africa)3
Partnership for Enhanced & Blended Learning (West Africa)3
Waitrose & Partners - Blue Charter Marine Plastic4
LEAP5
Digital Africa - British Council
Climate Cohort - COP266
Commonwealth Futures – British Council
Mzuzu University, Malawi		 Opening
Balance
£’000
290
161
-
16
76
7
8
94
7
9
(118)
-
33
23
(17)
93
5
1
688		 Total
Income
£’000
242
151
83
8
72
30
6
-
-
146
309
259
-
27
-
43
-
-
1,376		 Expenditure
£’000
(281)
(383)
(83)
(8)
(51)
(34)
(2)
-
-
(151)
(191)
(341)
(33)
(59)
17
(140)
-
-
(1,740)		 Gains on
investment
£’000
-
(35)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(35)		 Closing
Balance
£’000
251
(106)
-
16
97
3
12
94
7
4
-
(82)
-
(9)
-
(4)
5
1
289

Funds with negative balance: costs are reimbursed by the funder in arrears.

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Notes to the accounts

2021
ACU Development Fellowships1
CSFP Anniversary Fund1
Queen Elizabeth CSR1
F&P Turner
Marshall Sherfield Fellowships1
Annenberg1
Edward Boyle (Medical Electives)1
HW Paxton Legacy
Symons Medal
Climate Impacts Research Capacity and Leadership
Enhancement2
Partnership for Enhanced & Blended Learning3
Waitrose & Partners - Blue Charter Marine Plastic4
LEAP5
Digital Africa - British Council
Climate Cohort - COP266
Africa-UK Physics
Commonwealth Futures – British Council
Mzuzu University, Malawi		 Opening
Balance
£’000
228
169
180
11
67
11
6
94
7
(1)
(103)
180
7
-
-
12
13
5
886		 Total
Income
£’000
233
142
78
8
64
28
6
-
-
187
518
-
61
39
149
-
-
-
1,513		 Expenditure
£’000
(171)
(430)
(29)
(3)
(55)
(32)
(4)
-
-
(177)
(533)
(147)
(45)
(56)
(56)
(12)
(8)
(4)
(1,762)		 Gains on
investment
£’000
-
51
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
51		 Transfer
between
funds
229
(229)
-		 Closing
Balance
£’000
290
161
-
16
76
7
8
94
7
9
(118)
33
23
(17)
93
-
5
1
688

Funds with negative balance: costs are reimbursed by the funder in arrears.

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Notes to the accounts

14. Analysis of Group assets between Funds

2022
Endowment Fund
Restricted Fund
Unrestricted Designated Fund
Unrestricted General Fund
2021
Endowment funds
Restricted funds
Unrestricted Designated Fund
Unrestricted General funds		 Pension
and other
liability
£’000
Fixed
assets
£’000
Investments
£’000
Net current
assets /
(liabilities)
£’000
Total
£’000
-
-
25,359
15
25,374
-
-
340
(51)
289

-
534
-
1,616
2,150
(369)
2
8,236
(1,875)
5,994
(369)
536
33,935
(295)
33,807
Pension
and other
liability
£’000
Fixed
assets
£’000
Investments
£’000
Net current
assets /
(liabilities)
£’000
Total
£’000
-
-
25,700
(19)
25,681
-
-
340
348
688

-
682
-
2,112
2,794
(435)
2
9,379
(2,277)
6,669
(435)
684
35,419
164
35,832

15. Grants, awards and scholarships awarded from Endowments

CSFP Anniversary Fund
ACU Development Fellowships
Marshall Sherfield Fellowship Scheme
Funded by Endowments
Climate Impacts Research Capacity and
Leadership Enhancement
Funded by Restricted Funds		 £’000
481
160
40
681
19
19
700		 Awards
69
74
1
144
18
18
162

Grants are paid to individuals and the higher education institutions to which they are connected. As at 31 July 2022, ACU had grant commitments of £620k, payable over the next 2 years (2021: £184k).

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Notes to the accounts

16. Administration of External Funds

The ACU runs a number of schemes for which it receives a management fee (Note 3). The table below shows the bank balances and the value of transactions processed by ACU.

Chevening Scholarship Scheme
Commonwealth Scholarship Scheme
Marshall Aid Commemoration Commission
Staff and Educational Development Association
Heads of Educational Development Group
Total Third Party Funds		 Opening
bank
balance
£’000
2,594
1,552
1,693

231
4
6,074		 Incoming
Resources
£’000
59,155
28,525
2,550
289
24		 Resources
Expended
£’000
(60,057)
(28,347)
(3,234)
(287)
(8)
(91,933)		 Closing
bank
balance
£’000
1,692
1,730
1,009
233
20
90,543 4,684

17. Future financial commitments

At 31 July 2022 the ACU had commitments under operating leases as set out below:

2022 2022 2021 2021
Land and Office Land and Office
buildings equipment buildings equipment
£’000 £’000 £’000 £’000
Within one year 340 2 340 2
After one year but within five years 821 - 1,161 -
Charged to SOFA during the year 340 2 340 2

18. ACU Trading Ltd

ACU Trading Limited (ACUT) is a wholly owned subsidiary of ACU and its results for the period ended 31 July 2022 have been consolidated into Group Financial Statements of ACU. The principal activity of ACUT is the provision of staff services to the ACU. The results of ACUT for the period ended 31 July 2021 are as follows:

Turnover
Cost of sales
Gross Profit
Administration
Net profit
Net assets		 2022
£’000
5,332
5,009
323
323
-
-		 2021
£’000
4,990
Debtors
4,813
Cash at bank
177
Current assets
177
Creditors
-
Total Net assets
-
Reserves		 2022
£’000
3
110
113
113
-
-		 2021
£’000
1
264
265
265
-
-

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Notes to the accounts

19. Related Parties

9.
Related Parties
2022 2021
£’000 £’000
Balances owed to ACU Trading Ltd 211 43
Payable to ACU Trading Ltd for services 5,332 4,990
Receivable from ACU Trading Ltd for services 178 144

20. Pension Commitments

(a) Universities Superannuation Scheme (USS)

The total cost charged to the profit and loss account is £252k (2021: £280k)

Deficit recovery contributions due within one year for the institution are £56K (2021: £66K).

The latest available complete actuarial valuation of the Retirement Income Builder is as at 31 March 2020 (the valuation date), and was carried out using the projected unit method.

Since the institution cannot identify its share of USS Retirement Income Builder (defined benefit) assets and liabilities, the following disclosures reflect those relevant for those assets and liabilities as a whole.

The 2020 valuation was the sixth valuation for the scheme under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to have sufficient and appropriate assets to cover their technical provisions. At the valuation date, the value of the assets of the scheme was £66.5 billion and the value of the scheme’s technical provisions was £80.6 billion indicating a shortfall of £14.1 billion and a funding ratio of 83%.

The key financial assumptions used in the 2020 valuation are described below. More detail is set out in the Statement of Funding Principles (uss.co.uk/about-us/valuation-and-funding/statement-of-funding-principles).

CPI assumption Term dependent rates in line with the difference between the Fixed Interest
and Index Linked yield curves less:
1.1% p.a. to 2030, reducing linearly by 0.1% p.a. to a long-term difference of
0.1% p.a. from 2040
Pension increases (subject
to a floor of 0%)		 CPI assumption plus 0.05%
Discount rate (forward
rates)		 Fixed interest gilt yield curve plus:
Pre-retirement: 2.75% p.a.
Post retirement: 1.00% p.a.

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

2020 valuation
Mortality base table 101% of S2PMA “light” for males and 95% of S3PFA for females
Future improvements to
mortality		 CMI 2019 with a smoothing parameter of 7.5, an initial addition of 0.5% p.a.
and a long-term improvement rate of 1.8% pa for males and 1.6% pa for
females

Annual Report 2021-22

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For the lives we can lead

Notes to the accounts

The current life expectancies on retirement at age 65 are:

2022 2021
Males currentlyaged 65(years) 23.9 24.7
Females currentlyaged 65(years) 25.5 26.1
Males currentlyaged 45(years) 25.9 26.7
Females currentlyaged 45(years) 27.3 27.9

A new deficit recovery plan was put in place as part of the 2020 valuation, which requires payment of 6.2% of salaries over the period 1 April 2022 until 31 March 2024, at which point the rate will increase to 6.3%. The 2022 deficit recovery liability reflects this plan. The liability figures have been produced using the following assumptions:


ssumptions:
2022 2021
Discount rate 3.31% 0.87%
Pensionable salarygrowth 2.00% 2.00%

(b) Superannuation Arrangements of the University of London (SAUL)

The ACU participates in the Superannuation Arrangements of the University of London, a centralised defined benefit scheme for all qualified employees with the assets held in separate Trustee-administered funds.

The total SAUL pension cost charged to the Statement of Financial Activities is £6K (2021: £10K). This includes nil (2021: nil) outstanding contributions at the balance sheet date, and £nil deficit contributions (2021: nil).

21. Legacies

In 2018/19 the ACU has received £500k from the Frances Elizabeth Turner legacy and this has been invested with Newtons. In 2021/22 a further £100k was received. Income from this legacy will be used to fund scholarships along with the Queen Elizabeth Commonwealth Scholarship and CSFP Anniversary Scholarships. As at July 2022 a further £76k is expected on closure of the Estate Accounts.

Annual Report 2021-22

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The Association of Commonwealth Universities /ii W@The_ACU info@acu.co.uk www.acu.ac.uk For the lives we can lead