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2023-07-31-accounts

The Associati of Commonw alth Annual Report and Financial Statements 2022-2023

Contents

1 Introduction from our Chair........................................................... 1
2 About Us ........................................................................................ 3
3 Review of the year ......................................................................... 4
4 Financial Review........................................................................... 16
5 Governance and Structure ........................................................... 19
6 Statement of Trustees’ Responsibilities ...................................... 23
7 Independent Auditor’s Report ..................................................... 24
8 Financial Statements .................................................................... 27
9 Notes to the financial statements year ended 31 July 2023 ....... 30

INTRODUCTION

1 Introduction from our Chair

The 12 months covered by this report saw the ACU continue to deliver on its core ambition: to build a better world through international collaboration in higher education. We delivered life-changing international opportunities to thousands of students, brought universities together to exchange knowledge and forge new partnerships, supported world-class research on global challenges, and much more.

Like everything we do, these activities reflect our fundamental belief that higher education plays a pivotal role in building a fairer, more sustainable future for the Commonwealth and beyond. But we are also acutely aware that universities often reflect the unequal world in which they operate. Tackling these inequalities – on campus, in research, and in accessing opportunities to learn – therefore remains a key priority as we convene universities around our common interest in principles of fairness, equity and social justice.

In July, we bought together higher education stakeholders at our Canada symposium to explore how universities can move beyond rhetoric to tackle systemic inequities on campus and beyond, with practical ideation on embedding approaches in university strategic action plans and curriculum development.

We continued to design and deliver transformative programmes that strengthen the capacity of individuals and institutions and unlock learning opportunities for thousands of students. The PEBL programme trained hundreds of lecturers across west Africa in the design and delivery of online learning, and our new awardnominated Commonwealth Virtual Exchange expanded the benefits of international experience to a far wider group of students than would otherwise be possible.

Meanwhile, we found new ways to equip our member universities with practical tools and resources to drive equity and fairness in global higher education partnerships. Supporting the establishment and advancement of fairer northsouth and south-south research relationships was at the forefront of the Equitable Research Partnerships Toolkit, which itself was a collaborative project with stakeholders across the Commonwealth.

We take great pride in our longstanding dedication to scholarships as a means to enhance access to higher education. The Chevening and Marshall programs will now transition to a new provider from 1 September 2022 following the UK Government's tender process during 2022-23. We have collaborated closely with both the Foreign, Commonwealth and Development Office (FCDO) and the new provider to facilitate a seamless handover of these programs.

Having secured the endorsement of Commonwealth governments for a series of far-reaching policy recommendations – including improved access to higher education, greater recognition of universities’ contribution to sustainable development, and increased investment in the sector – a priority for this year has been working with stakeholders across the Commonwealth to realise and sustain these vital commitments ahead of the next Commonwealth Heads of Government Meeting in 2024.

We look forward to continuing to champion our members in our role as the voice of higher education in the Commonwealth while working with UK and Commonwealth Governments on our wider mobility portfolio which includes the Commonwealth Scholarship programme, Queen Elizabeth Commonwealth Scholarships, and others.

In September we welcomed Professor Colin Riordan CBE, previously ViceChancellor of the Cardiff University after we farewelled Dr Joanna Newman who moved onto a new role in the sector.

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INTRODUCTION

We look forward to another busy, dynamic and collaborative year ahead, where we will be strengthening our offer for members including launching new thematic dialogues and preparing for the re-introduction of our Vice Chancellor’s conference in 2025.

Professor Cheryl de la Rey Chair of the Council

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MISSION, VISION, VALUES

2 About us

The Association of Commonwealth Universities is a global network with a shared commitment to building a better world through international collaboration in higher education.

Founded in 1913, the ACU connects institutions, people, and partners to provide educational opportunities, strengthen the capacity of universities, and advance higher education’s contribution to sustainable development.

Its aim is to create a strong and connected higher education community that works across borders and boundaries to build a fairer, more sustainable world.

Our values

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.

Our strategic priorities

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REVIEW OF THE YEAR

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 2022-23 include:

In September 2022, we attended, alongside our international partners, the UN Transforming Education Summit , which aimed to elevate education to the top of the global political agenda.

In October 2022, we took part in a panel at the Association for Development of Education in Africa Triennale , alongside the Commonwealth Secretariat and representatives from the Kenyan and Mauritian ministries of education, where we discussed the delivery of a series of higher education policy recommendations made by the ACU at the Conference of Commonwealth Education Ministers in April 2022.

In November 2022, we joined the 27th United Nations Climate Change

Conference (COP27 ) to profile the vital role that universities play in delivering climate action. Highlights included:

In April 2023, we drew on the results of our most recent ACU Measures survey (see 3.3) to highlight stark inequalities in university research funding and other research-related support , particularly in lower income countries. Through coverage across key target media, we were able call attention to the longstanding disparities that continue to shape the research ecosystem.

In May 2023, we joined a meeting of the Commonwealth Accelerated Development Mechanism (CADME) at the Education World Forum, where we presented our proposal for the Commonwealth Higher Education Working Group , a new initiative led by the ACU to build on the positive commitments made by government ministers at the 2022 Conference of Commonwealth Education Ministers (CCEM). This group enables us to work closely with the Commonwealth Secretariat and Commonwealth Education Ministers between CCEM meetings to shape policy implementation, and will actively contribute to shaping and delivering the next CCEM in close collaboration with the host government and ACU regional committees. Our proposal for the working group was endorsed by the Commonwealth Education Ministers Action Group.

In May 2023, we also welcomed the Higher Education Minister of The Gambia to our offices to discuss governmental plans for higher education and the wide range of opportunities for collaboration afforded by the ACU network. In the same

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month, we attended the Conference of Commonwealth Health Ministers Meeting to highlight universities’ contribution to universal health coverage.

In July 2023, we hosted a delegation from the Presidential Unit of the Government of Togo to discuss how international collaboration in higher education can contribute to their development plans.

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. In July 2023, members of the initiative announced a new partnership with UN-Habitat which aims to increase capacity of urban stakeholders in Commonwealth countries to tackle the challenges raised by rapid urbanisation.

In July 2023, we attended the UN High Level Political Forum , where we represented the interests of higher education as part of our tripartite partnership with the International Association of Universities and Agence Universitaire de la Francophonie. This included exploring a new partnership with the Education and Academia Stakeholder Group. In a roundtable held by Sustainable Development Solutions Network, the International Science Council, UN DESI, and others, we also fed into discussions on supporting science for the SDGs, to be included in ministerial communique at September’s UN SDG Summit.

Also in July 2023, we presented an award at International Green Gown Awards , which recognise exceptional sustainability initiatives undertaken by universities. Steering committee members from our Higher Education and the SDGs Network and Commonwealth Climate Resilience Network were also judges. 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. The latest issue, published in July 2023, explored how university humanities contribute to meeting the UN Sustainable Development Goals, featuring 12 academics in ten countries.

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: Climate Adaptation and Resilience (CLARE) is a UK-Canada framework research programme on climate adaptation and resilience, aiming to enable socially inclusive and sustainable action to build resilience to climate change and natural hazards in Africa and Asia-Pacific. The ACU provides consultancy-style services to the UK Foreign, Commonwealth and Development Office and Canada’s

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International Development Research Centre to support the design of research capacity-strengthening activities within the programme. Projects conducted include:

The Commonwealth Futures Climate Research Cohort programme, funded by the British Council, is designed to support a pipeline of early career researchers from Commonwealth countries, with the capacities to contribute to climate action research. With a focus on climate change mitigation and adaptation, an applied training programme supports these researchers to co-create a research project with the active participation of policy and/or practice stakeholders.

the fields of food and nutrition security and sustainable agriculture. Throughout this year, the ACU continued to be a task lead in monitoring, evaluation, and impact assessment of the African Union and 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) is 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-to-face and digital learning – through expert-led training, collaboration, and the development of quality assured, credit-bearing blended courses that can be shared between institutions. PEBL West Africa began in September 2021, with support from the Australian Department of Foreign Affairs and Trade, and is working with 12 university partners in Ghana and Nigeria to build sustainable capacity for blended learning. Multiple milestones were reached in the second year of the project, including:

The LEAP4FNSSA project aims to establish a platform for research collaboration between European and African institutions to support research and innovation in

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April 2023 saw the launch of the ACU Equitable Research Partnerships Toolkit - a collection of practical resources to assist analysis and action to address equity in research partnerships. Supporting the establishment and advancement of fairer north-south and south-south research relationships was at the forefront during its creation, which was informed by substantial research conducted with a range of ACU members from across the Commonwealth, as well as equitable research partnership stakeholders and experts. The toolkit looks to stimulate critical thinking and dialogue about what equity means, and what it might ‘look like’ in a research partnership, as well as suggesting practical actions to strengthen this. The toolkit was shared and explored through a series of activities including:

The ACU’s 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 2022-23, three virtual fellowships were awarded.

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 international collaboration in higher education.

As of the 31 July 2023, the ACU had 502 member universities, having welcomed 17 new members over the year. A new membership fee structure was introduced from 1 August 2023, which is based upon a formula related to the UN Human Development Index (HDI), and divided ACU members into three groups: low, medium, and high. Within these groups, the new subscription brackets are based on an individual institution's recurrent income as stated for the most recent financial year. This new model of redistributive membership subscription provides all universities in the Commonwealth with an affordable option to join the ACU. It is worth noting that the introduction of the new subscription fee model, along with more efficient debt management practices, may temporarily result in a decrease in membership numbers in early 2023/24.

In March 2023, the ACU India Roundtable series explored the future of higher education in India and across the Commonwealth. Hosted in partnership with three member universities in India, the events were a forum for universities across the Commonwealth to discuss issues of common relevance and forge new partnerships within and beyond India. More than 200 staff from 46 universities in

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India, Australia, Bangladesh, Fiji, and the UK took part, as well as representatives from the University Grants Commission, the Association of Indian Universities, AusTrade, and the British Council.

In May 2023, we partnered with the Council for Education in the Commonwealth, the University of Nicosia, and the Foundation for the Management of European Lifelong Learning Programs on a three-day conference exploring ‘ Digital ’ transition and inclusion in education: an agenda for action . The event, which took place at the University of Nicosia, Cyprus, looked at how digital transformation can contribute to greener and more inclusive societies.

In July 2023, the ACU Canada Symposium explored how universities are tackling inequity: the distinct and shared challenges they face and how international collaboration can support their efforts. Hosted in partnership with York University, Canada, the event brought university leaders together to discuss issues around access and inclusion, decolonisation, and higher education’s social impact.

Throughout the year, the ACU’s five thematic networks and communities of practice enabled 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 2022-23 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 2022-23 include:

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 2022-23 include:

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University of Ghana to support a project to strengthen the capacity of university HR Officers in performance management systems and HR analytics, and share learnings with the wider ACU.

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 2022-23 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 2022-23 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 2022-23 include:

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 2022-23, ACU delegations met with African, European and Canadian regional committee members in person in Pretoria, Nicosia and Toronto, respectively.

ACU Measures , our flagship member benchmarking service, enables member universities across the world to compare practices and policies with their peers in

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non-competitive and confidential way, promoting the exchange of expertise and good practice between members and supporting institutional planning and decision-making.

government opened a competitive tender for Chevening and Marshall programmes, and in March 2023, we were informed that these programmes will be moving on to another provider, which resulted in a transition programme at the ACU.

We continue to be 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 until 31 August 2023, Chevening enables tomorrow’s leaders to study in the UK and join a global community of professionals who are creating positive change. Updates from 2022-23 include:

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

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.

In 2022-23, we managed the UK government’s three major scholarship programmes: Chevening, Commonwealth, and Marshall Scholarships, as well as the Queen Elizabeth Commonwealth Scholarships. In late 2022, the UK

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

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Commemoration Commission, administered by the ACU. 40 Scholarships were awarded in 2023.

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 Commonwealth Scholarship Commission and the Queen Elizabeth Commonwealth Scholarships – both detailed below – operate within this framework.

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 2022-23 include:

in Action’ webinar series (through which scholars and 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 clean energy, air and oceans and sports for development during 2022-23.

The Ocean Country Partnership Programme (OCPP) Scholarships were launched in September 2022. Funded through the UK’s Blue Planet Fund, these create unique opportunities for students to undertake a fully-funded Master’s or PhD programme in marine science. The pilot cycle took place in 2022-23, offering postgraduate scholarships to 14 students from the Solomon Islands and Vanuatu to study at the University of the South Pacific. Further scoping is underway to extend the scholarship offer to further OCPP priority countries.

The Queen Elizabeth Commonwealth Scholarships (QECS) offer opportunities 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 2022-23 include:

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communities. Examples include a menstrual hygiene awareness programme for secondary school students in Papua New Guinea and the formation of an international students association at a scholar’s host university in Sri Lanka.

The Turing Scheme is the UK’s global programme for studying, working, and living abroad. In the year covered by this report, the ACU continued to lead the assessment of grant applications for outward mobility funding for schools, further education/vocational education, and training and higher education, working with Capita as the scheme’s delivery partner.

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 and promote the value of international experiences more widely. Activities in this area include:

The ACU’s Challenge Grants are specifically for members of the ACU’s 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 grants:

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 partnershipbuilding, as well as opportunities to observe and exchange different techniques and practice. As of 31 July, the selection process for this year’s awards is underway, with Fellowships due to be awarded in October 2023.

The Commonwealth Virtual Exchange , launched in October 2022, is an eightweek virtual exchange programme linked to the UN Sustainable Development Goals. The programme, designed by senior specialists at member institutions, is designed to help students develop valuable skills such as leadership, teamwork, and entrepreneurial skills. Free for students to join and delivered entirely online, the initiative aims to ensure that a wider range of students have access to the benefits that international study experiences can bring. In the period covered by this report, 40 students from ten member universities took part in the pilot programme and the initiative was nominated for a global education award – The PIEoneer Awards 2023 – for promoting diversity, equity and inclusion.

The Routledge/Round Table Commonwealth Studentships support PhD research projects on Commonwealth-related themes. In 2022-23, two grants were awarded to students in Nigeria and Australia. Funded projects included research interrogating how voters in Nigeria respond when their elected politicians change political parties and research examining the symbiotic relationship between politics and masculinities in Fiji.

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The ACU Summer School brings Commonwealth students together to explore multidisciplinary, global issues 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 co-hosted by a different ACU member university. Locations to date have included Botswana, Cameroon, Canada, Ghana, Hong Kong, India, Malaysia, Mauritius, Rwanda, and the UK. Held annually, two Summer Schools fell within the period covered by this report:

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 2022-23, five grants were awarded to universities in Malawi, Kenya, UK, India and Nigeria for projects aimed at enhancing students’ intercultural skills and global knowledge without the need for physical travel.

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

5.1Create and sustain a high-performance culture by delivering efficient core services to support our people

The ACU underwent an organisation-wide restructure, with the new structure being implemented from 1 September 2023. These changes will support the ACU’s financial sustainability and result in a matrix way of working that will significantly contribute to achieving strategic priorities and enable the ACU to respond to the external opportunities and the challenges ahead.

As a result of not retaining the Chevening and Marshall contracts, we have been managing the TUPE transfer process for those staff members who worked on Chevening and Marshall. The transfer took place on 1 September 2023 to the new provider.

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

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continued across the year, including menopause awareness training, neurodiversity awareness for staff and training for managers, initiatives led by the Wellbeing Committee such as mental health awareness week, and a push to improve the collection of diversity data from staff to improve policies and processes and help with monitoring purposes. We have also updated the EDI statement on our ‘Work with Us' web page and we are trialling using more diverse websites for advertising vacancies.

At 5 April 2023, the mean pay gap was 0.7% with females earning more than males and the median pay gap was 1.2% with males earning more than females. National median gender pay gap among all employees was 14.9% in 2022 with males earning more than females.

----- Start of picture text -----
Median hourly pay rate £29
| Men | Women 0.7%
£1.05
£1.00 £0.99 £1.00 £1.00 £28
£0.85 £27
£26
£25
-1.1%
£24
£23
£22
Mean Pay Median Pay
| Men | Women
ACU April 23 ACU April 22 National April 22
----- End of picture text -----

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.

The ACU’s Research and Insight team continued to monitor and evaluate 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 2022-23 include:

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efficiencies in data importing/exporting, cleaning, wrangling and analysis to support the delivery of multiple areas of work across the ACU.

In July 2023, we launched a redesign of the ACU’s website , including changes to the navigation and categorisation to improve the user experience and provide a better representation of who we are and what we do.

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 2022-23 include:

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FINANCIAL REVIEW

4 Financial Review

the Chevening farewell and orientation, holding an in-person Council meeting, increased travel expenses to support our membership and the Chevening selection process, and higher employment costs.

Financial Performance Review

The ACU aims to generate a small surplus from its unrestricted general activities and this year achieved a surplus of £10k before actuarial gains and transfers between funds. Unrestricted reserves at 31 July 2023 stand at £5,396k.

The Statement of Financial Activities (SOFA) for the year is set out on page 27. A summary of the activities and the financial results is given below.

Unrestricted Funds - General

During the year we took the tough decision to reinstate our policy of suspending members who hadn’t paid their membership fees for the last two years. This led to a drop in our income and our provision for bad debt. On a positive note, we welcomed 16 new members. We increased the 2022/23 membership fee by 4%. The net effect of this was a £7k decrease in income to £1,208k.

Our external administration fees increased by £600k to £7,857k. This increase was primarily due to hosting events such as the Chevening farewell and orientation. We are delighted to announce our collaboration with the Centre for Environment, Fisheries and Aquaculture Science (Cefas) on the Ocean Country Partnership Programme (OCPP). This programme, focused on the research themes of marine pollution, sustainable seafood and marine biodiversity, is part of the UK Government's Blue Planet Fund.

Employment costs for unrestricted activity increased by £102k to £6,476k. The average headcount charged to General Funds has increased by 1 to 117.

2022/23 2021/22
£’000 £’000
Membership income 1,208 1,215
External administration 7,857 7,257
Investment income / interest 348 403
Other Income 194 82
Total Income 9,607 8,957
Total Expenditure 9,597 8,945
Net operating income as per SOFA 10 12
(Loss) / Gain on investments (243) (143)
Actuarial gains on defined benefit pension 59 66
schemes
Net movement in funds
Funds brought forward
Transfer to Designated Funds		 (174)
5,994
(424)		 (65)
6,669
(610)
Funds carried forward 5,396 5,994

Investment income declined by £55k to £348k. This decline was a result of us selling £1m worth of investments to support our cashflow and a £243k drop in market value of investments.

Total resources expended increased by £652k to £9,597k. This increase was driven by several factors, including the costs associated with hosting events like

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FINANCIAL REVIEW

Unrestricted Funds - Designated

The Trustees have set aside two Designated Funds:

Closing balance of Designated funds is £1,500k (2022: £2,150k). Note 11 shows the movements during the year in each fund.

The value of the Permanent Endowments stood at £17,499k (2022: £17,608k). The value of Expendable Endowments stood at £7,803k (2022: £7,766k).

Closing balance of the endowment funds is £25,302k (2022: £25,374k).

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 +0.83% for the 12 months to 31 July 2023.

Endowment Funds

The Permanent and Expendable Endowment Funds along with associated Restricted Funds generated £636k (2022: £561k) of investment income during the year. All the endowment income was credited to the relevant Restricted Funds. Investment worth £250k were sold to support cashflow relating to endowment funded activities. The market value of investments reduced by £33k to £25,417k. Note 15 lists the amount awarded in grants.

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FINANCIAL REVIEW

The ACU has 9 investment portfolios.

Fund / Purpose of Fund Permanent /
Expendable		 Investment
Manager		 Value at
31 July 23
£’000		 Actual
Performance
%
CSFP Anniversary
Queen Elizabeth Commonwealth Scholarships		 Permanent Newton 10,840 +0.90%
CSFP Anniversary
Queen Elizabeth Commonwealth Scholarships		 Restricted Newton 130 +0.90%
QECS Scholarships
Queen Elizabeth Commonwealth Scholarships		 Expendable Newton 6,193 +0.90%
QECS Frances & Philip Turner
Queen Elizabeth Commonwealth Scholarships		 Permanent Newton 620 +0.90%
ACU Main Fund
Investment of ACU reserves		 Permanent CCLA 6,993 (2.6%)
ACU Endowment
ACU Development Fellowships		 Permanent CCLA 5,786 (2.6%)
Edward Boyle
Edward Boyle medical electives		 Permanent CCLA 150 (2.6%)
Annenberg
Marshall Aid Commemoration Commission scholarships		 Permanent CCLA 720 (2.6%)
Marshall Sherfield
Post-doctoral fellowship for US students		 Expendable CCLA 977 (2.6%)

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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 on 30 May 1963 and is governed by the Royal Charter, Byelaws and Regulations dated 17 June 1963 and last amended on 13 October 2010.

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 2022/23. 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.

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 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 regular reviews of its governance arrangements, with the next review planned for the second half of 2024 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 Leadership 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.

19

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 £5.2m (2022: £5.7m) is £0.4m (2022: £1.2m) 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 450 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.

20

GOVERNANCE AND STRUCTURE

Council Members

Professor Cheryl de la Rey (Chair) Professor Feridun Hamdullahpur Professor Amanda Broderick Dr Rhonda Lenton Professor Md. Akhturazzmaan Professor Pal Ahluwalia Professor Sandeep Sancheti Professor Barnabas Nawangwe Professor Abiodun H. Adebayo Professor Sir Hilary Beckles

University of Canterbury, New Zealand Formerly University of Waterloo, Canada University of East London, UK York University, Canada University of Dhaka, Bangladesh University of the South Pacific, Fiji Marwadi University, India Makerere University, Uganda Covenant University, Nigeria

The University of the West Indies, Jamaica

Professor Barney Glover AO Snr. Professsor Sudantha Liyanage

Western Sydney University, Australia University of Sri Jayewardenpura, Sri Lanka

Professor Wendy Thomson CBE Professor Dato’ Ir Dr. Mohd Hamdi Abd Shukor

University of London, UK University of Malaya, Malaysia

New members (from 01/08/2023)

Professor Simone Buitendijk Professor Ms Hina Tayyaba Khalil

The University of Leeds, UK

Pakistan Institute of Fashion and Design, Pakistan

Professor Sasmita Samanta Kalinga Institute of Industrial Technology (KIIT), India Professor Kabiru Aderemi Adeyemo Lead City University, Nigeria Professor Sibongile Muthwa Nelson Mandela University, South Africa

Departing members (to 31/07/2023)

Professor Wim de Villiers Professor Colin Riordan Professor Shalini Bharat Professor Francis W. O. Aduol Professor Tawana Kupe

Stellenbosch University, South Africa Cardiff University, UK Tata Institute of Science and Technology, India

Technical University of Kenya, Kenya University of Pretoria, South Africa

Audit and Risk Committee

Remuneration Committee

Professor Amanda Broderick (Chair) Mr Graeme Appleby Professor Feridun Hamdullahpur

Professor Feridun Hamdullahpur Alison Johns Shearer West

Professor Wendy Thomson (to 31/07/2023) Professor Sir Hilary Beckles

21

GOVERNANCE AND STRUCTURE

Legal and administrative details

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 Leadership Team is responsible for the day-to-day running of the ACU under authority delegated to the CEO by the Trustees. The Leadership Team consists of the CEO, CFO and four Directors.

Principal place of business: Woburn House 20-24 Tavistock Square London WC1H 9HF

www.acu.ac.uk

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

Bankers:

National Westminster Bank plc Chancery Lance Holborn London WC2A 1AE

CCLA

85 Queen Victoria Street London EC4V 4ET

Auditors

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.

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

22

STATEMENT OF TRUSTEES’ RESPONSIBILITIES

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.

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

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:

Professor Cheryl de la Rey Chair of the Council

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.

23

AUDITOR’S 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 2023 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

24

AUDITOR’S REPORT

a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

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

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

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

25

AUDITOR’S REPORT

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.

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 non-compliance 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 noncompliance 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.

Date 21 December 2023

Crowe U.K. LLP 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.

26

FINANCIAL STATEMENTS

– Group Statement of Financial Activities year ended 31 July 2023

Unrestricted Funds Unrestricted Funds Restricted Endowment Restricted Endowment Restricted Endowment
Total		 Total
Total
Note General Designated Note General Designated Note General Designated Note General Designated
Funds		 Funds
Funds		 Funds
2023		 2023
2022
£’000 £’000 £’000
£’000		 £’000
£’000		 £’000
£’000		 £’000
£’000
Income and endowments from:


Grants & donations 2 - - -
876		 876
-		 -
876		 876
923
Membership income 1,208 - -
-		 -
-		 -
1,208		 1,208
1,215
External administration 3 7,857 - -
-		 -
-		 -
7,857		 7,857
7,257
Investment income/interest 4 348 - -
636		 636
-		 -
984		 984
964
Other 194 - -
11		 11
-		 -
205		 205
74
Total Income 9,607 - -
1,523		 1,523
- 11,130 10,433		 - 11,130 10,433 - 11,130 10,433
Expenditure on charitable activities:










Project grants - - -
851		 851
-		 -
851		 851
899
Membership engagement 1,412 517 517
-		 -
-		 -
1,929		 1,929
1,813
Scholarships, grants and awards 186 - -
597		 597
-		 -
783		 783
894
External and fund administration 7,929 557 557
-		 -
-		 -
8,486		 8,486
8,150
Expenditure on other activities:
Investment management 70 - -
159		 159
-		 -
229		 229
283
Total Expenditure 5 9,597 1,074 1,074
1,607		 1,607
- 12,278 12,039		 - 12,278 12,039 - 12,278 12,039
Net income / (expenditure) before
gains / (losses) on investments
10
(1,074)

(1,074)
(84)

(84)
- (1,148) (1,606)

- (1,148) (1,606)
- (1,148) (1,606)
(Losses) / Gains on investments 8 (243) - -
39		 39
(72)		 (72)
(276)		 (276)
(485)
Net (expenditure) / income before
transfers		 (233) (1,074) (1,074)
(45)		 (45)
(72) (1,424) (2,091)		 (72) (1,424) (2,091) (72) (1,424) (2,091)
Transfers between funds 11 (424) 424 424
-		 -
-		 -
-		 -
-
Net (expenditure) / income before
other recognised gains and losses		 (657) (650) (650)
(45)		 (45)
(72) (1,424) (2,091)		 (72) (1,424) (2,091) (72) (1,424) (2,091)
Actuarial gains on defined benefit
pension schemes		 20 59 - -
-		 -
-		 -
59		 59
66
Net movement in funds (598) (650) (650)
(45)		 (45)
(72) (1,365) (2,025)		 (72) (1,365) (2,025) (72) (1,365) (2,025)
Funds brought forward 5,994 2,150 2,150
289		 289
25,374		 25,374
33,807		 33,807
35,832
Funds carried forward 11 –
13		 5,396 1,500 1,500
244		 244
25,302 32,442 33,807		 25,302 32,442 33,807 25,302 32,442 33,807

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

27

FINANCIAL STATEMENTS

Group and Charity Balance Sheet as at 31 July 2023

Group Group Charity Charity
Note 2023 2023 2022 2023 2022
£’000 £’000 £’000 £’000 £’000
Fixed assets
Intangible assets 7a - - 148 - 148
Tangible assets 7b 211 211 299 211 299
Investments 8 32,409 32,409 33,935 32,409 33,935
Total Fixed Assets Total Fixed Assets 32,620 32,620 34,382 32,620 34,382
Current assets
Debtors 9 454 454 591 454 588
Cash at bank and in hand 2,235 2,235 1,627 2,098 1,517
Total Current Assets Total Current Assets 2,689 2,689 2,218 2,552 2,105
Liabilities
Creditors amounts falling due within one year 10 (2,557) (2,424) (2,421) (2,311)
Net Current (Liabilities) / Assets 132 132 (206) 131 (206)
Net assets excluding pension liability 32,752 32,752 34,176 32,751 34,176
Defined benefit pension scheme liability 20 (310) (310) (369) (310) (369)
Total Net assets Total Net assets 32,442 32,442 33,807 32,441 33,807
Funds
Unrestricted funds: General 11 5,396 5,396 5,994 5,396 5,994
Designated Designated
11		 1,500 1,500 2,150 1,500 2,150
Endowment funds 12 25,302 25,302 25,374 25,302 25,374
Restricted funds 13 244 244 289 244 289
Total funds 32,442 32,442 33,807 32,442 33,807

These financial statements were approved and authorised for issue by the Council on 29[th] November 2023 and signed on their behalf by:

Professor Cheryl de la Rey Chair of the Council

Professor Colin Riordan Secretary General

28

FINANCIAL STATEMENTS

Group Cash Flow Statement for the year ended 31 July 2023

Note 2023 2022
£’000 £’000
Cash flows from operating activities:
Net cash used in operating activities (1,626) (2,645)
Cash flows from investing activities:
Investment Income and Interest 4 984 964
Proceeds from sale of investments 8(a) 1,250 1,000
Net cash provided by investing activities 2,234 1,964
Cash flows from financing activities:
Receipt of endowment - 100
Net cash provided by financing activities - 100
Change in cash and cash equivalents in the reporting period 608 (581)
Cash and cash equivalents at the beginning of the reporting period 1,627 2,208
Cash and cash equivalents at the end of the reporting period 2,235 1,627
Reconciliation of cash flows from operating activities:
2023 2022
£’000 £’000
Net (expenditure) / income for the reporting period (1,365) (2,025)
Adjustments for:
Amortisation and depreciation charge 236 237
Losses / (Gains) on investments 276 485
Investment income received (984) (965)
Decrease / (Increase) in debtors 137 401
(Decrease) / Increase in creditors 133 (612)
Pension changes (59) (66)
Receipt of endowment - (100)
Net cash used in operating activities (1,626) (2,645)
ANALYSIS OF CASH AND CASH EQUIVALENTS
Opening Cash Closing
balance Flow balance
£’000 £’000 £’000
Cash at bank and in hand 1,627 608 2,235
1,627 608 2,235

29

NOTES TO THE ACCOUNTS

9 Notes to the Financial Statements year ended 31 July 2023

1. Accounting policies

(a) Accounting convention

ACU is a Public Benefit Entity registered as a charity in England and Wales on 5 March 1963 (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 2019”).

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

Income is included in the SOFA once entitlement has been met, the amount can be reasonably measured, and there is probability of receipt. Specifically:

Performance related grants are recognised when the conditions under the agreement have been met for the specific milestones and requirements set by the donor.

30

NOTES TO THE ACCOUNTS

(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 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.

31

NOTES TO THE ACCOUNTS

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.

(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

32

NOTES TO THE ACCOUNTS

separate trustee-administered fund. Because of the mutual nature of the scheme, the assets are not attributed to individual institutions and a scheme-wide contribution rate is set. The institution is therefore exposed to actuarial risks associated with other institutions’ employees and is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis. As required by Section 28 of FRS 102 “Employee benefits”, the institution therefore accounts for the scheme as if it were a defined contribution scheme. As a result, the amount charged to the profit and loss account represents the contributions payable to the scheme. Since the institution has entered into an agreement (the Recovery Plan) that determines how each employer within the scheme will fund the overall deficit, the institution recognises a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) with related expenses being recognised through the profit and loss account.

Critical accounting judgements

FRS 102 makes the distinction between a group plan and a multi-employer scheme. A group plan consists of a collection of entities under common control typically with a sponsoring employer. A multi-employer scheme is a scheme for entities not under common control and represents (typically) an industry-wide scheme such as Universities Superannuation Scheme. The accounting for a multi-employer scheme where the employer has entered into an agreement with the scheme that determines how the employer will fund a deficit results in the recognition of a liability for the contributions payable that arise from the agreement (to the extent that they relate to the deficit) 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.

33

NOTES TO THE ACCOUNTS

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 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 Trustees have reviewed the three-year budget that looks at the strength of the income and expenditure statement, balance sheet and cashflow. In addition, the Trustees have considered potential challenges, including the impact of reduced income from external administration fees and a decrease in income from government grants.

While uncertainties exist regarding future funding from Commonwealth governments, the Trustees wish to emphasize that these uncertainties do not represent a material concern that would cast doubt on the Charity's ability to continue as a going concern.

The Trustees therefore consider that it is entirely appropriate to prepare the financial accounts on a going concern basis.

34

NOTES TO THE ACCOUNTS

2. Grants and donations received

2.
Grants and donations received
2023 2022
£’000 £’000
Grants from UK Government
Foreign, Commonwealth and Development Office – CIRCLE 160 146
Foreign, Commonwealth and Development Office – PEBL SPHEIR Project - 308
160 454
Grants from other Agencies
Australian Government - Department of Foreign Affairs and Trade 607 259
European Commission – L4F - 27
Other 76 51
683 337
Legacies and Grants from charitable foundations
Marshall Sherfield Fellowship Foundation 33 32
F&P Turner Endowment - 100
33 132
876 923

3. External administration fees

3.
External administration fees
2023 2022
£’000 £’000
Chevening Scholarships 4,440 4,030
Commonwealth Scholarship award schemes 2,506 2,436
Marshall Scholarship scheme 298 237
Staff & Educational Development Association 123 108
Turing Scheme 321 422
Ocean Country Partnership Programme 160 -
Other schemes 9 24
7 7,857
7		 7,257

4. Investment income and interest

Unrestricted Restricted Total Total
Funds Funds 2023 2022
£’000 £’000 £’000 £’000
Investment income 343 636 979 963
Bank interest 5 - 5 1
348 636 984 964

35

NOTES TO THE ACCOUNTS

5. Analysis of total resources expended

Staff
costs		 Grants
Paid		 Direct
Costs		 Support
costs		 Total
£’000 £’000 £’000 £’000 £’000
Charitable activities:
Project grants 243 83 525 - 851
Membership services 667 32 434 796 1,929
Scholarships, grants and awards 160 551 72 - 783
External and fund administration 4,532 (5) 1,057 2,902 8,486
Fundraising activities:
Investment management costs - - 229 - 229
5,602 661 2,317 3,698 12,278

Support Costs

Support Costs
Membership
Services		 External and
fund admin		 Total
£’000 £’000 £’000
Staff Costs 440 1,607 2,047
Consultants 61 222 283
Office and Facilities 190 693 883
IT 71 261 332
Governance 21 77 98
Other 12 43 55
795 2,903 3,698

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:

2023 2022
£’000 £’000
Audit fees – ACU 20 17
Audit fees – ACU Trading Ltd 3 3
Other non-audit work 3 4
Council Meetings 75 -
Depreciation and amortisation 236 238

36

NOTES TO THE ACCOUNTS

6. Staff costs

a) Staff costs

2023 2022
£’000 £’000
Wages and salaries 5,744 5,417
Social security costs 625 631
Pension costs 646 669
7,015 6,717

During the year £139k termination payment was made. A further payment of £90k is outstanding at year end (2022: £116k).

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 £503k (2022: £460k).

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:

2023* 2022
Number Number
£60,001 to £70,000 3 2
£70,001 to £80,000 2 -
£80,001 to £90,000 - 1
£90,001 to £100,000 - 1
£100,001 to £110,000 £100,001 to £110,000
1		 2
£110,001 to £120,000 £110,001 to £120,000
1		 -
£130,001 to £140,000 1 -
£140,001 to £150,000 1 1
9 7

Of the above higher paid employees, 3 (2022: 4) were accruing benefit during the year, and 2 at the end of the year, in respect of membership of a defined benefit pension scheme.

The average headcount during the year was 134 (2022: 130).

b) Trustees remuneration and expenses

No Trustee received any remuneration in the year (2022: £nil). Trustees or their institutions were reimbursed £34k for travel expenses incurred during the year (2022: £nil).

37

NOTES TO THE ACCOUNTS

7. Group and Charity Assets

a) Intangible Assets

Computer
software
£’000
Cost
At 31 July 2022 668
At 31 July 2023 668
Amortisation
At 31 July 2022 520
Charge for year 148
At 31 July 2023 668
Net book value
At 31 July 2023 -
At 31 July 2022 148

b) Tangible Assets

Computer
equipment		 Office Re-
configuration		 Total
£’000 £’000 £’000
Cost
At 31 July 2022 131 787 918
At 31 July 2023 131 787 918
Depreciation
At 31 July 2022 131 488 619
Charge for year - 88 88
At 31 July 2023 131 576 707
Net book value
At 31 July 2023 - 211 211
At 31 July 2022 - 299 299

At 31 July 2023 there were no capital commitments.

38

NOTES TO THE ACCOUNTS

8. Group Investments

a) Movements in quoted investments

Unrestricted Unrestricted Restricted & Restricted &
funds funds Endowment funds Endowment funds
2023 2022 2023 2022
£’000 £’000 £’000 £’000
Market value, 1 August 8,236 9,379 25,699 26,040
Disposals at opening market value (1,000) (1,000) (250) 0
Unrealised (losses) / gains on revaluation (243) (143) (33) (341)
Market value, 31 July 6,993 8,236 25,416 25,699
Cost, 31 July 5,547 6,371 11,049 11,250

b) Analysis by type

Unrestricted Restricted Endowment Total Total
funds funds funds 2023 2022
£’000 £’000 £’000 £’000 £’000
Quoted investments 6,993 129 25,287 32,409 33,935
Cash held for
investment purposes - - - - -
6,993 129 25,287 32,409 33,935

9. Debtors and prepayments

Group Charity Charity
2023 2023 2022 2023 2022
£’000 £’000 £’000 £’000 £’000
Trade debtors 269 269 432 269 432
Sundry debtors 2 2 9 2 6
Accrued Income 81 81 15 81 15
Prepayments 102 102 135 102 135
454 454 591 454 588

39

NOTES TO THE ACCOUNTS

10. Creditors: amounts payable within one year

Group Charity Charity
2023 2022 2023 2022
£’000 £’000 £’000 £’000
Trade creditors 189 174 189 167
Deferred income 1,138 1,476 1,138 1,476
Income Tax and NI contributions 151 168 25 35
Value Added Tax 294 280 295 280
Sundry creditors 495 58 444 8
Accruals 290 268 166 134
Amounts due to ACU Trading Limited - - 164 211
2,557 2,424 2,421 2,311
Deferred income
Opening Released Deferred Closing
Balance in year in year Balance
£’000 £’000 £’000 £’000
Membership 7 (7) 4 4
Programme Delivery 824 (607) 342 559
External administration fee 611 (611) 551 551
Other 34 (34) 24 24
1,476 (1,259) 921 1,138

11. Designated and General Funds

2023 Brought
Forward		 Income Expenditure Gains Transfers Carried
forward
£’000 £’000 £’000 £’000 £’000 £’000
ACU office 299 - (87) - - 212
Road to 2030 1,851 - (987) - 424 1,288
Designated Funds 2,150 - (1,074) - 424 1,500
General Funds 5,994 9,607 (9,538) (243) (424) 5,396
8,144 9,607 (10,612) (243) - 6,896

Council approved a further transfer of £0.4m from General Funds to Designated Funds to support income generating opportunities and an innovation fund to support business development.

40

NOTES TO THE ACCOUNTS

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

12. Endowment funds

2023 Opening
funds		 Gains on
investment		 Closing
funds
£’000 £’000 £’000
Permanent endowment
CSFP Anniversary 10,776 67 10,843
ACU 5,943 (153) 5,790
Edward Boyle 150 (4) 146
Annenberg Foundation 739 (19) 720
17,608 (109) 17,499
Expendable endowment
Queen Elizabeth Commonwealth Scholarships 6,149 57 6,206
Marshall Sherfield 1,002 (26) 976
F&P Turner 615 6 621
7,766
 37 7,803
Total endowments 25,374 (72) 25,302

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.

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.

41

NOTES TO THE ACCOUNTS

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

42

NOTES TO THE ACCOUNTS

13. Restricted Funds

13.
Restricted Funds
2023 Opening
Balance		 Total
Income		 Expenditure Gains on
investment		 Closing
Balance
£’000 £’000 £’000 £’000 £’000
ACU Development Fellowships1 251 247 (185) - 313
Queen Elizabeth Commonwealth Scholarship1 (106) 315 (475) 39 (227)
F&P Turner1 16 11 (11) - 16
Marshall Sherfield Fellowships 97 73 (53) - 117
Annenberg 3 29 (29) - 3
Edward Boyle (Medical Electives) 12 6 (1) - 17
HW Paxton Legacy 94 - - - 94
Symons Medal 7 - - - 7
Climate Impacts Research Capacity and Leadership
Enhancement2		 4 160 (157) - 7
Partnership for Enhanced & Blended Learning (West Africa)1 (82) 606 (558) - (34)
LEAP3 (9) - (26) - (35)
Climate Cohort - COP261 (4) - 4 - -
Commonwealth Futures Climate Research Cohort4 - 76 (116) - (40)
Commonwealth Futures – British Council 5 - - - 5
Mzuzu University, Malawi 1 - - - 1
289 1,523 (1,607) 39 244

4: Aims to equip rising star researchers at ACU member universities with the relevant skills needed to effectively engage non-academic audiences with research and enhance the capability of cohort members to inform policy and practice within the context of COP.

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

43

NOTES TO THE ACCOUNTS

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

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

44

NOTES TO THE ACCOUNTS

14. Analysis of Group assets between Funds

2023 Pension
and other
liability
£’000		 Fixed
assets
£’000		 Investments
£’000		 Net current
assets /
(liabilities)
£’000		 Total
£’000
Endowment Fund - -
-		 -
25,287		 25,287
15		 15
25,302
Restricted Fund - -
-		 -
129		 129
115		 115
244
Unrestricted Designated Fund - -
299		 299
-		 -
1,201		 1,201
1,500
Unrestricted General Fund (310) (310)
-		 -
6,993		 6,993
(1,287)		 (1,287)
5,396
(310) 299
32,409		 44 32,442
2022 Pension
and other
liability
£’000		 Fixed
assets
£’000		 Investments
£’000		 Net current
assets /
(liabilities)
£’000		 Total
£’000
Endowment funds - -
-		 -
25,359		 25,359
15		 15
25,374
Restricted funds - -
-		 -
340		 340
(51)		 (51)
289
Unrestricted Designated Fund - -
534		 534
-		 -
1,616		 1,616
2,150
Unrestricted General funds (369) (369)
2		 2
8,236		 8,236
(1,875)		 (1,875)
5,994
(369) (369)
536		 536
33,935		 33,935
(295)		 (295)
33,807

45

NOTES TO THE ACCOUNTS

15. Grants, awards and scholarships awarded from Endowments

Total value Number
£’000 awarded
The CSFP Anniversary, Queen Elizabeth Commonwealth Scholarships and F&P Turner
Queen Elizabeth
Commonwealth Scholarship		 endowments support the Queen Elizabeth Commonwealth Scholarship awards which
enables people from around the Commonwealth to study in low and middle income
countries at ACU member institutions.		 402 63
ACU Development
Fellowships		 The ACU’s own endowment income is used to support small scale collaboration between
member universities through bursaries.		 87 60
Marshall Sherfield Fellowship
Scheme		 Funds post-doctoral fellowships for US students and are supplemented by grants from the
Marshall Sherfield Fellowship Foundation in the US.		 37 1
Endowment funded awards 526 124
Funded by the British Council, it supports early career researchers from around the
Climate Cohort- Group
(COP26)		 Commonwealth to enhance their skills in engaging policy makers and practitioners in their
research findings.		 39 26
Funded by the Department for Environment, Food & Rural Affairs under the auspices of
Ocean Country Partnership
Programme		 the UK Government's Blue Planet Fund. It supports Master’s and PhDs focused on the
research themes of marine pollution, sustainable seafood and marine biodiversity.		 161 19
Grant funded awards 200 45
TOTAL 726 169

In addition to the above, nearly 6,000 scholars benefitted from training provided by the Australian government funded Partnership for Enhanced & Blended Learning (West Africa) programme. The programme is designed to address the critical academic staff shortages many universities are currently facing. It will enable universities to share scarce teaching resources through quality assured, credit-bearing degree courses, delivered through blended learning.

46

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.

Opening
bank
balance
£’000		 Incoming
Resources
£’000		 Resources
Expended
£’000		 Closing
bank
balance
£’000
Chevening Scholarship Scheme 1,692 1,692
56,628		 (55,738) (55,738)
2,582
Commonwealth Scholarship Scheme 1,730 1,730
31,526		 (28,452) (28,452)
4,804
Marshall Aid Commemoration Commission 1,009 1,009
3,712		 (3,105) (3,105)
1,616
Staff and Educational Development Association 233 233
277		 (251) (251)
259
Heads of Educational Development Group 20 20
28		 (26) (26)
22
The Centre for the Environment, Fisheries and
Aquaculture Science		 0 0
725		 (321) (321)
404
Total Third Party Funds 4,684 4,684
92,896		 (87,893) (87,893)
9,687

17. Future financial commitments

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

2023 2023 2022 2022
Land and Office Land and Office
buildings equipment buildings equipment
£’000 £’000 £’000 £’000
Within one year 340 340
-		 340 340
2
After one year but within five years 482 482
-		 821 821
-
Charged to SOFA during the year 340 340
-		 340 340
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:

2023 2022
£’000 £’000
Turnover 5,842 5,332
Cost of sales 5,599 5,009
Gross Profit 243 323
Administration 243 323
Net profit - -
Net assets - -
2023 2022
£’000 £’000
Debtors 3 1
Cash at bank 110 264
Current assets 113 265
Creditors 113 265
Total Net assets - -
Reserves - -
47

NOTES TO THE ACCOUNTS

19. Related Parties

2023 2022
£’000 £’000
Balances owed to ACU Trading Ltd 164 211
Paid to ACU Trading Ltd for services 5,842 5,332
Received from ACU Trading Ltd for services 205 178

20. Pension Commitments

(a) Universities Superannuation Scheme (USS)

The total cost charged to the profit and loss account is £199k (2022: £252k)

Deficit recovery contributions due within one year for the institution are £48k (2022: £56k).

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 2020 valuation
Mortality base table 101% of S2PMA “light” for males and 95% of S3PFA for females 101% of S2PMA “light” for males and 95% of S3PFA for females

48

NOTES TO THE ACCOUNTS

Future improvements to CMI 2019 with a smoothing parameter of 7.5, an initial addition of 0.5% p.a. mortality and a long-term improvement rate of 1.8% pa for males and 1.6% pa for females

The current life expectancies on retirement at age 65 are:

2023 2022
Males currentlyaged 65(years) 24.0 23.9
Females currentlyaged 65(years) 25.6 25.5
Males currentlyaged 45(years) 26.0 25.9
Females currentlyaged 45(years) 27.4 27.3

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:

2023 2022
Discount rate 5.52% 3.31%
Pensionable salary growth 3.00% 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 £5K (2022: £6K). This includes nil (2022: nil) outstanding contributions at the balance sheet date, and £nil deficit contributions (2022: nil).

49