OpenCharities

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2021-07-31-accounts

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Open College of the Arts (A company limited by guarantee)

Financial Statements

for the year ended 31 July 2021

Charity No. 327446 Company No. 02125674

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Open College of the Arts

Financial Statements for the year ended 31 July 2021

Contents
Strategic Report
Details of Board of Trustees
Responsibilities and Corporate Governance Statement
Independent Auditor’s Report
Statement of Comprehensive Income
Statement of Changes in Reserves
Statement of Financial Position
Statement of Cash Flow
Statement of Principal Accounting Policies and Estimation Techniques
Notes to the Accounts		 Page
2-7
8
9-12
13-16
17
18
19
20
21-23
24-28

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Open College of the Arts

Strategic Report

The Board of Trustees, who are also the Directors present the report and accounts on behalf of the Trustees for year ended 31 July 2021 which are also prepared to meet the requirements for a Directors' Report and accounts for Companies Act 2006 purposes.

These financial statements have been prepared in accordance with the Statement of Recommended Practice (SORP): Accounting for Further and Higher Education 2019 and in accordance with Financial Reporting Standards (FRS 102 section 1A). They conform to guidance published by the Office for Students.

In preparing this report, the Trustees have taken advantage of the small companies exemptions provided by section 415A of the Companies Act 2006.

The Trustees confirm that:

• so far as they are aware, there is no relevant audit information of which the Company's auditor is unaware, and • they have taken all the steps that they ought to have taken as Trustees in order to make themselves aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

Purposes and activities for public benefit

The College is a public benefit entity and our students are the College’s primary beneficiaries.

The College Trustees confirm that they have complied with their duty to have due regard to the guidance on public benefit issued by the Charity Commission for England and Wales in exercising their duties and trust that this report, together with the information on the College's website (www.oca.ac.uk) and the work the College does in delivering its objectives, is self-evident of its compliance. The mechanisms for the governance and management of Open College of the Arts (OCA) have been provided to the Office for Students as part of the requirements for registration of the University for the Creative Arts (UCA) Group. Additionally, in June 2017 the Board of Trustees for OCA agreed to operate within the Charity Governance Code, established by the Charity Commission. We do not believe that the College carries out any activities that could harm its beneficiaries and we are not aware of views amongst others that such harm might arise. No serious incidents of material significance were reported in 2020/21.

OCA is a subsidiary of the University for the Creative Arts (UCA).

The objective of the College is to promote and provide education and training in the field of arts and crafts and related skills and disciplines in all countries of the world. The College’s mission is aligned to the UCA mission:

OCA Mission - We want to be:

The principal work of the College is through the provision of high quality, tutor supported, distance learning courses. This is undertaken using specially written course activities and associated online learning materials which guide students through a programme of work.

Objectives and Strategy

We will:

Advance OCA’s charitable purpose and mission through being:

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Our key priorities are to:

These priorities will be achieved by increasing student enrolments following targeted marketing activities and continuing the progress made in the improvement in the student offering described below.

Achievements and performance

OCA has been extremely resilient in planning and adapting quickly to the Coronavirus (COVID-19) situation, in particular managing the uncertainty and associated risks around the global pandemic. Student enrolment numbers were 21% above target across the 2020/21 academic year and 30% higher than the 2019/20 academic year. This increase has ensured OCA has a strong future financial base, clearing the deficit and building reserves.

OCA has met all the strategic objectives against the 2018-2021 Academic Strategy and complimentary Digital Transformation Strategy which set the agenda for the organisation. In particular OCA achieved a fully digital assessment process by July 2020 (fifteen months ahead of schedule) and a virtual learning environment (VLE) supported ‘assessment for learning’ process in place by November 2020 (a year ahead of schedule), the full launch of seasonal short course programmes in March 2021, the establishment of the Garden Design programme from September 2020, the establishment of a new ‘value-led’ student association in January 2021 and a very successful Periodic Review of all remaining OCA programmes in May 2021, with 6 commendation and only 2 conditions.

The College achieved a huge improvement in the 2020 National Student Survey, with 88.31% overall student satisfaction against a sector average of 75%, this success (a 10% improvement on 2019) was achieved as a consequence of an NSS Action Plan for improvement developed jointly between OCA and UCA and implemented through the Programme Leaders and tutor teams at OCA.

According to financial and sector forecasts the post pandemic period is expected to remain uncertain until at least 2023. OCA continues to manage the risks around both the recruitment and retention of students. In particular there continues to be a reduction in the traditional 50-70 age group, and an increase in younger learners enrolling with OCA and a consequent increase in their study intensity. OCA’s summer assessment cycle in July 2021 was 27% larger than 2019, which was 23% larger than 2018, so the College is looking to build capacity to scale operations. OCA’s business plan and budget sets out a strategy to build reserves, scale and diversify portfolio through short courses and other non-accredited offers to mitigate any loss in grant funding.

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Key performance indicators

Course enrolments and course unit completions are key indicators of the health of the organisation and act as useful performance measures. 2020/21 was an exceptional year with a sustained increase in enrolments as the coronavirus pandemic continued to drive people to seek digital and distance learning, enrolments (including short courses) increased 30% on prior year. The completion rate increased from prior year, as did the confirmed completion rate, this rate is derived from students who actively engaged with their course unit and subsequently completed.

KPI 2020/21 2019/20
Total Enrolments (excluding short
courses)		 1,817 1,425
New Enrolments (First course unit
excluding short courses)		 1,004 780
Completion Rate (foundations &
undergraduate only)		 51.8% 47.8%
Confirmed Completion Rate (foundations
& undergraduate only)		 62.6% 60.7%

Future Indicators

The indicators for 2020/21 allow OCA to judge the health of the organisation; as explained earlier the indicators such as new students, course unit enrolments and unit completions are all measures the College uses to track performance and demonstrate year on year improvement. The academic indicators on retention and widening participation enable the College to ensure that it is improving the outcomes for the widest demographic, including those who are most disadvantaged. For example, this year OCA will be monitoring areas such as BAME attainment, equality and student mental health and wellbeing and putting in place an action plan to address shortfall in areas of student satisfaction as represented in the National Student Survey results for 2021. The social impact measure is still in development however when it is refined it will allow the College to see how its work is making a difference to society and the impact that is having on the wider community. The KPI’s are ambitious but realistic given the current economic climate.

Commercial indicators for 2021/22

Academic indicators for 2021/22

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Financial review

The College achieved a surplus of £539,286 for the year ended 31 July 2021.

Income

The main source of the College’s income is tuition fees; students have the flexibility to complete their degree course over a number of years and are invoiced for each unit as they commence; an element of income is deferred for units which have not been completed, the method of deferring this income is described within the accounting policy note for Income Recognition. Tuition fee income has increased by 24% year on year. The College receives grant funding via UCA from the Office for Students (OfS) which is used for widening participation activities. The amount of the grant in future will depend on the College’s student numbers and government policy in relation to the funding of higher education.

Expenditure

In the year, the College created new posts and added capacity in the technology enhanced learning team to support demand, periodic review and cover maternity period. Increased capacity in the student services team to provide more learner support. Temporary staffing provision was also made among the academic team to support periodic review and cover a long-term sickness. Staff costs amount to 49.8% of the College’s expenditure; pay to tutors is variable and is dependent upon the number and type of enrolled courses. Operating costs have been closely monitored throughout the year with savings made wherever possible, significant savings have been made from the digitisation of course materials, processes, meetings etc. The change in business premises brought unexpected costs including a provision for dilapidations, these have however been mitigated by the savings made elsewhere.

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The College has made use of the OfS grant funding and student enhancement scheme funds to enable it to provide extra learning and support, student opportunities, hardship support, course and tutor development in year.

Financial Strategy

The College’s Financial Strategy is to maintain its reserves and aim for a resilient financial position that supports the college’s core activities, and which assists its strategic development.

Investment powers and policy

The Trustees have the power to invest (to the extent that there are surpluses available for this purpose). During 2020/21 there were no such investment surpluses.

Going concern

The College achieved a surplus in the year of £539,286 (2020: £110,635) and the Trustees have an agreed budget and Corporate Annual Plan for the forthcoming financial year to maintain the Colleges accumulated surplus position. As at 31 July 2021, the College reported an accumulated surplus of £498,085 the College’s largest creditor being a deferred income balance of £654,247 (2020: £631,338). The College is cash positive and is forecast to remain so. Stress-testing has been undertaken to calculate the effect on cash resources if income in the forecast period to 30 November 2022 is significantly reduced, this testing has shown that the college has sufficient cash headroom. Having reviewed the College’s recent performance and the results of the stress testing, Trustee’s assessment is there are adequate resources for the college to continue in operational existence for the foreseeable future, for this reason the financial statements have been prepared on a going concern basis.

The College has restricted reserves of £7,165.

Future Plans

OCA is in the process of establishing the next three year Academic Plan to take the College’s 10 year Strategic Plan forward to the next level using an evidence informed and methodical approach to set out the work that will be undertaken; this includes:

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The University for the Creative Arts (UCA) and the Open College of Arts (OCA) are currently in discussions about the future of their partnership and are having discussions with other potential partners. The aim of these discussions is to ensure both organisations evolve to achieve their strategic aims, and best meet the needs of their current and future students. These talks are at a stage where it is not yet possible to provide details.

Managing Risks and Uncertainty

Unlike other education providers, students of the College can commence and complete courses to their own timeframe, subject to some maximum limits, rather than within a traditional academic year. Also, the application to enrolment process is much faster, this means that the College has less time to predict and react to changing enrolment numbers. The College manages this risk by monitoring enrolments on a daily basis and preparing statistics on student completion rates and reacting to changes by increasing marketing activity and reducing costs if necessary. The College invests in marketing activities by advertising courses to prospective students who may not be aware of the potential to study in the non-traditional manner. The ongoing Covid-19 pandemic is not anticipated to have a detrimental impact as more students seek distance learning.

As a long-distance learning College, the quality of the on-line provision is an important factor in the success of students and the College has invested and continues to invest, in the student offering to encourage both new enrolments and engagement and re-enrolment from current students. Additionally, the security over the online resources and data held by the College is paramount and the College is supported by its parent UCA who host services in addition to employing its own IT and security resource.

Approval

This report was approved by the Trustees and signed on their behalf by:

Catherine Harper Chair of the Board of Trustees 3[rd] November 2021

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Board of Trustees Catherine Baxandall Professor Alan Cooke Resigned 28 October 2020 Catherine Harper Appointed 14 October 2020 Marie-Claire Isaaman Alan Newton John Oliver Harry Rich Carlos Manuel Cortes Pereira Sa Resigned 16 November 2020

Company Secretary

Sarah Martin

Principal & Chief Executive

Will Woods

Bankers

Barclays Bank plc, 10 Market Street, Bradford, BD1 1EG

Auditors

Internal Auditors: BDO LLP, 55 Baker Street, London, W1U 7EU External Auditors: Grant Thornton UK LLP, 2nd Floor, St John's House, Haslett Avenue West, Crawley, RH10 1HS

Solicitors

Eversheds LLP, 1 Callaghan Square, Cardiff, CF10 5BT

Country of Incorporation England

Registered Office

The Michael Young Arts Centre Room 201 DMC 02 County Way Barnsley Yorkshire England S70 2AG

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Responsibilities and Corporate Governance Statement

Responsibilities of the Board of Trustees

In accordance with the College’s Articles of Association, the Trustees who are also the Directors of the Open College of the Arts are responsible for the administration and management of the affairs of the College.

These responsibilities are set out in OCA’s governing documents:

OCA’s objects, powers and framework of governance are set out in its Articles of Association. Its Board of Trustees comprises nine members, all of whom are non-executive.

The Trustees are required to present audited financial statements for each financial year and is responsible for keeping proper accounting records, which disclose with reasonable accuracy, at any time, the financial position of the College and enable it to ensure that the financial statements are prepared in accordance with the Companies Act 2006, FRS102 section 1A and the Statement of Recommended Practice (SORP 2019) “Accounting for Further and Higher Education”. In addition, within the Office for Students (OfS)’ Terms and Conditions of Funding for Higher Education Institutions, the College is required to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the College and of the surplus or deficit and cash flows for that year. The results of the College are consolidated within the UCA group financial statements.

When preparing the financial statements, the Trustees ensure that:

The Trustees have taken reasonable steps to:

The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

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Corporate Governance

Principles and ethos of the College

The College endeavours to conduct its business in accordance with the seven principles identified by the Committee on Standards in Public Life (selflessness, integrity, objectivity, accountability, openness, honesty and leadership), and with the guidance to institutions of higher education which has been provided by the Committee of University Chairs (CUC) in its Higher Education Code of Governance, published in December 2014 and revised in June 2018 . A Register of Interests of Trustees and senior managers is regularly maintained.

Constitution and structural organisation

The Open College of the Arts (OCA) is a wholly owned subsidiary of the UCA as a result of a transfer deed entered into on 1 November 2016. OCA is a charitable company limited by guarantee; as such it is regulated by the Charity Commission for England and Wales. The nature of the relationship between UCA and OCA and the terms on which they provide services to each other are set out in a Service Level Agreement. OCA has its own management and governance arrangements.

The College’s Board of Trustees comprises nine members (3 positions vacant) appointed under the Articles of Association of the College, all of whom are non-executive. Members have a variety of backgrounds and experience from outside traditional HE but share the mission and values of OCA. The Board of Trustees normally meets three times a year, attendance at 2020/21 meetings is shown in the table below:

Trustee Trustee Meetings Attended
Catherine Baxandall October, February& June
Professor Alan Cooke October
Professor Catherine Harper October, February& June
Marie-Claire Isaaman February
Alan Newton October, February& June
John Oliver October & February
HarryRich October & February
Carlos Manuel Cortes Pereira Sa October

Amongst its responsibilities it keeps under review the effectiveness of the risk management arrangements and provides an opinion on the adequacy of the management and quality assurance of data submitted to the Higher Education Statistics Agency (HESA), the Student Loans Company, the OfS and other bodies.

The Audit & Risk Committee of UCA oversees the College’s programme of internal audit. The Audit & Risk Committee meets at least four times a year and comprises of lay members of the UCA Board of Governors and a co-opted member, none of whom serves on the Employment & Finance Committee of UCA. The College’s internal and external auditors are in attendance and the members meet the auditors without the officers of the UCA present immediately before each committee meeting. The Committee and the College’s Board of Trustees considers detailed reports from the auditors, which include recommendations for the improvement of the College’s systems of internal control, together with management responses and implementation plans. It also receives and considers guidance from the OfS through the Audit Code of Practice as it affects the College’s business and monitors adherence to the regulatory framework.

Committee considers the annual report for the Prevent Duty and the annual Modern Slavery and Human Trafficking Statement.

The Remuneration and Development Group advises the OCA Board on the remuneration of the holders of senior posts and monitors their performance. In carrying out their responsibilities, each member of the remuneration and development group acts in a way which he or she considers, in good faith, to be most likely to promote the success of the OCA for the benefit of its members as a whole. No individual may participate in deliberations in which their remuneration is being directly discussed or in decisions which directly affect their personal remuneration.

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The Trustees and UCA’s Board of Governors are responsible for approving OCA’s strategic direction, and UCA’s Employment & Finance Committee receives financial reports in respect of the College. Reports on OCA risks are received by its Board of Trustees, which provides an annual statement of assurance to the Audit & Risk Committee; in the period of report the College was encompassed by the UCA’s internal audit programme.

UCA approves appointments to the OCA Board of Trustees on the recommendation of UCA Nominations Committee.

Internal control

The Board of Trustees has responsibility for maintaining a sound system of internal control that supports the achievement of policies, aims and objectives, while safeguarding the public and other funds and assets for which it is responsible, in accordance with the responsibilities assigned to the Trustees within the Articles of Association and the OfS’ Terms and Conditions of Funding for Higher Education Institutions.

This system is based on an on-going process designed to identify the principal risks to the achievement of the College’s aims and objectives; to evaluate the likelihood and impact of those risks; and to manage them efficiently, effectively and economically. This process has been in place for the year ended 31 July 2021 and up to the date of approval of the financial statements and accords with OfS guidance.

The key elements of the College's systems of risk management and internal control, which are designed to discharge the responsibilities set out above, include the following:

The system of internal control is designed to manage rather than eliminate the risk of failure to achieve policies, aims and objectives; it can therefore only provide reasonable and not absolute assurance of effectiveness.

The Board of Trustees has responsibility for reviewing the effectiveness of the systems of risk management and internal control. The following processes have been established:

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The Trustees’ review of the effectiveness of the system of internal control was informed during the year by the Internal Auditors, BDO LLP, who operate to standards defined in the OfS Audit Code of Practice. The Internal Auditors provide reports to the Board of Trustees following their audits, which provides an independent opinion on the adequacy and effectiveness of the College’s system of internal control with recommendations for improvement. The Board’s review is also informed by the work of the senior managers within the College, who have responsibility for the development and maintenance of the internal control framework, and by comments made by the External Auditors, Grant Thornton UK LLP, in their Management Letter and other reports. In the opinion of Trustees there were no significant internal control weaknesses or failures arising during the year ended 31 July 2021 and up to the date of approval of the financial statements.

Signed _____ Will Woods Principal & Chief Executive

Signed

Catherine Harper Chair of the Board of Trustees

3rd November 2021

3rd November 2021

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Independent auditor's report to the members of Open College of the Arts

Opinion

We have audited the financial statements of Open College of the Arts (the ‘charitable company’) for the year ended 31 July 2021, which comprise statement of comprehensive income, the statement of changes in reserves, the statement of financial position, the statement of cash flow, the statement of principal accounting policies and notes to the financial statements. 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 company 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

We are responsible for concluding on the appropriateness of the trustees’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify the auditor’s opinion. Our conclusions are based on the audit evidence obtained up to the date of our report. However, future events or conditions may cause the company to cease to continue as a going concern.

In our evaluation of the trustees’ conclusions, we considered the inherent risks associated with the charitable company’s business model including effects arising from macro-economic uncertainties such as Brexit and Covid-19, we assessed and challenged the reasonableness of estimates made by the trustees and the related disclosures and analysed how those risks might affect the charitable company’s financial resources or ability to continue operations over the going concern period.

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

In auditing the financial statements, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. The responsibilities of the trustees with respect to going concern are described in the ‘Responsibilities of trustees for the financial statements’ section of this report.

Other information

The trustees are responsible for the other information. 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

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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.

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

We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matter on which we are required to report under the Companies Act 2006

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the trustees’ report.

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 Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of trustees for the financial statements

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 company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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

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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.

Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. Owing to the inherent limitations of an audit, there is an unavoidable risk that material misstatements in the financial statements may not be detected, even though the audit is properly planned and performed in accordance with the ISAs (UK).

The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below:

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Use of our report

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members 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 company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Adam Terry BSc ACA Senior Statutory Auditor for and on behalf of Grant Thornton UK LLP Statutory Auditor, Chartered Accountants Crawley 3rd November 2021

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Statement of Comprehensive Income

For the year ended 31 July 2021

Note
Income
Tuition fees and education contracts
1
OfS grants
Other operating income
2
Donations
TOTAL INCOME
Expenditure
Staff costs
3
Other operating expenses
4
Depreciation
7
TOTAL EXPENDITURE
5
Loss on disposal of fixed assets
Surplus for the year
Total comprehensive income for the year
Represented by:
Restricted comprehensive (deficit)/income for the year
6
Unrestricted comprehensive income for the year		 2021
£
2,392,569
192,663
12,384
-
2,597,616
1,023,209
1,022,761
8,380
2,054,350
(3,980)
539,286
539,286
(1,065)
540,351
539,286		 2020
£
1,928,518
175,314
11,936
10,000
2,125,768
991,687
1,010,052
13,394
2,015,133
-
110,635
110,635
8,230
102,405
110,635

The income and expenditure of the Company relates wholly to continuing operations. The notes on pages 21 to 28 form an integral part of these Financial Statements.

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Statement of Changes in Reserves

For the year ended 31 July 2021

Note

Balance at 1 August 2019 as previously stated
(deficit)
Surplus from the income and expenditure
statement
Transfers
Balance at 31 July 2020 (deficit)
(Deficit)/surplus from the income and expenditure
statement
Balance at 31 July 2021
6		 Income and expenditure
reserve
Restricted
Unrestricted
£
£
-
(151,836)
8,230
102,405
-
-
8,230
(49,431)
(1,065)
540,351
7,165
490,920		 Total
£
(151,836)
110,635
-
(41,201)
539,286
498,085

The notes on pages 21 to 28 form an integral part of these Financial Statements.

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Statement of Financial Position

As at 31 July 2021

Note
Non-current assets
Fixed assets
7
Current assets
Stock
Trade and other receivables
8
Cash and cash equivalents
12
Creditors: amounts falling due within one year
9
Net current assets/(liabilities)
Provisions: Other provisions
11
Total net assets/(liabilities)
Restricted reserves
Income and expenditure reserve - restricted
6
Unrestricted reserves
Income and expenditure reserve - unrestricted
Total surplus/(deficit)		 2021
£
11,230
1,746
469,909
994,496
1,466,151
(939,296)
526,855
(40,000)
498,085
7,165
490,920
498,085		 2020
£
14,417
5,079
417,876
375,570
798,525
(854,143)
(55,618)
-
(41,201)
8,230
(49,431)
(41,201)

Total surplus/(deficit)

The financial statements have been prepared in accordance with the provisions applicable to companies subject to the small companies regime and in accordance with the provisions of FRS 102 Section 1A - small entities.

The financial statements were approved by the Board of Trustees and signed on its behalf on 3rd November 2021 by:

Will Woods Principal & Chief Executive

Catherine Harper Chair of the Board of Trustees

The notes on pages 21 to 28 form an integral part of these Financial Statements.

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DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Statement of Cash Flow

For the year ended 31 July 2021

Note
Cash Flow from operating activities
Surplus for the year
Adjustments for non-cash items
Depreciation
Loss on sale of fixed assets
Decrease in stock
(Increase)/decrease in debtors
Increase/(decrease) in creditors
Increase in provisions
Net cash flow from operating activities
Cash flows from investing activities
Purchase of fixed assets
Proceeds from sales of fixed assets
Increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
12
Cash and cash equivalents at the end of the year
12		 2021
£
539,286
8,380
3,980
3,333
(52,033)
85,153
40,000
628,098
(9,714)
541
618,926
375,570
994,496		 2020
£
110,635
13,394
-
527
26,419
(80,472)
-
70,503
(7,735)
-
62,768
312,802
375,570

The notes on pages 21 to 28 form an integral part of these Financial Statements.

Page 20 of 28

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Statement of Principal Accounting Policies and Estimation Techniques

1 General Information

Country of registration - England

Registered Office - The Michael Young Arts Centre Room 201, DMC 02, County Way, Barnsley, Yorkshire, England, S70 2AG

2 Basis of Preparation

These financial statements have been prepared in accordance with the Statement of Recommended Practice (SORP): Accounting for Further and Higher Education 2019 and in accordance with Financial Reporting Standards (FRS 102 section 1A). They conform to guidance published by the Office for Students.

The financial statements are prepared in sterling, which is the functional currency of the College.

The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the financial statements, except as noted below.

3 Basis of Accounting

The financial statements are prepared under the historical cost convention.

4 Going Concern

The College achieved a surplus in the year of £539,286 (2020: £110,635) and the Trustees have an agreed budget and Corporate Annual Plan for the forthcoming financial year to maintain the Colleges accumulated surplus position. As at 31 July 2021, the College reported an accumulated surplus of £498,085 the College’s largest creditor being a deferred income balance of £654,247 (2020: £631,338). The College is cash positive and is forecast to remain so. Stress-testing has been undertaken to calculate the effect on cash resources if income in the forecast period to 30 November 2022 is significantly reduced, this testing has shown that the college has sufficient cash headroom. Having reviewed the College’s recent performance and the results of the stress testing, Trustee’s assessment is there are adequate resources for the college to continue in operational existence for the foreseeable future, for this reason the financial statements have been prepared on a going concern basis.

The College has restricted reserves of £7,165.

5 Income Recognition

Tuition fee income for foundation and undergraduate students, who benefit from flexible start and end course dates, is credited to the Statement of Comprehensive Income in proportion to the percentage of completion of service provided by the College to the student. In assessing the percentage of completion of the service the College has evaluated the value of the service provided and the expected costs of completing the service. The College is eligible to the income when a student:

Tuition fee income from short courses and post graduate courses is recognised over the arranged period of instruction.

Tuition fee income received in advance of performance related conditions being met is carried forward to a future financial year and included in creditors as deferred income.

Where the amount of the tuition fee is reduced, by a refund or discount, income receivable is shown net of the discount.

Page 21 of 28

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Income from the sale of goods and services, excluding tuition fee income, is credited to the Statement of Comprehensive Income when the goods or services are supplied to the external customers or the terms of the contract have been satisfied.

Grant funding from OfS is recognised as income when the College is entitled to the income and performance related conditions have been met. Income received in advance of performance related conditions being met is recognised as deferred income within creditors on the balance sheet and released to income as the conditions are met.

6 Accounting for Retirement Benefits

The College has a defined contribution pension scheme for employees. The amounts charged are as payable by the College during the period.

7 Employment Benefits

Short term employment benefits such as salaries and compensated absences are recognised as an expense in the year in which the employees render service to the College. Any unused benefits are accrued and measured as the additional amount the College expects to pay as a result of the unused entitlement.

8 Leases

Operating leases

Costs in respect of operating leases are charged on a straight-line basis over the lease term. Any lease premiums or incentives are spread over the minimum lease term.

9 Stocks

Stocks are valued at the lower of cost or net realisable value.

10 Tangible Fixed Assets

Equipment and plant, including computers and software, are capitalised at cost and depreciated over their expected useful life of 5 years for fixtures, fittings and equipment and 3 years for computer equipment on a straight line basis.

Depreciation methods, useful lives and residual values are reviewed at the date of preparation of each Balance Sheet.

11 Cash and Cash Equivalents

Cash includes cash in hand, deposits repayable on demand and overdrafts. Deposits are repayable on demand if in practice they are available within 24 hours without penalty.

Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash with significant risk of change in value.

12 Provision

Provisions are recognised when:

13 Reserves

Reserves are classified as restricted or unrestricted. The College currently has £7,165 in restricted reserves for a small enterprise enhancement scheme which funds progressing students and provides sponsorship of projects.

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DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

14 Significant estimates and Judgements

Tuition fee income for foundation and undergraduate students is credited to the Statement of Comprehensive Income once performance conditions have been met. In the College’s judgement performance conditions are met for those students entitled to continue a course based on the course’s terms and conditions to be when a student enrols and as each course assignment is completed. The timing of the release of deferred income is dependent upon student progression which is time flexible. The college has an active study policy to encourage students to engage with and complete course units, for this reason deferred income is shown within ‘Creditors: amounts falling due within one year’.

15 Financial Instruments

The financial assets and liabilities held qualify as basic financial instruments as described in Section 11 of FRS 102. Basic financial instruments, comprising trade debtors, cash and cash equivalents and trade payables, are initially recognised at transaction value and subsequently measured at their settlement value. Cash is held on deposit in Barclays Bank. Trade debtors and trade creditors consist of balances outstanding at the financial year end.

Page 23 of 28

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Notes to the accounts

1. Tuition fees and education contracts
UK & EU Higher Education
Non-EU Higher Education
UK & EU Further Education
Non-EU Further Education
Short Courses
Tuition fees and educational contracts
2. Other operating income
Educational Visits and Events
Sundry
3. Staff costs
Wages and salaries
Social security costs
Other pension costs		 2021
£
2,015,739
189,330
158,600
15,230
13,670		 2020
£
1,599,509
168,018
147,579
13,217
195
2,392,569 1,928,518
2021
£
609
11,775
12,384
2021
£
900,698
81,869
40,642
1,023,209		 2020
£
2,116
9,820
11,936
2020
£
872,741
79,578
39,368
**991,687 **
Pension contributions are paid into the College’s defined contribution group personal pension plan. The Pension contributions are paid into the College’s defined contribution group personal pension plan. The Pension contributions are paid into the College’s defined contribution group personal pension plan. The
College set up a defined contribution pension scheme for employees with effect from 1 April 2016. £4,682 was
payable at 31 July 2021 (2020: £5,124).
Average staff numbers: 2021
Number		 2020
Number
Number of employees 35 33
Full time equivalent 26 25
There were no higher paid staff in the year (2020: nil).
Emoluments of the Principal & Chief Executive 2021 2020
£ £
W Woods
Salary 88,001 88,001
Pension 4,400 4,400
92,401 92,401

Page 24 of 28

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Notes to the accounts (Continued)

3. Staff costs (continued)

The Principal’s pension contributions are on the standard terms of the College’s defined contribution group personal pension plan. No members of staff received employee benefits greater than £100,000.

The Principal and Chief Executive Officer took up office on 29 September 2017, the initial remuneration of £85,000 was increased in August 2018 by the nationally agreed cost of living pay award of 1.7% to the higher education sector and again in August 2019 by 1.8%. No cost of living award was agreed for August 2020 in line with the cost of living freeze for all staff. In determining the base salary when making the appointment, the Board of Trustees took advice from an external recruitment agency and benchmarked the role with senior management positions within the University for the Creative Arts (UCA), as parent company. At the time of appointment, the role was considered equivalent to that of an Executive Dean at UCA, where the salary band was between £83,913 and £100,000. The Principal’s base salary was set within that band. OCA has also contributed 5% of base salary pa to a defined contribution pension scheme. The total remuneration awarded was determined considering the skills and experience that the successful candidate would bring to the post, as evidenced during the selection process.

The Principal’s basic salary is 3.01 (2020: 3.01) times the median pay of staff, where the median pay is calculated on a full-time equivalent basis for the salaries paid by OCA to its staff.

The Principal’s total remuneration is 3.03 (2020: 3.00) times median total remuneration of staff, where the median total remuneration is calculated on a full-time equivalent basis for the total remuneration by OCA of its staff. It is not possible to reliably calculate the full-time equivalent value of tutor fees which are paid on a per student allocation basis or course commissioning fees, these have instead been included within total remuneration at actual values paid for the purposes of calculating median pay levels.

Key management personnel

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the College. The Principal & Chief Executive, Director of Learning & Teaching and Director of Curriculum & Quality all have this responsibility.

2021 2020
£ £
Key management personnel 155,160 153,380
Trustees

No Trustee has received/waived remuneration from the College during the year (2020: – none).

No expenses were paid to or on behalf of Trustees for travelling and subsistence (2020: £369 to 3 Trustees). No other expenses were paid (2020: nil).

4. Other operating expenses

Equipment, furniture and computing costs
Audit fees (including VAT): Remuneration for external audit services
Other expenses
Total		 2021
£
15,035
15,574
992,152
1,022,761		 2020
£
13,558
15,326
981,168
1,010,052

Page 25 of 28

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Notes to the accounts (Continued)

5. Analysis of expenditure by activity

Other operating
Staff costs
Costs
2021
2020
2021
2020
£
£
£
£
Academic
departments
380,478
367,233
544,355
493,704
Academic
services
439,928
426,522
127,437
159,210
Administration
and central
services
202,803
197,932
238,612
277,544
Premises
-
-
112,357
79,594
1,023,209
991,687
1,022,761
1,010,052
Depreciation
-
-
8,380
13,394
1,023,209
991,687
1,031,141
1,023,446
6. Restricted reserves
At 01 August 2020
New donations
Expenditure
Total restricted comprehensive (expenditure)/income
At 31 July 2021
Analysis of other restricted funds/donations by type of purpose:
Small enterprise enhancement scheme		 Other operating
Staff costs
Costs
2021
2020
2021
2020
£
£
£
£
Academic
departments
380,478
367,233
544,355
493,704
Academic
services
439,928
426,522
127,437
159,210
Administration
and central
services
202,803
197,932
238,612
277,544
Premises
-
-
112,357
79,594
1,023,209
991,687
1,022,761
1,010,052
Depreciation
-
-
8,380
13,394
1,023,209
991,687
1,031,141
1,023,446
6. Restricted reserves
At 01 August 2020
New donations
Expenditure
Total restricted comprehensive (expenditure)/income
At 31 July 2021
Analysis of other restricted funds/donations by type of purpose:
Small enterprise enhancement scheme		 Total
2021
2020
£
£
924,833
860,937
567,365
585,732
441,415
475,476
112,357
79,594
2,045,970
2,001,739
8,380
13,394
2,054,350
2,015,133
2021
2020
£
£
8,230
-
-
10,000
(1,065)
(1,770)
(1,065)
8,230
7,165
8,230
-
10,000
-
10,000		 Total
2021
2020
£
£
924,833
860,937
567,365
585,732
441,415
475,476
112,357
79,594
2,045,970
2,001,739
8,380
13,394
2,054,350
2,015,133
2021
2020
£
£
8,230
-
-
10,000
(1,065)
(1,770)
(1,065)
8,230
7,165
8,230
-
10,000
-
10,000
8,230
8,230
10,000
10,000

Page 26 of 28

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Notes to the accounts (Continued)

7. Fixed assets

7. Fixed assets
Cost
At 1 August 2020
Additions at cost
Disposals
At 31 July 2021
Depreciation
At 1 August 2020
Charge for year
Disposals
At 31 July 2021
Net book value at 31 July 2021
Net book value at 31 July 2020
8. Trade and other receivables
Amounts falling due within one year:
Trade receivables
Prepayments and accrued income
Other debtors
9. Creditors
Amounts falling due within one year
Trade creditors
Amount owed to group undertakings
Other tax payable & social security
Accruals
Other creditors
Deferred income		 Fixtures &
Fittings
Computer
Equipment
£
£
18,484
27,336
7,338
2,376
(8,876)
(20,031)		 Total
£
45,820
9,714
(28,907)
26,627
31,403
8,380
(24,386)
15,397
11,230
14,417
2020
£
385,457
32,419
-
16,946
9,681
7,890
23,513
4,277
4,103
(4,355)
(20,031)
7,812
7,585
9,134
2,096
10,594
3,823
2021
£
437,940
28,474
3,495
469,909
2021
£
49,236
41,129
24,816
165,186
4,682
654,247
939,296
417,876
2020
£
16,800
22,348
23,998
154,535
5,124
631,338
854,143

Amounts owed to group undertakings are unsecured, interest free, have no fixed date of repayment and are repayable on demand.

Page 27 of 28

DocuSign Envelope ID: C76BC46A-52D7-4DB8-B235-C6994C96D0BF

Notes to the accounts (Continued)

10. Lease Obligations

At 31 July 2021, the Charity had total future minimum lease payments in respect of property under noncancellable operating leases payable as follows:

Within one year
11. Provisions for liabilities and charges
Dilapidations
12. Cash and cash equivalents		 2021
£
20,967
20,967
2021
£
40,000
40,000		 2020
£
13,250
13,250
2020
£
-
-
Cash at bank
Cash in hand
13. Analysis of changes in net debt
Cash at bank and in hand		 2021
£
994,475
21
994,496
At 31 July
2020
Net cash
flows
£
£		 2020
£
375,540
30
375,570


At 31 July
2021

£
375,570
618,926
994,496

14. Related Party Transactions

The College has made enquires with the Trustees and senior staff and there are no Related Party Transactions to report, Trustee expenses are disclosed in note 4.

The College has taken advantage of the exemption offered by FRS 102 (section 33) in respect of transactions and balances between it and the University for the Creative Arts, as it is a wholly-owned subsidiary of the University for the Creative Arts, UCA Farnham, Falkner Road, Farnham, Surrey, GU9 7DS.

Page 28 of 28