Skip to main content

Independent auditors’ report to Council 2023-24

The report on the audit of the financial statements of the University, carried out by Grant Thornton UK LLP. Part of the Annual Accounts 2023-24.


Annual Accounts

Opinion

We have audited the financial statements of the University of Bath (the ‘parent University’) and its subsidiaries (the ‘group’) for the year ended 31 July 2024, which comprise the consolidated and University statement of comprehensive income, consolidated and University balance sheet, consolidated and University statement of changes in reserves, consolidated cash flow statement and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law 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:

  • give a true and fair view of the state of the group’s and the parent University’s affairs as at 31 July 2024 and of the group’s and the parent University’s income and expenditure, gains and losses, changes in reserves and of the group’s consolidated cash flows for the year then ended; and
  • have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice.

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 and the parent University in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the Financial Reporting Council's (FRC) 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 Council’s 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 group’s and the parent University’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 group or the parent University to cease to continue as a going concern.

In our evaluation of the Council’s conclusions, we considered the inherent risks associated with the group’s and the parent University’s business model including effects arising from macro-economic uncertainties such as public funding pressures and international student recruitment, we assessed and challenged the reasonableness of estimates made by the Council and the related disclosures and analysed how those risks might affect the group’s and the parent University’s financial resources or ability to continue operations over the going concern period.

In auditing the financial statements, we have concluded that the Council’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 group’s and the parent University’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

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

Other information

The other information comprises the information included in the Annual Accounts other than the financial statements and our auditor’s report thereon. The Council is responsible for the other information contained within the Annual Accounts. 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 there is 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.

Opinion on other matters prescribed by the Office for Students (OfS) Accounts direction (issued October 2019) (the ‘OfS Accounts direction’)

In our opinion, in all material respects:

  • funds from whatever source administered by the parent University for specific purposes have been properly applied to those purposes and managed in accordance with the relevant legislation
  • funds provided by the OfS, UK Research and Innovation (including Research England), the Education & Skills Funding Agency and the Department for Education have been applied in accordance with the OfS Terms and Conditions of funding for higher education institutions (issued July 2023), the funding agreement with UK Research and Innovation (including Research England), the Education and Skills Funding Agency and the Department for Education, and any other terms and conditions attached to them
  • the requirements of the OfS Accounts direction have been met

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the OfS Accounts direction requires us to report to you where:

  • the parent University’s grant and fee income, as disclosed in note 3 to the financial statements, has been materially misstated; and
  • the parent University’s expenditure on access and participation activities for the financial year has been materially misstated.

Responsibilities of Council

As explained more fully in the Statement of responsibilities of the Council, the Council is 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 Council 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 Council are responsible for assessing the group’s and the parent University’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Council either intends to liquidate the group or the parent University or to cease operations, or has 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 International Standards on Auditing (ISA) (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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below:

  • we obtained an understanding of the legal regulatory frameworks that are applicable to the University and the sector in which it operates. We determined that the following laws and regulations were most significant:
    • The Financial Reporting Standard applicable in the UK and the Republic of Ireland (FRS 102)
    • The Further and Higher Education Statement of Recommended Practice (FEHE SORP) 2019
    • Further and Higher Education Act 1992
    • Higher Education and Research Act 2017
    • OfS Accounts Direction (October 2019)
    • Relevant OfS regulatory notices and advice
    • The Higher Education Code of Governance
    • The Data Protection Act 2018
  • we understood how the Group and Parent University is complying with these legal requirements by making inquiries of management and those charged with governance. We enquired of management and those charged with governance whether there were any instances of non-compliance with laws and regulations, or whether they had any knowledge of actual or suspected fraud. We corroborated the results of our enquiries through our review of relevant committee minutes and through our legal and professional expenses review
  • we assessed the susceptibility of University’s financial statements to material misstatement, including how fraud might occur and the risk of material override of controls. Audit procedures performed by the engagement team included:
    • identifying and assessing the design effectiveness of certain controls management has in place to prevent and detect fraud
    • challenging assumption and judgements made by management in its significant accounting policies
    • identifying and testing journal entries, with focus on unusual journals with specific characteristics and large journals
    • review of business register of interest and the general ledger for any undisclosed related party transactions
    • inspecting Council and other committee minutes
    • assessing the extent of compliance with relevant laws and regulations as part of our procedures on the related financial statement item
  • these audit procedures were designed to provide reasonable assurance that the financial statements were free from fraud or error. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error and detecting irregularities that result from fraud is inherently more difficult than detecting those that result from error, as fraud may involve collusion, deliberate concealment, forgery or intentional misrepresentations. Also, the further removed non-compliance with laws and regulations is from events and transactions reflected in the financial statements, the less likely we would become aware of it
  • the engagement partner’s assessment of the appropriateness of the collective competence and capabilities of the engagement team included consideration of the engagement team’s:
    • understanding of, and practical experience with audit engagements of a similar nature and complexity through appropriate training and participation
    • knowledge of the higher education sector
    • understanding of the legal and regulatory requirements specific to the University including the provisions of applicable legislation and guidance issued by the OfS
  • the team communications in respect of potential noncompliance with relevant laws and regulations, including the potential for fraud in revenue through manipulation of income and management override of controls
  • in assessing the potential risks of material misstatement, we obtained an understanding of:
    • the University’s operations, including the nature of its income and expenditure and its services and of its objective and strategies to understand the classes of transactions, account balances, expected financial statement disclosures and business risks that may result in risks of material misstatement
  • the University’s control environment, including:
    • the policies and procedures implemented by the University to ensure compliance with the requirements of the financial reporting framework and relevant laws and regulations
    • the adequacy of procedures for authorisation of transactions and review of management accounts
    • procedures to ensure that possible breaches of laws and regulations are appropriately resolved.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the University’s Council, as a body, in accordance with the Royal Charter and statutes of the university. Our audit work has been undertaken so that we might state to the University’s Council 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 University and the University’s Council as a body, for our audit work, for this report, or for the opinions we have formed.

Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants London
12 December 2024

On this page