1. Tuition fees and education contracts
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Full-time UK students |
89.3 |
86.5 |
Full-time EU students |
13.8 |
13.8 |
Full time overseas students |
50.2 |
57.5 |
Part-time higher education students |
8.5 |
5.7 |
Short course and apprenticeship fees |
2.0 |
2.4 |
Research training support grants and other fees |
9.8 |
8.7 |
|
173.6 |
174.6 |
2. Funding body grants
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Office for Students Recurrent Grants |
30.9 |
28.3 |
Office for Students Specific Grants |
4.2 |
5.4 |
Office for Students Capital Grants |
4.2 |
2.6 |
|
39.3 |
36.3 |
3. Research grants and contracts
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
UK Research and Innovation (UKRI) |
18.9 |
19.3 |
UK charitable bodies |
2.5 |
2.7 |
European Commission |
4.7 |
4.4 |
UK central government, Local Authorities or Health Trust |
4.4 |
3.8 |
UK industry |
2.9 |
3.1 |
Other sponsors |
3.8 |
3.8 |
|
37.2 |
37.1 |
4. Other income
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Residences, catering and conferences |
21.4 |
27.1 |
Other services rendered (note 5) |
4.4 |
5.9 |
Other income |
8.4 |
13.1 |
|
34.2 |
46.1 |
5. Other services rendered
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Academic departments and services |
1.4 |
1.4 |
Sports and related facilities |
2.3 |
3.6 |
Other |
0.7 |
0.9 |
|
4.4 |
5.9 |
6. Investment income
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Investment income on endowments |
0.1 |
0.2 |
Change in the fair value of derivatives (note 20) |
1.4 |
- |
Net income and gains from short-term investments |
1.2 |
0.2 |
Other investment income |
0.2 |
1.0 |
|
2.9 |
1.4 |
7. Donations and endowments
Consolidated |
|
|
|
2021 |
2020 |
|
£m |
£m |
Donations with restrictions |
0.3 |
0.4 |
Unrestricted donations |
2.0 |
1.8 |
|
2.3 |
2.2 |
University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Donations with restrictions |
0.3 |
0.4 |
Unrestricted donations |
2.0 |
1.7 |
|
2.3 |
2.1 |
8. Staff costs
Consolidated |
|
|
|
2021 |
2020 |
|
£m |
£m |
Salaries |
136.3 |
141.0 |
Movement in USS pension provision |
(3.5) |
(33.7) |
Social security costs |
12.5 |
12.8 |
Other pension costs |
30.4 |
28.8 |
|
175.7 |
149.0 |
less: paid on behalf of other organisations |
(4.8) |
(4.4) |
less: capitalised within the cost of buildings |
- |
(0.4) |
|
170.9 |
144.2 |
University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Salaries |
135.6 |
141.1 |
Movement in USS pension provision |
(3.5) |
(33.7) |
Social security costs |
12.5 |
12.8 |
Other pension costs |
30.4 |
28.8 |
|
175.0 |
144.2 |
less: paid on behalf of other organisations |
(4.8) |
(4.4) |
less: capitalised within the cost of buildings |
- |
(0.4) |
|
170.2 |
144.2 |
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Access and Participation |
|
|
Access Investment |
1.4 |
1.8 |
Financial Support |
0.1 |
- |
Disability Support (excluding expenditure included in severance payments and key management personnel) |
0.3 |
0.4 |
Research and Evaluation |
0.2 |
- |
|
2.2 |
2.2 |
Further information on staff costs is included within the Annual Report of The Remuneration Committee.
9. Analysis of expenditure by activity
|
|
|
|
2021 |
2020 |
|
£m |
£m |
Academic departments |
114.0 |
113.8 |
Academic services |
30.8 |
30.7 |
Central administration |
17.9 |
18.4 |
General educational expenditure |
18.6 |
20.2 |
Staff and student facilities |
15.4 |
14.6 |
Premises |
42.4 |
41.3 |
IAAPS land and buildings write down |
21.5 |
- |
Residences, retail and catering operations |
33.0 |
37.4 |
Research grants and contracts |
25.0 |
25.3 |
Other services rendered |
1.0 |
1.7 |
Other expenses |
1.9 |
(26.7) |
Consolidated |
321.5 |
276.7 |
University of Bath |
320.7 |
276.6 |
Consolidated and University |
|
|
|
2021 |
2020 |
Other Operating Expenses include: |
£ |
£ |
External Auditors Remuneration (Group and University) |
|
|
Audit Services |
|
|
Financial statements - subsidiary |
10,380 |
3,000 |
Financial statements - University |
87,840 |
79,080 |
Covenant reporting |
2,100 |
2,000 |
US federal loan reporting |
5,400 |
4,380 |
|
105,720 |
88,460 |
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Access and Participation |
|
|
Access Investment |
2.2 |
2.6 |
Financial Support |
4.5 |
4.3 |
Disability Support |
0.4 |
0.4 |
Research and Evaluation |
0.3 |
- |
|
7.4 |
7.3 |
Read our access and participation plan (APP).
Access investment
We have underspent by £51,692 in the year 2020/21. This underspend is in large part due to the closure of sports and leisure facilities due to COVID-19 meaning a large proportion of activity could not be delivered causing a predicted underspend of over £250,000. The underspend allowed us to introduce additional activity and partnerships and combined with some of the underspend from Financial Support (below) allowed us to mitigate the understand. Additional in-person activity for students from target groups was run as soon as Covid-19 restrictions allowed. Mini residentials for students forced to defer entry from 2020 to 2021, in-person events for offer holders, additional residential visits for students and their parents and in-person residentials ran.
If the predicted numbers of students had attended the summer schools (many had to pull out at the last minute due to spikes in COVID-19 cases) the underspend would have been smaller. New partnerships with Rare and Villiers have allowed us to deliver even more activity to targeted groups.
Financial support
The 2020/21 academic year was impacted by the pandemic. The APP Finance Support budget recorded an overall underspend of £92k. This was primarily due to the low number of recipients eligible for the new Accommodation top-up bursary for those first-year undergraduate students with household incomes between £25k and £42k. The budget projected that 200 students would each be eligible for a £1k waiver from the cost of their University accommodation (responding to a need identified by the University of Bath Students’ Union). The impact of the pandemic meant that only £64k of this bursary was ultimately allocated, as many students were not in residence for the full academic year. There was a slight overspend on other bursary support, as the disruption to employers resulted in more students continuing directly into the final year of their degree instead of taking up a paid placement or internship.
Research and evaluation
The 2020/21 academic year was impacted by the pandemic. The University had an underspend of £193,105 against the budget. A significant amount of the underspend (£89,964) was against the projected funding of the doctoral research studentships. Four of the eight students completed and submitted during this period, whilst two suspended their studies and one was registered for only part of the year having returned from maternity leave. The Admissions Data and Evaluation Officer post also remained vacant during this period; a reorganisation of the Undergraduate Admissions team means that this post has been absorbed into another role, with the new post-holder taking up the position in September 2021. A further evaluation role was left unfilled and the resource used to fund an outreach position – this new role is therefore not included in the Research and Evaluation return.
Disability support for students
The 2020/21 academic year was impacted by the pandemic. The Disability team Head retired, and this resulted in a reorganisation of the line management of the team within the wider Student Services Department. The departure of the team Head accounted for a significant level of the underspend as the role was not replaced, and the reorganisation also resulted in another team member moving to a non-APP countable role. This saving in staffing costs accounts for the underspend from the projected budget.
10. Related party transactions
The financial statements of the University include transactions with related parties. In accordance with FRS 102 these are disclosed where members of the University of Bath’s Council or Key Management Personnel (KMP) disclose an interest in a body with whom the University undertakes transactions which are considered material to the University’s Financial Statements and/or the other party. Due to the nature of the University’s operations and the composition of the Board, being drawn from local public and private sector organisations, it is inevitable that transactions will take place with organisations in which a member of Council or KMP may have an interest. All transactions involving organisations in which a member of Council or KMP may have an interest, including those identified below, are conducted at arms length and in accordance with the University’s Financial Regulations and usual procurement procedures.
An updated register of the interests of the members of Council is maintained.
The University has taken advantage of the exemption within FRS 102 and has not disclosed transactions with other group entities where it holds 100% of the voting rights. Included within the financial statements are the following transactions with related parties:
|
Income recognised within the financial statements |
Expenditure recognised within the financial statements |
Balance due to the University at 31 July recognised within the financial statements |
Balance due from the University at 31 July recognised within the financial statements |
|
£m |
£m |
£m |
£m |
University of Bath Students’ Union |
- |
1.9 |
0.1 |
- |
University of Bath Students’ Union
The Students’ Union provides a range of services and facilities to the University’s student body. Two members of Council sit on the governing body of the Students' Union.
Reimbursements to members of Council for expenditure incurred whilst carrying out their duties amounted to £633 (2019/20 £5,015). Three members of Council (2019/20 11) claimed expenses during the year.
11. Interest and other finance cost
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Loans not wholly repayable within five years |
6.9 |
7.4 |
Change in discounted value of future USS payments (note 21) |
0.3 |
1.5 |
Change in the fair value of derivatives (note 20) |
- |
1.1 |
LGPS net interest charge (note 26) |
1.6 |
1.4 |
|
8.8 |
11.4 |
12. Capital commitments
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Provision has not been made for the following capital commitments at 31 July |
|
|
Capital Commitments |
|
|
Funded by University funds |
35.5 |
67.4 |
Capital commitments contracted at 31 July |
35.5 |
67.4 |
13. Fixed assets
Consolidated |
|
|
|
|
|
|
|
Freehold land and buildings |
Leasehold land and buildings |
Equipment |
Assets in the course of construction |
Intangible assets |
Total |
|
£m |
£m |
£m |
£m |
£m |
£m |
Cost / Valuation |
|
|
|
|
|
|
At 1 August 2020 |
18.3 |
740.0 |
95.4 |
68.6 |
- |
922.3 |
Additions at Cost |
0.1 |
3.9 |
8.3 |
27.0 |
0.2 |
39.5 |
Disposals |
- |
- |
(0.4) |
- |
- |
(0.4) |
Revaluations |
0.1 |
4.2 |
- |
3.4 |
- |
7.7 |
At 31 July 2021 |
18.5 |
748.1 |
103.3 |
99.0 |
0.2 |
969.1 |
Accumulated depreciation and impairment |
|
|
|
|
|
|
At 1 August 2020 |
1.5 |
7.9 |
72.9 |
- |
- |
82.3 |
Charge in year |
0.4 |
27.3 |
4.5 |
21.5 |
- |
53.7 |
Disposals |
- |
- |
(0.2) |
- |
- |
(0.2) |
Revaluations |
(1.8) |
(22.9) |
- |
- |
- |
(24.7) |
At 31 July 2021 |
0.1 |
12.3 |
77.2 |
21.5 |
- |
111.1 |
Net book value |
|
|
|
|
|
|
At 31 July 2021 |
18.4 |
735.8 |
26.1 |
77.5 |
0.2 |
858.0 |
At 31 July 2020 |
16.8 |
732.1 |
22.5 |
68.6 |
- |
840.0 |
As at 31 July 2021, we revalued all our freehold and leasehold Land and Buildings. This valuation is carried out by Carter Jonas Limited, an external Chartered Surveyor on the basis of Existing Use, Depreciated Replacement Cost or Market Valuation according to the nature and use of each building. The valuation was prepared in accordance with the Valuation Standards published by the Royal Institute of Chartered Surveyors.
The movement in land and buildings values following the revaluation is written back through the reversal of accumulated depreciation charged since the previous valuation exercise.
During the year the University impaired the costs of the IAAPS facility by £21.5m. This facility was substantially complete at the year-end and therefore costs have been compared to a market valuation for the first time, this market value is substantially less than the cost incurred and as a result, we have impaired its cost. Additional disclosure is made in the Financial Review.
University |
|
|
|
|
|
|
|
Freehold land and buildings |
Leasehold land and buildings |
Equipment |
Assets in the course of construction |
Intangible assets |
Total |
Cost / Valuation |
£m |
£m |
£m |
£m |
£m |
£m |
At 1 August 2020 |
18.4 |
742.3 |
95.4 |
68.6 |
- |
924.7 |
Additions at Cost |
0.1 |
3.9 |
8.3 |
27.0 |
0.2 |
39.5 |
Disposals |
- |
- |
(0.3) |
- |
- |
(0.3) |
Revaluations |
0.1 |
4.2 |
- |
3.4 |
- |
7.7 |
At 31 July 2021 |
18.6 |
750.4 |
103.4 |
99.0 |
0.2 |
971.6 |
Accumulated deprecation and impairment |
|
|
|
|
|
|
At 1 August 2020 |
1.5 |
9.7 |
72.9 |
- |
- |
84.1 |
Charge in year |
0.4 |
27.3 |
4.5 |
21.5 |
- |
53.7 |
Disposals |
- |
- |
(0.2) |
- |
- |
(0.2) |
Revaluations |
(1.8) |
(22.9) |
- |
- |
- |
(24.7) |
At 31 July 2021 |
0.1 |
14.1 |
77.2 |
21.5 |
- |
112.9 |
Net book value |
|
|
|
|
|
|
At 31 July 2021 |
18.5 |
736.3 |
26.2 |
77.5 |
0.2 |
858.7 |
At 1 August 2020 |
16.9 |
732.6 |
22.5 |
68.6 |
- |
840.6 |
Freehold and Leasehold Land and Buildings measured by valuation at 31 July 2021 includes the following historical cost:
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Freehold land and buildings |
12.7 |
12.6 |
Leasehold land and buildings |
513.6 |
509.7 |
Leasehold land and buildings includes land with a value of £41.1 million at 31 July 2021 (£85.8 million at 31 July 2020).
Equipment includes assets donated to us, these are valued at market value as at the date when they were received.
14. Non current asset investments
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
At 1 August |
|
|
Other investments |
0.8 |
1.3 |
Acquisition of investments |
0.1 |
0.3 |
Movement in market value |
0.9 |
(0.8) |
At 31 July |
1.8 |
0.8 |
15. Trade and other receivables
|
University |
Consolidated |
Consolidated and University |
|
2021 |
2021 |
2020 |
|
£m |
£m |
£m |
Prepayments and accrued income |
3.7 |
3.7 |
4.2 |
Amounts receivable from a subsidiary |
1.6 |
- |
- |
Research grant receivables |
12.7 |
12.7 |
9.5 |
Other receivables |
10.3 |
10.4 |
13.0 |
Other taxation receivables |
9.2 |
9.2 |
- |
|
37.5 |
36.0 |
26.7 |
Due within one year |
35.9 |
36.0 |
26.3 |
Due in more than one year |
1.6 |
- |
0.4 |
|
37.5 |
36.0 |
26.7 |
Debtors due in more than one year are all Other receivables.
16. Current asset investments
Consolidated and University |
|
|
|
|
|
Investments measured at Market Value |
Investments measured at Cost |
2021 |
2020 |
|
|
|
Total |
Total |
|
£m |
£m |
£m |
£m |
At 1 August |
136.4 |
54.7 |
191.1 |
214.5 |
New investments |
13.2 |
- |
13.2 |
106.4 |
Disposal of investments |
(5.4) |
(26.0) |
(31.4) |
(131.2) |
Market value movement |
9.2 |
- |
9.2 |
1.4 |
At 31 July |
153.4 |
28.7 |
182.1 |
191.1 |
Investments measured at market value includes Quoted investments of £106.4m (£89.4m) and those held in unit funds where a market value can be determined of £47.0m (£47.0m).
Investments measured at cost include those held in money market funds, certificates of deposit and fixed deposits.
Current Asset investments include £6.7m (£5.2m) held in respect of Endowments as disclosed in note 22.
17. Creditors: amounts falling due within one year
|
University |
Consolidated |
Consolidated and University |
|
2021 |
2021 |
2020 |
|
£m |
£m |
£m |
Bank loans |
10.0 |
10.0 |
5.0 |
Trade Payables |
24.3 |
24.3 |
19.7 |
Social Security and other taxation payable |
6.7 |
6.7 |
3.1 |
Finance lease obligations |
0.3 |
0.3 |
0.2 |
Deferred income |
74.9 |
74.9 |
71.7 |
|
116.2 |
116.2 |
99.7 |
Deferred income
Included in deferred income are the following items which have been deferred until specific performance-related conditions are met.
|
University |
Consolidated |
Consolidated and University |
|
2021 |
2021 |
2020 |
|
£m |
£m |
£m |
Donations |
0.6 |
0.6 |
0.9 |
Research grants received on account |
21.7 |
21.7 |
18.2 |
Grant income |
42.7 |
42.7 |
42.0 |
Other income |
9.9 |
9.9 |
10.6 |
|
74.9 |
74.9 |
71.7 |
18. Creditors: amounts falling due after more than one year
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Bank loans |
224.4 |
234.5 |
Derivatives |
13.9 |
17.5 |
Finance lease obligations |
1.7 |
1.9 |
|
240.0 |
253.9 |
19. Borrowings
Consolidated and University |
|
|
|
2021 |
2020 |
Analysis of Financing |
£m |
£m |
Bank loans and overdrafts are repayable as follows: |
|
|
In one year or less |
10.0 |
5.0 |
Between one and two years |
5.1 |
10.1 |
Between two and five years |
15.1 |
15.1 |
In five years or more |
204.2 |
209.3 |
|
234.4 |
239.5 |
20. Derivatives
The University is using hedge accounting for its interest rate swaps and foreign exchange options and as a result determined the effectiveness of the hedging arrangements. The analysis below shows the results of this assessment:
|
|
|
|
Consolidated and University |
Consolidated and University |
Consolidated and University |
|
|
Hedging Instrument |
Expiry Date |
Amount |
Market Value at |
Market Value at |
Movement in market value |
Disposals in year |
Total Movement |
Movement in market value |
|
|
|
2021 |
2020 |
2021 |
2021 |
2021 |
2020 |
|
|
|
£m |
£m |
£m |
£m |
£m |
£m |
Interest rate swaps |
Between 2027 and 2037 |
£35.5m |
13.9 |
17.5 |
(3.6) |
- |
(3.6) |
1.6 |
Foreign exchange options |
In 2020 |
$60.7m |
(1.3) |
(0.8) |
(1.3) |
0.8 |
(0.5) |
(0.9) |
|
|
|
12.6 |
16.7 |
(4.9) |
0.8 |
(4.1) |
0.7 |
Interest rate swaps are hedging instruments associated with the University’s loan portfolio with Lloyds Bank plc and Barclays Bank plc Foreign Exchange options are hedging instruments associated with our current asset investments in USD denominated funds.
The movement in market value for 2020/21 is a loss of £4.9m (2019/20 loss of £0.7m) is reported as follows:
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Interest Payable (note 11) |
- |
1.2 |
Interest Receiveable (note 6) |
(1.4) |
- |
Other Comprehensive Income |
(3.5) |
(0.5) |
|
(4.9) |
0.7 |
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Disclosure of Derivatives |
|
|
Other receivables due in less than one year |
1.3 |
0.8 |
Liabilities due in more than one year |
13.9 |
17.5 |
21. Provisions
Consolidated and University |
|
|
|
|
|
Obligations to fund deficit on USS Pension (note 26) |
Defined Benefit obligations LGPS (note 26) |
Total 2021 |
Total 2020 |
|
£m |
£m |
£m |
£m |
At 1 August |
44.3 |
99.5 |
143.8 |
147.8 |
Released in year |
(3.5) |
- |
(3.5) |
(33.7) |
Additions in year |
0.3 |
5.4 |
5.7 |
6.0 |
Interest in year |
- |
1.6 |
1.6 |
1.4 |
Actuarial loss in respect of pension |
- |
(9.5) |
(9.5) |
22.3 |
At 31 July |
41.1 |
97.0 |
138.1 |
143.8 |
Obligations to fund deficit on USS Pension
The obligation to fund the past deficit on our Superannuation Scheme (USS) arises from the contractual obligation with the pension scheme for total payments relating to benefits arising from past performance. Management has assessed future employees within the USS scheme and salary payments over the 15 year period of the contracted obligation in assessing the value of this provision and these are disclosed below:
|
2021 |
2020 |
Discount rate at year end |
0.89% |
0.74% |
Pensionable salary growth |
2.4% for the duration of the plan |
1.5% for the first two years and 2.4% thereafter |
USS membership growth |
1.0% for the duration of the plan |
in the range (1.5%) to 1% |
Defined benefit obligations (LGPS)
As a multi-employer scheme where the share of assets and liabilities applicable to each employer can be defined, we have accounted for the scheme under FRS 102 as a defined benefit scheme based on a full actuarial valuation of the Fund as at 31 March 2019.
22. Endowments
Restricted net assets relating to endowments are as follows:
Consolidated and University |
|
|
|
|
|
|
|
2021 |
2020 |
|
Restricted Permanent |
Expendable |
Total |
Total |
|
£m |
£m |
£m |
£m |
At 1 August |
|
|
|
|
Capital |
2.0 |
4.0 |
6.0 |
6.4 |
Accumulated Income |
0.3 |
0.8 |
1.1 |
1.0 |
|
2.3 |
4.8 |
7.1 |
7.4 |
Investment and donation income |
0.1 |
0.2 |
0.3 |
0.2 |
Expenditure |
(0.1) |
(0.3) |
(0.4) |
(0.1) |
(Decrease) Increase in market value of investments |
0.4 |
0.7 |
1.1 |
(0.4) |
At 31 July |
2.7 |
5.4 |
8.1 |
7.1 |
Representing: |
|
|
|
|
Capital |
2.4 |
4.7 |
7.1 |
6.1 |
Accumulated Income |
0.3 |
0.7 |
1.0 |
1.0 |
|
2.7 |
5.4 |
8.1 |
7.1 |
Analysis by type of purpose |
|
|
|
|
Lectureships |
1.4 |
2.5 |
3.9 |
3.4 |
Scholarships and bursaries |
1.2 |
2.5 |
3.7 |
3.1 |
Prize Funds |
0.1 |
0.2 |
0.3 |
0.4 |
General |
- |
0.2 |
0.2 |
0.2 |
|
2.7 |
5.4 |
8.1 |
7.1 |
Analysis by asset |
|
|
|
|
Current and non-current asset investments |
2.5 |
4.2 |
6.7 |
5.2 |
Cash and cash equivalents |
0.2 |
1.2 |
1.4 |
1.9 |
|
2.7 |
5.4 |
8.1 |
7.1 |
23. Restricted reserves
Reserves with restrictions are as follows:
Consolidated and University |
|
|
|
|
|
Other income |
Donations |
2021 |
2020 |
|
|
|
Total |
Total |
|
£m |
£m |
£m |
£m |
At 1 August |
0.5 |
1.7 |
2.2 |
2.1 |
New grants |
0.1 |
- |
0.1 |
- |
New donations |
- |
0.3 |
0.3 |
0.5 |
Expenditure |
(0.2) |
(0.5) |
(0.7) |
(0.4) |
At 31 July |
0.4 |
1.5 |
1.9 |
2.2 |
Analysis by type of purpose |
|
|
|
|
Research support |
0.1 |
- |
0.1 |
0.1 |
Scholarships and bursaries |
- |
0.7 |
0.7 |
0.6 |
General |
0.3 |
0.8 |
1.1 |
1.5 |
|
0.4 |
1.5 |
1.9 |
2.2 |
24. Contingent Liability
We have entered a number of nomination agreements with three organisations whereby we underwrite the shortfall in the letting of a number of student residences, summarised below. We do not expect any liability to be incurred as a result of these contracts as we expect all residences will be fully let as per the nomination agreements.
Dates |
Residences |
Legal entity with whom the agreement is held |
Maximum liability 31 July 2021 |
Maximum liability 31 July 2020 |
|
|
|
£m |
£m |
24/09/2016 to 18/09/2021 |
“Hello Student” |
Empiric (Bath James House) Limited |
0.3 |
2.2 |
14/09/2020 to 19/03/2021 |
Green Park House |
Bath Spa University |
- |
1.0 |
16/09/2021 to 15/09/2030 |
Acquilla Court |
Eagle One Acqua Sulis Limited and Acquilla MMXX Limited |
14.1 |
13.8 |
25/09/2021 to 03/09/2022 |
Twerton Mill |
Twerton Bath Limited |
0.5 |
- |
Total |
|
|
14.9 |
17.0 |
25. Lease obligations
The University had total operating lease commitments in respect of leased property as follows:
Consolidated and University |
|
|
|
2021 |
2020 |
|
£m |
£m |
Lease Commitments |
|
|
Lease commitments due in more than one year but less than two years |
5.1 |
5.0 |
Lease commitments due between two & five years |
20.0 |
20.4 |
Lease commitments due in more than five years |
24.0 |
28.9 |
Total Lease commitments |
49.1 |
54.3 |
Operating leases are held for six properties used by us as student accommodation. As we do not control the significant residual value in these properties upon the expiry of the lease period they have not been accounted for as Service Concession Arrangements.
The lease arrangements expire between 2024 and 2032, the lease payments are reported in other operating expenses.
26. Pensions
Universities Superannuation Scheme
We participate in the Universities Superannuation Scheme (USS), a hybrid pension scheme, providing defined benefits (for all members), as well as defined contribution benefits. The assets of the scheme are held in a separate fund administered by the trustee, Universities Superannuation Scheme Limited. USS has over 203,000 members and we had 2,299 (2,342) active members at 31 July 2021.
USS is a multi-employer scheme and is accounted for as set out in the accounting policies.
The latest available completed actuarial valuation of the Retirement Income Builder is at 31 March 2018 (the valuation date), which was carried out using the projected unit method.
The 2018 valuation was the fifth valuation for the scheme under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to adopt a statutory funding objective, which is to have sufficient and appropriate assets to cover their technical provisions. At the valuation date, the value of the assets of the scheme was £63.7 billion and the value of the scheme’s technical provisions was £67.3 billion indicating a shortfall of £3.6 billion and a funding ratio of 95%.
The key financial assumptions used in the 2018 valuation are described below. More detail is set out in the Statement of Funding Principles.
Pension increases (CPI)
Term dependent rates in line with the difference between the Fixed Interest and Index Linked yield curves, less 1.3% p.a.
Discount rate (forward rates)
- Years 1-10: CPI +0.14% reducing linearly to CPI –0.73%
- Years 11-20: CPI +2.52% reducing linearly to CPI +1.55% by year 21
- Years 21+: CPI +1.55%
The main demographic assumption used relates to the mortality assumptions. These assumptions are based on analysis of the scheme’s experience carried out as part of the 2018 actuarial valuation. The mortality assumptions used in these figures are as follows:
Mortality base table |
|
Pre-retirement |
71% of AMC00 (duration 0) for males and 112% of AFC00 (duration 0) for females |
Post-retirement |
97.6% of SAPS S1NMA “light” for males and 102.7% of RFV00 for females |
Future improvements to mortality |
CMI_2017 with a smoothing parameter of 8.5 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:
|
2021 |
2020 |
Males currently 65 yrs |
24.6 |
24.4 |
Females currently 65 yrs |
26.1 |
25.9 |
Males currently 45 yrs |
26.6 |
26.3 |
Females currently 45 yrs |
27.9 |
27.7 |
A new deficit recovery plan was put in place as part of the 2018 valuation, which requires payment of 2% of salaries over the
period 1 October 2019 to 30 September 2021 at which point the rate will increase to 6%. The 2021 deficit recovery liability
reflects this plan. The liability figures have been produced using the following assumptions:
|
2021 |
2020 |
Discount rate |
0.89% |
0.74% |
Pensionable salary growth |
1.5%-2.40% |
4.20% |
To illustrate how sensitive the funding level is to experience being different from assumed, the table below shows how the valuation results at 31 March 2018 would have differed given small changes in the key assumptions.
Assumption |
Change in Assumption |
Change in shortfall |
Discount rate |
Increase by 0.1% |
Reduce by £1.2 billion |
RPI/CPI Spread |
Increase by 0.1% |
Reduce by £0.7 billion |
Life expectancy |
Higher than assumed* |
Increase by £1.6 billion |
Asset values |
Fall by 10% |
Increase by £6.4 billion |
*Assumes member life expectancy is consistent with someone one year younger than their current age (i.e. a 60 year old is observed to have the life expectancy of someone aged 59).
USS is a “last man standing” scheme so that in the event of the insolvency of any of the participating employers in USS, the amount of any pension funding shortfall (which cannot otherwise be recovered) in respect of that employer will be spread across the remaining participant employers and reflected in the next actuarial valuation of the scheme.
Local Government Pension Scheme
We participate in the Avon Pension Fund which is a funded defined benefit pension scheme with the assets held in separate trustee administered funds. The assumptions which have the most significant effect on the determination of contribution levels are as follows:
|
|
Return on investments |
4.2% |
Long-term Salary inflation |
3.9% |
Pension inflation |
2.4% |
|
|
Valuation date |
31 March 2019 |
Valuation method |
Projected Unit |
Market value of assets at date of last valuation |
£4,820 million |
Market value of assets as a percentage of accrued benefits |
95.0% |
On the 1 June 2021 the University ceased to enrol new members of staff into the LGPS. The contributions payable by us were equal to 16.5% of total pensionable salaries for the period to 31 May 2021 and 19.3% for the balance of the period to the end of the financial year.
As a multi-employer scheme where the share of assets and liabilities applicable to each employer can be defined, we have accounted for the scheme under FRS 102 as a defined benefit scheme based on a full actuarial valuation of the Fund as at 31 March 2019, updated to 31 July 2021 by a qualified independent actuary.
The material assumptions used by the actuary were:
At end of year |
31 July 2021 |
31 July 2020 |
|
% |
% |
Rate of CPI inflation |
2.6 |
2.3 |
Rate of increase in salaries |
4.1 |
3.8 |
Rate of increase in pensions |
2.7 |
2.4 |
Discount rate |
1.6 |
1.6 |
Post retirement mortality assumptions for members retiring in normal health
|
31 July 2021 |
31 July 2020 |
Non-retired members (male) |
S2PA CMI_2018_[1.75%] 98% |
S2PA CMI_2018_[1.75%] 98% |
Non-retired members (female) |
S2PA CMI_2018_[1.75%] 88% |
S2PA CMI_2018_[1.75%] 88% |
Retired members (male) |
S2PA CMI_2018_[1.75%] 92% |
S2PA CMI_2018_[1.75%] 93% |
Retired members (female) |
S2PA CMI_2018_[1.75%] 87% |
S2PA CMI_2018_[1.75%] 85% |
Life expectancy |
|
|
Male/female future pensioner 65 in 20 years time |
24.8/27.4 years |
24.7/27.3 years |
Male/female current pensioner aged 65 |
23.3/25.4 years |
23.2/25.3 years |
The sensitivities regarding the principal assumptions used to measure our share of the scheme liabilities as at the valuation on 31 July 2021 are set out below:
Assumption |
Change in Assumption |
Impact on scheme liabilities |
Discount rate |
Increase by 0.1% |
Decrease by £4.3 million |
Rate of CPI Inflation |
Increase by 0.1% |
Increase by £4.4 million |
Rate of salary growth |
Increase by 0.1% |
Increase by £0.3 million |
Members live longer |
1 year longer |
Increase by £8.0 million |
Our University’s share of the scheme’s assets and liabilities |
|
|
|
2021 |
2020 |
|
£m |
£m |
Market value of assets |
150.5 |
130.5 |
Present value of scheme liabilities |
(247.5) |
(230.0) |
Net pension liability |
(97.0) |
(99.5) |
Amounts charged to SOCI |
|
|
Included in staff costs and operating expenses for the year (note 8) |
2021 |
2020 |
|
£m |
£m |
Current service cost |
8.8 |
8.2 |
Past service cost |
- |
0.8 |
Administration expenses |
0.1 |
0.1 |
Total operating charge |
8.9 |
9.1 |
Analysis of amount charged to interest payable |
|
|
|
2021 |
2020 |
|
£m |
£m |
Net interest charge (note 11) |
1.6 |
1.4 |
Net charge |
1.6 |
1.4 |
Amounts recognised in the Statement of Comprehensive Income |
|
|
|
2021 |
2020 |
|
£m |
£m |
Change in assumptions underlying the present value |
|
|
of the scheme assets |
17.8 |
(7.8) |
of the scheme liabilities |
(8.3) |
(14.5) |
Actuarial gain/(loss) recognised in the SOCI |
9.5 |
(22.3) |
The movement in the scheme's deficit during the year is made up as follows:
|
2021 |
2020 |
|
£m |
£m |
Deficit in scheme at 1 August |
99.5 |
71.3 |
Movement in the year: |
|
|
Current service and curtailment costs |
8.8 |
8.2 |
Contributions by the employer |
(3.5) |
(4.6) |
Past service cost |
- |
0.8 |
Administrative charge |
0.1 |
0.1 |
Net interest charge |
1.6 |
1.4 |
Actuarial loss |
(9.5) |
22.3 |
Deficit in scheme at 31 July |
97.0 |
99.5 |
Analysis of the movement in the present value of the scheme liabilities |
|
|
|
2021 |
2020 |
|
£m |
£m |
At the beginning of the year |
230.0 |
205.1 |
Current service cost |
8.8 |
8.2 |
Interest on pension liabilities |
3.6 |
4.3 |
Member contributions |
1.3 |
1.3 |
Past service cost |
- |
0.8 |
Actuarial losses on liabilities - other |
8.3 |
14.5 |
Curtailments |
0.1 |
- |
Benefits/transfers paid |
(4.6) |
(4.2) |
At the end of the year |
247.5 |
230.0 |
Analysis of the movement in the market value of the scheme assets |
|
|
|
2021 |
2020 |
|
£m |
£m |
At the beginning of the year |
130.5 |
133.8 |
Expected return on plan assets |
2.1 |
2.8 |
Actuarial (losses)/gains on assets |
17.8 |
(7.8) |
Administrative expenses |
(0.1) |
(0.1) |
Contributions by the employer |
3.5 |
4.6 |
Contributions by scheme participants |
1.3 |
1.3 |
Benefits/transfers paid |
(4.6) |
(4.1) |
At the end of the year |
150.5 |
130.5 |
Analysis of the scheme assets |
|
|
|
2021 |
2020 |
|
£m |
£m |
Equities |
64.3 |
57.7 |
Government bonds |
14.6 |
9.4 |
Other bonds |
12.2 |
3.5 |
Property |
9.5 |
11.5 |
Cash/liquidity |
2.7 |
3.9 |
Other |
47.2 |
44.5 |
At the end of the year |
150.5 |
130.5 |
University total pension costs (note 8) |
|
|
|
2021 |
2020 |
|
£m |
£m |
Universities Superannuation Scheme: employer only contributions |
20.9 |
20.8 |
Universities Superannuation Scheme: provision movement |
(3.5) |
(33.7) |
|
17.4 |
(12.9) |
Avon Pension Fund |
9.3 |
9.2 |
Contributions to other pension schemes |
0.1 |
0.1 |
Total pension costs |
26.9 |
(3.6) |
27 Post balance sheet event
Universities Superannuation Scheme
The movement in the USS pension provision and charge of £3.5m reflected on the face of SOCI is based on the scheme valuation at 31 March 2018. On 1 October USS signed and filed the USS 2020 valuation with the Pensions Regulator. The 2020 valuation has longer duration and higher deficit recovery contributions than the 2018 valuation.
We estimate the USS liability at 31 July 2021 under the 2020 valuation to be £119.2m and the resulting £76.9m adjustment will be reported as a debit against staff costs in the year ending 31 July 2022.
28 US Department of Education Financial Responsibility - Supplemental Schedule
In satisfaction of its obligations to facilitate students’ access to US federal financial aid, we are required by the US Department of Education to present the following Supplemental Schedule in a prescribed format.
The amounts presented within the schedules have been:
- prepared under the historical cost convention, subject to the revaluation of certain fixed assets
- prepared using United Kingdom generally accepted accounting practice, in accordance with Financial Reporting Standard 102
(FRS 102) and the Statement of Recommended Practice: Accounting for Further and Higher Education (2019 edition)
- presented in pounds sterling
The schedules set out how each amount disclosed has been extracted from the financial statements. As set out above, the accounting policies used in determining the amounts disclosed are not intended to and do not comply with the requirements of accounting principles generally accepted in the United States of America.
Primary reserve ratio
Line item - related disclosures |
Expendable net assets |
Year ended 31 July 2021 |
Year ended 31 July 2020 |
|
|
£ |
£ |
Statement of Financial Position - Net assets without donor restrictions |
Net assets without donor restrictions |
578,559,170 |
555,766,258 |
Statement of Financial Position - Net assets with donor restrictions |
Net assets with donor restrictions |
10,014,561 |
9,404,328 |
Statement of Financial Position - Property, Plant and equipment, net (note 13) |
Property, plant and equipment, net (includes Construction in progress) |
858,087,793 |
840,063,223 |
Note of the Financial Statements - Statement of Financial Position - Property, plant and equipment - pre-implementation |
Property, plant and equipment - pre-implementation |
818,623,929 |
773,805,910 |
Note of the Financial Statements - Statement of Financial Position - Property, plant and equipment - post-implementation without outstanding debt for original purchase (note 13) |
Property, plant and equipment - post-implementation without outstanding debt for original purchase |
12,398,140 |
20,699,308 |
Note of the Financial Statements - Statement of Financial Position - Construction in progress (note 13) |
Construction in progress |
77,476,818 |
68,541,544 |
Statement of Financial Position - Postemployment and pension liabilities |
Post-employment and pension liabilities |
138,179,723 |
143,834,767 |
Statement of Financial Position - Note Payable and Line of Credit for long-term purposes (both current and long term) and Line of Credit for Construction in process |
Long-term debt - for long term purposes |
250,238,689 |
259,128,944 |
Statement of Financial Position - Note Payable and Line of Credit for long-term purposes (both current and long term) and Line of Credit for Construction in process |
Long-term debt - for long term purposes pre-implementation |
250,238,689 |
259,128,944 |
Statement of Financial Position - Perpetual Funds (note 22) |
Net assets with donor restrictions: restricted in perpetuity |
8,138,906 |
7,147,282 |
Line item - related disclosures |
Total expenses and losses |
Year ended 31 July 2021 |
Year ended 31 July 2020 |
|
|
£ |
£ |
Statement of Activities - Total Operating Expenses (Total from Statement of Activities prior to adjustments) |
Total expenses without donor restrictions - taken directly from Statement of Activities |
324,993,338 |
310,303,351 |
Statement of Activities - Non-Operating (Investment return appropriated for spending), Investments, net of annual spending gain (loss), Other components of net periodic pension costs, Pension-related changes other than net periodic pension, changes other than net periodic pension, Change in value of split-interest agreements and Other gains (loss) - (Total from Statement of Activities prior to adjustments) |
Non-Operating and Net Investment (loss) |
10,167,195 |
600,732 |
|
Pension-related (credits)/ changes other than net periodic costs |
12,962,610 |
11,328,462 |
Equity ratio
Line item - related disclosures |
Modified net assets |
Year ended 31 July 2021 |
Year ended 31 July 2020 |
|
|
£ |
£ |
Statement of Financial Position - Net assets without donor restrictions |
Net assets without donor restrictions |
578,559,170 |
555,766,258 |
Statement of Financial Position - total Net assets with donor restrictions |
Net assets with donor restrictions |
10,014,561 |
9,404,328 |
Line item - related disclosures |
Modified assets |
£ |
£ |
Statement of Financial Position - Total Assets |
Total Assets |
1,082,887,662 |
1,062,605,733 |
Net income ratio
Line item - related disclosures |
|
Year ended 31 July 2021 |
Year ended 31 July 2020 |
|
|
£ |
£ |
Statement of Changes in Reserves - total of movement shown for Income & Expenditure Reserve and Revaluation Reserve |
Change in Net Assets Without Donor Restrictions |
23,450,072 |
(16,186,956) |
Statement of Activities - (Net assets released from restriction), Total Operating Revenue and Other Additions and Sale of Fixed Assets, gains (losses) |
Total Revenue and Gains |
289,451,747 |
297,660,552 |