1. Tuition fees and education contracts

2. Funding body grants

3. Research grants and contracts

4. Other income

5. Other services rendered

6. Investment income

7. Donations and endowments

8. Staff costs

Professor Ian White’s basic salary was 8.0 (2020-21 7.8) times the median pay of staff and 14.6 (15.0) times the lowest pay of staff, where median and lowest pay are calculated on a full-time equivalent basis for the salaries paid to our staff. Professor Ian White’s total remuneration was 7.3 (2020-21 7.4) times the median total remuneration and 16.5 (2020-21 17.5) times the lowest total remuneration, where median and lowest total remuneration are calculated on a full-time equivalent basis for the total remuneration paid to our staff.

The Vice-Chancellor’s salary was set with reference to external benchmarks on recruitment in April 2019, making comparison with Universities of similar scale, complexity and ranking. The salary is not due for review until the third anniversary of his recruitment and until that point will only be adjusted by the Joint Negotiating Committee for Higher Education Staff (JNCHES) annual pay award (review planned for October 2022). There are no performance-related elements in the remuneration package. One of the key principles adopted was for the Vice-Chancellor to be subject to the same policies as other staff wherever practical and details of the remuneration package were subsequently published.

Remuneration of other higher paid staff

Remuneration of other higher paid staff, excluding employer's pension contributions and before salary sacrifice are:

The net reduction of 3 staff is a combination of recruitments, exits and changes bringing staff into this group for the first time. In accordance with Office for Students (OfS) guidance, this table only includes staff who completed the full year in post. Due to turnover in the senior team, some roles (including Deputy Vice-Chancellor, Pro-Vice-Chancellor (Research), and Pro-Vice-Chancellor (Education)) will not appear in this data until next year.

Included in the above total are two staff employed by the University’s subsidiary, Institute of Advanced Propulsion Systems (IAAPS) Ltd.

Included within the above full time equivalent totals are 24.7 (2020-21 19.5) staff employed by the University’s subsidiary IAAPS Ltd.

Key management personnel

Key management personnel are those persons having authority and responsibility for planning, directing and controlling our activities. Positions held by our key management personnel are:

• Vice-Chancellor & President
• Deputy Vice-Chancellor & Provost
• Pro-Vice-Chancellor (Education)
• Pro-Vice-Chancellor (Research)
• Pro-Vice-Chancellor (Student Experience)
• Vice-President (Community & Inclusion)
• Vice-President (Enterprise)
• Chief Operating Officer
• Director of Finance
• Director of Policy, Planning and Compliance

Compensation includes remuneration and all employer benefits paid or payable in exchange for services provided by our key management personnel in the year.

Severance payments include a mixture of redundancy costs, typically at the end of a fixed term contract, settlement agreements and individually agreed exits.

Access and participation staff costs

9. Analysis of expenditure by activity

Read our access and participation plan (APP).

Access investment

We have overspent on access work in 2021-22 compared to what we had committed to in the APP. This is due to increased activity to support students who missed out on information and experiences about higher education during the height of the COVID-19 pandemic. The increased demand from schools and students and the ability to deliver large scale events again has meant there is a small overspend. Given the challenges students (and their supporters) have faced during the height of the pandemic, we decided this appropriate. The overspend in Access was mitigated by an underspend elsewhere.

Financial support

The APP Finance Support budget recorded an overall underspend of £281k. This was in part due to the lower-than-expected number of recipients eligible for the 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, but only 146 met the eligibility criteria. The bursary has been reviewed for 2022-23 and alternative criteria have been put in place to ensure the largest number of students get the financial support they need. The largest underspend against commitments was for our Bath Bursary scheme with fewer than expected students meeting the household income requirements than expected. This will be monitored and if this trend continues, we will review the eligibility for the scheme.

Disability Support for Students

The University had an overspend of £37k against the committed spend. The increased spend includes some previously not included diagnostic assessments for students and an increase of 16k for additional, non-medical, support for students. In part this increase was seen due to proactive work by the University to encourage students to declare disabilities as well as the impact of COVID-19 lockdowns meaning more students were presenting with mental health concerns. An additional project to support autistic students into the world of work was run through a partner charity called Next Steps Foundation.

Research and evaluation

We spent £0.3m against a budget of £0.4m, the main reason for this was that £0.2m of the forecast (when written in the APP) was for new doctoral students to undertake research projects. These students have now completed these projects but the costs was lower than estimated, and the funding has not continued.

For 2022-23 a new approach to this activity is being taken, aligned to the University Strategy. Due to the pandemic and a new University strategy a different approach will be taken in 2022-23.

Despite underspending against the forecast, we have increased spend compared to the previous year through an additional data analysis focused role, created to support the monitoring and development of the APP.

10. Related party transactions

The financial statements of the University include transactions with related parties. In accordance with Financial Reporting Standard (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.

See an updated register of the interests of the members of Council.

The University has taken advantage of the exemption within FRS102 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:

University of Bath Students’ Union

The Students’ Union provide a range of services and facilities to the University’s student body. Two members of Council sit on the governing body of the Student Union.

Reimbursements to members of Council and Audit and Risk Assurance Committee (ARAC) for expenditure incurred whilst carrying out their duties amounted to £3,003 (2020-21 £633). 6 members of Council and 1 external member of ARAC (2020-21 3 members of Council) claimed expenses during the year.

11. Interest and other finance cost

12. Fixed assets

As at 31 July 2022, we revalued all our freehold and leasehold Buildings. Carter Jonas Limited, an external Chartered Surveyor revalued all buildings carried at market value and a sample of leasehold buildings valued using Existing Use or Depreciated Replacement Cost according to the nature and use of each building. The University applied the same valuation methodology to all leasehold building that were not part of the sample so that all leasehold building are valued at fair value at 31 July 2022. The Carter Jonas valuation was prepared in accordance with the Valuation Standards published by the Royal Institute of Chartered Surveyors.

The movement in buildings values following the revaluation is written back through an increase in valuation and the reversal of accumulated depreciation charged since the previous valuation exercise.

Provision has not been made for capital commitments funded by University funds, of £21.7m (2020-21 £35.5m) that were contracted at 31 July.

Freehold and Leasehold Land and Buildings measured by valuation at 31 July 2022 includes the following historical cost:

Leasehold land and buildings includes land with a value of £41.1m at 31 July 2022 (£41.1m at 31 July 2021).

Equipment includes assets donated to us, these are valued at market value as at the date when they were received.

13. Non current asset investments

14. Trade and other receivables

Debtors due in more than one year are all Other receivables.

15. Current asset investments

Investments measured at market value includes Quoted investments of £96.6m (2020-21 £106.4m) and those held in unit funds where a market value can be determined of £35.0m (2020-21 £47.0m).

Investments measured at cost include those held in money market funds, certificates of deposit and fixed deposits.

Current Asset investments include £6.3m (2020-21 £6.7m) held in respect of Endowments as disclosed in note 21.

16. Creditors: amounts falling due within one year

Deferred income

Included in deferred income are the following items which have been deferred until specific performance-related conditions are met.

17. Creditors: amounts falling due after more than one year

18. Borrowings

On 10 August 2022 the University committed to a debt restructure exercise and details of this are reported in Note 26 Post Balance Sheet events.

19. 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:

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 United States Dollar (USD) denominated funds. The movement in market value is reported as follows:

On 10 August 2022 the University committed to a debt restructure exercise and details of this are reported in Note 26 Post Balance Sheet events.

20. Provisions

21. Endowments

Restricted net assets relating to endowments are as follows:

22. Restricted reserves

Reserves with restrictions are as follows:

23. Contingent Liability

We have entered a number of nomination agreements with two 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.

24. Lease obligations

The University had total operating lease commitments in respect of leased property as follows:

Operating leases are held for eight properties (2020-2021 seven) 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 2049, the lease payments are reported in other operating expenses.

The commitments above reflect minimum price increases, based on Consumer Price Index (CPI), which are capped by many agreements, typically, between 4% and 5%.

25. 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 2,276 (2020-21 2,299) active members at 31 July 2022. 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 2020 (the valuation date), which was carried out using the projected unit method.

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

The key financial assumptions used in the 2020 valuation are described below. More detail is set out in the Statement of Funding Principles.

CPI assumption

Term dependent rates in line with the difference between the Fixed Interest and Index Linked yield curves, less 1.1% per annum to 2030, reducing linearly by 0.1% per annum to a long-term difference of 0.1% per annum from 2040.

Pension increases (subject to a floor of 0%)

CPI assumption plus 0.05%.

Discount rate (forward rates)

Fixed interest gilt yield curve plus:

• Pre-retirement 2.75% per annum
  
• Post-retirement 1.00% per annum

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 2020 actuarial valuation. The mortality assumptions used in these figures are as follows:

The current life expectancies on retirement at age 65 are:

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 have assessed future employees within the USS scheme and salary payments over the 16 year period ending 31 July 2038 of the contracted obligation to maintain employer contributions at 6.3% to assess the value of this provision.

The liability figures have been produced using the following assumptions:

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:

The contributions payable by us are 19.3% of pensionable pay throughout this period.

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 2022 by a qualified independent actuary.

The material assumptions used by the actuary were:

Post retirement mortality assumptions for members retiring in normal health

The sensitivities regarding the principal assumptions used to measure our share of the scheme liabilities as at the valuation on 31 July 2022 are set out below:

The movement in the scheme's deficit during the year is made up as follows:

26. Post balance sheet event

On 10 August 2022 the University committed to a number of refinancing transactions and these are summarised below.

It entered into an agreement with the Pension Insurance Corporation for a 50 year £50.0m term settlement private placement with an all-in cost of 3.66%. The private placement funds were received on 8 November 2022.

It issued a prepayment notice to the European Investment Bank to settle its loan, the committed costs were £48,297,435 and settlement was made on 30 September 2022.

It issued break notices to Lloyds Bank plc and Barclays Bank plc to settle its interest rate and inflation derivatives and the committed costs were £7,343,600 and settlement was made on 4 October 2022. The market value of these derivates at 31 July 2022 was £7,660,608.

27. US Department of Education Financial Responsibility - Supplemental Schedule

In satisfaction of its obligations to facilitate students’ access to United States federal financial aid, we are required by the United States 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

The 31 July 2021 comparator for Statement of Financial Position - Property, plant and equipment - pre-implementation has been restated to the figure that should have been reported at the end of the financial year 2020-21.

Equity ratio

Net income ratio