1146516 Consolidated Financial Statements for the Year Ended 31
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University of Wales Charity number: 1146516 Consolidated Financial Statements For the year ended 31 July 2020 1 UNIVERSITY OF WALES CONTENTS Pages Members 3 Administration details and professional advisors 4 Operating and financial review 5 Statement of corporate governance 15 Independent auditor’s report to the council of University of Wales: Trinity Saint David 19 Consolidated and University statements of comprehensive income 22 Consolidated and University statements of changes in reserves 23 Consolidated and University statements of financial position 24 Consolidated statement of cash flows 25 Statement of accounting policies 26 Notes to the accounts 31 2 UNIVERSITY OF WALES OPERATING AND FINANCIAL REVIEW The Trustees of the University who served in the year and up to the date of the signing of these financial statements are listed below: Member Ex Officio The Vice-Chancellor Independent Members The Venerable A. J. Randolph Thomas (Chair) Anthony Ball Margaret Evans (Vice Chair) Arwel Ellis Owen Dr Elizabeth Siberry Pamela Berry Andrew Curl Eifion Griffiths Maria Stedman Gareth O Jones (passed away 12 Nov 2019) Nigel Roberts Deris Davies Williams Staff Member Dr Stuart Robb Clerk and Secretary: Sarah Clark 3 UNIVERSITY OF WALES OPERATING AND FINANCIAL REVIEW Legal Status Established by Royal Charter in 1893 (RC000676) the University is a registered charity (number 1146516). The principal office is the University Registry, King Edward VII Avenue, Cathays Park, Cardiff CF10 3NS. The names of the members of the University Council (who also act as charity trustees) are stated are disclosed in the previous page. Professional Advisors Independent Auditor External KPMG, 3, Assembly Square, Britannia Quay, Cardiff CF10 4AX Internal Mazars, One Caspian Point, Pierhead Street, Cardiff CF10 4DQ Banker HSBC Bank plc, 56 Queen Street, Cardiff. CF10 2PX Insurance Adviser University Mutual Association Ltd, 4th Floor, 5 St. Helen’s Place, London. EC3A 6AB Pensions Adviser Mercer Ltd, 1 Whitehall Quay, Whitehall Road, Leeds. LS14HR Investment Adviser Jaggers & Associates, Exchange Quay, Salford. M5 3EQ Solicitor Blake Morgan, Bradley Court, Park Place, Cardiff. CF10 3DP Eversheds LLP, 1 Callaghan Square, Cardiff CF10 5BT Preparation of the consolidated financial statements The consolidated financial statements for the year to 31 July 2020 have been prepared in accordance with applicable law and UK Accounting Standards, including the Statement of Recommended Practice – Accounting for Further and Higher Education 2019, the Accounts Direction for 2019/20 issued by the Higher Education Funding Council for Wales, and Financial Reporting Standard 102 – the Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland (FRS 102). The consolidated financial statements for the year to 31 July 2020 have been prepared on a going concern basis as detailed on page 26. Basis of Consolidation The consolidated financial statements comprise of the University and its subsidiary companies; Awen Wales Limited, for the year to 31 July 2020 and UW Centre for Batch Manufacture Limited, from 1 August 19 to 1 July 2020, with control being passed to UWTSD on 1 July 2020. The Centre for Advanced Welsh and Celtic Studies subsidiary company was consolidated into the 2018-19 financial statements but was dissolved in 2019-20. Background It is now ten years since the University of Wales issued its formal Wales Pledge as it reaffirmed its commitment, as part of the formal integration of the University of Wales with UWTSD, to safeguard some of the cultural and heritage assets associated with the University. Over the last decade the University has systematically engaged in a series of structural initiatives which have safeguarded the legacy of the University. An imperative for the Governing Body has been to systematically deal with a number of legacy issues as it secured integration with UWTSD. In doing so it has, through good governance, due process and structured execution managed to successfully deliver upon a number of the key pledges articulated over a decade ago. The nature of such implementation has called upon the University to invest and disinvest in an appropriate manner, always mindful of safeguarding the cultural assets associated with the University of Wales. This has included a detailed engagement with regard to securing the future of Gregynog and allowing a new Trust to develop a future 4 UNIVERSITY OF WALES OPERATING AND FINANCIAL REVIEW strategic plan. It also has included the continual investment in the intellectual capital capacity of the University of Wales Press which has served Higher Education well. In the same context, the University’s commitment to Celtic Scholarship has been further promoted with the University of Oxford and UWTSD. The further integration of CBM with UWTSD has also allowed the University to continue to play a role in the context of innovation and applied research as it serves the economic resilience and reconstruction mission of the Government of Wales. The University of Wales has over the last decade successfully delivered upon its core pledges and has systematically facilitated significant transformational change within the context of Welsh Government policy. University Strategy Since 2012, the strategy of the University has been to prepare for academic and administrative integration and merger with the University of Wales Trinity Saint David (UWTSD). In July 2017 the University Council was satisfied that the University could move to the next phase of the formal merger. Pursuant to this decision, the academic and administrative functions of the University of Wales and UWTSD were integrated on 1 August 2017 with a formal Deed of Union to enable this being signed in October 2017. The next phase will be a formal constitutional merger. Further information regarding the background to the merger can be found in previous annual reports or on the University website: www.wales.ac.uk/en/AboutUs/Developments/Developments-Merger-and- Reconfiguration.aspx The priorities of the University throughout the pre constitutional merger period have been to manage the resources of the institution to: • Maintain the high quality and standards of a University of Wales degree; • Maintain the University’s traditional contribution to the economic, social, cultural and intellectual wellbeing of a sustainable Wales; • Prepare for constitutional merger with UWTSD; and • Ensure that the University is financially sustainable and able to meet its obligations to students and to enable constitutional merger with UWTSD. The way in which the University has continued to safeguard its legacy for future generations, remain faithful to its core values, and ensure that assets are used their intended purpose are set out in Adduned Cymru (the Wales Pledge). For more information please see the University website: www.wales.ac.uk/Resources/Documents/Merger/Adduned-Cymru-English.pdf. Public benefit statement The University is a registered charity and its charity number is 1146516. Delivery of the above-described strategic objectives has also met the charitable objects of the University, which are for the advancement of education, learning and research and to serve Wales and its people. In setting and reviewing the University’s objectives and activities, University Council has had due regard to the Charity Commission’s guidance on the reporting of public benefit and particularly to its supplementary public benefit guidance on the advancement of education. The operational review below sets out the University’s activities in support of its strategic and charitable objectives. 5 UNIVERSITY OF WALES OPERATING AND FINANCIAL REVIEW Ethical investment and banking policies University Council (as trustees of the University’s endowment funds) is expected to act in the best interests of the beneficiaries of the funds for which it is responsible. The beneficiaries include the University itself, staff and students. Council’s policy is to aim for the best possible financial return from investments, consistent with an appropriate risk profile, and it may exclude investments from the investment portfolios if the aims of the bodies concerned are incompatible with its objectives. Equal opportunities On 1 August 2017, the University adopted the equal opportunities systems and practices of UWTSD, whose commitment to equality and diversity is set out in its Strategic Equality Plan 2016-20. The University aims to create a culture of openness and respect in which barriers for those with protected characteristics are identified and removed. It wants its people to feel safe and valued, and to achieve their full potential for the benefit of the individual, the organisation and wider communities. It wishes to promote equality of opportunity, fair working practices, and good interpersonal relations throughout its staff and student bodies. Environmental sustainability policy Sustainability is at the heart of how the University does business. The University believes that environmental sustainability is the foundation of wider economic and social sustainability and is an integral part of good institutional practice. It has a duty to satisfy itself that all of its operations and activities are conducted with proper regard to the environment. Health and Safety There were no reportable safety incidents in 2019-20 or significant near miss events. On 1 August 2017, the University adopted the health and safety systems and practices of UWTSD, which was a smooth transition as the two