Report and Financial Statements for Year

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Report and Financial Statements for Year Wigan & Leigh College Wigan & Leigh College Report and Financial Statements for the year ended 31 July 2017 Financial Statements for the year ended 31 July 2017 V/Wigan & Leigh College Key Management Personnel, Board of Governors and Professional advisers Key management personnel Key management personnel are defined as members of the College Executive and were represented by the following in 2016-17: Anna Dawe - Principal Claire Foreman - Vice Principal Curriculum (permanent from 01/08/17) Louise Brown - Vice Principal College Services Claire Jarvis - Vice Principal Finance (to 31/08/16) Ruth Paisley - Interim Finance Director (19/08/16 to 28/04/17) Kevin Williams - Finance Director (from 24/04/17) Chris Davey - Vice Principal Business Services (to 31/10/16) Lorraine Groch - Vice Principal Business Services (04/11/16 to 30/09/17) Dave Harrison - Assistant Principal College IT Services/MIS Board of Governors A full list of Governors is given on pages 16 to 17 of these financial statements. 2 Wigan & Leigh L Financial Statements for the year ended 31 July 2017 lJ/ College Professional advisers Financial statements auditors and reporting accountants: Wylie & Bisset LLP 168 Bath Street Glasgow G2 4TP Internal auditors: ICCA Education Training and Skills 11 th Floor McLaren House 46 Priory Queensway Birmingham 84 ?LR Bankers: Barclays Corporate l51 Floor 3 Hardman Street Manchester M33HF Solicitors (local issues): Stephensons 10/14 Library Street Wigan WN11NN Solicitors (educational and national issues): Eversheds Eversheds House 70 Great Bridgewater Street Manchester M15ES 3 Financial Statements for the year ended 31 July 2017 V_/Wi gan & Leigh College CONTENTS Page number Operating and Financial Review 5 Statement of Corporate Governance and Internal Control 15 Governing Body's statement on the College's regularity, propriety and compliance with Funding body terms and conditions of funding 23 Statement of Responsibilities of the Members of the Corporation 24 Independent Auditor's Report to the Corporation of Wigan and Leigh College 26 Reporting Accountant's Assurance Report on Regularity 29 Statement of Comprehensive Income 31 Statement of Changes in ReseNes 32 Balance Sheet as at 31 July 33 Statement of Cash Flows 34 Notes to the Accounts 35 4 Financial Statements for the year ended 31 July 2017 ~/Wi gan & Leigh Colege Operating and Financial Review Nature, Objectives and Strategies The Corporation present their report and the audited financial statements for the year ended 31 July 2017. Legal status The Corporation was established under the Further and Higher Education Act 1992 for the purpose of conducting the business of Wigan & Leigh College. The College is an exempt charity for the purposes of Part 3 of the Charities Act 2011. Mission The College's mission as approved by its Corporation is: "To deliver high quality, inclusive education and training to ensure all learners achieve their maximum potential and respond to the needs of our communities". Public Benefit Wigan & Leigh College is an exempt charity under the Part 3 of the Charities Act 2011 and is regulated by the Secretary of State for Business, Innovation and Skills as Principal Regulator for all FE Corporations in England. The members of the Governing Body, who are trustees of the charity, are disclosed on pages 16 to 17. In setting and reviewing the College's strategic objectives, the Governing Body has had due regard for the Charity Commission's guidance on public benefit and particularly upon its supplementary guidance on the advancement of education. The guidance sets out the requirement that all organisations wishing to be recognised as charities must demonstrate, explicitly, that their aims are for the public benefit. In delivering its mission, the College provides the following identifiable public benefits through the advancement of education: High-quality teaching Widening participation and tackling social exclusion Excellent employment record for students Strong student support systems Links with employers, industry and commerce. Implementation of strategic plan The College has adopted a strategic plan for the period 1 August 2015 to 31 July 2020. This strategic plan included plans around quality, efficiency and growth. The Corporation monitors the performance of the College against this plan. The plan is reviewed and updated each year. The key objectives within the plan were as follows: 5 Financial Statements for the year ended 31 July 2017 lJ/Wi gan & Leigh College 1. Quality: to become an outstanding College by 2020 with: • Inspirational and innovative teaching, learning and training which raises the ambitions and aspirations of all our learners • exceptional levels of student care with an emphasis on good citizenship, employability skills and positive progression outcomes • the creation of a college community with core values at its heart where staff and students are nurtured so that we have high levels of morale together with creativity, innovation and excellence 2. Growth: to deliver a transformational curriculum in response to the needs of our learners and the economy, and expand our provision by being first choice for school leavers, adults and employers in Wigan and Leigh and the surrounding areas 3. Efficiency: maintain good financial health and financial stability, enabling the College to invest in providing innovative learning communities and environments. 4. Partnership: to work collaboratively with local and regional partners to ensure the curriculum offer is fully integrated to meet skill priorities in Wigan and Leigh and Greater Manchester and provides relevant, high quality, academic, technical and workplace education and training. The College is on target to achieve these objectives. Financial objectives The College's financial objectives are: - To achieve an annual operating surplus; - To pursue alternative sources of income, on a selective basis, consistent with the College's core competencies, and the need for a financial contribution to the College's overall finances; - To generate sufficient levels of income to support the asset base of the College; - To further improve the College's shorter term liquidity; and - To maintain financial health grade of 'Good'. In order to facilitate these objectives the College has adopted a financial framework that included the following criteria: • Realise an operating surplus of at least 2% of income each financial year • Restrict borrowings to 40% of total reserves • Achieve a pay cost that is a maximum of 65% of income by 2018 • Operate with a current ratio of at least 1:1 • Maintain cash and bank balances of at least 30 days spend equivalent to £2m 6 Financial Statements for the year ended 31 July 2017 'I/Wigan & Leigh College A series of performance indicators have been agreed to monitor the successful implementation of the policies. Performance indicators The College is committed to observing the importance of sector measures and indicators against which it measures its performance and has in place a full range of KPls. Key performance rates for 2016-17 were as follows: National 2016 2017 Average 2016 16-18 Achievement Rate (Overall) 76.4% 83.2% 80.2% 19+ Achievement Rate (Overall) 84.0% 87.4% 85.9% 16-18 Retention (Overall) 85.9% 90.8% 89.9% 19+ Retention (Overall) 91.0% 91.9% 91 .9% The College also scored the highest satisfaction rate of 87.6% in the 2017 (84.9% in 2016) FE choices survey when compared to all Greater Manchester colleges that participated. The College is required to complete the annual Finance Record for the Skills Funding Agency which produces a financial health grading. The Finance Record for 2016-17 shows that the College's financial health grade is 'Good'. The current rating of Good is considered an acceptable outcome at the present time. The College are keen to strike a balance between generating operating surpluses and setting aside investment resources into information technology and infrastructure. FINANCIAL POSITION Financial results The College generated an operating surplus in the year of £478k (2015-16: £690k), with total comprehensive income of £10.8m (2015-16: expenditure £2.084m). The College has total reserves of £11.ll0m and cash balances of £3.859m. The College wishes to accumulate reserves and cash balances in order to reinvest in supporting teaching, learning and assessment and fund future capital improvements. The College did not dispose of any tangible assets during the year and had minimal movement in relation to additions given significant capital expenditure being incurred in prior years. The College has significant reliance on the education sector funding bodies for its principal funding source, largely from recurrent grants. In 2016-17 the FE funding bodies provided 80.0% (2015-16: 78.0%) of the College's total income. 7 Financial Statements for the year ended 31 July 2017 V/Wigan & Leigh College Tangible fixed assets additions during the year amounted to £357k (2015-16 £3k) relating to: • A Hair and Beauty Salon • New laboratory facilities • A new Media Suite • Construction of an access road to allow for extended car parking facilities The College is reporting net current assets of £267k in its balance sheet. The College's forecasts and financial projections indicate that the College has a reasonable expectation that it has adequate resources to continue in operational existence for the foreseeable future and for that reason will continue to adopt the going concern basis in the preparation of its financial statements. The College, like other colleges in the Further Education Sector, has significant reliance on EFA and the SFA for its principle funding source. In 2016-17, the EFA and SFA provided 75.0% (2015-16: 71 .5%) of the College's total income. Treasury policies and objectives Treasury management is the management of the College's cash flows, its banking and money market transactions; the effective control of the risks associated with those activities; and the pursuit of optimum performance consistent with those risks. The College has a separate treasury management policy in place.
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