Fin Accounts 2009 of UNI

7/28/2019 Fin Accounts 2009 of UNI

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Report and Financial Statements

For the Year Ended 31 July 2009

2008-2009


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UNIVERSITY OF WOLVERHAMPTON

CONTENTS

Page

Board of Governors 1

Statement of Primary Responsibilities of the Board of Governors 2

Report of the Board of Governors 3

Corporate Governance Statement 14

Statement of the Board of Governors Responsibilities 17

Independent Auditors Report to the Board of Governors 18

Statement of Principal Accounting Policies 20

Consolidated Income and Expenditure Account 23

Consolidated Statement of Historical Cost Surpluses and Deficits 24

Statement of Total Recognised Gains and Losses 25

Balance Sheet 26

Consolidated Cash Flow Statement 28

Notes to the Accounts 29


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THE UNIVERSITY OF WOLVERHAMPTON

CHANCELLOR

The Rt. Hon. the Lord Paul of Marylebone

BOARD OF GOVERNORS

Membership

Independent Members: Ms K CopestakeMr M Elliott (Deputy Chairman)Mr P Finlan (to August 2008)Ms K GeeDr J J ohnsonCllr K S SahotaMr J SharpMr B J Sharples (Chairman)

Mr A J SmithMr S Towe CBEMr J Wooldridge CBE

Co-opted Members: Mr R CarrMr J ChorleyMs L CuttingMr I HydeMrs M JeffriesDr S Walford

Vice-Chancellor: Professor C V Gipps

Academic Board Nominee Members:

Mrs P A CooperProfessor J Gilkison

Student Nominee Member:

Ms C McGivern

Clerk to the Board of Governors:

Mr A W Lee

Bankers Internal Auditors

Barclays Bank PLC RSM Bentley J ennisonQueens Square 5, Ridge HouseWolverhampton Ridge House DriveWV1 1TE Stoke on Trent

ST1 5SJExternal Audi tors

KPMG LLPOne Snow HillSnow Hill QueenswayBirmingham

B4 6GH


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Statement of Primary Responsibi lities

The principal responsibilities of the Board of Governors of the University of Wolverhampton are set out inthe Instrument and Articles of Government but in accordance with the CUC Model Statement of PrimaryResponsibilities may be summarised as follows:-

1. To approve the mission and strategic vision of the institution, long-term academic and business plansand key performance indicators, and to ensure that these meet the interests of stakeholders.

2. To delegate authority to the head of the institution, as chief executive, for the academic, corporate,financial, estate and personnel management of the institution. And to establish and keep under regularreview the policies, procedures and limits within such management functions as shall be undertaken by andunder the authority of the head of the institution.

3. To ensure the establishment and monitoring of systems of control and accountability, including financialand operational controls and risk assessment, and procedures for handling internal grievances and formanaging conflicts of interest.

4. To ensure processes are in place to monitor and evaluate the performance and effectiveness of the

institution against the plans and approved key performance indicators, which should be, where possible andappropriate, benchmarked against other comparable institutions.

5. To establish processes to monitor and evaluate the performance and effectiveness of the governing bodyitself.

6. To conduct its business in accordance with best practice in higher education corporate governance andwith the principles of public life drawn up by the Committee on Standards in Public Life.

7. To safeguard the good name and values of the institution.

8. To appoint the head of the institution as chief executive, and to put in place suitable arrangements formonitoring his/her performance.

9. To appoint a secretary to the governing body and to ensure that, if the person appointed has managerialresponsibilities in the institution, there is an appropriate separation in the lines of accountability.

10. To be the employing authority for all staff in the institution and to be responsible for establishing ahuman resources strategy.

11. To be the principal financial and business authority of the institution, to ensure that proper books ofaccount are kept, to approve the annual budget and financial statements, and to have overall responsibilityfor the Universitys assets, property and estate.

12. To be the institutions legal authority and, as such, to ensure that systems are in place for meeting allthe institutions legal obligations, including those arising from contracts and other legal commitments made

in the institutions name.

13. To make such provision as it thinks fit for the general welfare of students, in consultation with the senateor academic board.

14. To act as trustee for any property, legacy, endowment, bequest or gift in support of the work andwelfare of the institution.

15. To ensure that the institutions constitution is followed at all times and that appropriate advice isavailable to enable this to happen.


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University of Wolverhampton Financial Statements for the year to 31 July 2009

3

REPORT OF THE BOARD OF GOVERNORS

Scope of the Financial Statements

The Financial Statements presented to the Board of Governors comprise the results of the University andits subsidiary undertakings, The University of Wolverhampton Enterprise Limited, The University ofWolverhampton Corporate Services Limited, i-CD Limited (formerly Wolverhampton PolytechnologyLimited) and UOW Properties Limited. The University of Wolverhampton Enterprise Limited is also amajority shareholder in Wolverhampton Science Park Limited. The University has a 33.33% share inUnibyte Ltd, a 5% share in Flyte Ltd and a 32% share in Equiami Ltd, but these results are not consolidatedon the grounds of materiality.

The subsidiaries undertake activities including training, courses, research, testing, consultancy and propertydevelopment for a wide variety of commercial and other organisations. The companies taxable profits aretransferred back to the University under a deed of covenant arrangement except for UOW PropertiesLimited.

Review of Financial Performance

The Universitys Consolidated Income and Expenditure position for the year to 31 J uly 2009 is summarisedas follows:

2008/09 2007/08000 000

Income 150,873 148,514

Expenditure 162,659 (153,927)

Exceptional Restructuring Costs (1,786) (150)

Profit on Disposal of Assets 0 825______ ______

Deficit after Depreciation of Assets atValuation, Disposal of Assets andBefore Tax (13,572) (4,738)

Taxation 0 0______ ______

Deficit on Continuing Operations afterDepreciation of Assets at Valuation,Disposal of Assets and Tax (13,572) (4,738)

______ ______

______ ______Deficit for the year on a HistoricalCost Basis (12,414) (3,342)

______ ______

The Universitys Consolidated Income and Expenditure position for the year to 31 J uly 2009 shows a deficitof 12.414Mon an historical cost basis.


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INCOME

Income has grown to nearly 151M, an overall increase of 1.6%. The Universitys income split is shown inthe diagram below:

Funding council income shows an overall decrease of 2.2M. Recurrent grants from the Higher EducationFunding Council for England (HEFCE) and the Training Development Agency (TDA) were increased by2.75% to reflect inflation assumptions; however, the University experienced holdback against both HEFCEand TDA contracts totalling 4.1M, accompanied by further reductions in earmarked HEFCE funding.

Overall tuition fee income rose by 5.3M to 50.5M. The overall growth masks variations in specific feecategories. Fee income from Full Time Home/EU students continued to grow strongly from 23.4M to27.4M reflecting the final year of the new fee arrangements. Tuition fees from overseas students havefallen slightly from 2007/08 levels, but continue to provide an important source of income. Part-time feesrecovered from a fall in 2007/08, partly as a result of the Universitys decision to increase fee levels to amore economically sustainable level. The level of franchised provision continues to grow, showing a 27%increase over 2007/08. Following the fall in NHS contract income in 2007/08, the position has stabilised in

2008/09.

Externally funded project income continued to increase during the year despite difficult trading conditions.

Income from residences and catering operations fell to 7.4M reflecting decreased occupancy in studentresidences. Investment income has fallen sharply following the Bank of Englands decision to cut base ratesfrom 5% at the start of the year to the current 0.5%.

EXPENDITURE

The main area of expenditure, salaries and wages, grew by 6.2% to 98.0M. This rise results in part fromthe full year effect of pay rises from 2007/08, and a further 5% inflation-linked increase in October 2008which was the final stage of the J NCHES 2006-09 pay agreement. Additional cost pressures arise from

increments and a limited number of additional posts agreed at budget setting for 2008/09. The Universityhas carried out a number of restructuring exercises during the year which has given rise to 1.8Mseverance costs.

2008/09 Income Split in 000s

1,355

2,583

4,035

5,293

6,755

7,403

11,685

24,023

32,029

55,712

Interest Receivable

Research Grants & Contracts

TDA

Other Income

International Tuition Fees

Residences, Catering & Conferences

NHS Nursing Contract

Other Services Rendered

UK/EU Tuition Fees

HEFCE


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In addition, the impact of adjustments due to FRS 17 and enhanced pensions results in an additionalcharge of 2.9M to pay costs (2007/08: 3.3M). An additional 1.9M (2007/08: 0.3M), pension interestcost has also arisen meaning that the total expenditure arising from FRS17 and enhanced pensions was4.8M, an increase of 1.1M over 2007/08. Increased pension costs have arisen primarily as a result of afall in the discount rate from 5.8% p.a. to 5.6% p.a., an increase in the assumed rate of future inflation (and

hence salary increases and pension increases) from 3.2% p.a. to 3.7% p.a., and an increase in theassumed life expectancy of scheme members.

Other expenses have grown to 55.4M from 52.7M. This includes additional expenditure against externallyfunded projects and an increase in student bursary payments arising from the third year of the new feesregime. Payments to partners for franchised provision have also risen with increased activity levels.

Depreciation includes impairment costs of 1.1M arising from the pending demolition of MG building andthe current vacant status of three blocks of residences at Telford.

Cash Flow

The consolidated Cash Flow Statement shows a net increase in cash of 6.5M. Payments in the year on

acquiring fixed assets totalled 3.6M funded from receipts of grant from the Funding Council and theUniversitys own resources. A total of 8.3M was received in capital grant funding, but this is largelyretained for funding construction of the new Performance Hub on the Walsall Campus. The net cashreceived from operating activities was 5.1M. This largely results from an increase in creditors, a majorcomponent of which is the projected repayment of HEFCE and TDA holdback.

Key Future Financial Issues

Following the results of an audit of the Universitys HESES07 return, part of the holdback of HEFCE granthas been consolidated into baseline funding for 2009/10. This combines with cuts in the overall funding forteaching of 1.4% being imposed on all institutions and the continuing impact of the removal of funding forELQ students. Further cuts in funding are expected in 2010/11, although the way that HEFCE will removethis funding is not currently known. The level of HEFCE and TDA funding beyond 2009/10 remains

uncertain.

2008/09 was the 3rd

year of the top-up fee, so further tuition fee income growth from Full Time students infuture years can only come from inflation-linked fee increases or planned increases in student numbers, thelatter restricted by the limited availability of Additional Student Numbers. Demand for full-time places in2009/10 has been strong, and the University is likely to have met targets. Furthermore, student numberrestrictions do not apply to part-time and international students, and the University is actively pursuinggrowth in these areas. However, increased competition in the international market in the medium term mayimpact on University plans.

Cash balances remain healthy; however, interest rates will probably continue at low levels for theforeseeable future and limit the amount of interest received from investing these balances.

The final element of the 2006-09 J NCHES pay agreement was a 5% increase payable from October 2008.The full year effect of this increase will be experienced in 2009/10, together with a further rise from August2009. At this time the likely level of the August pay rise is unclear. The University is actively managing paycosts through a selective post-freeze and is seeking to reduce pay costs further by means of redundancy.

The overall impact of FRS17 and enhanced pension costs has increased in 2008/09 due to falling discountrates and increasing life expectancy assumptions. Early indications are that the level of this adjustment islikely to be repeated in 2010/11. In the long run, pension costs remain an area of financial exposure.

The University has recently entered into a 3-year electricity contract which will protect against price rises forthe life of the contract. However, evidence suggests that energy costs are likely to rise and this will impactbeyond 2010/11 as gas and electricity contracts come up for renewal. To offset this, the University will seekto reduce usage through the Carbon Trust's HE Carbon Management programme.


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The Student Experience

The overall student experience is at the heart of the Universitys activities and planning. With one of thelarger student populations in the UK (including both undergraduate and postgraduate students) it isessential that the University monitors and evaluates this critical business area ensuring both high standards

and continuous improvement.

In the last year the University underwent an Institutional Audit by the Quality Assurance Agency:

In England and Northern Ireland, QAA conducts institutional audits on behalf of the higher education sector,to provide public information about the maintenance of academic standards and assurance of the quality oflearning opportunities provided for students. Institutional audit is an evidence-based process carried outthrough peer review. It forms part of the Quality Assurance Framework established in 2002 followingrevisions to the United Kingdom's approach to external quality assurance. At the centre of the process is anemphasis on students and their learning.

1

The University was extremely pleased with the outcome of the audit which confirmed:

As a result of its investigations, the audit team's view of the University of Wolverhampton is that:

Confidence can reasonably be placed in the soundness of the institution's present and likely futuremanagement of the academic standards of the awards that it offers.

Confidence can reasonably be placed in the soundness of the institution's present and likely futuremanagement of the quality of the learning opportunities available to students.

The Audit Team went on to praise the quality of the student experience and student support in identifying anumber of features of good practice:

The systematic approach, led by the Dean of Students, to the collation of student views from a rangeof internal and external sources, which demonstrates the University's regard for the student voice.

The effective support for student learning provided by Learning Information Services and InformationTechnology Services, which is assisted by both departments being integral to the academic planningand development processes.

The clear commitment to and the fulfilment of the University's regional mission, which enrichesstudent learning opportunities.

The establishment of a range of methodical initiatives, for example effective study-skills support,designed to improve student retention and progression.

The University's cooperative partnership with the Students' Union, exemplified by the work of theUniversity Student Affairs Committee and the Dean of Students and the provision of pastoral support.

The audit team concluded that:

The University's arrangements for student support were appropriate and effective, and that they contributedpositively to the quality of learning opportunities.

The University regularly engages with students, through a variety of feedback mechanisms, to ensure thatour students experiences are positive. We want to know what we are doing well (so as to maintaininvestment and standards) as well as identifying areas where we could be doing better. In addition to ourinternal mechanisms the most notable measure of student satisfaction comes through the NationalStudent Survey.

The National Student Survey (NSS) is a census of students in their final year of a course leading toundergraduate credits or qualifications across the UK.

2The National Student Survey is conducted each

1 View the QAA report at: http://www.qaa.ac.uk/reviews/reports/institutional/Wolverhampton09/RG410Wolverhampton.pdf

2www.thestudentsurvey.com


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year independently of Universities by Ipsos Mori, on behalf of HEFCE, the results of which are madeavailable to each University and in the public domain via the website www.unistats.com

The National Student Survey (published data) asks a total of 22 questions in seven categories: Teaching,Assessment and feedback, Academic support, Organisation and management, Learning resources,

Personal development and Overall satisfaction (this is a separate question, not calculated from the otherscores).

The University was pleased to report another year of improving scores from this years survey data (Surveyconducted in February - April 2009 and results published in August 2009).

The University has stated aims:

To improve the percentage figure for overall satisfaction year on year -(UoW) 2006: 72% (national: 80%)(UoW) 2007: 75% (national: 81%)(UoW) 2008: 76% (national: 82%)(UoW) 2009: 78% (national: 81%)

To have an increasing number of resul ts that are equal to (or greater than) the national meanfigure in each category (for subjects taught by the University -2006: 2 (out of 7) at/above national mean (Learning Resources; Assessment & Feedback)2007: 2 (out of 7) at/above national mean (Learning Resources; Personal Development)2008: 2 (out of 7) at/above national mean (Learning Resources; Assessment & Feedback)2009: 4 (out of 7) at or above national mean (Assessment & Feedback, Organisation &Management, Learning Resources, and Personal Development).

In the last year in particular we have seen a number of improved scores that we are able to relate directly toinitiatives and investments in services and facilities that have been well received by the student population.For example our investment in physical learning spaces, learning centres and IT accessibility acrosscampuses has produced NSS results in this category that are amongst the best in the country.

Over the last two years changes to the organisation and management of the student life cycle andexperience; improved enrolment processes, improved use of e:Vision and the introduction of a virtualhelpdesk, Chat Live with a Librarian and other on-line functionality has improved the student experience byproviding more remote access to services and learning content through WOLF.

The University closely and carefully monitors these developments and is active in using this data to informfuture developments and decision making. The current activity to refocus the undergraduate curriculum(Learning Works), is expected to deliver further significant improvements to the student experience fromSeptember 2010. While it will take at least three years for all of these developments to be fully embeddedand for a cohort of students to have undergone a whole course of study under the new arrangements weare able to identify what is working well - and where we need to do more - through our continuousengagement with student voice initiatives, listening and acting on student feedback.
http://www.unistats.com/http://www.unistats.com/


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Student Numbers

In 2008/09 the University enrolled 23,610 students (2007/08 22,413), comprising 13,827 full time andsandwich students (2007/08 13,959) and 9,783 part time students (2007/08 8,454). Recruitment and

retention continues to be one of the Universitys key corporate priorities. The following tables provide furtherbreakdowns of the Universitys student population in 2008/09.

Home,EUandOverseasnumbers TotalsHome 19894EU 1200Overseas 2516GrandTotal 23610

LevelofStudy TotalsFoundation 883Undergraduate 18000Postgraduatetaught 4484Postgraduateresearch 243GrandTotal 23610

Mode TotalModedisaggregatedby SchoolFull Time &Sandwich

PartTime

Art & Design 1207 299 1506

Humanities, Law & Social Sciences 2086 721 2807Wolverhampton Business School 1307 1243 2550

Legal Studies 1021 657 1678

Applied Sciences 1451 564 2015

Computing & Information Technology 1150 393 1543

Engineering & the Built Environment 886 1257 2143

Education 1167 2802 3969

Sports, Performing Arts & Leisure 1455 238 1693

Health 2097 1609 3706

Grand Total 13827 9783 23610

Capital Investments

The University is currently developing the next phase of its Estates Strategy. This must be underpinned byalignment to strategic objectives, sound financial planning and an explicit delivery programme. The physicalappearance of the Universitys campuses and the manner in which they support the learning and workingenvironment send a powerful message about aspiration and achievement. In recognising this, theUniversity seeks to create an environment which is welcoming, secure, supportive and sustainable, andprovides a range of spaces appropriate for delivering and experiencing modern higher education, therebycreating a positive learning, working and social culture.

The University is committed to maintain and improve the quality of the Universitys physical estate, providesustainable facilities to support the increased use of technology for teaching and learning, and promotesafety, security, accessibility and environmental awareness on the Universitys campuses. The University iscommitted to developing efficient and effective integrated systems that support students, staff and visitors.


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These will be provided through the use of appropriate information technology based on a resilientinfrastructure.

Indicators of Success will include:

A fit for purpose University estate;

Excellent and well-used library and IT facilities for students and staff;

Improved energy efficiency and waste recycling.

Thus far the University has made huge strides towards the consolidation of its estate. The University isactively monitoring the efficiency of space utilisation and will take action to improve performance in thoseareas where current utilisation is poor.

The key capital development currently in progress is the Performance Hub on the Walsall Campus. Thenew building will house both performing arts and a learning resource centre. The estimated cost of thedevelopment is 16M. Planning approval is currently being sought and will be considered by the Walsall

Planning Committee in November 2009. In terms of design progress, stage D has been signed off andstage E employers requirements are in development and will be completed by November 2009. The projectprocurement process will be completed by March 2010 and the anticipated project completion is J uly 2011,in readiness for the 2011/12 academic year.

Future plans for capital development will revolve around the Universitys Innovation and EnterpriseStrategy. The starting point for the implementation of the strategy is consideration of the possible relocationof the Business School from the Telford Campus. In addition there are ongoing discussions about aproposed Science Facility, in order to make establish suitable and sufficient facilities for this burgeoningdepartment. For each of these projects an options and appraisals report will be undertaken and subjected tothe provision of a robust business case with particular reference to alignment with the institutions strategicobjections and plans, affordability and risk management. Alongside the construction of new buildingsconsideration will be given to providing for maintenance of the existing estate.

Payment of Creditors

It is the Universitys policy to obtain the best terms for all business; therefore, there is no single policy as tothe terms applied. The aim is to pay invoices in accordance with agreed contractual conditions, or whereno such conditions exist, by the end of the month following receipt of goods or services or the presentationof a valid invoice, whichever is the latest.

Carbon Management

The University is participating in Phase 5 of the Carbon Trust's HE Carbon Management programme.Using the Carbon Trust's templates, the Carbon Management Plan is currently being drafted, for approval inearly 2010, and is designed to lead to a reduction of 25% in the University's direct carbon emissions over a

five year period. This is the average level of reduction which has been achieved by universitiesparticipating in earlier phases of the programme.

The University's plan is expected to be a combination of specific engineering projects and projects whichwill depend upon changes in working practice. The university is in the process of prioritising projects fordevelopment and identifying the necessary funding for these projects. The Core Team which is developingthe Plan includes representation from academic schools, the Students' Union, Marketing andCommunications and Finance, as well as senior staff from Facilities.


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Equality and Diversity

The legislation on race, sex, disability, sexual orientation, religion and belief, and age make unjustifiablediscrimination illegal. In the case of the first three the University has the duty to promote equality and good

relations. It is expected that in 2010 a Single Equalities Act will be passed. This will harmonise equalitylegislation and iron-out any anomalies. Although much will remain the same, there will be some changesthat the University will need to take account of. The Universitys commitment to equality and diversity and itsvarious policies and plans may be found at www.wlv.ac.uk/edu.

The University has an Equality and Diversity Unit to take forward its aims and objectives. The Unit staffwork closely with the Equality and Diversity Committee and other committees and schools and departmentsto encourage good practice and to deliver the outcomes of the Universitys Strategic Objectives in the areaof Equality and Diversity. The indicators of success for our 2012 strategic objectives in the area of Equalityand Diversity are:

An ethnically diverse staff and student body Equivalent levels of satisfaction for all groups of students

Good progression rates for all categories of s tudent

Employment of Disabled Persons

The University has a written policy of equal opportunities that is the responsibility of all members of staffand students as part of their normal activities as members of an academic and social community. Inaddition the University has a Disability Equality Scheme which is a demonstration of the UniversitysCommitment to promoting equality for disabled people. There is a section on staff related issues and thewhole scheme may be found along with other equality related information at www.wlv.ac.uk/edu.

It is the responsibility of the Board of Governors and the University Executive to initiate, oversee andmonitor the implementation of the policy.

The University has an Equality and Diversity Advisory Committee that is responsible to the Vice-Chancellorand the Board of Governors and reports to them once a year. The Committee advises on policy mattersconcerning Equality and Diversity, particularly in terms of priorities for action, suggests new initiatives,participates in the monitoring of the effectiveness of implementation strategies, and the achievement oftargets.

There is Equality and Diversity Unit to assist staff with any queries or issues they may want to raiseregarding Equality and Diversity matters. It has an experienced disability specialist able to provideappropriate advice and support and to work with Schools and Departments on their provision for disabledstaff and students.

It is the policy of the University to employ disabled persons in suitable posts and to make arrangements

wherever possible to encourage staff who develop a disability to continue working for the University. Everyopportunity is taken to improve access for disabled staff and students to University premises via a rollingprogramme of improvement to buildings and provision of equipment. Physical access to the Universitypremises is a core consideration within the strategy for improvement of the Universitys estate and is beingaddressed within the Estates Project. The University is working with DisabledGo to ensure that any personwith a disability wishing to visit University premises can view information on the Web about the accessibilityof University buildings and how to access them when planning their visit.

Employee Involvement

The University has a comprehensive two-way communications strategy and employs a wide range oftechniques to involve staff across the whole of the University.

Communications about policies, progress and events are delivered via both paper-based and electronicmedia. Open Meetings with the Vice-Chancellor and staff from each Campus also take place during theyear. The University seeks views on a wide diversity of issues from its staff through participation on variouscommittees and working groups.
http://www.wlv.ac.uk/eduhttp://www.wlv.ac.uk/eduhttp://www.wlv.ac.uk/eduhttp://www.wlv.ac.uk/edu


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The University has an extensive Corporate Staff Development Programme that provides and promotes arange of courses both at the University and at Partner Colleges.

In the production of the Disability Scheme the University held widespread consultations with staff and

students with disabilities and have continued to hold focus groups to review the progress of the scheme. Inaddition the University has two staff networks in relation to disability. One is for the support and informationsharing between disabled staff, the other is to discuss disability issues between staff involved in theprovision of reasonable adjustments for staff and students with disabilities. There is also a Black andMinority Ethnic (BME) staff network, a Lesbian, Gay, Bisexual and Transgender (LGBT) staff network and aGender network focussing on issues around these equality strands.

Knowledge Transfer

The University of Wolverhampton is a major provider of Knowledge Transfer activities for business and thewider community both in the region and elsewhere. It is at the forefront of the sector in working withregional businesses and currently delivers more than thirty Knowledge Transfer Partnerships (KTPs),securing first position in the West Midlands and second position nationally for the number of KTPs it

operates. In addition, the University is engaged in promoting innovation and enterprise in the BlackCountry, Telford and Wrekin and Shropshire. It is playing a leading role in the Wolverhampton TelfordTechnology Corridor and provides leadership for a range of regional collaborative projects such as theRegional Knowledge Transfer Partnership Programme and the West Midlands Centre for ConstructingExcellence. The University also has a number of centres and institutions that provide services to individualsand businesses for high level skills development, business incubation and start-up including: a ContinuingProfessional Development company (i-CD Ltd), an ICT business incubator (e-Innovation Centre), a CreativeIndustries incubator (SP/ARK), a student placements programme for Entrepreneurs in Education (SPEED)and an Institute for Innovation and Enterprise. The Universitys knowledge transfer and incubation activitiesare delivered primarily at the Wolverhampton Science Park and Telford Campus locations.

In the past, the University of Wolverhampton has been particularly successful in attracting funding, bothrevenue and capital, from the RDA, Advantage West Midlands (AWM) and Government Office West

Midlands (GOWM) to part fund many of these activities. It is expected however that regional and localfunding streams will alter substantially in the future, partly due to the recession and partly due to changingGovernment priorities. The role of the Regional Development Agency is expected to change with moreresponsibility and funding being delivered to the local authorities.

All current business in knowledge transfer, training and similar activities that are intended to be surplusgenerating are now carried on through University of Wolverhampton Corporate Services Ltd. Activities thatare not surplus generating (e.g. research contracts, European and U.K. Government contracts forknowledge transfer) operate through the Universitys accounts. The major NHS contract for nurseeducation delivered in the School of Health is handled through University of Wolverhampton CorporateServices Ltd.

Although the overall level of activity continues to be reasonable, all sectors are now beginning to show

signs of slowdown. The private sector has been slow for some time with public sector and overseas workfilling the gaps, however the UK public sector is now beginning to show signs of the Governments fundingcrisis. National Health Service business has not yet been affected but we expect to see some slowdowneven in the Governments priority spending areas.

Whilst there will be a significant cushion of high levels of continuing work-in-progress during 2009/10, arealistic forecast of 2010/11 will probably see improving levels of private sector work but a reduced level ofpublic sector activity with the cushion of current contracts largely removed.


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Key Performance Indicators (KPIs)

In response to the guidance from the Committee of University Chairs (CUC), the Board of Governors hasadopted 21 KPIs as the means by which it monitors the overall health of the institution. These gaugeperformance in a range of areas including: student application, recruitment and retention; academic and

research quality; financial health; performance of the estate; and staffing. Performance against these KPIsis reported annually to the Board of Governors via the relevant University Committee. Each KPI is awardeda status from 1 4 where:

1 =Good2 =Satisfactory but room for improvement3 =Requires further action4 = Unsatisfactory

Of the 21 KPIs, 20 have been reviewed and reported in during the year. In general, the University hasperformed well on the majority of KPIs. In those areas where less than satisfactory performance has beenreported, the University is committed to taking action where possible to make the necessary improvements.

The University continues to invest significant effort in improving student retention and progression.There are a number of projects ongoing that aim to enhance the educational experience ofstudents. The University Strategy for Learning & Teaching aims to embed the quality, relevance,effectiveness and efficiency of our learning environments into the mainstream processes andprocedures of University planning and implementation, so as to enhance the lives, the educationalexperience and employability of our students.

The University continues to closely monitor the results of the National Student Survey. The surveycovers seven assessment categories which reflect student satisfaction with their experience at theUniversity.

The University continues to invest significant sums to improve the functional suitability andutilisation of the estate. Alongside this, the University is actively reviewing space utilisation.

The University is committed to maintaining and enhancing the diversity of student and staffpopulations. The University has an Equality and Diversity Unit that puts in place policies and plansto fulfill the positive duty to promote equal opportunities and to take active steps to preventdiscrimination occurring. Equality and diversity issues are included in school and department plansthat are produced annually.

Risk Management

The University maintains a series ofRisk Registers at University and School & Service Department level, aswell as for a number of projects. The University risk register contains 20 key risks which are linked toobjectives outlined in the Strategic Plan and related to a number of corporate KPIs. They cover such areasas: data assurance, recruitment and retention of students; the achievement of applied research anddevelopment contribution targets: Health and Safety; recruitment and retention of staff; and businesscontinuity and emergency planning. The University risk register is kept up to date by the Risk Committee

and is regularly report to the Executive and Audit Committee.

Key developments during the year have been in the following areas:

In response to the increased likelihood of pandemic flu, the University has developed and publishedits Influenza Pandemic Management Plan. This presents the key processes and procedures thathave been designed to plan for and respond to an Influenza Pandemic;

Work on business continuity planning is progressing;

Schools and departments have been required for the first time to submit Annual AssuranceStatements;

The first cohort of School and Service Department staff have attended and passed theManagement of Risk (M_o_R) course;

Employment, Policy and Finance Committee received the first Annual Safety Assurance Report.This measures performance against a set of key objectives that were presented as part of theUniversitys Safety Strategy.


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Current Key Risks & IssuesIn 2007/08 the University was subject to an audit of its Higher Education Students Early Statistics Survey" return for 2007 by the Higher Education Funding Council for England (HEFCE). The University hasreceived notification that the audit has been closed, and that there is holdQack of grant for 2008/09 whichhas been partly. consolidated into funding for 2009/10. The University continues to discuss the level ofholdback and has yet to agree the phasing of grant repayments.2008/09 was the final year of a three-year pay agreement concluded in the Joint Negotiating Committee forHigher Education Staff ( ~ I N C H E S ) in 2006. This agreement provided for a pay rise in October 2008 of thegreater of 2.5% or the September inflation figure. The actual Retail Prices Index figure for September was5%, leading to higher than expected pay rises for University staff in 2008/09 on top of substantial increasesin pay costs in previous years. The current pay round has yet to be concluded and there is risk of industrialaction in support of Union pay claims. The financial impact of recent pay rises is exacerbated by theincreasing impact of FRS17 on the University's accounts.The current difficult economic conditions increase pressure on the University in a number of key areas. Theeconomy has yet to move out of recession and it is possible that reduced economic activity and pressure ondisposable incomes will adversely impact on demand from new and existing customers. Whilst non-payinflation is currently low, there are significant risks of cost increases for the supply of energy in the short tomedium term.Taken together, these have a significant impact on the position of University finances. Whilst theUniversity's balance sheet remains strong, management are aware of the need to re-balance theUniversity's income and expenditure account to achieve a surplus for re-investment.One of risks on the University Risk Register relates to data on funding returns. The revised HEFCEFinancial Memorandum published in June 2008 introduced a new requirement for Audit Committees toprovide assurance on the management and quality assurance arrangements for data submitted to theHigher Education Statistics Agency (HESA), HEFCE and other funding bodies. During the year a workinggroup under the leadership of the Pro Vice Chancellor Student Affairs has examined how to deliver thenecessary assurance. The Group has reviewed all returns, documented and, where necessary, coordinatedfurther development of the processes used for collation and preparation of the data, and validation andsign-off of the return. The Group also paid attention to ensuring that ongoing changes in data definitionsand return requirements were captured and fed into return preparation.ConclusionThe results paint a picture of a financially difficult year for the University of Wolverhampton. Universityincome has risen slightly despite HEFCE and TDA holdback, mainly through growth in tuition fees andexternally funded project income, and student numbers also rose. Set against this expenditure rose sharply,particularly in the area of staff costs. In addition, increases in FRS17 pension adjustments and the impact ofone-off impairment of assets resulted in a substantial increase in the deficit for the year.The impact of current and future government policy on Higher Education in general and financing inparticular remains uncertain. The University is taking active steps to manage cost growth through costsaving initiatives, frozen posts and redundancy.

Approved by the Board of Governors on 26th November 2009 and signed on its behalf by:

/I.B.J.Sharples Chairman of the Board of Governors

13


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14

CORPORATE GOVERNANCE STATEMENT

The University is committed to exhibiting best practice in all aspects of corporate governance which relateto a Higher Education Corporation and an exempt charity. This summary describes the manner in whichthe University has applied the principles set out in Section 1 of the Combined Code on Corporate

Governance issued by the London Stock Exchange in 2003 in so far as it is applicable to a HigherEducation Corporation. Its purpose is to help the reader of the accounts understand how the principleshave been applied.

In the opinion of the Governors, the University complies with all the provisions of the Combined Code in sofar as they apply to the Higher Education Sector and it has complied throughout the year ended 31 J uly2009.

The Governing Body

The membership of the Universitys Board of Governors, the majority of which is non-executive, comprisesindependent co-opted staff and student members together with the Vice-Chancellor appointed inaccordance with the Universitys Instrument of Government. The roles of the Chairman and Deputy

Chairman of the Board of Governors are separated from the role of the Universitys designated PrincipalOfficer, the Vice-Chancellor. The matters reserved specifically to the Board of Governors for decisions areset out in the Education Reform Act 1988 (the Act) and the Articles of Government of the University, andunder the Financial Memorandum with the HEFCE and the Funding Agreement with the TDA. The Board ofGovernors holds the ultimate responsibility for the ongoing strategic direction of the University, theUniversitys finances, approval of major developments and receipt of regular reports from Executive officerson the day to day operations of the University and its subsidiary companies.

The Board of Governors meets no fewer than four times a year and has several committees, which includeAudit Committee, Employment Policy and Finance Committee, Senior Posts Reviews Committee andNominations Committee. All of these committees are formally constituted with Terms of Reference and arechaired by an independent member of the Board. In addition, the Articles of Government provide formatters of academic policy to be determined by the Academic Board.

Appointments to the Governing Body

The Nominations Committee considers and recommends nominations to fill vacancies in the independentand co-opted categories of Board membership.

Audi t Commit tee

The Audit Committee meets regularly throughout the year and has been granted plenary powers from theBoard of Governors. It meets with the External Auditors and Internal Auditors of the University and reviewstheir work. The Committee considers detailed reports together with recommendations for improvement tothe Universitys systems of internal control, managements responses and implementation plans. It reviewsthe External Auditors Management Report and the Universitys Annual Financial Statements. Whilst senior

executives attend meetings of the Audit Committee as necessary, they are not members of the Committeeand once a year the Committee meets with External Auditors on their own for independent discussions.

Employment Policy and Finance Committee

The Employment Policy and Finance Committee has plenary powers to act on behalf of the Board on allmatters of employment and financial policy, except where provided otherwise by the Act or by the Articles ofGovernment, or by a specific decision of the Board. This Committee meets three times a year.

Senior Posts Reviews Committee

The Senior Posts Reviews Committee also has plenary powers to consider and approve the grading,appraisal, pay and conditions, and service of designated senior post holders in conformance with good

management practice and the requirements of the Financial Memorandum between the HEFCE and theUniversity.


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Internal Control

The University is ultimately responsible for the Universitys system of internal control and for reviewing itseffectiveness. However, such a system is designed to manage rather than eliminate the risk of failure toachieve business objectives, and can provide only reasonable and not absolute assurance against material

misstatement or loss.

The system of internal control is based on an ongoing process integrated with the strategic planningprocess and designed to identify the principal risks to the achievement of policies, aims and objectives; toevaluate the nature and extent of those risks; and to manage them efficiently, effectively and economically.The complete process was in place at the start of the financial year 2008/2009, namely:

a. an approved Risk Management Policy;

b. a Risk Committee, with appropriate terms of reference, which normally meets 3 times a year;

c. a ranked University Risk Register and local risk registers within Academic Schools and ServiceDepartments; and

d. an annual assurance report.

The process has been developed further during the course of the year in the following ways:

a. the further development of local risk registers for almost all Academic Schools and ServiceDepartments across the University;

b. the procurement and deployment of specific risk management software to assist with the analysisand ranking of risks; and

c. the identification of key risks by Executive members in the light of the strategic plan.

In addition, the Governors review of the effectiveness of the system of internal control is also informed bythe following:

a. The Audit Committee provides oversight of the process of internal control. The Board receivesperiodic reports from the audit committee concerning the processes of internal control and riskmanagement;

b. The Audit Committee receives reports from the Internal Audit Service on the adequacy andeffectiveness of specific systems of internal control together with recommendations forimprovement;

c. The Internal Audit Service report annually to the Audit Committee on their independent opinion onthe adequacy and effectiveness of the system of internal control, together with recommendations

for improvement;

d. The Internal Audit Services assignment review of Risk Management;

e. Comments made by the External Auditors in their management letter and other reports;

f. The Annual Assurance Report to the Audit Committee regarding the operation of risk managementprocesses; and

g. The work of the managers within the institution, who have responsibility for the development andmaintenance of the internal control framework, and by comments made by other external reviewagencies and stakeholders e.g. QAA, TDA, HEFCE etc.

Governors are satisfied internal control processes have been in place throughout the year to 31 J uly 2009and up to the date of signing these accounts.


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Going Concern

After making appropriate enquiries the Board of Governors considers that the University has adequateresources to continue in operational existence for the foreseeable future. Plans have been developedduring the year to realign the cost base to current and forecast income levels and these will be implemented

in the 2009/10 year. The University is budgeting for further deficit in 2009/10 due to a planned restructuring,after which it is forecast that the Universitys financial position will improve. For these reasons the Board ofGovernors continue to adopt the going concern basis in preparing the financial statements.


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17

STATEMENT OF THE BOARD OF GOVERNORS RESPONSIBILITIES

In accordance with the Education Reform Act 1988, the Board of Governors of The University ofWolverhampton is responsible for the administration and management of the affairs of the University and isrequired to present audited financial statements for each financial year.

The Board of Governors is responsible for keeping proper accounting records which disclose withreasonable accuracy at any time the financial position of the University and to enable it to ensure that thefinancial statements are prepared in accordance with the Education Reform Act 1988, the Statement ofRecommended Practice (SORP) for Higher Education Institutions and the relevant accountancy standards.In addition, within the terms and conditions of a Financial Memorandum agreed between the HigherEducation Funding Council for England and the Universitys Board of Governors. The Board of Governorsthrough the Vice Chancellor as its designated office holder, is required to prepare financial statements foreach financial year which give a true and fair view of the Universitys state of affairs and of the surplus ordeficit and cash flows for that year.

In causing the financial statement to be prepared, the Board of Governors has ensured that:

Suitable accounting policies are selected and applied consistently; J udgements and estimates are made that are reasonable and prudent; Applicable accounting standards have been followed, subject to any material departures disclosed and

explained in the financial statements; Financial statements are prepared on the going concern basis, unless it is inappropriate to presume

that the University will continue in operation.

The Board of Governors has taken reasonable steps to:

Ensure that the funds from the HEFCE and the TDA are used only for the purpose for which they havebeen provided and in accordance with the Financial Memorandum between the HEFCE and theUniversity and any other conditions which the HEFCE and the TDA may from time to time prescribe;

Ensure that there are appropriate financial and management controls in place to safeguard public funds

and funds from other sources; Safeguard the assets of the University and prevent and detect fraud; Secure the economical, efficient and effective management of the Universitys resources and

expenditure.

The key elements of the Universitys system of internal financial control, which is designed to discharge theresponsibilities set out above, include the following:

Clear definitions of the responsibilities of, and the authority delegated to, Deans of School, Directorsand Heads of Services;

A professional internal audit team whose annual programme is approved by the Audit Committee; A comprehensive medium and short term planning process, supplemented by detailed annual income,

expenditure, capital and cash flow budgets; A quarterly review of financial results, involving variance reports and updates of forecast outturns; Clearly defined and formalised requirements for approval and control of expenditure, with investment

decisions involving capital or revenue expenditure being subject to formal, detailed appraisal andreview according to approval levels set by the Board of Governors;

Comprehensive Financial Regulations detailing financial controls and procedures, approved by theAudit Committee and the Board of Governors.

Any system of internal financial control can, however, only provide reasonable but not absolute assuranceagainst material mis-statement or loss. In March 2005 the Board resolved to adopt the CUC GovernanceCode of Practice http://www.shef.ac.uk/cuc/pubs/CUC-Summary-Guide-HEFCEFinal.pdf and furtherresolved to undertake a full review of Governance effectiveness in accordance with the Code every fouryears. The next full review will be in the period 2010/2011.
http://www.shef.ac.uk/cuc/pubs/CUC-Summary-Guide-HEFCEFinal.pdfhttp://www.shef.ac.uk/cuc/pubs/CUC-Summary-Guide-HEFCEFinal.pdf


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18

Independent auditors report to the Board of Governors of the University ofWolverhampton

We have audited the Group and University financial statements (the financial statements) of theUniversity of Wolverhampton for the year ended 31 J uly 2009 which the Group Income and Expenditure

Account, the Group and University Balance Sheets, the Group Cash Flow Statement, the Group statementof total recognised gains and losses and the related notes. These financial statements have been preparedunder the historical cost convention (as modified by the revaluation of certain fixed assets) and inaccordance with the accounting policies set out therein.

This report is made solely to the Board of Governors, in accordance with paragraph 13(2) of the University'sArticles of Government and section 124B of the Education Reform Act 1988. Our audit work has beenundertaken so that we might state to the Board of Governors those matters we are required to state to it inan auditors report and for no other purpose. To the fullest extent permitted by law, we do not accept orassume responsibility to anyone other than the Board of Governors, for our audit work, for this report, or forthe opinions we have formed.

Respective Responsibi lities of the University Board of Governors and Auditors

The University Board of Governors responsibilities for preparing the Operating and Financial Review andthe financial statements in accordance with the Accounts Direction issued by the Higher Education FundingCouncil for England, the Statement of Recommended Practice: Accounting for Further and HigherEducation, applicable law and UK Accounting Standards (UK Generally Accepted Accounting Practice) areset out in the Statement of Responsibilities on page 17.

Our responsibility is to audit the financial statements in accordance with relevant legal and regulatoryrequirements and International Standards on Auditing (UK and Ireland).

We report to you our opinion as to whether the financial statements give a true and fair view and areproperly prepared in accordance with the Statement of Recommended Practice: Accounting for Further andHigher Education. We also report to you whether income from funding bodies, grants and income forspecific purposes and from other restricted funds administered by the University have been properly appliedonly for the purposes for which they were received and whether, in all material respects, income has beenapplied in accordance with the Statutes and, where appropriate, with the Financial Memorandum with theHigher Education Funding Council for England and the Financial Memorandum with the Training andDevelopment Agency for Schools. We also report to you whether in our opinion the Operating and FinancialReview is not consistent with the financial statements.

In addition we report to you if, in our opinion, the University has not kept proper accounting records, or if wehave not received all the information and explanations we require for our audit.

We read the Operating and Financial Review and the Corporate Governance Statement and consider theimplications for our report if we become aware of any apparent misstatements within them or materialinconsistencies with the financial statements.

Basis of Opinion

We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued bythe Auditing Practices Board and the Audit Code of Practice issued by the Higher Education FundingCouncil for England. An audit includes examination, on a test basis, of evidence relevant to the amountsand disclosures in the financial statements. It also includes an assessment of the significant estimates andjudgments made by the Universitys Board of Governors in the preparation of the financial statements andof whether the accounting policies are appropriate to the Group and Universitys circumstances,consistently applied and adequately disclosed.

We planned and performed our audit so as to obtain all the information and explanations which weconsidered necessary in order to provide us with sufficient evidence to give reasonable assurance that thefinancial statements are free from material misstatement, whether caused by fraud or other irregularity or

error. In forming our opinion we also evaluated the overall adequacy of the presentation of information inthe financial statements.


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OpinionIn our opinion:

the financial statements give a true and fair view, in accordance with UK Generally AcceptedAccounting Practice, of the state of the Group and the University's affairs as at 31 July 2009 and ofthe Group's deficit of expenditure over income for the year then ended; the financial statements have been properly prepared in accordance with the Statement ofRecommended Practice: Accounting for Further and Higher Education; in all material respects, income from the Higher Education Funding Council for England, theTraining and Development Agency for Schools, grants and income for specific purposes and fromother restricted funds administered by the University during the year ended 31 July 2009 have beenapplied for the purposes for which they were received; and in all material respects, income during the year ended 31 July 2009 has been applied in accordancewith the University's statutes and, where appropriate, with the Financial Memorandum with theHigher Education Funding Council for England and the Financial Memorandum with the Trainingand Development Agency for Schools.

Mic ael R leyfor and on behalf of KPMG LLP. Statutory AuditorChartered AccountantsOne Snow HillSnow Hill QueenswayBirminghamB46GH26 November 2009

.'

19i


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20

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES

1. Accounting Convention

The Financial Statements have been prepared under the historical cost convention as modified by

the revaluation of certain land and buildings inherited from Walsall and Wolverhampton LocalAuthorities and transferred from the Commission for the New Towns at valuation, and in accordancewith both the Statement of Recommended Practice: Accounting in Further and Higher EducationInstitutions (SORP - 2007) and applicable Accounting Standards.

2. Basis of Consolidation

The consolidated financial statements show the position of the University and all its subsidiaryundertakings for the financial year to 31 J uly 2009. The University owns the whole of the issuedshare capital in The University of Wolverhampton Corporate Services Limited, The University ofWolverhampton Enterprise Limited, i-CD limited (formerly Wolverhampton Polytechnology Limited)and UOW Properties Limited. The University of Wolverhampton Enterprise Limited has a majority

share holding (81%) in Wolverhampton Science Park Limited, Wolverhampton City Council (WCC)being the minority shareholder. WCCs interest in Wolverhampton Science Park amounted to25,090 in 2008/2009 (33,697 in 2007/2008). This has not been separately disclosed in theUniversitys Consolidated Financial Statements. Wolverhampton Science Park Limited has,therefore, also been included in the Consolidated Financial Statements of the University. TheUniversity has a 33.33% share in Unibyte Ltd a company spun out in August 2005, a 32% holding inEquiami Ltd and a 5% holding in Flyte Ltd. These companies have not been consolidated on thebasis of materiality.

The University of Wolverhampton Students Union is an independent constituted body and,therefore, is not included in the Consolidated Financial Statements of the University.

3. Recognition of Income

The recurrent grant from HEFCE and the TDA represents the funding allocation which is attributableto the current financial year and is credited direct to the income and expenditure account.

Grants which are applied to acquire tangible fixed assets are credited to deferred capital grants andreleased to the income and expenditure account over the estimated useful lives of the relevantassets.

Income from research grants, contracts and other services rendered is included to the extent of thecompletion of the contract or services concerned. This is generally equivalent to the sum of therelevant expenditure incurred during the year and any related contribution towards overhead costs.

4. Pension Schemes

The two principal pension schemes for the Universitys staff are the Teachers Pension Scheme foracademic staff and the West Midlands Metropolitan Authorities Pension Fund for non-teaching staff.The schemes are defined benefit schemes and are both independently administered schemes.

In the case of the Teachers Pension Scheme, the University is unable to identify its share of theunderlying assets and liabilities of the scheme on a consistent and reasonable basis and therefore asrequired by FRS17 Retirement Benefits accounts for the scheme as if it were a defined contributionscheme. The amounts charged to the Income and Expenditure account represents the contributionspayable to the scheme in respect of the accounting period. There are fourteen members of staff inthe Universities Superannuation Scheme. This scheme is accounted for in a similar manner to TPS.

The West Midlands Metropolitan Authorities Pension Fund provides benefits based on finalpensionable pay. The assets of the scheme are held separately from those of the University. Pensionscheme assets are measured using market value. Pension scheme liabilities are measured using aprojected unit method and discounted at the current rate of return on a high quality corporate bond of


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21

equivalent term and currency to the liability. The pension scheme surplus (to the extent that it isrecoverable) or deficit is recognised in full. The movement in the scheme surplus/deficit is splitbetween operating charges, finance items and, in the statement of total recognised gains and losses,actuarial gains and losses

5.Foreign Currencies

Transactions denominated in foreign currencies are recorded at the rate of exchange ruling at thedates of the transactions. Monetary assets and liabilities denominated in foreign currencies aretranslated into Sterling at year end rates. The resulting exchange differences are dealt with in thedetermination of income and expenditure for the financial year.

6. Leases

Rental costs under operating leases are charged to expenditure in equal annual amounts over theperiods of the leases.

7. Tangible Fixed Assets

(a) Land and Buildings

Freehold land and buildings are stated at valuation except for the buildings constructed sincethe last valuation, which are shown at cost. The basis of valuation is depreciated replacementcosts for specialised buildings or open market value for other buildings. The valuation wascarried out by W S Atkins Consultants Limited, Chartered Surveyors, as at 31 J uly 1996 inaccordance with the RICS Statements of Asset Valuation Practice and Guidance Notes.

On adoption of FRS 15, the University followed the transitional provisions to retain the bookvalue of land and buildings, which were revalued in 1996, but not to adopt a policy ofrevaluations of these properties in the future. These values are retained subject to therequirement to test assets for impairment in accordance with FRS 11.

Where buildings are acquired with the aid of specific grants they are capitalised anddepreciated over their expected useful life. The related grants are treated as deferred capitalgrants and released to income over the expected useful life of the buildings. The buildingsexpected useful lives vary from 5 to 50 years as recommended in the valuation report fromW S Atkins Consultants Limited.

Where refurbishment of buildings has been undertaken, the cost has been capitalised andwritten-off over a ten year period.

Where buildings are in the course of construction as at the year end, the asset is recognised atthe value contained in the appropriate architects valuation certificate. No depreciation ischarged against these assets until they are complete, at which point they are depreciated in

line with normal depreciation policy.

Freehold land is not depreciated.

(b) Equipment

Equipment costing less than 5,000 per individual item has been written off in the year ofacquisition since 1 April 1992 (1,000 up to 31 March 1992). All other equipment is capitalisedat cost.


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22

Capitalised equipment transferred to the University as at 1 April 1989 is included on the basisof estimated cost less a deduction to reflect age and usage. Capitalised equipment acquiredsince 1 April 1989 is stated at cost and depreciated over its expected useful life as follows:

Heavy Machinery - 20 years

Art and Design Equipment/Coaches - 10 years

Catering Equipment/Technology Related Machinery - 7 years

Computer, Scientific, Photographic Equipment and Vehicles - 5 years

Other Equipment - 4 - 7 years

Where equipment is acquired with the aid of specific grants it is capitalised and depreciated asabove. The related grant is treated as a deferred capital grant and released to income over theexpected life of the equipment.

8. Stocks

The stocks are stores of oil held by the Estates Department, computer stock bought through bulkpurchase agreement, catering provisions held in the refectories, and other small stocks held forresale. They are valued at the lower of cost or net realisable value.

9. Maintenance of Premises

The cost of long term and routine maintenance is charged to the Income and Expenditure Account inthe period it is incurred.

10. Taxation Status

The University is an exempt charity by status established under the Education Reform Act 1988 asamended (the Act). By virtue of the Act, the University is an exempt charity for the purposes of theCharities Acts and is, therefore, not liable for Corporation or Income Tax on any of its charitableactivities. The University is registered for Value Added Tax and is unable to recover input tax on themajority of its purchases, education being an exempt activity under current VAT legislation.

The trading activities undertaken by the University are administered through the companies, TheUniversity of Wolverhampton Corporate Services Limited, i-CD limited (formerly WolverhamptonPolytechnology Limited), The University of Wolverhampton Enterprise Limited (including itssubsidiary Wolverhampton Science Park Limited) and UOW Properties Limited, which as commercialorganisations are liable to Corporation Tax. These companies, however, transfer their profits to theUniversity under a deed of covenant, in accordance with FRS 21, except UOW Properties Limited, onan annual basis.

11. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised when the institution has a present legal or constructive obligation as aresult of a past event, it is probable that a transfer of economic benefit will be required to settle theobligation and a reliable estimate can be made of the amount of the obligation. The provision forenhancing the on-going pensions of former members of staff is renewed annually with reference toupdated actuarial tables.

Contingent liabilities are disclosed by way of a note, when the definition of a provision is not met andincludes three scenarios: possible rather than a present obligation; a possible rather than a probableoutflow of economic benefits; an inability to measure the economic outflow.

Contingent assets are disclosed by way of a note, where there is a possible, rather than present,asset arising from a past event.


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23

CONSOLIDATED INCOME AND EXPENDITURE ACCOUNT

For the year ended 31 July 2009

2008/09 2007/08Notes 000 000

INCOMEFunding Council Grants 1 59,747 61,914Academic Fees and Support Grants 2 50,469 45,165Research Grants and Contracts 3 2,583 2,731Other Operating Income 4 36,719 35,992Endowment Income and Interest Receivable 5 1,355 2,712

______ ______

Total Income 150,873 148,514______ ______

EXPENDITUREStaffCosts 6 96,216 92,147Restructuring Costs 6 1,786 150Other Operating Expenses 7 55,391 52,719Depreciation 10 7,781 7,282Interest Payable 8 3,271 1,779

______ ______

Total Expenditure 164,445 154,077

______ ______

Deficit on Continuing Operations after Depreciationof Fixed Assets at Valuation and Before Tax (13,572) (5,563)

Taxation 0 0_____ _____

Deficit before Disposal of Fixed Assets (13,572) (5,563)

Profit on Disposal of Fixed Assets 0 825_____ _____

Deficit on Continuing Operations after Depreciation of

Assets at Valuation, Disposal of Assets and Tax (13,572) (4,738)_____ _____

Deficit for the Year Transferred from AccumulatedIncome in Endowment Funds 10 16

_____ _____

Deficit for the Year Retained Within General Reserves (13,562) (4,722)_____ _____

The income and expenditure account is in respect of continuing activities.

The Governors believe that there is no corporation tax liability for the year.


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24

NOTE OF HISTORICAL COST SURPLUSES AND DEFICITS


2008/09 2007/08Notes 000 000

Deficit on Continuing Operations (13,572) (4,738)

Difference between an Historical Cost DepreciationCharge and the Actual Depreciation Charge forthe Year Calculated on the Revalued Amount 22 1,158 1,396

_____ _____

Historical Cost Deficit for the Year before Taxation (12,414) (3,342)_____ _____


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STATEMENT OF CONSOLIDATED TOTAL RECOGNISED GAINS AND LOSSES


2008/09 2007/08000 000

Deficit on Continuing Operations after Depreciationof Assets at Valuation, Disposal of Assets and Tax (13,572) (4,738)

Actuarial Gain/(Loss) on Local Government Pension Fund 3,329 (25,157)

New Endowments 47 26

Impairment of Fixed Asset to Revaluation Reserve (286) 0_____ _____

Total Recognised Losses Relating to the Year (10,482) (29,869)

Reconciliation:

Opening Reserves and Endowments 82,965 112,834

Total Recognised (Losses)/Gains Relating to the Period (10,482) (29,869)

_______ _______

Closing Reserves and Endowments 72,483 82,965_______ _______


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26

BALANCE SHEETS AS AT 31 JULY 2009

Consolidated University

2009 2008 2009 2008Notes 000 000 000 000

FIXED ASSETSTangible Assets 10&11 173,477 177,096 161,350 164,680Investments 12 36 36 36 36

_______ _______ _______ _______

173,513 177,132 161,386 164,716_______ _______ _______ _______

ENDOWMENT ASSET INVESTMENTS 13 160 123 160 123_______ _______ _______ _______

CURRENT ASSETSStock and Stores in Hand 14 167 243 167 243Debtors 15 10,623 12,431 9,240 14,896Investments 26,310 24,370 26,310 23,833Cash at Bank and in Hand 24,644 18,133 26,325 20,040

______ ______ ______ ______

61,744 55,176 62,042 59,011______ ______ ______ ______

CREDITORS: AMOUNTS FALLING DUEWITHIN ONE YEAR 16 37,572 23,585 34,632 21,271

______ ______ ______ ______

NET CURRENT ASSETS 24,172 31,591 27,410 37,740______ ______ ______ ______

TOTAL ASSETS LESS CURRENT LIABILITIES 197,845 208,846 188,956 202,579

CREDITORS: AMOUNTS FALLING DUEAFTER MORE THAN ONE YEAR 17 22,436 23,565 18,790 19,764

PROVISIONS FOR LIABILITIES ANDCHARGES 19 6,880 6,859 6,880 6,859

_______ _______ _______ _______

NET ASSETS excluding pension liability 168,529 178,422 163,286 175,956

PENSION LIABILITY 48,599 47,590 48,599 47,590

_______ _______ _______ _______

NET ASSETS including pension liability 119,930 130,832 114,687 128,366_______ _______ _______ _______


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BALANCE SHEETS AS AT 31 JULY 2009

DEFERRED CAP TAL GRANTSENDOWMENTSRestricted ExpendableRESERVESRevaluation Reserve

Notes20

21

22I and E Excluding Pension Reserve 23Pension ReserveI and E Including Pension Reserve

TOTAL FUNDS

Consolidated ' University2009 2008 2009 2008'000 '000 '000 '000

47,448 47,867 39,166 39,279

160 123 160 123

34,120 35,564 33,753 35,20286,801 94,868 90,207 101,352(48,599) (47,590) (48,599) (47,590)38,202 47,278 41,608 53,762

119,930 130,832 114,687 128,366

The Financial Statements on pages 20 to 49 were approved by the Board of Governors on26th NOVember;'9 s ~ n its behaij by:

B.J.Sharples lz.the Board of Governors

G.Sproston ~ r Pro Vice Chancellor and Director of Finance

27


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28

CONSOLIDATED CASH FLOW STATEMENT


2008/09 2007/08Notes 000 000

CASH FLOW FROM OPERATING ACTIVITIES 24 5,144 1,774

Returns on Investments and Servicing of Finance 25 (233) 979

Capital Expenditure and Financial Investment 26 4,671 (4,970)

Management of Liquid Resources 27 (1,940) 274

Financing 28 (1,094) (1,035)

_____ _____

INCREASE/(DECREASE) IN CASH IN THE YEAR 29 6,548 (2,978)_____ _____

RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS/DEBT

Increase/(Decrease) in Cash in the Year 29 6,548 (2,978)

Increase/(Decrease) in Short Term Deposits 27 1,940 (274)

Repayment of Debt 28 1,094 1,035_____ _____

Movement in Net Funds in the Year 29 9,582 (2,217)

Net Funds as at 1 August 29 18,031 20,248

______ _____

Net Funds as at 31 July 29 27,613 18,031______ ______


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NOTES TO THE ACCOUNTS

29

2008/09 2007/08000 000

1. FUNDING COUNCIL GRANTS

Recurrent GrantsHEFCE 50,192 50,542TDA 2,663 2,916

Specific GrantsHEFCE:

Special Initiatives 4,366 5,604

TDA:Graduate Teacher Scheme 725 857Other Special Initiatives 647 857

Deferred Capital Grants Released in the YearHEFCE:

Buildings 996 996Equipment 158 142

______ ______

59,747 61,914______ ______

2. ACADEMIC FEES AND SUPPORT GRANTS

Full-time UK and EU Students 27,365 23,358Full-time Students Charged Overseas Fees 6,755 6,988Part-time UK and EU Students 3,014 2,265Franchised Courses 1,650 960Education Contracts 11,685 11,594

______ ______

50,469 45,165______ ______

3. RESEARCH GRANTS AND CONTRACTS

Research Council 915 960

UK Based Charities 146 72Other Research Grants and Contracts 1,522 1,699______ ______

2,583 2,731______ ______


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2008/09 2007/08000 000

4. OTHER OPERATING INCOME

Residences, Catering and Conferences 7,403 7,959Other Services Rendered 24,023 22,073Released from Deferred Capital Grants 701 816Other Income 4,592 5,144

______ ______

36,719 35,992______ ______

5. ENDOWMENT INCOME AND INTEREST RECEIVABLE

Transferred from Endowments 2 7Other Investment Income 1,353 2,705

_____ _____

1,355 2,712_____ _____

6. STAFF

Staff Costs:Wages and Salaries 78,028 75,137Social Security Costs 6,267 5,624Other Pension Costs (Including FRS 17 Adjustment) 11,921 11,386Restructuring Costs 1,786 150

______ ______

98,002 92,297______ ______

Emoluments of the Vice-Chancellor for the year to 31 J uly 228 213___ ___

The emoluments of the Vice-Chancellor are shown inclusive of employerspension contribution. The Universitys pension contributions to theUniversities Superannuation Scheme are paid at the rate of 14.9%.and amount to 27,816 (2007/08 25,719).

Number NumberThe full time equivalent number of staff employed on 31 J uly bymajor category:

Academic 870 893Technical, Administrative and Clerical 1,036 1,028Other, including Manual 314 285

_____ _____

2,220 2,206_____ _____


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Remuneration of the other higher paid staff, excluding employers pension contributions

2008/09 2007/08

100,000 - 109,999 4 3110,000 - 119,999 3 2120,000 - 129,999 2 1130,000 - 139,999 1 0140,000 - 149,999 1 0160,000 - 169,999 3 1

2008/09 2007/08000 000

7. OTHER OPERATING EXPENSES

Residences, Catering and Conferences 1,166 1,149

Books and Consumables 3,112 3,315Equipment 4,938 4,331Printing and Stationery 1,955 1,756Heat, Light, Water and Power 2,092 2,899Repairs and General Maintenance 2,525 2,778Long Term Maintenance 679 1,772Grants to University of Wolverhampton Students Union 834 1,095Rents 1,317 1,535Rates 664 972Auditors Remuneration 135 129Auditors Remuneration in Respect of Non-Audit Services 39 36Equipment Operating Lease Rentals 34 34Franchise Payments to Colleges 4,176 3,277

Staff Travel and Subsistence 1,510 1,779Staff Recruitment Costs 437 683Staff Development 1,507 1,567Student Placements and Travel Costs 6,031 4,834Partners and Consultancy 12,730 7,354Telecommunications and Postage 880 926Provision for Bad Debts 960 1,223Cleaning Costs 634 670Legal, Professional and Other 1,753 2,498Insurance 418 557Aim Higher 828 1,628Publicity 1,199 1,298Subscriptions 409 624

Other 2,429 2,000______ ______

55,391 52,719______ ______

Auditors remuneration includes: 2008/09 2007/08Auditors remuneration: 000 000

- Financial statements audit 53 47- Internal audit 82 82

Auditors remuneration in respect of non-audit services includes:- Financial statements audit other services 39 36


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8. INTEREST PAYABLE

2008/09 2007/08

000 000

Bank Loan Not Wholly Repayable Within Five Years 1,409 1,454Net Pension Interest Cost in respect of FRS17 1,603 70Net Pension Interest Cost in respect of Enhanced Pensions 259 255

______ ______

3,271 1,779______ ______

9. ANALYSIS OF EXPENDITURE BY ACTIVITY

OtherStaff Operating InterestCosts Depn Expenses Payable Total000 000 000 000 000

Academic Departments 50,185 11,453 61,638Academic Services 7,778 4,739 12,517Research Grants and Contracts 1,550 971 2,521Residences, Catering and Conferences 2,799 2,994 5,793Premises 6,410 6,321 12,731Administration 20,105 13,133 33,238Other Expenses 9,175 7,781 15,780 3,271 36,007

______ ______ ______ ______ ______

98,002 7,781 55,391 3,271 164,445______ ______ ______ ______ ______

The Depreciation Charge has been funded by:Deferred Capital Grant 1,855Revaluation Reserve Released 1,158General Income 4,768

____

7,781

____


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10. TANGIBLE ASSETSConsolidated

Land and Assets inBuildings the Course ofFreehold Equipment Construction Total

000 000 000 000Valuation/CostAt 1 August 2008

Valuation 78,519 0 0 78,519Cost 136,834 37,301 95 174,230

Additions at Cost 2,505 443 1,539 4,487Disposals at Cost (39) 0 0 (39)Impairment (286) 0 0 (286)

______ ______ ______ ______

At 31 J uly 2009Valuation 78,233 0 0 78,233Cost 139,300 37,744 1,634 178,678

______ ______ ______ ______

DepreciationAt 1 August 2008 40,441 35,212 0 75,653Charge for Year 7,025 768 0 7,793Eliminated on Disposal (12) 0 0 (12)

______ ______ ______ ______

At 31 J uly 2009 47,454 35,980 0 83,434______ ______ ______ ______

Net Book ValueAt 31 J uly 2009 170,079 1,764 1,634 173,477

_______ _______ _______ _______

At 1 August 2008 174,912 2,089 95 177,096_______ _______ _______ _______

Inherited 35,564 0 0 35,564Financed by Capital Grant 47,077 790 0 47,867Other 87,438 974 1,634 90,046

_______ _______ _______ _______Net Book ValueAt 31 J uly 2009 170,079 1,764 1,634 173,477

_______ _______ _______ _______

The transitional rules set out in FRS 15 Tangible Fixed Assets have been applied on implementingFRS 15. Accordingly, the book values at implementation have been retained. The basis of valuationis depreciated replacement cost or open market value for existing use and was carried out by a firmof independent surveyors in 1996.

Asset value has been reduced in 2008/09 by 286,000 for the impairment of part of the TelfordResidences. There has also been an increase in depreciation released to Income and Expenditure of1,077,000 for impairment of Telford Residences and MG building on the Wolverhampton Campus.


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11. TANGIBLE ASSETSUniversity

Land and Assets in

Buildings the Course ofFreehold Equipment Construction Total000 000 000 000

Valuation/CostAt 1 August 2008

Valuation 71,134 0 0 71,134Cost 128,587 35,849 94 164,530

Additions at Cost 2,431 443 1,539 4,413Disposals at Cost 0 0 0 0Impairment (286) 0 0 (286)

______ ______ ______ ______

At 31 J uly 2009Valuation 70,848 0 0 70,848Cost 131,018 36,292 1,633 168,943

______ ______ ______ ______

DepreciationAt 1 August 2008 37,108 33,876 0 70,984Charge for Year 6,693 764 0 7,457

______ ______ ______ ______

At 31 J uly 2009 43,801 34,640 0 78,441______ ______ ______ ______

Net Book ValueAt 31 J uly 2009 158,065 1,652 1,633 161,350

_______ _______ _______ _______

At 1 August 2008 162,613 1,973 94 164,680_______ _______ _______ _______

Inherited 35,202 0 0 35,202Financed by Capital Grant 38,471 721 0 39,192Other 84,392 931 1,633 86,956

_______ _______ _______ _______Net Book Value

At 31 J uly 2009 158,065 1,652 1,633 161,350_______ _______ _______ _______


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12. INVESTMENTS

Consolidated University

2008/09 2007/08 2008/09 2007/08000 000 000 000

Balance as at 1 August 36 81 36 81Acquisitions 0 0 0 0Impairment 0 (45) 0 (45)

___ ___ ___ ___

Balance as at 31 J uly 36 36 36 36___ ___ ___ ___

The investment closing balance represents 35,688 Ordinary shares of 1 each, fully paid in CVCPProperties plc.

The University also owns 100% of the issued share capital of the following subsidiary companies:

University of Wolverhampton Enterprise Limited 100 fully paid up 1 sharesi-CD Limited 100 fully paid up 1 sharesUniversity of Wolverhampton Corporate Services Limited 100 fully paid up 1 sharesUoW Properties Limited 1000 fully paid up 1 sharesUniversity of Wolverhampton Innovation Limited 1 fully paid up 1 shareUniversity of Wolverhampton Incubation Limited 1 fully paid up 1 shareUniversity of Wolverhampton Ventures Limited 1 fully paid up 1 share

All seven companies are registered in England and operate in the UK.

University of Wolverhampton Enterprise Ltd also owns 810 fully paid

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Fin Accounts 2009 of UNI

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