LONDON’S GLOBAL UNIVERSITY
Annual Report and Financial Statements
for the year ended 31 July 2010
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
MISSION STATEMENT
UCL - London's Global University
We are

a world-class centre of research and teaching, dedicated to developing and
disseminating original knowledge to benefit the world of the future.
We believe



in engaging fully with the world around us;
in breaking new ground through challenging convention;
in progress through partnership.
We value





creativity and innovation;
independent thought;
integrity;
energy;
perseverance.
We are committed



to the pursuit of excellence and sustainability;
to maintaining rich academic diversity embracing the Arts and Sciences;
to equality of opportunity and fulfilment of potential for all our staff and
students.
We strive always



to lead;
to inspire;
to achieve.
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
CONTENTS
Page
1
Committee Membership
2
Financial Highlights
3
Background to the preparation of the Annual Report and Financial
Statements
4
Operating and Financial Review
17
Corporate Governance
19
Responsibilities of the Council of UCL
21
Independent Auditors Report to the Members of the Council of UCL
23
Statement of Principal Accounting Polices
28
Consolidated Income and Expenditure Account
29
Statement of Group Historical Cost Surpluses and Deficits
29
Statement of Total Recognised Gains and Losses
30
Consolidated Balance Sheet
31
UCL Balance Sheet
32
Consolidated Cash Flow Statement
33
Notes to the Accounts
65
Financial Summaries (unaudited)
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
COMMITTEE MEMBERSHIP
Council (Trustees)
Lay Members:
Ms Anne Bulford (Treasurer)
Lord Hart of Chilton* (until 30/09/10)
Ms Philippa Foster-Back
Mr Rob Holden
Mr Mark Knight
Ms Catherine Newman
Ms Vivienne Parry* (Vice-Chair)
Ms Katharine Roseveare
Dr Gill Samuels
Professor Chris Thompson
Sir Stephen Wall* (Chair)
Baroness Warwick of Underhill (from
01/10/10)
Academic
Members:
Professor David Attwell (from
01/10/10)
Dr Bob Barber (from 01/10/10)
Professor Iain Borden (until
30/09/10)
Professor Robert Brown* (until
30/09/10)
Professor Malcolm Grant* (Provost)
Dr Nikos Konstantinidis (until
30/09/10)
Mr Josh Blacker (until 31/07/10)
Mr Matthew Burgess (from 01/08/10)
Dr Benet Salway*
Dr Stephanie Schorge (from
01/10/10)
Dr Andrea Townsend-Nicholson (until
30/09/10)
Professor Nick Tyler (from 01/10/10)
Professor Maria Wyke
UCL Union:
Mr Andrew Caddy (until 31/07/10)
Mr Michael Chessum (from 01/08/10)
Finance Committee
Lay Members:
Ms Anne Bulford (Chair)
Mr Ven Balakrishnan (from 01/01/10)
Mr Nigel Buchanan (until 31/12/09)
Mr Mark Clarke
Mr David Dutton (until 31/12/09)
Mr Robin Fox (until 31/07/10)
Ms Susannah Lloyd (from 01/01/10)
Mr Derek Thomas (until 31/07/10)
Sir Stephen Wall
Academic
Members:
Professor Malcolm Grant (Provost)
Dr Robert Barber
Professor Dame Hazel Genn
Professor David Ingram
Dr Andrea Townsend-Nicholson
Professor Jonathan Wolff
UCL Union:
Mr Andrew Caddy (until 31/07/10)
Mr Matthew Burgess (from 01/08/10)
Audit Committee
Lay Members:
Mr Rob Holden
Mr John Hustler
Mr Mark Knight (Chair)
Mr Nigel Smith
Investments Committee
Lay Members:
Ms Anne Bulford (Chair)
Mr Ven Balakrishnan (from 01/01/10)
Mr Nigel Buchanan (until 31/12/09)
Mr Mark Clarke

denotes also member of Remuneration Committee
* denotes also member of Nominations Committee
1
Mr Robin Fox (until 31/0810)
Ms Susannah Lloyd (from 01/01/10)
Mr Nigel Thomas
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
FINANCIAL HIGHLIGHTS
2010
£m
Restated
2009
£m
CONSOLIDATED INCOME & EXPENDITURE ACCOUNT
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Endowment income and interest receivable
Total income
Share of income from joint ventures
NET INCOME
201.0
150.5
275.1
133.8
5.0
209.9
126.7
254.3
124.0
8.2
765.4
(3.0)
762.4
723.1
(3.7)
719.4
TOTAL EXPENDITURE
732.4
707.5
Share of operating loss in joint ventures and associates
Loss on disposal of tangible fixed assets
Profit on disposal of fixed asset investments
Taxation
Minority interest
Transfer to accumulated income within specific endowments
(0.3)
0.7
(0.9)
0.1
(0.7)
(6.1)
0.1
SURPLUS FOR THE YEAR
29.6
5.1
Fixed assets
Endowment asset investments
Net current assets
Total assets less current liabilities
605.0
67.9
55.5
728.4
599.4
57.2
30.9
687.5
Non-current liabilities and provisions
Provision for liabilities and charges
Pension liabilities
(78.7)
(1.3)
(8.1)
(80.1)
(1.3)
(8.1)
NET ASSETS
Represented by:
640.3
598.0
Deferred grants
Endowments
Reserves
Minority interest
348.2
67.9
224.3
(0.1)
349.5
57.2
192.3
(1.0)
42.7
16.8
(5.0)
6.3
2010
No.
2009
No.
22,628
9,638
21,126
9,385
CONSOLIDATED BALANCE SHEET
OTHER KEY STATISTICS
Consolidated recognised gains
Consolidated increase in cash flow
Student numbers
Average staff numbers
2
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
BACKGROUND TO THE PREPARATION OF THE ANNUAL REPORT AND
FINANCIAL STATEMENTS
The Council of UCL is responsible for this operating and financial review together with the
financial statements. The format follows the Statement of Recommended Practice (SORP):
Accounting for Further and Higher Education.
Since the previous financial statements were approved a revised Model Financial
Memorandum between HEFCE and higher education institutions (HEIs) has been issued. The
Model Financial Memorandum sets out the formal relationship between HEFCE and the
governing bodies and accountable officers of the HEIs it funds. All HEIs, including UCL, are
bound by the requirements of their charter and statutes (or equivalent) and by rules relating to
their charitable status. The Memorandum does not supersede those requirements but is
intended to complement and reinforce them.
On 1 June 2010 HEFCE became the principal regulator of those HEIs in England that are
exempt charities, one of which is UCL. This is a new legal obligation and HEFCE’s existing
functions as the main funder of higher education in England are not affected.
This new responsibility results from the Charities Act 2006, which implements a government
decision that all charities should be subject to regulation. Until June 2010, although they were
expected to comply with charity law, exempt charities were outside the scope of the Charity
Commission's regulatory powers. From 1 June 2010, the exempt charity regulation provisions
of the 2006 Act came into effect for HEIs, and they are now subject to the Charity
Commission's powers.
HEFCE is one of several principal regulators; some are yet to be appointed. All principal
regulators have the duty, as far as they reasonably can, to promote compliance with charity
law by the exempt charities for which they are responsible. This will require regular monitoring
and occasional more detailed work, including liaison with the Charity Commission on complex
issues that might need the use of its powers.
As part of this change the following information must be included in the HEI's audited financial
statements and related reports from 2009-10:






The charitable status of the HEI;
The trustees who served at any time during the financial year and until the date the
financial statements were formally approved;
A statement that the charity has had regard to the Commission’s guidance on public
benefit;
A report on how the HEI has delivered its charitable purposes for the public benefit;
Information about payments to or on behalf of trustees, including expenses;
payments to trustees for serving as trustees (and waivers of such payments); and
related party transactions involving trustees;
From 2010-11: the names of linked charities of the HEI.
Much of this information is already included in the financial statements but additional
requirements, principally around disclosures relating to public benefit, have been included in
the operating and financial review below. There are no other material changes required to the
financial statements as a result of the revised Model Financial Memorandum. A full version of
the memorandum can be found at:http://www.hefce.ac.uk/pubs/hefce/2010/10_19/
The financial statements include the consolidated results of UCL’s subsidiary companies,
details of which are shown at Note 39 and whose commercial activities are, for legal and
taxation reasons, more appropriately channelled through limited companies.
These accounts have been prepared on a going concern basis as described in more detail in
Note 1 of the Accounting Policies.
3
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
OPERATING AND FINANCIAL REVIEW
This Operating and Financial Review has been prepared for UCL as a whole and therefore
gives greater emphasis to those matters which are significant to UCL when viewed as a
whole.
It should be noted that the 2009 figures have been restated following a change in HESA
guidance in relation to research income. Income passed on to other institutions or
organisations as part of a collaborative project or subcontracted work, which was previously
excluded, has now been included along with associated costs. This has resulted in an
increase in research income of £5.6m along with an increase in staff costs of £0.7m and an
increase in other operating expenses of £4.9m. There is no overall effect on the surplus for
the year.
Long term strategy & objectives
In June 2007 UCL published a new White Paper “Modernising UCL” laying out UCL’s strategy
and aims for 2007–2012. The focus is wholly on strengthening UCL’s world-class academic
excellence in a financially disciplined way. Themes include modernisation of administrative
structures and information systems and devolution of certain management responsibilities
from the centre to faculty level supported by investment in staff and facilities. These themes
continue to be central to UCL’s strategy going forward as we face the uncertainty of public
spending cuts.
UCL is a world-class centre of research and teaching, dedicated to developing and
disseminating original knowledge to benefit the world of the future. It believes in engaging
fully with the world around it, in breaking new ground through challenging convention and in
progress through partnership. UCL values creativity and innovation, independent thought,
integrity, energy and perseverance. It is committed to the pursuit of excellence and
sustainability, to maintaining rich academic diversity embracing the Arts and Sciences, to
equality of opportunity and fulfilment of potential for all our staff and students. UCL will strive
always to lead, to inspire and to achieve.
UCL continues to rank among the world's top universities, as reflected in our performance in a
range of rankings and tables. Information about UCL’s position in rankings over the past five
years is shown below:-
Times Higher/QS World Rankings (World)
QS World Rankings (World)
Times Higher World Rankings (World)
The Sunday Times (UK)
The Guardian (UK)
Complete University Guide (Independent) (UK)
The Times Good University Guide (UK)
Shanghai Jiao Tong University (World)
2005
28
N/A
N/A
5
7
N/A
6
26
2006
25
N/A
N/A
5
4
N/A
5
26
2007
9
N/A
N/A
5
5
6
6
25
2008
7
N/A
N/A
6
7
8
7
22
2009
4
N/A
N/A
4
6
8
5
21
2010
N/A
4
22
4
5
9
7
21
Financial Results for the year ended 31 July 2010
UCL’s summary consolidated Income and Expenditure results for the year ended 31 July
2010 are shown in the table overleaf.
The 2010 year has seen a significant improvement in the overall financial position of the
university with the retained surplus rising from £5m to £30m. Whilst some of the improvement
has come from continued income growth of 6.0% in the year much of it has come from cost
controls that have been in place. These have meant that staff and operating costs, which
make up 94% of total expenditure, have risen by only 4.6%. In addition the last year saw no
recurrence of the £5m loss on shares held as fixed assets that occurred in the previous year.
4
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
OPERATING AND FINANCIAL REVIEW
The improvement in the surplus has followed through to the year end cash position where
cash at the bank and in short term deposits improved to £164m.
These results need to be taken in context. It is vital that the university generates and sustains
sufficient surpluses and cash balances to meet its future investment needs particularly in the
light of an anticipated significant reduction in capital funding from HEFCE as well as
reductions in teaching grants, and to a lesser extent research funding. These results reflect
the decisions taken over the past two years to not only grow our income but also to control
costs in order to move UCL towards a more financially sustainable position in the long term.
Summary Consolidated Income and Expenditure
Operating Income
Deferred grants released
Total income
Operating Expenditure
Depreciation
Total Expenditure
Surplus after depreciation and before tax
Net Share in joint ventures, associates, tax & minority
interests
Profit/(Loss) on disposal of subsidiary & fixed/tangible fixed
assets
Surplus on continuing operations
Transfer from accumulated income within specific
endowments
Surplus retained within general reserves
2010
£m
732.5
29.9
762.4
(692.1)
(40.3)
(732.4)
30.0
Restated
2009
£m
680.7
33.0
719.4
(667.6)
(39.9)
(707.5)
11.8
(1.1)
(0.7)
0.7
(6.1)
29.6
5.0
0.1
0.1
29.7
5.1
Income from the Funding Council was down £9m (4%) at £201m, the fall entirely driven by a
reduction in deferred capitals grant and funding for special initiatives. Direct funding for
teaching and research remained flat.
Academic fee income was up £24m (19%) at £151m reflecting increases in both Home/EU
and overseas student numbers. Tuition fees from full time overseas students now contribute
£74m to the total. Income from research grants and contracts was up £20.8m (8%) over the
previous year to reach £275m. This indicates that the measures implemented in previous
years to encourage and support research applications going forward continue to deliver
benefit in a more difficult economic environment.
As noted above expenditure has risen more slowly than income. Staff costs have risen 6.1%
compared with an increase of only 2.7% in the average number of staff on the payroll during
the year and a rise in research direct costs of 7%, 56% of which is staff cost related. A low
pay award of 0.5% and recruitment controls have also played their part in keeping staff costs
down. Other operating expenditure rose by an even lower rate of 1.9%.
Capital Expenditure for the year was £40m, a fall from the previous year when it stood at
£66m – however that included large land and buildings purchases for UKCMRI and of Central
House.
The improvement in the surplus has followed through to the year end cash position where
cash at the bank and in short term deposits improved to £164m. Improvements in the financial
markets have meant that the value of UCL’s endowment assets have increased in value by
nearly £11m to £68m. Total reserves increased from £175 million to £205 million.
5
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
OPERATING AND FINANCIAL REVIEW
Financial Outlook
The outcomes of the Comprehensive Spending Review (CSR) are now known at least in their
broad terms and will impact both teaching and research at UCL. The Coalition Government
has announced recently that it would seek early Parliamentary approval for an increase in the
maximum tuition fee for UK-EU undergraduates. The amount that a university may charge will
rise from £3,290 a year now, to £6,000 from academic year 2012-13. In exceptional cases, a
university may go as high as £9,000. As with the present fee, it will be covered by a
subsidised Government loan which is not repayable until after graduation and then only out of
earned income over £21,000 a year. These increases are designed to offset the withdrawal of
funding from universities for providing undergraduate education, except for some support for
higher cost (e.g. clinical and laboratory) and vulnerable (e.g. certain modern languages)
subjects. Along with universities UCL will have to decide what fee levels it intends to charge
from 2012-13 bearing in mind the nature of the exceptional conditions which a university
would need to satisfy in order to justify charging a fee above £6,000 a year. As part of the
decision making process there are many questions that will need answering.



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
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
What do we need to charge to be financially viable while continuing to offer degree
courses in significant academic disciplines no longer funded by government?
What is an appropriate fee for a UCL degree given its academic rigour, the
professionalism of those who provide it, its distinctiveness and the quality of the student
experience?
Where can investment best be made to enhance present provision and maintain UCL’s
position as a global leader in higher education?
How well does UCL research inform its teaching?
What is the value to the student of the teaching contact points?
How effectively are new technologies being deployed in teaching at UCL?
What is the fitness for purpose of academic feedback and assessment?
What progress has been made with internationalisation of UCL’s curriculum
How far is employability embedded in UCL programmes?
What further reforms and improvements must be effected in advance of the introduction
of a new fees regime?
Research funding fared relatively well under the Spending Review with the Science Budget,
which covers funding for Research Councils, HEFCE research funds and the HEFCE Higher
Education Innovation Fund, maintained at £4.6bn in cash terms (i.e. a real terms reduction
over the four years of 9%). The Government has asked the Research Councils to make
efficiency savings of £324m pa by 2014-15 which is likely to lead to fewer larger grants being
awarded, but these savings will be reinvested in science to offset some of the losses through
inflation. No indications have been given of any further changes in the distribution of HEFCE
research funding in favour of STEM subjects or moves to further concentrate funding
according to research excellence and so the impact of a real terms reduction in HEFCE
research funding at UCL remains unclear.
Home/EU student quotas remain an area of continuing uncertainty with no indication as to
whether these will be lifted altogether, remain as they are or be replaced by some other form
of quota system. The possibility of the quotas remaining together with concerns over possible
plans to limit overseas student numbers by the Government could hamper UCL’s plans to
respond to the other funding changes.
At the same time as reviewing its future income streams UCL needs to continue reviewing its
cost base. Staff costs including pensions still represent 60% of UCL’s total expenditure. USS,
UCL’s largest pension provider, is currently consulting on proposed rule changes to protect
the long term financial sustainability of the scheme. UCL welcomes the proposals and in
particular the recognition that, in future, any cost increases will need to be shared by both
employers and employees. Further work will be needed on procurement savings, process
reviews and administrative structures.
6
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
OPERATING AND FINANCIAL REVIEW
Public Benefit
In identifying its aims, UCL’s trustees have taken due consideration of the guidance relating to
public benefit published by the Charity Commission.
UCL’s objects, as detailed in its Royal Charter, are:
“… to provide education and courses of study in the fields of Arts, Laws, Pure Sciences,
Medicine and Medical Sciences, Social Sciences and Applied Sciences and in such other
fields of learning as may from time to time be decided upon by the College and to encourage
research in the said branches of knowledge and learning and to organise, encourage and
stimulate postgraduate study in such branches.”
In addition to its objects UCL's global vision is informed by four clear principles of intent that
form the basis of all it does:
• To enhance UCL's educational and research environment by promoting the global context in
which UCL operates.
• To contribute throughout the range of UCL activity (research, teaching, learning, business
links, and community engagement) to the resolution of problems of global significance.
• To contribute to UCL's financial stability by maximising income generation from all aspects
of global activity where the potential to do so exists.
• To engage with public bodies, including UK Government, in matters of support for British
Higher Education in a global market
However, a university has a much broader charitable purpose than just advancing education
and a wide range of activities undertaken at UCL in the past twelve months support this
broader public benefit.
The prevention or relief of poverty
This year UCL launched its Grand Challenge of Sustainable Cities, a programme to rally the
university’s breadth of experience in service of urban sustainability. This programme will
address the urban environment’s significant problems in areas such as food, security, energy,
water, waste, transport, economy, trade, wealth creation and quality of life. UCL’s research
interests in this area are wide-ranging and include, for example, the Development Planning
Unit’s work on a project examining ‘Urban Water Poverty’ in the context of the Millennium
Development Goals.
The advancement of education
UCL was founded in 1826 as a radically different university, opening up English higher
education for the first time to people of all beliefs and social backgrounds. That radical
tradition remains alive today. UCL continues to provide education to around 23,000 students
at both undergraduate and postgraduate levels. 34% of UCL students come from outside the
UK, attracted from nearly 140 countries around the globe.
The university undertakes a range of outreach activities in support of its widening participation
strategy. UCL's widening participation strategy aims to raise awareness of higher education,
to assist in the preparation for higher education by addressing the academic, social and
cultural issues underlying historic levels of low participation, to enhance the diversity of UCL's
student body by recruiting the brightest students regardless of their background and to
improve the retention of students at UCL. In line with our Access Agreement UCL has
continued to set aside £5m to provide enhanced bursaries for students from low income
families and to support outreach activities. During 2009-10 UCL's Transitions Programme,
7
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
OPERATING AND FINANCIAL REVIEW
which provides generic and bespoke academic and non-academic support to students before
and after they enrol with the aim of encouraging progression and enhancing retention, has
been rolled out across all UCL departments.
UCL's outreach activities have also been expanded. These include organised events and
activities at UCL for school and college staff and students (including an admissions
conference and seminars for staff and organised visits, master classes and summer schools
for students) and Outreach work by UCL staff and students in schools and colleges. UCL staff
visit schools to make presentations on higher education and the university applications
procedure, and UCL student ambassadors visit schools and colleges to advise, mentor or
tutor their students. UCL outreach activities also make the best possible use of the
Bloomsbury Theatre and community links, and our diverse Museums and Collections, with an
interactive teaching programme for schools and colleges.
The advancement of health or the saving of lives
UCL Medical School is one of the largest in the country with a yearly intake of 330
undergraduate students on the MBBS programme. Our biomedical research interests range
across pure and translational areas and from age and wellbeing, through cancer,
cardiovascular and neuroscience to experimental and systems medicine.
The UCL Medical School is committed to excellence in education and has a strong reputation
for teaching informed by cutting-edge research. The School has a distinguished cadre of
academic staff who are at the forefront of international research in medical sciences and
clinical medicine.
Translational research is supported by close partnerships with NHS trusts. UCL Partners is a
an academic health sciences system, drawing UCL together with four major hospital partners
in a joint mission to enhance medical research and teaching, clinical care and population
health.
This also includes the use of popular technology including iPhones applications. More than
three million doctors have downloaded the iStethoscope application, invented by a UCL
researcher, which enables physicians to monitor their patients' heartbeats using their phone.
The patient can email their heart pattern to their doctor to enable them to receive professional
assessment of their condition.
The advancement of citizenship or community development
UCL is a world-class, research-led, multi-faculty university, consciously and deliberately
global and wide-ranging in its reach and ambition. It strives for excellence and is committed to
making a difference in the world; to provide an educational environment that reflects these
values and supports students to develop in the round. UCL believes that a university can and
should aim to shape students’ personal and social development, as well as encourage their
intellectual growth. UCL’s ‘education for global citizenship’ is a term that encapsulates all that
UCL aims to do to enable its students to respond to the intellectual, social and personal
challenges that they will encounter throughout their future lives and careers.
UCL has a well-established culture of student volunteering. Annually, around 900 students
participate in activities through the Voluntary Services Unit (VSU), such as organising football
tournaments for homeless people, getting involved with campaigning organisations, teaching
computer skills to local elderly people, or coordinating fundraising events for disability
charities. The VSU also runs an Innovations Programme which supports students to develop
their own proposals for new community programmes. Among the student–led projects this
year are: the Refugee Project, which brings UCL volunteers together with refugees and
asylum seekers to build confidence through mentoring and group activities; the Physics
8
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
OPERATING AND FINANCIAL REVIEW
Outreach Project, which brings exciting university-level physics experiments into secondary
schools to challenge perceptions of the subject; and the Language Skills Pool, which provides
pro bono translation and interpreting services for charities across London.
The advancement of the arts, culture, heritage or science
As well as providing education in these areas, for example through the UCL Centre for
Museums, Heritage and Material Cultural Studies, UCL's outstanding collections cover a wide
variety of disciplines, reflecting the range of the university's academic work. Three collections
- the Petrie Museum, the Grant Museum and the Art Collections - are open to the public.
Other collections are primarily for teaching and research but can be seen and studied by
appointment.
The Petrie Museum alone houses an estimated 80,000 objects, making it one of the greatest
collections of Egyptian and Sudanese archaeology in the world. It illustrates life in the Nile
Valley from prehistory through the time of the pharaohs, the Ptolemaic, Roman and Coptic
periods to the Islamic period.
UCL also owns the Bloomsbury Theatre which operates as a public theatre offering a wide
variety of comedy and theatre and also showcases student drama for 12 weeks each year.
This year UC Opera presented Schumann’s Genoveva as part of the UCL Bloomsbury
Theatre student season. UC Opera has been bringing rarely performed work to the stage for
nearly 60 years including 17 British premières and three world premières. The society is
unique in that it exists in the absence of an academic UCL music department and is run by
students for students, most of whom have no prior professional musical training.
In September 2009 UCL launched its Cultural Property Policy. UCL is the first university in the
UK to develop and implement a policy of this kind. Our definition of cultural property is broad,
including objects and specimens identified as having artistic, historic, scientific, religious or
social significance.
The advancement of amateur sport
UCL Union gives UCL students the opportunity to participate in over 30 different sports, with
100 teams representing UCL in regional leagues and cups. Many students continue to play
long after they graduate, and there are a number of alumni sports groups too. UCL Union also
runs a public gym, Bloomsbury Fitness, and has a sports ground which is available for use by
the public.
Our sports teams are also involved with the community both here and overseas to encourage
take up of amateur sport, particularly in schools. This year the Women’s Rugby Club won the
University of London Union league, the British Universities and College Sports (BUCS)
league, the BUCS Cup, our Varsity competition against Kings College, and the Middlesex
Sevens. This earned them the largest horde of trophies for any sports club in one season in
recent history. In addition they have volunteered in the local community, refereeing tag rugby,
organising tag rugby tournaments for 150 school children and coaching rugby, amongst other
sports. Over the summer they organised a visit to Gambia to train and coach rugby skills at
schools all over the country, culminating in a tournament featuring 15 teams.
The advancement of human rights, conflict resolution or reconciliation or the promotion of
religious or racial harmony or equality or diversity
UCL has always been at the forefront of challenging social exclusion and addressing
questions of social justice. The UCL Institute for Human Rights (IHR), which was launched in
October 2009, was established to bring the university’s multidisciplinary expertise (for
example in law, the humanities, and social and medical sciences) to bear on human rights.
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The UCL IHR brings together the broad range of teaching and research undertaken across
UCL in subjects that fall within the broadly conceived field of human rights. It aims to advance
and disseminate knowledge regarding issues of moral justification, legal interpretation and
practical implementation of human rights, both domestic and international.
The institute also aims to equip students studying human rights with the knowledge and skills
that will enable them to contribute to the human-rights movement, be it through civil society,
governmental institutions or legal practice.
The advancement of environmental protection or improvement
The UCL Energy Institute brings together different perspectives, understandings and
procedures in energy research, transcending the boundaries between academic disciplines. It
coordinates multidisciplinary teams from across the University, providing critical mass and
capacity for ambitious projects. During 2009-10, the Institute won a grant worth more than
£850,000 to develop a new model of energy consumption. The project will involve a
multidisciplinary team of social scientists, building scientists and energy system modellers.
Understanding how, when and why we consume energy is becoming increasingly important
as government and industry plan and implement the decarbonisation of the country's housing
stock, a key step in the move toward a low-carbon world.
Operations
Partnerships and Collaborations
In October 2009 UCL and Yale University initiated an alliance to improve global health
through scientific research, clinical and educational collaboration. The agreement brings
together the skills and expertise of UCL and its associated hospitals (known as UCL
Partners), Yale University and Yale-New Haven Hospital. It is based on the universities’
shared aims to advance biomedical research and treatment of disease for people around the
world.
The collaboration has led to new joint clinical programmes to treat cardiomyopathy, congenital
heart disease, sudden cardiac death and chronic total occlusion of the coronary arteries. In
addition to exchanging expert physicians to treat individual cases at each site, the members
of the collaboration are making use of telemedicine technology to share clinical information
and expertise among themselves, and eventually with other institutions around the world. By
analysing healthcare delivery in the diverse settings overseen by each institution, researchers
can work to develop best management practices for hospitals. UCL scientists will also benefit
from new links to Yale’s renowned scientists and physicians, and will be able to make use of
Yale’s world-class research infrastructure.
As the result of a collaboration with the Kanazawa Institute of Technology in Japan and the
CNRS in France the UCL Ear Institute has installed a new small-animal magnetoencephalograph (MEG), the most advanced machine of its type in the world.
UCL has been in negotiation for 5 years now to establish a new school in Camden under the
Government’s academy programme. UCL’s objectives are to make a real contribution to the
community in which we operate, and to work to raise aspiration and attainment amongst the
academy’s proposed 1,100 pupils. Although several universities now have links with, or joint
sponsorship of, academies, UCL remains the only university to be a sole sponsor. Like many
projects this one has been tied up for several months as discussions with government have
continued over its funding. This has now been resolved and the project will go ahead although
the opening date has, of necessity, been delayed a year to September 2012.
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The development of our new School of Energy and Resources, Australia (UCL SERAus) in
Adelaide continues. The refurbishment of the new campus there is now completed and the
School opened its doors to Masters students in February. The School is also running an
executive education programme.
The UCL Department of Computer Science, has established a national Knowledge Transfer
Network for Financial Services. This initiative, funded by industry, the Technology Strategy
Board, ESRC and NERC, aims to build multi-disciplinary partnerships between academia and
the financial services industry. UCL is a key partner in the new collaboration, together with
other leading universities, and industry bodies such as the ABI, the CII and the Actuarial
Profession. It has a remit that encompasses the whole of financial services and the whole of
the UK, and will provide input to the research councils and government to inform decisions on
strategic funding.
In February 2010 UCL signed a 5 year partnership agreement with the University of
Nazarbayev in Kazakhstan. Under the agreement UCL will deliver a foundation year based on
the University Preparatory Certificates (UPC) that the UCL Language Centre currently offers
in London to high-ability international students, The NUA is a completely new university being
established by the Kazakh government to bring world class education to the Kazakh people.
To help it realise this ambition, the NUA is intending to partner with world-leading universities
to deliver teaching and research across a wide variety of disciplines including Medicine,
Social Sciences, Natural/Applied Sciences, and Engineering and Technology. There are also
to be research centres focusing on Energy, Instrumentation and Life Sciences. All teaching
and research at the university will be in the English Language. In addition, a programme in
English for Academic Purposes (EAP) will also run and UCL will employ 50 teaching staff to
deliver the UPC and the EAP in the Centre for Preparatory Studies (CPS) at the NUA. The
CPS will be located in purpose-built accommodation that will be fitted out to the teaching and
technical specifications required by UCL. Entry standards will be set at the same level as the
programmes delivered in London and teaching will start in Autumn 2010.
Progress continues on the UK Centre for Medical Research and Innovation (UKCMRI). UCL
is one of the four founding partners for the venture, along with the Medical Research Council
(MRC), Cancer Research UK and the Wellcome Trust. The Government’s decision to invest
£220m in the venture was announced in the Comprehensive Spending Review in October
2010 and the Joint Venture Agreement between the founding partners was signed in
November 2010.
In June the consortium released its vision for the institute alongside designs for the building
which will be based at St Pancras and Somers Town in the London Borough of Camden. The
vision has been drafted by a panel of leading international scientists who came together to
conceive of an institute capable of tackling the underlying causes of our most challenging
health problems. They were advised by experts from Oxford, Cambridge, Yale, Harvard, the
US National Institutes of Health and other world-renowned institutions, as well as
biotechnology and pharmaceutical industry leaders. The building is designed to foster
innovation by allowing collaboration between different academic disciplines.
UCL is to become the first British university to open a campus in Doha, Qatar, following an
agreement signed in October by UCL, Qatar Foundation for Education, Science and
Community Development and Qatar Museums Authority (QMA). Approximately 150 students
per year will eventually study a range of research programmes and masters degrees in
archaeology, conservation and museum studies at UCL in Qatar (UCL-Q), while a wide range
of bespoke training courses will be provided for QMA’s museum and heritage professionals.
Research
The UCL Research Strategy recognises that the world’s major problems are complex,
systemic and interconnected to an unprecedented degree. In 2009-10 the university
accelerated its response to these key problems, through the further development of UCL
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Grand Challenges (focused on Global Health, Sustainable Cities, Intercultural Interaction and
Human Wellbeing).
UCL Grand Challenges seek to generate wisdom – here defined as the judicious application
of knowledge for the good of humanity – by bringing together the spectrum of our expertise,
perspectives and methodologies in order to address issues in their full complexity. By creating
networking opportunities, providing spaces for debate and facilitating novel research, they
prepare the way for wise counsel to improve policymaking and practice.
Major UCL Grand Challenges projects and events initiated included Healthy Cities (the
second UCL–Lancet Commission), Carbon Governance, London 2061 (scenarios and drivers
for the capital's future), Urban Water Poverty, Global Perspectives on the Economic Crisis,
Beyond the Ghetto (ethnicity patterns in the built environment), the UCL Global Migration
Symposia Series, Population Footprints (human population growth and global capacity) and
the Religion in Society Forum.
The university formally launched several new cross-disciplinary initiatives: the UCL Institute
for Human Rights, the UCL Genetics Institute, the UCL Institute for Risk & Disaster Reduction
and the UCL Centre for Digital Humanities. UCL 'Town Meetings' were held during the year
on future thematic collaboration on European studies, human evolution, computational
biology, vulnerable populations and forensic sciences.
UCL Research Themes were also introduced in order to encourage cross-disciplinary
interaction on both a structured and spontaneous basis. The themes range from Ageing &
Wellbeing to Energy, Environment & Transport, and from Biomedical Imaging to Risk &
Security.
Building on the existing connections individuals and research groups have with policymakers,
UCL has begun to develop an institution-wide programme of policy engagement through
which external agencies can identify sources of relevant wisdom and UCL can better
anticipate and respond swiftly – using the breadth of its expertise – to emerging policy issues.
Students
The 2009-10 student recruitment cycle saw an unprecedented level of applications for both
undergraduate and taught postgraduate programmes and, despite concerns regarding the
consequences of Points Based Immigration on overseas enrolments, it became evident early
in the year that targets for undergraduate and taught postgraduate programmes would be
exceeded.
Student numbers for 2009-10 reached a total of 22,628, an increase of 1,502 or 7.1% on
2008-09. The majority of the increase was in postgraduate student numbers, which was not
unexpected given the difficult employment market, although the largest increase was in
international taught postgraduate students, which were up 384 or 26% on the previous year.
With respect to undergraduates, UCL was able to manage successfully its recruitment of new
UK/EU students to come within the limit set by the Government and thereby avoid financial
penalties, although numbers still exceeded our internal quota by 310 students or 3%. Actual
recruitment of international undergraduate students also exceeded expectations with an
increase of 186 students above target and 283 or 10% above numbers in the previous year.
Although recruitment of research postgraduates was not as buoyant as the other areas, there
was still a small improvement against target and an increase of 237 students over the
previous year. In order to try and increase UK/EU numbers further, during the year UCL has
awarded 194 IMPACT studentships which provide 50% of the funding required for fees and
stipend for the full three or four years of the programme. Early feedback on the scheme is
encouraging and it is expected that matched funding will be secured to allow around 150 of
the awards to be taken up during 2010-11. As well as enabling us to expand our research
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student population to match those of our competitors, the IMPACT scheme has fostered links
with industrial and other organisations providing match funding for the awards.
In terms of gender, the international trend shows distinctly higher levels of participation in
higher education by women than men – the gap across the UK now exceeds 11%. The data
from UCL, which has remained fairly constant for the past three years, does not match this
trend. At UCL for UK undergraduates, numbers of men and women are almost equal; for
other EU, over 57% are female; for non-EU almost 56% are female (total 51% are female).
For postgraduates, around 53% of UK students are female; 58% for other EU; 58% for nonEU. In total, 55% are female.
In the 2010 National Student Survey 87% of UCL final-year students responding declared
themselves satisfied with the quality of their courses – the same percentage as the previous
year. This compares to a Russell Group average of 86% and a sector average of 83%. In
addition, six months after graduation 83% of UCL graduates were employed in a ‘graduate
job’ as defined by the standard occupational classification system. 88% of graduates were
either employed in some capacity or undertaking further study.
During the year the UCL Common Timetable was introduced. Completion of the project is a
major step forward in the modernisation of UCL and the simplification of its processes. It
means staff and students can now view their personal timetables or find out what is being
taught, when and where, across UCL. Up to 8,000 unique users are accessing the system at
peak times, though daily usage is around 3,000, and students are able to get information in
several formats, personalised according to the modules they have registered to take.
Feedback from students has been very positive. UCL is now making considerably more
efficient use of the teaching estate and managing increased student numbers without
additional space. Allocation of rooms continues to present a challenge. The benefits of
proximity to the department need to be balanced with the requirement for all 11,000+ teaching
events to take place in an appropriate size and style of room and work on this aspect of the
project will continue.
In October 2010 the report from the independent review panel headed by Dame Fiona
Caldicott into Umar Farouk Abdulmutallab’s time at UCL was published. The inquiry panel
was set up in January 2010 following the arrest of Mr Abdulmutallab in the US on 25
December 2009 on suspicion of attempting to bomb a US civil aircraft, and the subsequent
criminal charges brought against him. The inquiry panel was asked to explore the nature of
Mr Abdulmutallab’s experience as an undergraduate student of UCL between 2005 and 2008,
including his period as President of the student Islamic Society.
The central conclusion of the report that there was no evidence to suggest either that Umar
Farouk Abdulmutallab was radicalised while a student at UCL, or that conditions at UCL
during that time or subsequently were conducive to the radicalisation of students. In addition
to investigating the nature of Mr Abdulmutallab’s experience at UCL, the panel also undertook
to suggest how UCL could review its processes in order to ensure that it is implementing good
practice on campus. UCL Council has discussed the panel’s recommendations and has
agreed an action plan setting out how this activity will be taken forward.
Staff and Their Involvement
This year UCL has undertaken a root and branch review of its equality strategies and action
plans. There are now revised Disability and Race Equality Schemes in place, both with
targeted action plans to measure progress. These initiatives were informed by findings from
the 2009 staff survey and were developed in consultation with staff and interest groups. A
vibrant agenda of events was organised by the LGBT Network to mark Lesbian Gay Bisexual
Trans History Month. In addition a plan of action has been agreed to implement the new
Equalities Act, including the establishment of a group of equalities champions at senior level
within UCL.
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There has been demonstrable progress on action to recruit and retain women in academic
science, engineering and technology (SET) disciplines. UCL has attained 4 departmental
Silver Athena SWAN awards and these place UCL at the vanguard of national activity in this
area.
The implementation of an on line recruitment system in the last year has harnessed 21st
century technology as befits a world class employer, enabling both applicants and recruiting
managers to access the system from anywhere in the world 24/7.
UCL has also strengthened its partnership working with its Trade Unions, developing dialogue
and engagement over the nature of budget constraints and efficiency savings. Particular
focus has been on the management of organisational change and staff support through
improved redeployment processes and bespoke career coaching opportunities.
As part of a continual review of the range of benefits available to staff, UCL introduced a
‘Pensions Exchange’ scheme in May 2010 for all members of its two biggest pension
schemes. As a result, staff take-home pay has increased and UCL has benefited from
savings in employers’ national insurance contributions. The savings are being used to
enhance the working environment for staff and to help meet the rising cost of pension
provision.
Procurement
Over the past year UCL has continued to work on a number of major procurement initiatives
with the objectives of providing benefits in cost, efficiency and service. These have mainly
fallen into the following three areas:

Implementation of a streamlined Procure To Pay process including the introduction of
electronic purchasing, on line catalogues and ordering, and electronic invoicing for key
suppliers. This latter initiative now means that over 20% of UCL’s purchase invoices
arrive electronically rather than in hard copy. Future changes include the centralisation of
invoice processing and the introduction of on line Auctions for suitable categories of
spend;

Collaboration through multi organisation purchasing arrangements to help reduce the
overhead of Procurement and provide cost benefits. Examples include UNIPROC - for
stationery, travel, laboratory supplies, books & publications, SUPC – adopting contracts in
areas where UCL has less spend, and the use of National Contracts (gases,
photocopiers, electronic components, computing).

Improvements in the Procurement Strategy to provide cost benefits including a reduction
of supplier base, consolidation of activity into preferred supplier contracts, improvements
in supplier terms, reduction in off contract spend, and the negotiation of early payment
and volume discounts enabled by the process changes that have been implemented
Estates
The year saw the start of a comprehensive review of the Estate Strategy with the long term
objectives of ensuring the Estate is fit for purpose, efficiently and effectively supports the
academic mission, is effectively utilised and environmentally sustainable.
The process commenced with a utilisation study of the Bloomsbury Campus where pressures
on space are intense. The survey took place through the second term and a full report was
issued after Easter. The utilisation survey information has provided a robust platform for the
second stage of the strategic review, the development of a Masterplan for the Bloomsbury
Campus. This work commenced in June 2010 with the appointment of the Masterplan team
led by the architectural practice Lifchutz Davidson Sandilands. The brief for the Masterplan
includes: space utilisation, including efficient use of space, functionality and location of uses;
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movement & circulation; environmental sustainability; public engagement and accessibility;
identity, heritage and integrity with the locality; and the quality of the student experience.
The development of a strategic masterplan is a substantial undertaking which will establish a
long term and flexible framework for the estate for the next ten years and beyond. The study
is expected to be completed by Easter 2011 and will form the centre piece of a new estate
strategy planned to be published during the second half of 2011.
During the year a strategic priority has been to focus on improving the environmental
sustainability of the estate. A series of new initiatives have been implemented, notably joining
the EcoCampus environmental accreditation scheme for Universities; significant acceleration
of progress in implementing the carbon management plan supported by the HEFCE-Salix
Revolving Green Fund; commitment to the 10:10 campaign to reduce carbon emissions by up
to 10% in 2010; and the start of the development of a strategy to increase the capacity of
local combined heat and power generation. An indicator of progress has been UCL’s
improved position in the People and Planet university green league table, rising from 98th
place in 2009 to 48th place in 2010.
The year saw continuing public realm improvement with the completion of the Bloomsbury
Campus external illuminated way finding signage, the refurbishment of the Front Lodges, and
improvements to Malet Place.
Other capital improvements completed include: the refurbishment of 20-21 Gordon Square;
the restoration of the front façade of 16-26 Gordon Square; completion of the second phase
of the learning laboratory on the ground floor of the DMS Watson building; a new
Radiochemistry suite in the Kathleen Lonsdale Building and the expansion of the CPD clinical
skills facilities on the fourth floor of 123 Grays Inn Road for the Eastman Dental Institute.
New projects underway include refurbishment of the Darwin building with improved and
consolidated facilities for the biosciences together with a full refurbishment of the Darwin
lecture theatre. The final phase of the Foster Court refurbishment and completion of public
realm improvements to Malet Place including a new courtyard outside the Medwar Building
are also well advanced. Following the acquisition of Central House, Upper Woburn Place last
year, extensive modernisation and refurbishment works have commenced with a mix of
support and academic activities due to move into the building over coming months. At the
Royal Free Hampstead campus significant works have progressed to improve research
facilities.
This year has also seen the start of a substantial programme of works to improve many
centrally booked teaching rooms including a major upgrade of the Gustave Tuck Lecture
Theatre.
Fundraising, the UCL Campaign & Communications
The Development and Corporate Communications Office has continued to coordinate
fundraising activity for UCL priorities, whilst staff in academic departments have also been
successful in securing gifts for their research and other activities. In the past 12 months, the
DCCO has met with over 300 individuals. There has been particular success in raising gifts to
support the renovation of the Lewis’s Building into new student union accommodation, and for
scholarships and bursaries for undergraduate students.
The Annual Fund has seen a second year of growth in unrestricted funding and generated
over £640,000 for UCL’s greatest needs and priorities and departmental discretionary funds.
A newly established gift club acknowledging our most generous donors, called the Provost’s
Circle, has also seen gifts in excess of £1000 increase by 76% on last year. A focus on new
graduates to help encourage a culture of giving has paid dividends with the class of 2008
alumni making up 13% of all new donors recruited last year.
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CORPORATE GOVERNANCE
UCL is committed to exhibiting best practice in all aspects of corporate governance and
endeavours to conduct its business in accordance with the seven principles identified by the
Committee on Standards in Public Life (selflessness, integrity, objectivity, accountability,
openness, honesty and leadership).
This summary describes the manner in which UCL has applied the principles set out in
Section 1 of the Combined Code on Corporate Governance issued by the London Stock
Exchange in June 1998 and revised in June 2008 in so far as they relate to Higher Education
Institutions. Its purpose is to help the reader of the accounts understand how the principles
have been applied. UCL keeps under careful review its organisation and arrangements to
ensure that the best principles of Governance and Management are maintained in a manner
appropriate to the nature and character of the institution. In so doing, it takes into account
such guidance as set out for example in the Combined Code, the Reports of the Committee
on Standards in Public Life and the CUC Governance Code of Practice.
UCL‘s Governing Body, the Council, has taken account of the CUC’s governance code of
practice and general principles within the CUC Guide for Higher Education Governing Bodies
in the UK issued in 2004. UCL’s practices are consistent with the provisions of the code,
except that the reports of governance effectiveness reviews are not at present published
widely.
The Council is responsible for the system of internal control operating within UCL and its
subsidiary undertakings (“the Group”) and for reviewing its effectiveness. Such a system can
only provide reasonable, and not absolute, assurance against material misstatement or loss,
and cannot eliminate business risk. The Council identifies areas for improvement in the
system of internal control, based on reports and views from the Audit Committee, Academic
Board and other committees.
At its November 2010 meeting, the Council carried out an annual assessment for the year
ended 31 July 2010 by considering a report from the Audit Committee, and taking account of
events since 31 July 2010. The Council is of the view that there is an ongoing process for
identifying, evaluating and managing the Group’s key risks and internal controls, and that it
has been in place for the whole of the year ended 31 July 2010, and up to the date of
approval of the annual report and accounts, that the process has been subject to regular
review, and that it accords with the internal control guidance for directors on the Combined
Code, as deemed appropriate for higher education.
In accordance with the Statutes of UCL, the Council comprises lay members, the President
and Provost (Provost hereafter), academic staff members and student members (in numbers
specified by Statute). The Statutes provide for the distinct roles of Chair and Vice-Chair of the
Council, the Treasurer, and of UCL's Chief Executive, the Provost. The powers and duties of
the Council are set out in Statutes; by custom and under the Financial Memorandum with the
Higher Education Funding Council for England, the Council holds to itself the responsibilities
for the ongoing strategic direction of UCL, approval of major developments and the receipt of
regular reports from UCL officers on the day to day operations of its business and its
subsidiary companies. The Council has formally identified those items of business which it
retains to itself for collective decision. The Council meets at least three times each year; it
has several committees, including Finance Committee, Audit Committee, Risk and Efficiency
Committee, Remuneration Committee and Nominations Committee. All of these Committees
are formally constituted with Terms of Reference.
In accordance with the Regulations for Management of UCL, the Finance Committee
comprises lay members, the Provost and academic staff members (in numbers specified by
regulation). The Committee meets at least four times annually, and is chaired by the
Treasurer. Inter alia it recommends to the Council UCL's annual revenue and capital budgets
and monitors performance in relation to the approved budgets and reviews UCL's annual
financial statements. It also reviews UCL's accounting policies which are applied in the
preparation of those financial statements. The Committee also receives and considers
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CORPORATE GOVERNANCE
reports from the Higher Education Funding Council for England as they affect UCL's business
and monitors adherence with the regulatory requirements.
The Investments Committee, which reports to Finance Committee, is chaired by the Treasurer
and comprises four other lay members with investment expertise appointed by Council. It
governs, manages and regulates the investments of UCL.
The Audit Committee, which meets at least three times annually, is chaired by a lay member
of Council and comprises lay members only. The Committee considers reports from the
Internal Auditors arising from their audits, which highlight significant issues and
management’s response thereon and reviews the conclusions of the work. The Audit
Committee also approves the annual programme of UCL’s Internal Audit Services Audit plans
are drawn up based on assessment of relative risks and significance of each operating area
and their materiality in the context of overall UCL activity. In complying with Code provision
D.2.1 (to conduct, at least annually, a review of the Group’s system of internal controls), the
Audit Committee conducts a high level review of the arrangements for internal control and
data quality, with regular consideration of risk and control, based on reports received from the
Risk and Efficiency Committee, with emphasis given to obtaining the relevant degree of
assurance and not merely reporting by exception. It reports to the Council the results of this
review. The Committee is responsible for meeting with External Auditors to consider the
nature and scope of the annual audit and, thereafter discuss audit findings and the
management letter arising out of the audit of the annual financial statements. Whilst UCL
officers attend the meetings of the Audit Committee as necessary, they are not members of
the Committee, and the Committee meets from time to time with the Internal and External
Auditors on their own for independent discussions.
The Risk and Efficiency Committee includes the Vice-Provosts for Operations and
Academic/International Matters, the Dean of Students, and the heads of UCL’s Corporate
Support Services; the Director of Internal Audit Services is in attendance at meetings. The
Committee was established to develop a strategy for the implementation of a Risk
Assessment and Management Policy, including the methodology for identifying and assessing
significant risks on a continuous basis and ensuring that procedures are in place for those
identified risks to be managed, monitored and reviewed in a consistent and effective manner.
The Committee reviews, on a regular basis, the risk management and control process to
consider what changes, if necessary, should be recommended. It may also consider key
risks identified throughout UCL, for example on academic matters. It reports to the Audit
Committee at termly intervals, or more frequently, should the need arise.
The Academic Committee, which reports to the Council via the Academic Board, is
responsible for inter alia monitoring the effectiveness of the academic quality assurance
strategy, encompassing policies and procedures in respect of quality management and quality
enhancement.
The Nominations Committee considers the filling of vacancies in the lay membership of
Council and of other UCL Committees (except the Nominations Committee, for which Council
itself considers vacancies in the lay membership).
The Remuneration Committee is chaired by the Chair of Council and comprises three other
members of Council and the Provost. It determines the annual remuneration of senior officers
of UCL and where necessary decides on any severance payments. The Provost is excluded
from discussions relating to his own remuneration package. The Remuneration Committee
also receives a report of the annual review of all professorial salaries and administrative
equivalents not otherwise considered by it. The remuneration of these staff is determined by
the Provost in consultation with relevant Vice-Provosts and Deans and the Director of Human
Resources. Salary levels are set to attract and retain members of staff for the successful
operation of UCL, both academically and administratively, and incorporate rewards for
individual performance. No remuneration is paid to lay members of the Council or any of its
Committees.
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RESPONSIBILITIES OF THE COUNCIL OF UNIVERSITY COLLEGE LONDON
In accordance with UCL's Charter and Statutes, the Council is responsible for the
administration and management of the affairs of UCL, including ensuring an effective system
of internal control, and is required to present audited financial statements for each financial
year.
The Council is responsible for the keeping of proper accounting records which disclose with
reasonable accuracy at any time the financial position of UCL and for ensuring that the
financial statements are prepared in accordance with UCL's Charter and Statutes, the
Statement of Recommended Practice: Accounting for Further and Higher Education and other
relevant accounting standards. In addition, within the terms and conditions of the Financial
Memorandum agreed between the Higher Education Funding Council for England and the
Council of UCL, the Council, through the Provost, its designated office holder, is required to
prepare financial statements for each financial year which give a true and fair view of the state
of affairs of UCL and of the surplus or deficit and cash flows for that year.
In causing the financial statements to be prepared, the Council has ensured that:
(i) suitable accounting policies are selected and applied consistently;
(ii) judgments and estimates are made that are reasonable and prudent;
(iii) applicable accounting standards have been followed, subject to any material
departures disclosed and explained in the financial statements;
(iv) financial statements are prepared on the going concern basis. The Council is
satisfied that it has adequate resources to continue in operation for the foreseeable
future and for this reason the going concern basis continues to be adopted in the
preparation of the financial statements.
The Council has taken reasonable steps to:
(i) ensure that funds from the Higher Education Funding Council for England are used
only for the purposes for which they have been given and in accordance with the
Financial Memorandum with the Funding Council and any other conditions which the
Funding Council may from time to time prescribe;
(ii) ensure that there are appropriate financial and management controls in place to
safeguard public funds and funds from other sources;
(iii) safeguard the assets of UCL and prevent and detect fraud;
(iv) secure the economical, efficient and effective management of UCL's resources and
expenditure.
The key elements of UCL’s system of internal control, which is designed to discharge the
responsibilities set out above, include the following:
(i) clear definitions of the responsibilities of, and authority delegated to, heads of
academic and administrative departments;
(ii) comprehensive Financial Regulations, detailing financial controls and procedures,
approved by the Council;
(iii) a professional Internal Audit Service whose annual programme of work is approved
by Audit Committee endorsed by the Council, and whose head provides the Provost,
Audit Committee and Council, with a report on internal audit activity within UCL and
an opinion on the adequacy and effectiveness of UCL’s system of internal control,
including internal financial control;
19
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
RESPONSIBILITIES OF THE COUNCIL OF UNIVERSITY COLLEGE LONDON
(iv) regular reviews of financial performance and key business risks, and termly reviews
of financial forecasts including variance reporting and updating;
(v) a comprehensive planning process for the short to medium term supported by
detailed income, expenditure, capital and cash flow budgets and forecasts, including
review and refresh of strategic objectives, the key risks affecting their achievement
and key performance indicators of progress.
(vi) embedded risk management policies and procedures incorporating identification,
monitoring and review of internal controls moderating and mitigating key risks,
covering all categories of risk at all levels of the organisation.
(vii) clearly defined procedures for the approval and control of expenditure, with
investment decisions involving capital or recurrent expenditure being subject to formal
detailed review according to levels set by the Council.
Any system of internal control can only provide reasonable, and not absolute, assurance
against material misstatement or loss.
The Council is responsible for the maintenance and integrity of the corporate and financial
information included on the company's website. Legislation in the United Kingdom governing
the preparation and dissemination of financial information differs from legislation in other
jurisdictions.
20
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF THE COUNCIL OF
UNIVERSITY COLLEGE LONDON
We have audited the financial statements of University College London (UCL) for the year
ended 31 July 2010 which comprise the statement of principal accounting policies, the
consolidated income and expenditure account, the statement of total recognised gains and
losses, the consolidated and entity balance sheets, the consolidated cash flow statement, and
the related notes 1 to 40. These financial statements have been prepared under the
accounting policies set out therein.
This report is made solely to the Council of UCL, as a body, in accordance with the Financial
Memorandum dated June 2008. Our audit work has been undertaken so that we might state
to the Council those matters we are required to state to them in an auditors' report and for no
other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Council and the Council’s members as a body, for our
audit work, for this report, or for the opinions we have formed.
Respective responsibilities of the Council and auditors
The Council’s responsibilities for preparing the Annual Report and the financial statements in
accordance with UCL’s statute, the Statement of Recommended Practice on Accounting for
Further and Higher Education and other applicable law and United Kingdom accounting
standards (United Kingdom Generally Accepted Accounting Practice) are set out in the
statement of the Council’s responsibilities.
Our responsibility is to audit the financial statements in accordance with relevant legal and
regulatory requirements 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 are properly prepared in accordance with the Statement of Recommended Practice on
Accounting for Further and Higher Education. We also report whether income from funding
bodies, grants and income for specific purposes and from other restricted funds administered
by UCL have been properly applied only for the purposes for which they were received. In
addition, we report to you whether income has been applied in accordance with the UCL’s
statutes and, where appropriate, with the Financial Memorandum with the Higher Education
Funding Council for England.
We also report if, in our opinion, the information given in the Annual Report as described in
the contents section is not consistent with the financial statements, if UCL has not kept
adequate accounting records, or if we have not received all the information and explanations
we require for our audit.
We also at the request of Council, review whether the corporate governance statement
reflects the Group’s compliance with the four provisions of the Combined Code specified for
our review by Council and we report if it does not. We are not required to consider whether
the Council’s statements on internal control cover all the risks and controls, or form an opinion
on the effectiveness of the Group’s corporate governance procedures or its risk and control
procedures.
We read the other information contained in the Annual Report and consider whether it is
consistent with the audited financial statements. We consider the implications for our report if
we become aware of any apparent misstatements or material inconsistencies with the
financial statements. Our responsibilities do not extend to any further information outside the
Annual Report.
We are not required to consider whether the statement of internal control (included as part of
the Corporate Governance Statement) covers all risks and controls, or to form an opinion on
the effectiveness of UCL’s corporate governance procedures or its risk and control
procedures.
21
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
STATEMENT OF PRINCIPAL ACCOUNTING POLICIES
1. Basis of Preparation
The financial statements are prepared under the historical cost convention as modified by the
revaluation of investments and in accordance with both the Statement of Recommended
Practice: Accounting for Further and Higher Education (SORP) 2007 and applicable United
Kingdom Generally Accepted Accounting Practice.
UCL’s business activities, together with the factors likely to affect its future development,
performance and position are set out in the Operational and Financial Review on pages 4 to
16. The financial position of UCL, its cash flows, liquidity position and borrowing facilities are
also described here. UCL has considerable financial resources, along with funding from
HEFCE, for research grants and other teaching contracts across different geographic areas
and industries. As a consequence, Council believes that UCL is well placed to manage its
risks successfully despite the current uncertain economic outlook. The members of Council
have a reasonable expectation that UCL has adequate resources to continue in operational
existence for the foreseeable future. Thus they continue to adopt the going concern basis of
accounting in preparing the annual financial statements.
2. Basis of Consolidation
The consolidated financial statements consolidate the financial statements of UCL and its
subsidiary undertakings (collectively referred to as “the Group”) for the financial year to 31
July. The results of subsidiaries acquired or disposed of during the period are included in the
consolidated income and expenditure account from the date of acquisition or up to the date of
disposal. Intra-group transactions are eliminated on consolidation.
The UCL Union has not been consolidated since it is a separate enterprise over which UCL
has limited influence both in areas of financial control and policy decisions.
3. Income and Expenditure Account
The income and expenditure account has been drawn up in line with the SORP and with
classifications based on the requirements of the annual financial return made to the Higher
Education Statistics Agency.
Funding Council block grants are accounted for in the period to which they relate.
Funding Council grants to fund special initiatives are credited to the income and expenditure
account in line with the delivery of each initiative. Any payments received in advance of
service delivery are recognised in the balance sheet as liabilities.
Tuition fee income is stated gross and credited to the income and expenditure account over
the period in which students are studying. Bursaries and scholarships are accounted for gross
as expenditure and not deducted from income.
Income received from research grants and contracts is included to the extent only of
expenditure incurred during the year, together with any related overhead contributions
towards costs.
Other income and income in respect of other services rendered are accounted for on an
accruals basis and credited to the income and expenditure account to the extent of the
completion of the contract or service concerned. Any payments received in advance of
service delivery are recognised in the balance sheet as liabilities.
Income from the sale of goods or services is credited to the income and expenditure account
when the goods or services are supplied to the external customer or the terms of the contract
have been satisfied.
23
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
STATEMENT OF PRINCIPAL ACCOUNTING POLICIES
Income from general donations to support revenue expenditure is credited to the income and
expenditure account in full in the year in which it is receivable.
Income is deferred only when the Group has to fulfil conditions before becoming entitled to it
or where it has been specified by the donor that the money must be expensed in a future
period.
Income received from endowments is credited to the income and expenditure account in the
period in which it is earned. Income from restricted endowments not expended in the year is
transferred from the income and expenditure account to an endowment reserve fund.
Realised gains or losses arising from dealing in assets underlying endowment funds are
retained within the endowment in the balance sheet.
Increases or decreases in value arising on the revaluation or disposal of endowment assets is
added to or subtracted from the funds concerned and accounted for through the balance
sheet by debiting or crediting the endowment asset, crediting or debiting the endowment fund
and is reported in the statement of total recognised gains and losses.
Any increase in value arising on the revaluation of fixed asset investments is carried as a
credit to the revaluation reserve, via the statement of total recognised gains and losses;
impairment in value is charged to the income and expenditure account as a debit, to the
extent that it is not covered by a previous revaluation surplus.
Expenditure incurred relates to the receipt of goods and services. A provision for bad debts is
included on the basis that as debts become older a higher percentage become irrecoverable.
Where the Group disburses funds it has received as paying agent on behalf of the Funding
Council or other body, and has no beneficial interest in the funds, the receipt and subsequent
disbursement of the funds have been excluded from the income and expenditure account.
4. Pension Arrangements
The Group contributes to three principal pension schemes on behalf of its employees: the
Universities Superannuation Scheme (USS), the Superannuation Arrangements of the
University of London (SAUL) and the National Health Service Pension Scheme.
Contributions are also made to two smaller schemes, the Federated Pension Scheme (FPS)
and the Royal Free Hospital School of Medicine Pension and Assurance Scheme (RFHSM)
both of which are closed to new members.
All are defined benefit schemes. The USS, SAUL and the NHS Pension Scheme are multiemployer schemes and it is not possible to identify UCL’s share of the underlying assets and
liabilities. Therefore, as required by FRS 17, the contributions are charged directly to the
income and expenditure account as if the schemes were defined contribution schemes.
USS is a “last man standing” scheme which means that in the event that another member
institution becomes insolvent the other participating members will pick up any funding
shortfall. Further details about USS, information about the latest informal valuations of the
scheme and proposed rule changes can be found at www.uss.co.uk.
The FPS and RFHSM are single employer defined benefit schemes accounted for in
accordance with FRS 17. The amounts charged to the income and expenditure account are
the current service costs and gains and losses on settlements and curtailments. They are
included as part of staff costs. Past service costs are recognised immediately in the income
and expenditure account if the benefits have vested in the scheme membership. If the
benefits have not vested immediately, the costs are recognised over the period until vesting
occurs. The interest cost and the expected return on assets are shown as a net amount of
other finance costs or credits adjacent to interest. Actuarial gains and losses are recognised
immediately in the statement of total recognised gains and losses.
24
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
STATEMENT OF PRINCIPAL ACCOUNTING POLICIES
The FPS and RFHSM schemes are funded, with the assets of the schemes held separately
from those of the group, in separate trustee administered funds. Pension scheme assets are
measured at fair value and liabilities are measured on an actuarial basis using the projected
unit method and discounted at a rate equivalent to the current rate of return on a high quality
corporate bond of equivalent currency and term to the scheme liabilities. The actuarial
valuations are obtained at least triennially and are updated at each balance sheet date. The
resulting defined benefit asset or liability, net of the related deferred tax, is presented
separately after other net assets on the face of the balance sheet.
5. Accounting for Research and Development
Expenditure on pure and applied research is expensed, and is treated as part of the
continuing activities of the Institution. Expenditure on development activities is carried
forward and amortised over the period expected to benefit, where the conditions of SSAP 13
are met.
6. Foreign Currencies
Transactions denominated in foreign currencies are recorded at the rate of exchange ruling at
the dates of the transactions. Monetary assets and liabilities denominated in foreign
currencies are translated into sterling at year end rates. The resulting exchange differences
are dealt with in the determination of income and expenditure for the financial year unless
such funds are held for onward transmission to a research partner under an agency
agreement, in which case they are included in creditors.
7. Taxation
UCL enjoys charitable status and is therefore potentially exempt from taxation in respect of
most income under Part 11 Chapter 3 of the Corporation Tax Act 2010 and in respect of
capital gains under Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent
that they are applied for its charitable purposes.
Subsidiary companies are liable to corporation tax.
UCL is partially exempt for the purposes of Value Added Tax and is only able to reclaim a
minor element of VAT charged on goods and services bought in.
8. Land and Buildings
Land and Buildings are stated in the Balance Sheet at cost where purchased or constructed
by the Group, or valuation where acquired through donation or via the exchange of nonmonetary consideration. Freehold buildings are depreciated on a straight line basis over their
expected useful lives of 50 years. Land which is held freehold is not depreciated and that
held on long leasehold is depreciated over the life of the lease up to a maximum of 50 years.
Major refurbishments and fixtures and fittings are capitalised and depreciated as follows:
Major refurbishments
Fixtures and fittings
20 years
10 years
9. Equipment
Expenditure on furniture and equipment costing less than £25,000 is written off to the income
and expenditure account in full in the year of acquisition.
25
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
STATEMENT OF PRINCIPAL ACCOUNTING POLICIES
Equipment and furniture costing more than £25,000 is capitalised at cost, and depreciated
over its expected useful life as follows:
Equipment funded by research grants
Other furniture and equipment
Term of grant
5 years
10. Acquisition with the aid of specific grants
Where tangible fixed assets, excluding freehold land, are acquired with the aid of specific
grants, they are capitalised and depreciated as above. The related grants are credited to a
deferred capital grant account, and are released to the income and expenditure account over
the expected useful economic life of the related asset on a basis consistent with the
depreciation policy.
Specific grants received to fund the purchase of freehold land are credited directly to the
income and expenditure account in the year of the purchase.
11. Leased Assets
Finance lease obligations are included within creditors. Financing amounts are charged to the
income and expenditure account so as to produce a constant periodic charge on the balance
outstanding. Assets held under finance leases are capitalised and depreciated over the
shorter of the lease term or the expected useful lives of equivalent owned assets.
Operating lease costs are charged to the income and expenditure account in the year in
which they are incurred.
12. Heritage Assets
Individual objects, collections, specimens or structures with historic, artistic, scientific,
technological, geophysical or environmental qualities that are held and maintained principally
for their contribution to knowledge and culture are termed heritage Assets.
Heritage assets acquired on or after 1st July 2006, whether donated, purchased or on loan,
are capitalised and recognised in the balance sheet at cost or valuation, where such cost or
valuation is reasonably obtainable or reliable and amounts to £25,000 or more.
Items donated or on loan are valued by internal valuers. In exceptional cases, where items
are of a rare or unusual nature, an external valuation may be sought.
Heritage assets acquired prior to 1st July 2006 have not been capitalised due to the difficulty
and cost of attributing a reliable cost or value to them, in particular due to the significant cost
involved in the reconstruction and analysis of past accounting records required to do so.
The useful economic lives of assets capitalised are considered and depreciation provided
accordingly where they are considered to be finite.
13. Patents, licences, rights, trademarks and other similar rights over assets
Expenditure on patents, licenses, rights, trademarks and other similar rights over assets is
charged to the income and expenditure account in full, in the year in which they are incurred.
14. Investments
Endowment Asset Investments and fixed asset investments in listed securities are stated at
market value in the Balance Sheet. Subsidiary and associate company investments are
stated at cost less provision for impairment.
26
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
STATEMENT OF PRINCIPAL ACCOUNTING POLICIES
Current asset investments are shown at the lower of cost or net realisable value.
In the consolidated accounts the Group’s share of the results in joint ventures is shown each
year in the income and expenditure account and the group’s share of gross assets and
liabilities is recognised on the balance sheet.
15. Stocks
Stocks are made up of goods for resale, centrally held stock holdings and major stocks held
by academic departments and are stated at the lower of cost or net realisable value.
16. Cash Flows and Liquid Resources
Cash flows comprise increases or decreases in cash.
Cash includes cash in hand and overdrafts. Liquid resources comprise assets held as a
readily disposable store of value. They include current asset investments and endowment
cash balances.
27
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
CONSOLIDATED INCOME AND EXPENDITURE ACCOUNT
YEAR ENDED 31 JULY 2010
INCOME
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Endowment income and interest receivable
Note
1
2
3
4
5
Total Income
Less: Share of income from joint ventures
15
Net Income
EXPENDITURE
Staff costs
Other operating expenses
Interest payable
Depreciation
6
7
8
9
Total Expenditure
SURPLUS AFTER DEPRECIATION OF TANGIBLE FIXED
ASSETS AT COST AND BEFORE TAX
Share of operating profit in joint ventures
Share of operating loss in associates
Taxation
Share of taxation in associates
15
16
10
16
SURPLUS AFTER DEPRECIATION OF ASSETS AT COST AND
TAX
Minority interest
26
SURPLUS BEFORE EXCEPTIONAL ITEMS
Exceptional items: continuing operations
Profit on disposal of fixed asset investments
Loss on disposal of tangible fixed assets
SURPLUS ON CONTINUING OPERATIONS AFTER
DEPRECIATION OF ASSETS AT COST, DISPOSAL OF
ASSETS AND TAX
Surplus for the year transferred to accumulated income in
endowment funds
11
24
SURPLUS FOR THE YEAR RETAINED WITHIN GENERAL
RESERVES
2010
£'000
Restated
2009
£'000
200,995
150,555
275,061
133,801
5,004
209,895
126,736
254,285
124,026
8,164
765,416
723,106
(3,032)
(3,725)
762,384
719,381
442,666
242,086
7,325
40,284
417,236
237,649
12,722
39,921
732,361
707,528
30,023
11,853
56
(325)
(11)
(1)
(312)
(374)
2
11
29,742
11,180
(895)
(52)
28,847
11,128
738
-
(6,149)
29,585
4,979
70
139
29,655
5,118
The consolidated income and expenditure of the Group relates wholly to continuing activities.
2009 figures have been restated. Details of restatements are provided at Note 40.
28
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
STATEMENT OF GROUP HISTORICAL COST SURPLUSES AND
DEFICITS
Note
2010
£'000
2009
£'000
29,596
4,977
550
550
Historical cost surplus for the year before taxation
30,146
5,527
Historical cost surplus for the year after taxation
30,135
5,529
2010
£'000
2009
£'000
24
24
24
29,585
5,357
1,817
3,610
4,979
(3,864)
(5,659)
1,320
25
(81)
(24)
25
25
25
383
2,359
(300)
8
1,203
(2,979)
42,730
(5,016)
RECONCILIATION TO CLOSING RESERVES AND
ENDOWMENTS
Opening reserves and endowments
Total recognised gains/(losses) for the year
249,536
42,730
254,552
(5,016)
Closing reserves and endowments
292,266
249,536
Surplus on continuing operations before taxation
Difference between historical cost depreciation and the actual
charge for the year calculated on the re-valued amount
STATEMENT OF GROUP TOTAL RECOGNISED GAINS AND
LOSSES
Surplus on continuing operations after depreciation of assets at cost
and disposal of assets and tax
Appreciation/(diminution) of endowment asset investments
Net realised gain/(loss) from sale of endowment asset investments
Net endowments received in year
Adjustment to income and expenditure reserve for previously
unconsolidated associates
Adjustment to income and expenditure reserve for change in
percentage holdings in associates
Unrealised gain on revaluation of fixed asset investments
Actuarial loss in respect of pension schemes
29
25
Note
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
CONSOLIDATED CASH FLOW STATEMENT
Note
2010
£'000
2009
£'000
Net cash inflow from operating activities
29
86,804
24,066
Returns on investments and servicing of finance
31
(2,461)
225
Taxation
10
(11)
2
Capital expenditure and financial investment
32
(12,873)
(7,774)
Acquisitions and disposals
33
(70)
(138)
71,389
16,381
Cash inflow before use of liquid resources and financing
Management of liquid resources
30
(51,324)
(7,567)
Financing
34
(1,226)
(1,379)
18,839
7,435
Increase in cash in the year
Increase in deposits repayable at short notice
Decrease in debt
18,839
51,324
1,226
7,435
7,567
1,330
Change in net funds
71,389
16,332
Net funds at 1 August 2009
22,253
5,921
93,642
22,253
Increase in cash in the year
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN
NET FUNDS
Net funds at 31 July 2010
30
32
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
1. FUNDING COUNCIL GRANTS
HEFCE recurrent grant:
Teaching
Research
Other (including special funding)
2010
£'000
2009
£'000
68,649
104,937
10,014
68,751
104,115
12,677
9,274
8,121
15,869
8,483
200,995
209,895
2010
£'000
2009
£'000
47,133
73,946
8,168
7,331
6,607
7,370
38,985
61,539
7,241
5,390
5,183
8,398
150,555
126,736
2010
£'000
Restated
2009
£'000
101,256
86,886
34,138
12,029
20,153
2,933
15,925
1,741
91,229
86,483
29,070
10,056
16,224
3,315
16,739
1,169
275,061
254,285
231,156
43,905
215,140
39,145
275,061
254,285
Deferred Capital Grants released in year:
Buildings
Equipment
2. ACADEMIC FEES AND SUPPORT GRANTS
Full-time students
Full-time students charged overseas fees
Part time fees
Other fees
Research training support grants
Short course fees
3. RESEARCH GRANTS AND CONTRACTS
Source of income:
OST research councils
UK based charities
UK central government, local/health authorities, hospitals
UK industry, commerce and public corporations
EU government bodies
EU other
Other overseas
Other sources
Research income relating to direct expenditure incurred during the year
Contribution towards overhead costs
Income from research grants and contracts includes deferred capital grants released in the year of
£8,285,000 (2009 £8,602,000).
2009 figures have been restated. Details of restatements are provided at Note 40.
33
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
4. OTHER OPERATING INCOME
2010
£'000
2009
£'000
23,185
33,909
36,994
14,239
3,663
18,790
3,021
22,836
24,244
33,996
14,415
3,442
21,387
3,706
133,801
124,026
Residences and catering
Other services rendered
Health authorities
Donations and sundry grants
Released from deferred capital grants
Other income
Share of joint venture income
Income from residences and catering includes deferred capital grants released in the year of £41,000
(2009 £41,000).
5. ENDOWMENT AND INVESTMENT INCOME
Note
2010
£'000
2009
£'000
Income from expendable endowments
Income from permanent endowments
Other interest receivable and investment income
Share of joint venture income
24
24
2,165
362
2,466
11
2,254
393
5,498
19
5,004
8,164
2010
£'000
2009
£'000
364,770
30,987
46,909
346,057
30,264
40,915
442,666
417,236
6. INFORMATION REGARDING EMPLOYEES
Staff costs:
Salaries and wages
NI contributions
Other pension costs
Note
36
2009 figures have been restated. Details of restatements are provided at Note 40.
Emoluments of the Provost and President:
Salary
Non pensionable lump sum payment
Benefits
Payment in lieu of pension scheme contributions
Pension contributions
2010
£
2009
£
302,326
15,453
47,352
303,492
20,000
12,280
40,418
28,552
365,131
404,742
The emoluments of the Provost are shown on the same basis as for higher paid staff.
Compensation for loss of office in respect of one higher paid employee totalled £50,095 (2009 £nil).
No trustee has received any remuneration from the group during the year (2009 – £nil).
7 trustees are also employees of the University but received no additional payment for acting as
trustees.
The total expenses paid to or on behalf of 2 trustees was £593 (2009 – £nil).
34
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Remuneration of higher paid staff:
The following sets out the remuneration of all higher paid staff including distinction awards paid to
clinical academic staff and payments relating to private consultancy work, both of which are funded
from non-HEFCE funds, but excluding employers pension contributions:
2010
2009
No.
No.
£100,001 - £110,000
49
64
£110,001 - £120,000
61
49
£120,001 - £130,000
31
33
£130,001 - £140,000
29
28
£140,001 - £150,000
29
27
£150,001 - £160,000
23
23
£160,001 - £170,000
27
19
£170,001 - £180,000
17
23
£180,001 - £190,000
15
14
£190,001 - £200,000
17
13
£200,001 - £210,000
11
8
£210,001 - £220,000
3
3
£220,001 - £230,000
2
1
£230,001 - £240,000
3
2
£240,001 - £250,000
1
£250,001 - £260,000
1
£260,001 - £270,000
2
1
£310,001 - £320,000
1
£320,001 - £330,000
2
£370,001 - £380,000
1
The average number of individuals paid through the payroll during the year was 9,638 (2009 9,385).
7. OTHER OPERATING EXPENSES
2010
£'000
Restated
2009
£'000
12,037
23,500
33,368
7,687
18,359
14,854
8,724
11,548
6,472
6,448
11,655
1,518
1,822
8,000
16,791
10,960
165
78
2,324
7,592
38,184
12,999
21,160
33,015
7,083
16,963
13,609
8,632
12,571
7,332
9,591
7,242
1,711
2,401
7,719
16,315
11,285
143
13
2,278
8,421
37,166
242,086
237,649
Residences and catering
Furniture, computer and other equipment costs
Academic consumables and laboratory expenditure
Books, publications and periodicals
Scholarships and prizes
General educational expenditure
Rents, rates and insurance
Heat, light, water and power
Service charges
Repairs and general maintenance
Long term maintenance
Telephone
Advertising and recruitment
Printing, postage, stationery and other office costs
Conference, travel and training
Professional fees
Audit Fees
Other fees paid to auditors
Grants to Students Union and other student bodies
Payments to non contract staff and agencies
Other costs
2009 figures have been restated. Details of restatements are provided at Note 40.
35
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
8. INTEREST AND OTHER FINANCE COSTS
Note
Bank loans and other loans wholly repayable within five years
Loans not wholly repayable within five years
Finance leases
Realised and unrealised losses on shares held as fixed assets
Net charge on pension scheme assets and liabilities
36
2010
£'000
2009
£'000
5
3,641
3,357
322
221
3,729
3,452
5,219
101
7,325
12,722
9. ANALYSIS OF EXPENDITURE BY ACTIVITY
2010
Academic departments
Academic services
Research grants and contracts
Residences and catering
Premises
Administration
Other expenses
Staff
Costs
£'000
Other
Operating
Expenses
£'000
Interest
Payable
£'000
Depreciation
£'000
Total
£'000
223,839
20,501
128,295
2,773
8,158
40,820
18,280
27,527
15,204
94,576
12,037
50,365
26,086
16,291
1,859
3,855
1,611
7,589
2,192
8,285
2,658
19,037
412
111
258,955
37,897
231,156
19,327
81,415
67,318
36,293
442,666
242,086
7,325
40,284
732,361
The depreciation charge has been funded from:
Deferred capital grants released
General income
£'000
29,894
10,390
40,284
Restated
2009
Academic departments
Academic services
Research grants and contracts
Residences and catering
Premises
Administration and central
services
Other expenses
Staff
Costs
£'000
Other
Operating
Expenses
£'000
Interest
Payable
£'000
Depreciation
£'000
Total
£'000
213,014
19,968
119,002
2,844
8,047
31,133
15,741
87,536
11,565
46,470
1,964
3,838
7,535
2,128
8,602
1,138
20,114
251,682
37,837
215,140
17,511
78,469
37,609
16,752
28,200
17,004
6,920
268
136
66,077
40,812
417,236
237,649
12,722
39,921
707,528
The depreciation charge has been funded by:
Deferred capital grants released
General income
£'000
30,025
9,896
39,921
36
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
10. TAXATION
Taxation charges and credits are in respect of UK corporation tax in the
following subsidiary companies:
2010
£’000
2009
£’000
UCL Trading Ltd
UCL Business Plc
(11)
-
2
Total tax charge
(11)
2
2010
£'000
2009
£'000
738
-
738
-
-
(5,951)
(198)
-
(6,149)
11. EXCEPTIONAL ITEMS
Profit on disposal of fixed asset investments:
Profit on disposal of shares held as fixed asset investments
Loss on disposal of tangible fixed assets:
Loss on disposal of work in progress – Institute of Cultural Heritage
Loss on disposal of equipment
See Note 8 regarding the reclassification of realised/unrealised losses on fixed asset investments.
12. TANGIBLE ASSETS
Consolidated
Cost
At 1 August 2009
Additions at cost
Transfers
At 31 July 2010
Freehold
Land and
Buildings
£'000
Leasehold
Land and
Buildings
£'000
Equipment,
Plant and
Machinery
£'000
Assets in the
course of
construction
£'000
Total
£'000
543,004
15,597
4,194
562,795
178,452
8,958
5,107
192,517
144,957
12,111
157,068
9,307
3,589
(9,301)
3,595
875,720
40,255
915,975
Depreciation
At 1 August 2009
Charge for year
At 31 July 2010
Net Book Value
At 31 July 2010
141,393
18,192
159,585
56,385
5,748
62,133
114,380
16,344
130,724
-
312,158
40,284
352,442
403,210
130,384
26,344
3,595
563,533
At 1 August 2009
401,611
122,067
30,577
9,307
563,562
37
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
UCL
Cost
At 1 August 2009
Additions at cost
Transfers
At 31 July 2010
Freehold
Land and
Buildings
£'000
Leasehold
Land and
Buildings
£'000
Equipment,
Plant and
Machinery
£'000
Assets in the
course of
construction
£'000
Total
£'000
543,004
15,597
4,194
562,795
177,285
8,958
5,107
191,350
144,207
12,023
156,230
9,307
2,097
(9,301)
2,103
873,803
38,675
912,478
Depreciation
At 1 August 2009
Charge for year
At 31 July 2010
Net Book Value
At 31 July 2010
141,393
18,192
159,585
56,017
5,707
61,724
113,864
16,274
130,138
-
311,274
40,173
351,447
403,210
129,626
26,092
2,103
561,031
At 1 August 2009
401,611
121,268
30,343
9,307
562,529
The declared value of buildings for insurance purposes (day one basis) as at 1 August 2010 was
£2,187m (2009 £2,176m).
At 31 July 2010, freehold land and buildings included £32.7m (2009 £32.7m) in respect of freehold land
which is not depreciated.
The above includes assets held under finance leases. At 31 July 2009 the net book value of the assets
held under finance leases was £25.3m (2009 £25.9m) with a depreciation charge for the year of
£638,000 (2009 £638,000).
13. HERITAGE ASSETS
Since its foundation in 1826 UCL has acquired and established a number of significant collections of
heritage assets representative of its interests in the arts, humanities, sciences and medicine. Many of
the items contained therein are of international as well as national importance.
UCL’s collections have made, and continue to make, a significant contribution to the furtherance of
scholarship, promotion of innovation and the dissemination of knowledge for public benefit.
UCL recognises that its status as a first class international university requires the adoption of
internationally-recognised standards of conduct in the acquisition, preservation, management and
disposal of heritage assets, as well as meeting the requirements of United Kingdom legislation. Policies
to ensure appropriate standards are maintained are set out in the Cultural Property Policy. UCL’s
Museums, Heritage and Cultural Property Committee is responsible for oversight of all UCL’s activities
in relation to heritage assets and for advising Council thereon.
No assets have been capitalised in the balance sheet for the year ended 31 July 2010 as the volume of
items, the elapsed time since acquisition and the information available on acquisition methods render
the cost of identifying the appropriate accounting treatment disproportionate to the benefit to be derived
by users of the financial statements. Further, there have been no additions in the year under review
which met the capitalisation threshold of £25,000.
The principal collections are as follows:
Petrie Collection of Egyptian and Sudanese Archaeology.
The collection comprises over 86,000 objects acquired over a period spanning 1892 to the present day,
via a combination of donations, bequests, purchases and direct collection.
38
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
William Petrie was appointed to the first British Chair of Egyptology and Philology in 1892 at UCL. He
conducted numerous excavations from 1884 to 1924 from which many of the objects in the collection
derive.
At any time, a number of objects from the collection are on display in the Petrie Museum which is open
to the public Tuesday to Saturday from 13.00 to 17.00. Special arrangements can be made to
accommodate school visits and individual researchers. The museum also offers a range of teaching
and learning resources and services.
UCL Art Collections
The collection comprises over 10,000 fine art objects acquired from 1847 to the present day, via a
combination of donations bequests, purchase and direct collection.
Sub collections include the Flaxman sculpture collection, the Flaxman drawings, the Painting
Collection, European Print Collection, European Drawing Collection, Slade Print Collection, Slade
Drawing Collection, The collections include prize-winning student work from the Slade School of Fine
Art, prints and drawings by Old Master artists such as Durer, Rembrandt, Turner and Constable and
sculpture models by the Neo-Classical artist John Flaxman.
UCL Art Collections operates a study centre, a gallery with public exhibitions and a range of education
programmes. There is an on-line catalogue where many of the items in the collection can be viewed.
Grant Museum of Zoology
The Grant Museum is the only remaining university zoological museum in London. It was founded as a
teaching collection and currently houses around 62,000 specimens, covering the whole Animal
Kingdom, collected from 1827 to the present day.
The Museum contains many skeletons, mounted animals and specimens preserved in fluid. Many of
the species are now endangered or extinct including the Tasmanian tiger or thylacine, the quagga, and
the dodo.
Further items of particular interest and beauty include a selection of spectacular glass models made by
the Blaschka family in the late 1800s, many of Robert Grant's original specimens as well as those of
Thomas Henry Huxley, and the collection of Sir Victor Negus's bisected heads which have been
described as “both arresting and beautiful”.
Acquisitions have been by way of donation and bequest, purchase and direct collection by staff and
students.
The museum is open to the public every week day afternoon from 13.00 to 17.00 hours.
Library Special Collections of Books and Manuscripts
UCL Library Special Collections is one of the foremost university collections of manuscripts, archives
and rare books in the UK. It includes fine collections of medieval manuscripts and early printed books,
notably from the C.K Ogden Collection and Graves Library, as well as significant holdings of 18th
century works, and highly important 19th and 20th century collections of personal papers, archival
material, and literature, covering a vast range of subject areas, notably Latin American archives, Jewish
collections and the George Orwell Archive.
The collections have been built up since 1826 to the present day by way of donation, bequest,
purchase and direct collection.
In addition to the above, there are a number of smaller collections covering a range of subjects
including archaeology, geography and biomedicine.
39
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
14. INVESTMENTS
Monies held
on long term
deposit
£'000
Other
Investments
£'000
Investment in
subsidiaries
£'000
9,815
675
-
25,885
9,974
(200)
2,359
(130)
(7,126)
-
35,700
10,649
(200)
2,359
(130)
(7,126)
At 31 July 2010
10,490
30,762
-
41,252
UCL
At 1 August 2009
Additions
Revaluations
Impairments
Disposals
9,815
675
-
24,957
9,913
2,359
(7,126)
2,712
(700)
-
37,484
10,588
2,359
(700)
(7,126)
At 31 July 2010
10,490
30,103
2,012
42,605
Consolidated
At 1 August 2009
Additions
Investment reclassified as Associate
Revaluations
Impairments
Disposals
Total
£'000
Included in monies held on long term deposits is £10.49m (2009 £9.82m) over which there is a legal
charge.
The deposit represents a security fund to meet the obligations under finance leases (Note 20).
Included in other investments is a £250,000 investment in Combined London Colleges University
Challenge LP (CLCUC), of which UCL is one of four limited partners. Under the terms of the
Partnership Agreement, a manager has been appointed to manage the partnership, and is responsible
for setting operational procedures and for selecting, monitoring and realising investments.
Consequently UCL has no significant influence over the operation of CLCUC and so does not account
for it as an associate or joint venture.
15. INVESTMENTS IN JOINT VENTURES
The UCL group has interests in the following joint ventures:
(a)
(b)
(c)
(d)
(e)
The Centre for Scientific Enterprise Ltd (CSE) is a collaborative educational venture between
London Business School (LBS) and University College London (UCL), promoting the transfer of
science and technology ideas into commercial products and services. The company had ceased
trading by 31 July 2010.
Bio-Nano Centre Limited is a joint venture company of Imperial College London (ICL) and UCL.
The company is a specialist research and development consultancy facilitating the development
and commercialisation of new bio-medical and nano-technology based products. The company
prepares accounts to 31 July, and accounts to 31 July 2010 are included.
EuroTempest Limited is a joint venture company of Benfield, Royal & Sun Alliance and UCL
Business pc. The company transforms weather forecasts and observations into the specific
information required to make successful live risk management decisions. The company
prepares accounts to 31 December, and accounts to 31 December 2009 plus management
accounts to 31 July 2010 are included.
Interbiomedica Ltd is a joint venture company of CP Biomedica and UCL Business pc. The
Group's interest was disposed of during the year.
UKCMRI Construction Ltd has been established to manage construction of the UK Centre for
Medical Research and Innovation. It is a joint venture company of UCL, Cancer Research UK,
The Medical Research Council and the Wellcome Trust. The company prepares accounts to 31
March, and accounts to 31 March 2010 plus management accounts to 31 July 2010 are included.
40
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
These joint venture investments are disclosed in the financial statements as follows:
Share of income:
CSE
Bio-Nano
EuroTempest
UKCMRI Construction Ltd
Share of operating profit/(loss):
CSE
Bio-Nano
EuroTempest
Interbiomedica
UKCMRI Construction Ltd
Share of gross assets:
CSE
Bio-Nano
EuroTempest
UKCMRI Construction Ltd
Share of gross liabilities:
CSE
Bio-Nano
EuroTempest
Interbiomedica
UKCMRI Construction Ltd
Share of reserves:
CSE
Bio-Nano
EuroTempest
Interbiomedica
UKCMRI Construction Ltd
41
2010
£'000
2009
£'000
864
94
2,074
25
309
68
3,323
3,032
3,725
(204)
196
26
36
2
(321)
9
-
56
(312)
721
42
7,830
350
271
17
5,572
8,593
6,210
(525)
(9)
(7,828)
(146)
(271)
(10)
(36)
(5,572)
(8,362)
(6,035)
196
33
2
204
7
(36)
-
231
175
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
16. INVESTMENTS IN ASSOCIATES
The UCL group has interests in the following associate companies:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
47.4% holding in Pentraxin Therapeutics Ltd. The company, which began trading in August
2003, has been established for the purpose of developing and commercially exploiting certain
technology for designing, synthesizing and developing novel therapeutic drugs. The company
prepares accounts to 31 July, and accounts to 31 July 2010 are included.
47% holding in Canbex Therapeutics Ltd. The principal activity of the company is research and
development on two novel chemical series aimed at cannabinoid receptors. The disease targets
are spasticity and pain. The company prepares accounts to 31 July, and accounts to 31 July
2010 are included.
30.1% holding in Domainex Ltd. The principal activity of the company is to exploit its technology
platform in the field of protein domain hunting, gene expression and protein structure analysis.
The company prepares accounts to 30 April, and accounts to 30 April 2010 plus management
accounts to 31 July 2010 are included.
34.8% holding in Multilyte Ltd. The principal activity of he company is the development of a
ubiquitous microanalytical technology (based on the use of microassays) for diagnostic
applications in the medical research and other fields. The company prepares accounts to 28
February, and accounts to 28 February 2010 are included. The directors have given assurance
that there are no material transactions up to 31 July 2010.
33.3% holding in London Technology Network CIC. The principal activity of the company is to
encourage interaction between industry and the regional academic research base. The company
had ceased trading at 31 July 2009.
27.9% holding in ordinary shares of Bloomsbury DSP Limited. The principal activity of the
company is the development and marketing of advanced sonar equipment. The company
prepares accounts to 30 June, and accounts to 30 June 2010 plus management accounts to
31 July 2010 are included.
40.0% holding in ordinary shares of Senceive Limited. The company provides information
delivery services and products to industry. The company prepares accounts to 31 October, and
accounts to 31 October 2009 plus management accounts to 31 July 2010 are included.
29.3% holding in ordinary shares (12.3%) and preference shares (17%) in Genex Biosystems
Limited. The shares carry equal voting rights. The principal activity of the company is life
sciences research and development. The company prepares accounts to 31 July, and accounts
to 31 July 2010 are included.
20% holding in NP Complete Ltd. The company is developing a software environment suitable
for solving complex optimisation problems in applications ranging from integrated circuit design
through to finance. The company prepares accounts to 30 November, and accounts to 30
November 2009 plus management accounts to 31 July 2010 are included.
35.5% holding in Endomagnetics Ltd. The company develops medical devices. The company
prepares accounts to 30 April, and accounts to 30 April 2010 plus management accounts to 31
July 2010 are included.
20% interest in UCL Partners Ltd, a company limited by guarantee. The company promotes
excellence in clinical care, health education and research. The company prepares accounts to 31
March, and accounts to 31 March 2010 plus management accounts to 31 July 2010 are included.
42
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
The investment in associates is disclosed in the financial statements as follows:
Share of operating profit/(loss):
Pentraxin Therapeutics Ltd
Canbex Therapeutics Ltd
Domainex Ltd
Multilyte Ltd
London Technology Network CIC
Bloomsbury DSP Ltd
Senceive Ltd
Genex Biosystems Ltd
NPComplete Ltd
Endomagnetics Ltd
UCL Partners Ltd
Share of taxation:
Senceive Ltd
UCL Partners Ltd
Share of net assets/(liabilities):
Pentraxin Therapeutics Ltd
Canbex Therapeutics Ltd
Domainex Ltd
Multilyte Ltd
Bloomsbury DSP Ltd
Senceive Ltd
Genex Biosystems Ltd
NPComplete Ltd
Endomagnetics Ltd
UCL Partners Ltd
Purchase of investments in associates:
Senceive Ltd
Genex Biosystems Ltd
43
2010
£'000
2009
£'000
268
(63)
(178)
(47)
(110)
(57)
(7)
(136)
5
65
(70)
(141)
(13)
(141)
(12)
(43)
(12)
(7)
-
(325)
(374)
(1)
11
-
(1)
11
(165)
(301)
412
60
1
(12)
(59)
(14)
(17)
4
(433)
(261)
234
107
1
36
(1)
(7)
-
(91)
(324)
57
-
127
10
57
137
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
17. ENDOWMENT ASSET INVESTMENTS (Consolidated and UCL)
Note
2010
£'000
2009
£'000
57,170
65,512
1,522
1,817
5,357
2,018
75
(5,659)
(3,864)
1,106
At 31 July 2010
67,884
57,170
Represented by:
Fixed interest securities and equities
Cash
58,277
9,607
49,581
7,589
Total endowment asset investments
67,884
57,170
Endowment assets at cost
64,121
62,253
At 1 August 2009
Net purchase of investments
Net realised gain/ (loss) from sale of investments
Increase/(decrease) in market value of investments
Increase in cash balances held for endowment funds
18. DEBTORS
32
24
24
30
Consolidated
2010
2009
£'000
£'000
Amounts falling due within one year:
Invoiced debtors
Research grants and contracts
Local health authorities/hospitals
Halls of residence debtors
Advances to members of staff
Intercompany debtors
Other debtors and prepayments
Amounts falling due after one year:
Other debtors and prepayments
Loans to associate companies
UCL
2010
£'000
2009
£'000
9,898
81,800
22,441
397
3,382
23,667
10,765
65,844
17,324
410
2,765
63,574
7,580
81,800
22,441
397
3,370
11,562
21,334
8,582
65,844
17,324
410
2,756
10,510
60,341
1,377
327
1,474
344
1,377
-
1,474
-
143,289
162,500
149,861
167,241
19. CREDITORS: AMOUNTS
FALLING DUE WITHIN ONE YEAR
Consolidated
Bank loans
Private Finance Initiative loans
Overdrafts
Research grants received on account
Purchase ledger creditors
Other creditors including taxation and
social security
Obligations under finance leases
Accruals and deferred income
Inter-company creditors
44
UCL
2010
£'000
2009
£'000
2010
£'000
2009
£'000
1,278
86
2
117,639
17,814
1,278
13
3,210
92,405
13,391
1,278
86
117,639
16,971
1,278
13
3,209
92,405
12,598
38,432
330
76,912
-
32,695
246
87,993
-
36,371
330
74,746
2
31,624
246
83,733
16
252,493
231,231
247,423
225,122
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
20. CREDITORS: AMOUNTS FALLING DUE AFTER MORE
THAN ONE YEAR (Consolidated and UCL)
Note
Obligations under finance leases
Cruciform building - Private Finance Initiative
Long term bank loan
Salix Revolving Green Fund
Analysis of Loan repayments:
In less than one year:
Finance leases
Loans
In more than one year but no more than two years:
Finance leases
Loans
In more than two years but no more than five years:
Finance leases
Loans
In more than five years:
Finance leases
Loans
In less than one year
19
2010
£’000
2009
£’000
41,941
16,764
19,809
180
42,140
16,850
21,087
-
78,694
80,077
330
1,364
246
1,291
442
1,449
350
1,364
2,168
5,010
1,786
4,661
39,331
30,294
40,004
31,912
80,388
(1,694)
81,614
(1,537)
78,694
80,077
It is anticipated that UCL will exercise options under the leasing arrangements between 20 and 25
years into the term of each lease. The obligations under these long term liabilities will be met from
payments which amount to approximately £3.7m per annum. Security is provided to the lessors by way
of annual payments into a security deposit (Note 14).
The loan facility of £21.1m has a fixed rate of interest of 5.66% for the remaining term of the loan, until
August 2026.
21. OPERATING LEASES
At 31 July 2010 UCL had annual commitments under non-cancellable operating leases as set out
below:
2010
2009
Land and
Land and
Buildings
Other
Buildings
Other
£’000
£’000
£’000
£’000
Operating leases which expire:
Within one year
215,283
79,427
59,088
36,729
In the second to fifth years inclusive
1,031,396
110,583
1,234,441
122,595
Over five years
2,438,754
575
2,292,875
4,885
Total
3,685,433
190,585
3,586,404
164,209
45
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
22. PROVISIONS FOR LIABILITIES AND CHARGES (Consolidated and
UCL)
2010
£’000
2009
£’000
At 1 August 2009
Provided in year
At 31 July 2010
1,250
1,250
1,250
1,250
The provision represents our best estimate, based on expert advice, of a sum payable in respect of
construction of a building following the outcome of adjudication which occurred during 2009.
23. DEFERRED CAPITAL GRANTS
Funding
Council
£’000
Other
Grants
£’000
Total
£’000
At 31 August 2009
Freehold buildings
Leasehold buildings
Equipment
Investments
208,710
40,601
14,841
-
33,803
40,295
9,491
1,853
242,513
80,896
24,332
1,853
Total
264,152
85,442
349,594
4,288
4,485
3,026
8,261
2,582
5,912
12,549
7,067
8,938
Total
11,799
16,755
28,554
Released to income and expenditure account:
Freehold buildings
Leasehold buildings
Equipment
Investments
(7,115)
(2,159)
(8,121)
-
(4,363)
(2,338)
(5,288)
(510)
(11,478)
(4,497)
(13,409)
(510)
Total
(17,395)
(12,499)
(29,894)
At 31 July 2010
Freehold buildings
Leasehold buildings
Equipment
Investments
205,883
42,927
9,746
-
37,701
40,539
10,115
1,343
243,584
83,466
19,861
1,343
Total
258,556
89,698
348,254
Consolidated
Cash receivable:
Freehold buildings
Leasehold buildings
Equipment
46
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Funding
Council
£'000
Other
Grants
£'000
Total
£'000
At 1 August 2009
Freehold buildings
Leasehold buildings
Equipment
208,710
40,601
14,841
33,803
39,442
9,491
242,513
80,043
24,332
Total
264,152
82,736
346,888
4,288
4,485
3,026
8,261
2,582
5,912
12,549
7,067
8,938
Total
11,799
16,755
28,554
Released to income and expenditure account:
Freehold buildings
Leasehold buildings
Equipment
(7,115)
(2,159)
(8,121)
(4,363)
(2,303)
(5,288)
(11,478)
(4,462)
(13,409)
Total
(17,395)
(11,954)
(29,349)
At 31 July 2010
Freehold buildings
Leasehold buildings
Equipment
205,883
42,927
9,746
37,701
39,721
10,115
243,584
82,648
19,861
Total
258,556
87,537
346,093
UCL
Cash receivable:
Freehold buildings
Leasehold buildings
Equipment
47
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
24. ENDOWMENTS
(Consolidated and
UCL)
Unrestricted
Permanent
£’000
Restricted
Permanent
£’000
Total
Permanent
£’000
Restricted
Expendable
£’000
2010
Total
£’000
2009
Total
£’000
Capital
Accumulated income
At 1 August 2009
427
41
468
7,637
341
7,978
8,064
382
8,446
46,490
2,234
48,724
54,554
2,616
57,170
63,493
2,019
65,512
Reclassifications
Additions
Disposals
Investment income
Expenditure
-investment
management fees
- other
19
217
343
217
362
4,072
(679)
2,165
4,289
(679)
2,527
1,320
2,647
(2)
(16)
1
(34)
(262)
47
(36)
(278)
48
(211)
(2,072)
(118)
(247)
(2,350)
(70)
(198)
(2,588)
(139)
14
247
261
1,556
1,817
(5,659)
40
726
766
4,591
5,357
(3,864)
At 31 July 2010
523
9,215
9,738
58,146
67,884
57,170
Represented by:
Capital
Accumulated income
481
42
8,884
331
9,365
373
55,906
2,240
65,271
2,613
54,554
2,616
523
9,215
9,738
58,146
67,884
57,170
UCL
2010
£'000
2009
£'000
Net realised
gain/(loss) from sale
of investments
Increase/(decrease)
in market value of
investments
25. RESERVES
Consolidated
2010
2009
£'000
£'000
Income and expenditure reserve
At 1 August 2009
Surplus for the year
Adjustment for previously unconsolidated associates
Adjustment for change in percentage holdings in
associates
Transfer from revaluation reserve
Less pension surplus
At 31 July 2010
48
174,569
169,595
182,614
175,559
29,655
(81)
5,118
(24)
29,948
-
7,183
-
383
550
(333)
8
550
(678)
550
(333)
550
(678)
204,743
174,569
212,779
182,614
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
UCL
2010
£'000
2009
£'000
Pension reserve (Consolidated and UCL)
At 1 August 2009
(8,133)
(5,832)
(300)
333
(2,979)
678
(8,100)
(8,133)
25,930
25,277
166
(50)
2,193
1,253
(190)
(190)
(360)
(360)
27,739
25,930
2010
£'000
2009
£'000
(1,043)
(1,094)
895
(13)
52
(1)
At 31 July 2010
(161)
(1,043)
27. CAPITAL COMMITMENTS (Consolidated and UCL)
2010
£'000
2009
£'000
21,220
20,905
31,087
73,079
42,125
104,166
Actuarial loss
Surplus retained within reserves
At 31 July 2010
Revaluation reserve (Consolidated and UCL)
At 1 August 2009
Revaluation of fixed asset investment property
Revaluation of fixed asset investments portfolio to
market value
Transfer to general reserve in respect of depreciation
of Examination Halls
Transfer to general reserve in respect of depreciation
of Goldsmid House
At 31 July 2010
26. MINORITY INTEREST (Consolidated)
The minority interest relates to the following companies:
(a) Bloomsbury Bioseed Fund Ltd (BBSF). 30% owned outside of the Group.
(b) Proaxon Ltd. 17% owned outside of the Group.
(c) Evexar Medical Ltd. 1% owned outside of the Group.
At 1 August 2009
Minority interest in subsidiary undertakings’ results for the year
Share capital acquired by the Group
Commitments contracted at 31 July 2010
Authorised but not contracted at 31 July 2010
49
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
28. OTHER COMMITMENTS
UCL has a commitment to purchase shares in UKCMRI with a value of £39.6m.
29. RECONCILIATION OF CONSOLIDATED OPERATING SURPLUS TO
NET CASH INFLOW FROM OPERATING ACTIVITIES
Operating surplus after depreciation of tangible fixed
assets at cost and before tax
Items not involving cash movements:
Depreciation
Deferred capital grants released to income
Impairment of fixed asset investments
Decrease in stocks
(Increase)/decrease in debtors
Increase in creditors
Increase/decrease in provisions
Pension cost less contributions payable
Items which are not operating activities:
Interest receivable
Interest payable
Investment income
2010
£'000
2009
£'000
30,023
11,853
40,284
(29,894)
130
134
19,197
25,253
(655)
39,921
(36,437)
5,633
102
(45,036)
48,201
1,250
(779)
(2,466)
7,325
(2,527)
(5,498)
7,503
(2,647)
86,804
24,066
1 August
2009
£’000
Cash
Flows
£’000
Other
Changes
£’000
31 July
2010
£’000
7,589
23,182
(3,210)
27,561
2,018
13,613
3,208
18,839
-
9,607
36,795
(2)
46,400
Short term deposits
76,306
51,324
-
127,630
Debt due within one year
(1,537)
1,406
(1,563)
(1,694)
Debt due after one year
(80,077)
6,830
(5,447)
(78,694)
22,253
78,399
(7,010)
93,642
30. ANALYSIS OF CHANGES IN NET FUNDS
Cash at bank and in hand
Endowment assets
Deposits repayable on demand
Overdrafts
The decrease in debt is due to capital repayments of £1,406,000, plus new loans of £180,000 giving a
net decrease in debt of £1,226,000.
Management of liquid resources comprises short term deposits and endowment cash balances.
50
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
31. RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
2010
£'000
2009
£'000
Income from endowments
Other interest received
Interest paid
Interest element of finance lease rental payment
2,527
2,052
(3,503)
(3,537)
2,647
4,969
(3,860)
(3,531)
Net cash (outflow)/inflow from returns on investments and servicing of finance
(2,461)
225
2010
£'000
2009
£'000
(41,158)
(3,112)
(1,522)
(45,792)
(57,417)
(2,283)
(75)
(59,775)
738
28,554
17
3,610
432
28
50,221
1,320
(12,873)
(7,774)
32. CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT
Purchase of tangible fixed assets
Purchase of fixed asset investments
Net purchase of endowment asset investments
Total payments to acquire fixed and endowment assets
Proceeds from disposal of fixed asset investments
Proceeds from disposal of tangible fixed assets
Capital grants received towards the purchase of tangible assets
Net loans to associate companies repaid
Net endowments received
Net cash outflow from capital expenditure and financial investment
33. ACQUISITIONS AND DISPOSALS
2010
£’000
2009
£’000
Purchase of investment in associate – Senceive Ltd
Purchase of investment in associate – Genex Biosystems Ltd
Purchase of investment in subsidiary – Evexar Medical Ltd
(57)
(13)
(127)
(10)
(1)
Total acquisitions and disposals
(70)
(138)
2010
£'000
2009
£'000
Mortgages and loans acquired
Mortgage and loan capital repayments
180
(1,406)
(1,379)
Net cash outflow from financing
(1,226)
(1,379)
35. HARDSHIP AND ACCESS BURSARY FUNDS (Consolidated and UCL)
2010
£’000
2009
£'000
At 1 August 2009
Funding Council grants
Interest earned
30
250
1
281
(249)
44
287
2
333
(303)
32
30
34. FINANCING
Disbursed to students
At 31 July 2010
Funding Council grants are available solely for students and UCL acts only as paying agent. The grants
and related disbursements are therefore excluded from the income and expenditure account.
51
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
36. PENSION FUNDS
2010
£’000
2009
£’000
34,176
5,849
6,253
340
291
28,802
5,644
5,774
398
297
46,909
40,915
The total pension costs for UCL were:
Contribution to USS
Contribution to SAUL
Contribution to NHS
Charged to I&E in respect of RFHSM Pension & Assurance Scheme
Charged to I&E in respect of FPS
The three principal pension schemes for UCL’s staff are the Universities Superannuation Scheme
(USS), the Superannuation Arrangements of the University of London (SAUL) and the National Health
Service Pension Scheme. Assets of each scheme are held in separate trustee administered funds. It is
not possible to identify UCL’s share of the underlying assets and liabilities of either scheme and hence
contributions are accounted for as if they were defined contribution schemes. The schemes are defined
benefit schemes which are externally funded and contracted out of the State Second Pension (S2P)
and valued every three years by professionally qualified independent actuaries using the Projected Unit
Method.
The rates of contribution for both schemes are determined by the Trustees on the advice of actuaries,
the cost recognised for the year in the Income and Expenditure account being equal to the contribution
to the scheme.
Outstanding contributions to USS, SAUL and the NHS pension scheme were £6.0m at 31 July 2010.
Universities Superannuation Scheme (USS)
The latest actuarial valuation of the scheme was at 31 March 2008 using the projected unit method.
The assumption and other data which have the most significant effect on the determination of the
contribution levels are as follows:
Past Service
Future Service
Investment returns per annum
Salary scale increases per annum
Pension increases per annum
Market value of assets at last actuarial valuation date
Proportion of members’ accrued benefits covered by the
actuarial value of assets
Current Employers contribution rate from
4.4%
4.3%
3.3%
6.1%
4.3%
3.3%
£28,843m
103.0%
16.0%
Superannuation Arrangement of the University of London (SAUL)
The latest actuarial valuation of the scheme was at 31 March 2008 using the projected unit method.
The assumption and other data which have the most significant effect on the determination of the
contribution levels are as follows:
Past Service
Future Service
Investment returns per annum
- before retirement
6.9%
7.0%
- after retirement
4.8%
5.0%
4.85%
4.85%
Salary scale increases per annum*1
Pension increases per annum
3.35%
3.35%
Market value of assets at last actuarial valuation date
£1,266m
Proportion of members’ accrued benefits covered by the
actuarial value of assets
100.0%
Current Employers contribution rate
13.0%
*1 excludes an allowance for promotional increases.
52
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
National Health Service Pension Scheme
The NHS Pension Scheme is an unfunded defined benefit scheme available to staff who immediately
prior to appointment at UCL were members of this scheme.
The last valuation of the scheme took place as at 31 March 2004. Between valuations, the
Government Actuary provides an update of the scheme liabilities on an annual basis. On advice from
the actuary the employer’s contributions were increased from 7% to 14% from the 1 April 2004.
The scheme is a multi-employer scheme, where the asset and liabilities for UCL cannot be identified.
Federated Pension Scheme (FPS) and the Royal Free Hospital School of Medicine (RFHSM)
Pension and Assurance Scheme
The Federated Pension Scheme (FPS) for non academic staff of Middlesex Hospital Medical School
which since merger with UCL on 1 August 1987 has become closed to new entrants. This scheme is a
defined benefit scheme.
The Royal Free Hospital School of Medicine (RFHSM) Pension and Assurance Scheme operated for
non academic staff at the Royal Free Hospital School of Medicine. On merger with UCL on 1 August
1998 this scheme has been closed to all new entrants. This scheme is a defined benefit scheme.
As a consequence of both FPS and the RFHSM Pension & Assurance Scheme being closed to new
entrants, it is likely that the current service cost will increase as the members approach retirement.
The last triennial valuation of the FPS was undertaken on 31 March 2007 and for the Royal Free
Hospital School of Medicine Pension and Assurance Scheme on 1 August 2006. For the purposes of
reporting under FRS17 a valuation of both schemes was undertaken on 31 July 2009, and details are
given below.
FPS (1645)
Valuation method
Valuation date (31 July)
2010
Projected Unit
2009
2008
Inflation assumption
Increase for pensions
Increase for deferred pensions
Investment return
Salary scale increase per annum
Discount rate for liabilities
3.30%
3.20%
3.30%
6.04%
4.30%
5.40%
3.40%
3.30%
3.40%
6.29%
4.40%
6.00%
3.75%
3.75%
3.75%
6.50%
5.25%
6.30%
Projected over-funding
£2.1m
£1.8m
£3.3m
Funding level
111%
109%
116%
£19.1m
£21.2m
£20.9m
£22.7m
£20.7m
£24.0m
nil
nil
nil
Present value of liabilities
Fair value of the scheme assets
Current Employers contribution rate
53
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Disclosure of fair values of assets and expected rates of return
2010
Expected
rate of
return
Equities
Property &
infrastructure
Annuities
Gilts
Bonds
Cash
Total
Fair Value
£’000
Holding
%
Restated 2009
Expected
rate of
return
Fair Value
£’000
Holding
%
7.20%
9,805
46
7.50%
8,529
43
5.40%
4.20%
5.40%
0.50%
4,128
3,468
3,843
(5)
21,239
19
16
18
-
5.50%
6.00%
4.50%
6.00%
0.50%
923
4,333
3,478
2,462
111
19,836
5
22
18
12
1
The Trustees for the scheme had historically secured benefits for a number of deferred pensions and
current pensioners with insurance companies. It has come to light that some of these policies were
written in the names of the individual members rather than the Trustees. In terms of the disclosure, this
means that rather than disclosing an asset value and a corresponding liability we simply disclose the
net liability figure. Therefore the asset figures are considerably lower than previously disclosed,
however, the corresponding liability figures are also lower, resulting in the same overall surplus and
deficits.
Reconciliation of the present value of the scheme liabilities
to the asset and liability recognised in the balance sheet
Fair value of assets
Value of liabilities (defined benefit obligation)
Funded status
Recognised pension asset
Unrecognised pension asset
2010
£'000
Restated
2009
£'000
21,239
19,105
2,134
19,836
18,041
1,795
318
1,816
571
1,224
2010
£'000
Restated
2009
£'000
291
1,070
(1,226)
297
1,148
(1,387)
135
58
Total expense recognised in the income and expenditure
Current service cost
Interest cost on obligation
Expected return on scheme assets
Total income and expenditure charge
54
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Amounts for the current and previous four periods
2010
£'000
Restated
2009
£'000
2008
£'000
2007
£'000
2006
£'000
21,239
19,105
2,134
19,836
18,041
1,795
23,981
20,686
3,295
26,009
20,069
5,940
24,805
19,370
5,435
1,098
(2,391)
(37)
(2,837)
468
90
2010
£'000
Restated
2009
£'000
Opening defined benefit obligation
Interest cost on obligation
Current service cost
Actuarial gain on obligation
Members contributions
Benefits paid
18,041
1,070
291
624
25
(946)
18,410
1,148
297
(949)
30
(895)
Closing defined benefit obligation
19,105
18,041
2010
£'000
Restated
2009
£'000
Opening fair value of scheme assets
Expected return
Actuarial (gain)/loss
Members contributions
Benefits paid
19,836
1,226
1,098
25
(946)
21,705
1,387
(2,391)
30
(895)
Closing fair value of scheme assets
21,239
19,836
Total amounts recognised in the statement of total recognised gains and losses
2010
£'000
2009
£'000
Recognised pension asset/(liability) at the start of the year
Income and expenditure charge
STRGL losses
571
(135)
(118)
746
(58)
(117)
318
571
Fair value of scheme assets
Value of liabilities (funded obligations)
Surplus
Experience loss on liabilities
Experience gain/(loss) on assets
Changes in the present value of the defined benefit obligation
Changes in the fair value of scheme assets
Recognised pension asset/(liability) at the end of the year
The cumulative amount of actuarial gains and losses recognised in the statement of total recognised
gains and losses in respect of the Federated Pension Scheme is a net loss of £5,154,000 (2009 - net
loss of £5,036,000).
A reliable estimate of the contributions expected to be paid to the Federated Pension Scheme for the
year 2011 cannot be made, as the funding valuation of the Scheme as of 31 March 2010, which is
currently in progress, is likely to result in a change to the contribution rate.
55
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
RFHSM Pension & Assurance Scheme
Valuation method
Projected Unit
Valuation date (31 July)
2010
2009
2008
Inflation assumption
Increase for pensions
Increase for deferred pensions
Investment return
Salary scale increase per annum
Discount rate for liabilities
3.30%
3.30%
3.30%
5.80%
4.30%
5.40%
3.40%
3.40%
3.40%
6.12%
4.40%
6.00%
3.60%
3.60%
3.60%
6.32%
4.60%
6.10%
Projected under-funding
£(8.4)m
£(8.7)m
£(6.6)m
65%
59%
65%
Present value of liabilities
Fair value of the scheme assets
£24.3m
£15.9m
£21.2m
£12.5m
£18.7m
£12.1m
Current Employers contribution rate
105.9%
105.9%
105.9%
Funding level
Disclosure of fair values of assets and expected rates of return
Expected
rate of
return
Fair Value
2010
£’000
Holding
12,823
3,059
15,882
81
19
Expected
rate of
return
Fair Value
2009
£’000
Holding
10,086
2,414
12,500
81
19
2010
£'000
2009
£'000
Fair value of assets
Value of liabilities (defined benefit obligations)
Funded status
15,882
24,300
(8,418)
12,500
21,204
(8,704)
Recognised pension liability
(8,418)
(8,704)
Total expense recognised in the income and expenditure
2010
£'000
2009
£'000
Current service cost
Interest cost on obligation
Expected return on scheme assets
Past service cost
340
1,282
(804)
95
398
1,152
(812)
-
913
738
Equities
Bonds
Total
6.4%
3.4%
%
6.7%
3.7%
Reconciliation of the present value of the scheme liabilities to the
asset and liability recognised in the balance sheet
Total income and expenditure charge
56
%
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Amounts for the current and previous four periods
2010
£’000
2009
£’000
2008
£'000
2007
£'000
2006
£'000
15,882
(24,300)
(8,418)
12,500
(21,204)
(8,704)
12,156
(18,734)
(6,578)
12,605
(17,317)
(4,712)
10,871
(16,732)
(5,861)
(359)
1,311
1,329
(1,844)
33
(2,513)
(294)
266
1,104
77
2010
£'000
2009
£'000
Opening defined benefit obligation
Interest cost on obligation
Current service cost
Past service costs
Actuarial (gain)/loss on obligation
(Gain)/loss arising from changes in assumptions underlying the scheme
liabilities
Member contributions
Benefits paid
21,204
1,282
340
95
(359)
18,734
1,152
398
1,329
1,852
73
(187)
(311)
84
(182)
Closing defined benefit obligation
24,300
21,204
2010
£'000
2009
£'000
Opening fair value of scheme assets
Expected return
Actuarial (gain)/loss
Employers contributions
Members contributions
Benefits paid
12,500
804
1,311
1,381
73
(187)
12,156
812
(1,844)
1,474
84
(182)
Closing fair value of scheme assets
15,882
12,500
2010
£'000
2009
£'000
Recognised pension liability at the start of the year
Income and expenditure charge
STRGL losses
Employer contributions
(8,704)
(913)
(182)
1,381
(6,578)
(738)
(2,862)
1,474
Recognised pension liability at the end of the year
(8,418)
(8,704)
Fair value of scheme assets
Value of liabilities (funded obligations)
Deficit
Experience (loss)/gain on liabilities
Experience gain/(loss) on assets
Changes in the present value of the defined benefit obligation
Change in the fair value of scheme assets
Total amounts recognised in the statement of total recognised gains
and losses
The cumulative amount of actuarial gains and losses recognised in the statement of total recognised
gains and losses in respect of the RFHSM Pension & Assurance Scheme is a net loss of £6,427,000
(2009 - net loss of £6,245,000).
A reliable estimate of the contributions expected to be paid to the RFHSM Pension & Assurance
Scheme for the year 2011 cannot be made, as the Trustees are currently undertaking a recovery
planning exercise which may result in a change to the contribution rate.
57
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
37. RELATED PARTY TRANSACTIONS
The operating statements of UCL include transactions with related parties. In accordance with FRS 8
‘Related Party Transactions’ these are disclosed where members of UCL’s Council and Senior
Management Team (SMT) disclose an interest in a body with whom UCL undertakes transactions
which are considered material to UCL’s Financial Statements and / or the other party. Due to the
nature of UCL’s operations and the composition of Council (being drawn from local and private sector
organisations) and SMT, it is inevitable that transactions will take place with organisations in which
members of the Council or SMT may have an interest. All transactions involving organisations in which
members of Council or SMT may have an interest, including those identified below, are conducted at
arms length and in accordance with UCL’s Financial Regulations and usual procurement procedures.
An updated register of the interests of members of Council and SMT is maintained.
UCL has taken advantage of the exemption within FRS 8 and not disclosed transactions with other
group entities where it holds more than 90% of the voting rights.
The Provost is a member of the HEFCE Board and Mrs Alison Woodhams is a member of the HEFCE
Audit Committee. UCL receives £201m of funding from HEFCE (see Note 1), these transactions are
conducted at arms length and in the normal course of business. Professor Sir John Tooke is a nonexecutive director of UCL Hospitals.
Rex Knight has an outstanding loans under the UCL staff house loan scheme, the amount outstanding
at year end was £103,452.
During the year, Professor Robert Brown had a close family member who was employed by UCL. Their
remuneration was based on UCL’s standard terms and conditions applicable to other staff employed in
similar capacities.
Catherine Newman has a child who attended UCL as a student in 2009-10. Their attendance was in
line with normal UCL policies and procedures and conducted at arms length.
Jeff Skinner, Secretary of Bloomsbury Bioseed Fund, has undertaken ad-hoc lecturing for UCL. His
remuneration was based on UCL’s standard terms and conditions as applicable to other individuals
contracted in similar capacities.
Evexar Medical Ltd, a subsidiary of UCL, has received a loan from Stephen Barker, one of its directors.
The balance outstanding at 31 July 2010 was £27,562 (2009 £27,562). Also, income includes £7,510
(2009 £7,510) for sale of goods to Evexar Compression Advisory Limited, an investee in Evexar
Medical Ltd. There was an outstanding debtor balance of £8,636 at 31 July 2010 (2009 £8,636).
Evexar Medical Ltd has also received a loan of £183,000 (2009 £183,000) from Esperante AB. Mr
Dean Slagel, a director of Canbex, is also an officer of Esperante. The balance outstanding at 31 July
2010 including associated interest was £233,735 (2009 £219,095).
58
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Transactions with subsidiaries of UCL have been eliminated on consolidation and no disclosure of
these transactions has therefore been given.
The Group has year end debtor balances with the following associate and joint venture companies:
Pentraxin Therapeutics
Limited
Canbex Therapeutics
Limited
Total debtors
Balance at
1 August 2010
£'000
Cash
transfers
£'000
Income
Expenditure
£'000
£'000
Balance at
31 July 2009
£'000
913
(410)
104
-
607
16
(58)
53
-
11
929
(468)
157
-
618
Additionally, the Group has granted loans to the following associate companies:
Canbex Therapeutics Limited
Genex Biosystems Limited*2
UKCMRI Construction Ltd
2010
£'000
327
96
2,773
2009
£'000
314
37
1,768
Total loans
3,196
2,119
*2 Bloomsbury Bioseed Fund (BBSF) has provided in full against this debtor balance
The following parties are related to UCL by virtue of having a shared director with a UCL subsidiary.
Transactions were as follows:
Transactions
Transactions
Balance at
Balance at
in 2009-10
in 2008-09
31 July 2010
31 July 2009
£'000
£'000
£'000
£'000
The Anthony Nolan
(12,282)
(12,370)
3,067
Trust
London Genetics Ltd
14,780
Licensing Executives
(768) / 1,438
963
Society Ltd
Albion Ventures LLP
7,460
3,750
Close Ventures Ltd
3,750
38. CONTINGENT LIABILITY
UCL is a member of UM Association (Special Risks) Ltd, a university mutual company limited by
guarantee, formed to provide cover for losses arising from acts of terrorism. The scheme’s ability to pay
claims is derived from one of the following sources:
(a) The reserve fund exceeding £10m accumulated from the net contributions of Members;
(b) £1billion aggregate layer of ‘excess’ cover obtained through a selection of insurers and reinsurers (structured as £500m for any one loss or in the aggregate, followed by a further loss of
£500m or in the aggregate).
No claims were notified to the Association for the year 2009-2010.
As at 31 July 2010 UCL was involved in a dispute with a building contractor concerning the final
amount of construction of a building. Our best estimate of the outcome of adjudication has been
included in the amounts as a provision, disclosed at Note 22. A negotiated settlement is being sought
in respect of a further amount. No disclosure of this amount will be made in these accounts on the
grounds that to do so may prove prejudicial to the eventual outcome.
59
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
39. SUBSIDIARY UNDERTAKINGS
The following UCL subsidiary companies which are incorporated and registered in England and Wales
and which have traded during the year have been consolidated into the financial statements:
Company
Principal Activity
Status
UCL Trading
Ltd
Contracting,
consultancy and other
commercial activities.
Property investment.
UCL
Investments
Ltd
UCL
Properties Ltd
UCL
Residences
Ltd
UCL
Enterprises
Ltd
UCL
Cruciform Ltd
UCL
Consultants
Ltd
Somers Town
Community
Sports Centre
100% owned
Class of
Shares
Ordinary
100% - UCL
100% owned
Ordinary
100% - UCL
Property development
and investment.
Commercial lettings of
accommodation.
100% owned
Ordinary
100% - UCL
100% owned
Ordinary
100% - UCL
General commercial
trading.
100% owned
Ordinary
100% - UCL
Exploitation of
intellectual property in
the field of biomedicine.
Provision of
administrative support
to staff engaged in
consultancy.
Operation of sports
centre.
100% owned
Ordinary
50% - UCL
50% - UCL
Cruciform Trust
100% owned
Ordinary
100% - UCL
Ltd by guarantee.
UCL has the
power to appoint 5
of the 9 trustees
and so has
effective control
100% owned
-
-
Ordinary
Ordinary 'A'
Redeemable
Preference
Ordinary
100% - UCL
100% - UCL
100% - UCL
UCL Business
Plc
Exploitation of
intellectual property.
UCL Bio(3)
Ltd
Developing interactive
teaching and learning
solutions.
100% owned
Ordinary 'A'
Ordinary 'B'
Free Clinical
Enterprises
Ltd
UCL Clinical
Research
Management
Centre Ltd
Testing of new drugs in
the final approval stage.
100% owned
Ordinary
Conducting clinical
trials in the field of
analgesia.
100% owned
Ordinary
60
Proportion Held
100% - UCL
Business
100% - UCL
Business
100% - UCL
Business
100% - UCL
Business
100% - UCL
Business
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Stanmore
Clinical
Research
Facility Ltd
Nervation Ltd
Conducting clinical
studies and trials.
100% owned
Ordinary
100% - UCL
Business
Holding company.
100% owned
Ordinary
100% - UCL
Business
100% - UCL
Business
100% - UCL
Business
100% - Nervation
Ordinary 'A'
Nervation
Vascular
Technologies
Ltd
Bloomsbury
Bioseed Fund
Ltd (BBSF)
Proaxon Ltd
Evexar
Medical Ltd
The Ageing
Biomarker
Company Ltd
Dormant following
disposal of business.
100% owned
Redeemable
Preference
Ordinary
Investment in
biotechnology start ups.
70% owned
Ordinary
70% - UCL
Developing and
commercialising
medical treatments.
Developing and
commercialising
medical and surgical
devices.
Validation of molecular
biomarkers for disease
diagnosis and
personalised medicine.
Currently dormant.
83% owned
A Preferred
Ordinary
96% owned
Ordinary 'A'
Ordinary 'B'
100% - BBSF
72% - UCL
Cruciform
2% - UCL Business
100% - UCL
Business
50% owned
Ordinary ‘A’
50% - UCL
Business
UCL Advanced Diagnostics Ltd and Free Clinical Research Holdings Ltd were dissolved during the
year.
Free Clinical Enterprises Ltd, Nervation Ltd, Nervation Vascular Technologies Ltd, Stanmore Clinical
Research Facility Ltd and UCL Clinical Research Management Centre Ltd are in the process of being
wound up.
61
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
40. RESTATEMENT OF PRIOR YEAR FIGURES
The 2009 figures have been restated following a change in HESA guidance in relation to research
income. Income passed on to other institutions or organisations as part of a collaborative project or
subcontracted work, which was previously excluded, has now been included along with associated
costs. This has resulted in an increase in research income of £5.645m along with an increase in staff
costs of £696,000 and an increase in other operating expenses of £4.949m. There is no overall effect
on the surplus for the year.
Additionally, the staff cost breakdown in Note 9 for 2009 has been restated following a change in the
analysis of rechargeable salaries.
The effects of the restatements on the notes to the accounts are as follows:
3. RESEARCH GRANTS AND CONTRACTS
Source of income:
OST research councils
UK based charities
UK central government, local/health authorities/hospitals
UK industry, commerce and public corporations
EU government bodies
EU other
Other overseas
Other sources
Research income relating to direct expenditure incurred
during the year
Contribution towards overhead costs
As
previously
stated
2009
£'000
Restate
research
income
£'000
Restated
2009
£'000
88,173
86,097
27,835
10,050
16,162
3,315
15,843
1,165
3,056
386
1,235
6
62
896
4
91,229
86,483
29,070
10,056
16,224
3,315
16,739
1,169
248,640
5,645
254,285
209,971
38,669
5,169
476
215,140
39,145
248,640
5,645
254,285
As
previously
stated
2009
£'000
Restate
research
income
£'000
Restated
2009
£'000
345,361
30,264
40,915
696
-
346,057
30,264
40,915
416,540
696
417,236
6. INFORMATION REGARDING EMPLOYEES
Staff costs:
Salaries and wages
NI contributions
Pension costs
62
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
7. OTHER OPERATING EXPENSES
Residences and catering
Furniture, computer and other equipment costs
Academic consumables and laboratory expenditure
Books, publications and periodicals
Scholarships and prizes
General educational expenditure
Rents, rates and insurance
Heat, light, water and power
Service charges
Repairs and general maintenance
Long term maintenance
Telephone
Advertising and recruitment
Printing, postage, stationery and other office costs
Conference, travel and training
Professional fees
Audit fees
Other fees paid to auditors
Grants to Students Union and other student bodies
Payments to non contract staff and agencies
Other costs
As
previously
stated
2009
£'000
Restate
research
income
£'000
Restated
2009
£'000
12,999
21,160
33,015
7,083
16,963
13,609
8,632
12,571
7,332
9,591
7,242
1,711
2,401
7,719
16,315
11,285
143
13
2,278
8,421
32,217
4,949
12,999
21,160
33,015
7,083
16,963
13,609
8,632
12,571
7,332
9,591
7,242
1,711
2,401
7,719
16,315
11,285
143
13
2,278
8,421
37,166
232,700
4,949
237,649
9. ANALYSIS OF EXPENDITURE BY ACTIVITY
Staff costs
as
previously
stated
2009
£'000
Academic departments
Academic services
Research grants and contracts
Residences and catering
Premises
Administration and central services
Other expenses
63
Restate
research
costs
Reanalyse
rechargeable
salaries
£'000
£'000
Staff costs
restated
2009
£'000
202,354
19,896
118,306
2,844
8,047
37,598
27,495
696
-
10,660
72
11
(10,743)
213,014
19,968
119,002
2,844
8,047
37,609
16,752
416,540
696
-
417,236
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
NOTES TO THE ACCOUNTS
Other
operating
expenses
as
previously
stated
2009
£'000
Academic departments
Academic services
Research grants and contracts
Residences and catering
Premises
Administration and central services
Other expenses
64
£'000
Other
operating
expenses
restated
2009
£'000
30,657
15,741
83,063
11,565
46,470
28,200
17,004
476
4,473
-
31,133
15,741
87,536
11,565
46,470
28,200
17,004
232,700
4,949
237,649
Restate
research
income
UNIVERSITY COLLEGE LONDON
ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010
FINANCIAL SUMMARIES (unaudited)
2010
£'000
2009
£'000
2008
£'000
2007
£'000
2006
£'000
200,995
150,555
275,061
133,801
5,004
209,895
126,736
254,285
124,026
8,164
193,832
107,753
211,217
112,253
2
10,705
178,773
97,795
201,698
111,944
9,352
166,964
86,308
184,136
115,148
915
6,952
765,416
723,106
635,762
599,562
560,423
(3,032)
(3,725)
(348)
(1,167)
-
Net Income
762,384
719,381
635,414
598,395
560,423
EXPENDITURE
Staff costs
Other operating expenses
Interest payable
Depreciation
442,666
242,086
7,325
40,284
417,236
237,649
12,722
39,921
383,607
205,130
7,371
38,659
364,073
183,738
7,469
35,070
347,803
167,451
7,857
30,895
Total expenditure
732,361
707,528
634,767
590,350
554,006
30,023
11,853
647
8,045
6,417
56
(325)
(11)
(1)
(312)
(374)
2
11
(73)
(525)
62
3
(137)
(536)
(245)
(1)
(282)
(264)
(57)
6
29,742
11,180
114
7,126
5,820
(895)
(52)
462
25
45
28,847
11,128
576
7,151
5,865
738
-
5,180
-
-
-
(6,149)
113
170
352
(195)
(104)
29,585
4,979
6,039
7,308
5,761
70
139
(511)
(398)
613
29,655
5,118
5,528
6,910
6,374
INCOME
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Profit on disposal of investments
Endowment income, donations and interest
Total income
Less: Share of income from joint ventures
SURPLUS AFTER DEPRECIATION OF
TANGIBLE FIXED ASSETS AT COST
AND BEFORE TAX
Share of operating profit/(loss) in joint ventures
Share of operating loss in associates
Taxation
Share of taxation in associates
SURPLUS AFTER DEPRECIATION OF
ASSETS AT COST AND TAX
Minority interest
SURPLUS BEFORE EXCEPTIONAL ITEMS
Exceptional items: continuing operations
Profit on disposal of subsidiary
(Loss)/profit on disposal of fixed asset
investments
Profit/(loss) on disposal of tangible fixed assets
SURPLUS ON CONTINUING OPERATIONS
AFTER DEPRECIATION
OF ASSETS AT COST, DISPOSAL OF
ASSETS AND TAX
Surplus for the year transferred to
accumulated income in endowment funds
SURPLUS FOR THE YEAR RETAINED
WITHIN GENERAL RESERVES
65