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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
CONTENTS
Page
1
2
Committee Membership
3
Financial Highlights
4
Treasurer’s Report
7
Corporate Governance
9
Responsibilities of the Council of
University College London
11
Auditors’ Report to the Members of the
Council of University College London
13
Statement of Principal Accounting
Policies
16
Consolidated Income and Expenditure
Account
17
Consolidated Balance Sheet
18
UCL Balance Sheet
19
Statement of Total Recognised Gains
and Losses and of Cash Flow
20-37
Notes to the Accounts
38
Financial Summaries (unaudited)
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
COMMITTEE MEMBERSHIP
Council 2000-2001
Lay Members:
Lord Young of Graffham•* (Chairman)
Professor C. W. Jonas•* (Vice-Chairman)
Mr K. J. Hawkins• (Treasurer)
Viscount Bearsted
Mr B. W. Bennett
Sir John Birch
Ms A. S. Biss
Mr S. P. Chalfen
Ms J. Clements
Sister Teresa Finn
Baroness Flather of Windsor and Maidenhead
Mr R. T. Fox
Sir Alan Greengross•*
Mr R. A. Lyons
Miss M. F. Rudland
Ms J. Salmon
Dr P. Williams
Professor A. J. Zuckerman
Academic Members:
Professor Sir Chris Llewellyn Smith•*
Professor R. D. Ashton
Professor D. A. Brown
Professor I. H. Dennis
Dr H. D. Donoghue
Dr M. M. Dworetsky
Professor H.D. Griffiths
Professor A. R. Lord
Dr S. Meghji
Professor B. B. Nutt
Professor R. L. Souhami
Dr W. Stephenson
Professor P. A. Wood
UCL Union:
Mr R. Fear
Mr B. Hogan
Mr D. Ozarow
Finance Committee 2000-2001
Lay Members:
Mr K. J. Hawkins (Chairman)
Mr J. E. Bellamy
Mr D. M. M. Dutton
Mr R. S. Horsman
Mr C. W. Jonas
Professor P. G. Moore
Lord Young of Graffham
Academic Members:
Professor Sir Chris Llewellyn Smith
Ms E. C. Dalton
Professor W. E. Davies
Dr M. M. Dworetsky
Professor R. S. J. Frackowiak
Mr P. S. McLennan
Vice-Provosts:
Professor D. T. Delpy
Miss M. J. Gallyer
Professor R. J. Levinsky
Professor M. J. Worton
UCL Union:
Mr R. Fear
Audit Committee 2000-2001
Lay Members:
Sir Alan Greengross (Chairman)
Ms A. S. Biss
Mr R. T. Fox
Mr J. R. Hustler
Investments Committee 2000-2001
Lay Members:
•
*
Mr K. J. Hawkins (Chairman)
Mr R. G. Cottam
Mr D. M. M. Dutton
Professor P. G. Moore
Mr H. Stevenson
denotes also member of Remuneration Committee
denotes also member of Nominations Committee
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
FINANCIAL HIGHLIGHTS
2001)
£m)
2000)
£m)
Change)
%)
Funding Council Grants
Academic Fees and Support Grants
Research Grants and Contracts
Other Operating Income
Profit on Disposal of Investments
Endowment Income and Interest Receivable
125.3)
55.7)
141.0)
84.7)
-)
5.6)
117.6)
52.0)
123.8)
75.6)
6.5)
5.9)
6.6)
7.1)
13.9)
12.0)
TOTAL INCOME
412.3)
381.4)
8.1)
TOTAL EXPENDITURE
415.1)
382.6)
8.5)
Profit on disposal of fixed asset investments
Profit on disposal of tanglible fixed assets
1.5)
2.2)
-)
1.0)
SURPLUS/(DEFICIT) FOR THE YEAR
0.9)
(0.2)
Fixed Assets
Endowment Asset Investments
Net Current Assets
280.4)
80.7)
23.4)
259.9)
85.3)
27.5)
7.9)
(5.3)
(14.7)
Total Assets Less Current Liabilities
384.6)
372.6)
3.2)
Non-Current Liabilities and Provisions
(60.0)
(59.9)
(0.2)
(0.8)
-)
323.8)
312.7)
3.5)
154.9)
80.7)
88.2)
142.0)
85.3)
85.5)
9.1)
(5.3)
3.2)
(1.9)
(0.3)
7.3)
(9.8)
2001)
No.)
2000)
No.)
16,850)
8,789)
16,336)
8,635)
CONSOLIDATED INCOME AND EXPENDITURE ACCOUNT
CONSOLIDATED BALANCE SHEET
Minority interest
TOTAL NET ASSETS
Represented by:
Deferred Grants
Endowments
Reserves
OTHER KEY STATISTICS
Consolidated Recognised (Losses)/Gains
Consolidated movement in Cash Flow
Student Numbers
Average Staff Numbers
3
3.1)
1.8)
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REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
TREASURER’S REPORT
Scope of Financial Statements
The financial statements for the first time in a number of years do not include any merger activity. Notes 36 – 39 include the separate
Income and Expenditure account for the year for those postgraduate institutes who have merged with UCL in recent years, but whose
activities are fully consolidated within UCL’s reported activity.
The financial statements also include the consolidated results of UCL’s trading subsidiaries, details of which are shown at Note 13,
and whose commercial activities are, for legal and taxation reasons, more appropriately channelled through limited companies.
Results for the Year
During the year, UCL has maintained its position, both nationally and internationally, as a centre of excellence in teaching and
research. Funding from the HEFCE under the Science Research Investment Fund (SRIF), based on research volume and excellence,
secured for UCL the largest award of any university, and research grant and contract activity has shown significant growth, with
income increasing by 14% over the previous year.
The financial statements demonstrate steady growth in most areas, as shown by the Financial Highlights on page 3. A £31 million
(+ 8.1%) increase in total income, means that UCL’s turnover has now passed £400 million – the surplus of £0.9 million however,
although much in line with forecast, reflects the continuing struggle to achieve a balanced financial position, in the context of
HEFCE funding which fails to keep pace with salary inflation, inadequate recurrent funding for teaching and research infrastructure
and UCL’s underlying commitments to an extensive capital programme. The Income and Expenditure consolidated results for the
years ended 31 July are summarised as follows:
Income
Expenditure
Profit on disposal of assets
2001)
£m)
2000)
£m)
412.3)
(415.1)
3.7)
381.4)
(382.6)
1.0)
0.9)
(0.2)
Surplus/(Deficit) for the year
At 31 July 2001, total accumulated funds on the Income and Expenditure Account stood at £85.7 million.
Tangible fixed asset additions amounted to £39 million in the year, bringing fixed asset additions to £100 million in the last three years.
A substantial contribution to the cost of these capital developments is provided by specific grants and contributions – at the year end
a balance of £155 million was held as deferred capital grants to fund further specific projects. These capital developments relate to a
number of diverse areas such as improvements and expansion at Halls of Residence, new and improved research facilities, and a new
Combined Heat and Power Scheme which will in the long-term provide a cost effective means of providing heat and electricity.
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TREASURER’S REPORT (Continued)
Also deserving of mention is the Queen’s Anniversary Prize for Excellence in Higher Education awarded to the Institute of Child
Health in recognition of its innovative research and training programmes which have made it a world-leading centre that has
contributed to the health of children world wide.
There have been numerous academic developments during the year with two very well publicised initiatives. In April the Institute of
Crime Science was opened with initial funding provided by the Jill Dando Appeal – the Institute will be a centre for research and
teaching aimed at the reduction of opportunities to commit crime. In March, Adastral Park was opened, which is intended to
undertake cutting-edge telecommunications research in collaboration with industrial partners, BT, Agilent, Coming, Nortel and others.
During the year an income generation/savings programme was initiated with the objective of improving UCL’s operating budget
position by £10 million per annum. The response, involving every department across UCL, has already led to significant progress
towards achieving the target.
Investment Performance
At the year end the value of UCL’s endowment asset investments stood at £80.7 million, a net decrease of £4.5 million on the previous
year caused primarily by a major downturn in the stock market, which saw UCL’s investment portfolio diminish in value by £10.2
million.
UCL’s investments are managed by Cazenove and the returns are very closely monitored by the Investments Committee aided by a
specialist consultancy service. Investment performance has been slightly ahead of comparative indicators in respect of fixed-interest
stocks, and generally disappointing for both UK and overseas equity holdings.
Cash Flow
As a consequence of UCL’s decision to continue to fund a substantial part of its capital programme from reserves, cash balances have
continued to decline and in July UCL had cause to use a pre-arranged overdraft facility pending completion of its negotiations for a
£75 million longer term borrowing arrangement on 3 August 2001.
Capital Projects
As reported last year, UCL recorded considerable success in the JIF (Joint Infrastructure Fund) awards, with total funding of £57
million for thirteen projects. More recently £47 million was awarded under SRIF (Science Research Investment Fund). These schemes
will provide substantial funding for a programme totalling £140 million to be carried out in the next two to four years, and goes part
way to meeting research infrastructure needs, particularly in the sciences.
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TREASURER’S REPORT (Continued)
Other Major Activity
Significant effort was directed towards submission of the 2001 Research Assessment Exercise in March 2001. The results to be
published in December 2001, will be used to assess UCL’s research standards and inform the HEFCE funding process. At the last
RAE round in 1996, 70% of UCL’s units of assessment achieved a grade 5 or 5* indicating that the majority of research is of
international and national excellence. UCL’s strategic objective is to improve ratings of departments where possible and to maintain
ratings for those that have been adjudged to be excellent.
UCL’s strength in teaching has also been evidenced by QAA (Quality Assurance Agency) results. During the year all UCL departments
reviewed were classified as excellent, with one department, Economics, receiving the maximum score. Over the last six years 27 reviews
have been undertaken, all departments have been adjudged excellent, with four departments receiving the maximum score.
Creditors Policy
UCL’s policy is to make payments to its creditors within the stipulated terms of business.
Staff and their Involvement
College staff are informed of developments within the organisation through publication of a regular newsletter and by increasing use
of UCL’s Intranet. All staff are encouraged to participate in formal and informal discussion at all levels throughout UCL.
Conclusion
The recent JIF and SRIF schemes are welcomed, which will contribute greatly to infrastructural improvements. The capital
programme planned for the next few years however, will be the cause of much disruption and inconvenience, and I would like to
thank all those who are likely to be affected for their forbearance, and I, with the rest of UCL, look forward to the resulting
transformation of UCL’s campus.
Finally, it is recognised throughout UCL that its future financial health is heavily dependent on the success of the income generation/
savings programme. UCL staff can be congratulated for the responsible way in which the program is being approached.
Kerry J Hawkins
Treasurer
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REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
CORPORATE GOVERNANCE
UCL is committed to exhibiting best practice in all aspects of corporate governance. 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, 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’s Governing Body, 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 mis-statement or loss, and cannot eliminate business risk. Where areas for improvement in the system of internal control
are identified, the Council considers the recommendations made to it by Audit Committee, Academic Board and other committees.
At its December 2001 meeting, the Council carried out an annual assessment for the year ended 31 July 2001 by considering a report
from the Audit Committee, and taking account of events since 31 July 2001. The Council is of the view that there is an ongoing process
for identifying, evaluating and managing the Group’s key risks, and that it has been in place for the whole of the year ended 31 July
2001, 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.
The Council comprises lay and academic persons appointed under the Statutes of UCL. The Statutes provide for the distinct roles
of Chairman and Vice-Chairman of the Council, the Treasurer, and of UCL’s Chief Executive, the Provost and President. 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
has also considered amendments to its Charter and Statutes and is in ongoing discussion with officers of the Privy Council concerning
formal adoption of these changes. The Council meets at least three times each year; it has several committees, including a Planning
& Resources Committee, Finance Committee, Audit Committee, Risk and Efficiency Committee, Academic Board, Remuneration
Committee and Nominations Committee.
The Planning & Resources Committee makes recommendations and gives advice to the Council in respect of its strategic and
development responsibilities, including issues relating to significant changes in activity and the external environment, which affect
key risks.
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CORPORATE GOVERNANCE (Continued)
The Finance Committee is chaired by the Treasurer and comprises lay members and academic members of staff. Inter alia they
recommend to the Council UCL’s annual revenue and capital budgets and monitor performance in relation to the approved budgets
and review UCL’s annual financial statements. They also review UCL’s accounting policies which are applied in the preparation of
those financial statements. The Committee also receives and considers reports from the Higher Education Funding Council for
England as they affect UCL’s business and monitors adherence with the regulatory requirements.
The Audit Committee, which meets at least three times annually, is chaired by a lay member of Council and comprises lay members
only. They are responsible for meeting with external auditors to discuss audit findings, the management letter and internal control
report arising out of the audit of the annual financial statements, and with Internal Auditors to consider detailed internal audit reports
and recommendations for the improvement of UCL’s system of internal controls, together with management’s response and
implementation plans. 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 External Auditors on their own for independent discussions. The
Audit Committee also approves the annual programme of the Internal Audit Service and reviews the conclusions of its work. Audit
plans are drawn up based on assessment of the control risks in 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, 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 Risk and Efficiency Committee includes the Vice-Provosts for Administration and Teaching and Learning, the Dean of Students,
and the directors of Administrative Divisions; the Director of Internal Audit Services is in attendance at meetings. The Committee
has been established to develop a strategy for the implementation of a Risk Assessment and Management Policy, including the
methodology for identifying and assessing key 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 also considers key
risks identified by other Committees, for example on Health and Safety and 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 Academic Board, is responsible for inter alia monitoring the effectiveness
of the academic quality assurance strategy, encompassing policies and procedures in respect of quality audit, quality enhancement and
subject review.
The Nominations Committee considers nominations for vacancies in the Council membership under the relevant Statute. The
Remuneration Committee is chaired by the Chairman of Council and comprises three other members of Council and the Provost
and President. It determines the annual remuneration of senior officers of UCL and where necessary decides on any severance
payments. The Provost and President is excluded from discussions relating to his own remuneration package. The Remuneration
Committee also receives details of all professorial salaries and administrative equivalents not otherwise considered by it. The
remuneration of these staff is determined by the Provost and President in consultation with relevant Vice-Provosts. 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 the 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 and President, 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.
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RESPONSIBILITIES OF THE COUNCIL OF UNIVERSITY COLLEGE LONDON
(Continued)
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 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;
(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 medium to short-term supported by detailed income, expenditure, capital and cash
flow budgets and forecasts;
(vi)
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.
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REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
AUDITORS’ REPORT TO THE MEMBERS OF
THE COUNCIL OF UNIVERSITY COLLEGE LONDON
We have audited the financial statements of University College London for the year ended 31 July 2001 which comprise the income
and expenditure account, the balance sheet, the cash flow statement, the statement of total recognised gains and losses and the related
notes 1 to 39. These financial statements have been prepared under the accounting policies set out therein.
Respective responsibilities of the Council and auditors
As described in the responsibilities of the Council, the Council is responsible for the preparation of the financial statements in accordance
with applicable United Kingdom law and accounting standards. Our responsibilities as independent auditors, are established by statute,
the Audit Practices Board, the Higher Education Funding Council for England and by our profession’s ethical guidance.
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 and whether income has been applied in accordance with the
Statutes and, where appropriate, with the Financial Memorandum with the Higher Education Funding Council for England.
We also report to you if, in our opinion, the Treasurer’s report is not consistent with the financial statements, if UCL has not kept
proper accounting records, the accounting records do not agree with the financial statements or if we have not received all the
information and explanations we require for our audit.
We also, at the request of the 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 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 Treasurer’s report, including the corporate governance statement, and consider
consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the
financial statements.
Basis of audit opinion
We conducted our audit in accordance with United Kingdom auditing standards issued by the Auditing Practices Board and the
Audit Code of Practice issued by the Higher Education Funding Council for England. An audit includes examination, on a test basis,
of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant
estimates and judgements made by the Council in the preparation of the financial statements, and of whether the accounting policies
are appropriate to the circumstances of UCL and the group, consistently applied and adequately disclosed.
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AUDITORS’ REPORT TO THE MEMBERS OF
THE COUNCIL OF UNIVERSITY COLLEGE LONDON (Continued)
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to
provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement,
whether caused by fraud or other irregularity or error. In forming our opinion, we also evaluated the overall adequacy of the
presentation of information in the financial statements.
Opinion
In our opinion:
a).
the financial statements give a true and fair view of the state of affairs of UCL and the Group as at 31 July 2001 and of the
surplus of the Group for the year then ended and have been properly prepared in accordance with the Statement of
Recommended Practice on Accounting in Further and Higher Education Institutions;
b).
income from the Higher Education Funding Council for England, grants and income for specific purposes and from other
restricted funds administered by UCL have been applied for the purposes for which they were received; and
c).
income has been applied in accordance with UCL’s statutes and, where appropriate, with the financial memorandum dated
June 2000 with the Higher Education Funding Council for England.
Deloitte & Touche
Chartered Accountants
and Registered Auditors
Hill House
1 Little New Street
London EC4A 3TR
18 December 2001
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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)
and applicable United Kingdom Accounting Standards.
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 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.
Income received from specific endowments and donations, research grants and contracts is included to the extent only of
expenditure incurred during the year, together with any related overhead contributions towards costs.
4.
Pension Arrangements
Pension costs are assessed in accordance with the advice of professionally qualified independent actuaries and are accounted
for on the principle of charging the cost of providing pensions over the period that UCL benefits from the employees’ services.
A detailed explanation of the arrangements for each of the pension schemes in operation at UCL can be found at note 32.
5.
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 unless such funds
are held for onward transmission to a research partner under an agency agreement. The resulting exchange differences are dealt
with in the determination of income and expenditure for the financial year.
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STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (Continued)
6.
Taxation
UCL enjoys charitable status and is therefore exempt from taxation in respect of non-trading income or capital gains under
Section 505 of the Income and Corporation Taxes Act 1988 and Section 256 of the Taxation of Chargeable Gains Act 1992.
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.
7.
Land and Buildings
Land and Buildings are stated in the Balance Sheet at cost. 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
8.
20 years
10 years
Investment Property
Investment properties are stated in the Balance Sheet at their open market value. No depreciation is charged on such properties.
The Companies Act 1985 requires all properties to be depreciated. However, this requirement conflicts with the generally
accepted accounting principle set out in SSAP 19. UCL considers that, because this property is not held for consumption,
but for its investment potential, to depreciate it would not give a true and fair view and that it is necessary to adopt SSAP 19
in order to give a true and fair view.
If this departure from the act had not been made, the deficit for the financial year would have been increased by depreciation.
However, the amount of depreciation cannot be reasonably quantified, because depreciation is only one of many factors
reflected in the annual valuation and the amount which may otherwise have been shown cannot be separately identified
or quantified.
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
STATEMENT OF PRINCIPAL ACCOUNTING POLICIES (Continued)
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.
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
10.
Term of grant
5 years
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.
11.
Intangible Fixed Assets
Patents, licenses, rights, trade marks and other similar rights over assets are stated in the balance sheet at cost and amortised
over a period of five years.
12.
Investments
Both Fixed Asset and Endowment Asset Investments are stated at market value in the Balance Sheet.
13.
Stocks
Stocks are made up of goods for resale, centrally held stores holdings and major stores held by academic departments and are
stated at the lower of cost or net realisable value.
14.
Cash Flows and Liquid Resources
Cash flows comprise increases or decreases in cash. Cash includes cash in hand, deposits repayable on demand and overdrafts.
Deposits are repayable on demand if they are in practice available within 24 hours without penalty.
Liquid resources comprise assets held as a readily disposable store of value. They include term deposits held as part of UCL’s
treasury management activities. They exclude any such assets held as Endowment Asset Investments.
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
CONSOLIDATED INCOME AND EXPENDITURE ACCOUNT
YEAR ENDED 31 JULY 2001
Note
2001)
£’000)
2000)
£’000)
1
2
3
4
125,250)
55,740)
141,000)
84,692)
-)
5,601)
117,521)
52,049)
123,789)
75,639)
6,499)
5,898)
412,283)
381,395)
262,813)
126,813)
6,294)
19,211)
242,118)
117,116)
5,982)
17,376)
415,131)
382,592)
(2,848)
(1,197)
1,493)
2,206)
-)
1,027)
851)
(170)
(2)
(12)
849)
(182)
13)
-)
862)
(182)
INCOME
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Profit on disposal of investments
Endowment income and interest receivable
5
Total Income
EXPENDITURE
Staff costs
Other operating expenses
Interest payable
Depreciation
6
7
8
9
Total Expenditure
DEFICIT FOR THE YEAR BEFORE DISPOSAL
OF FIXED ASSETS AND BEFORE TAX
Profit on disposal of fixed asset investments
Profit on disposal of tangible fixed assets
10
10
SURPLUS/(DEFICIT) FOR THE YEAR AFTER
DISPOSAL OF FIXED ASSETS BUT BEFORE TAX
Taxation
SURPLUS/(DEFICIT) FOR THE YEAR AFTER
DISPOSAL OF FIXED ASSETS AND TAX
Minority interest
SURPLUS/(DEFICIT) FOR THE YEAR
The Group has no revalued assets which it depreciates and thus there is no difference between the surplus/(deficit) as reported and
the historical cost results.
The consolidated income and expenditure of the Group relate wholly to continuing activities.
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
CONSOLIDATED BALANCE SHEET AS AT 31 JULY 2001
Note
2001)
£’000)
Restated)
2000)
£’000)
Tangible assets
Intangible assets
Investments
11
12
13
269,237)
672)
10,517)
280,426)
249,604)
315)
9,943)
259,862)
ENDOWMENT ASSET INVESTMENTS
14
80,726)
85,274)
695)
97,974)
511)
2,667)
101,847)
585)
82,112)
2,201)
6,434)
91,332)
(78,421)
(63,870)
23,426)
27,462)
384,578)
372,598)
FIXED ASSETS
CURRENT ASSETS
Stores
Debtors
Short term deposits and investments
Cash at bank and in hand
15
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
16
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT LIABILITIES
CREDITORS: AMOUNTS FALLING DUE
AFTER MORE THAN ONE YEAR
17
(57,786)
(57,612)
PROVISIONS FOR LIABILITIES AND CHARGES
18
(2,222)
(2,275)
MINORITY INTEREST
35
(760)
-)
323,810)
312,711)
19
154,918)
141,968)
20
80,351)
375)
80,726)
84,905)
369)
85,274)
85,716)
1,302)
1,148)
88,166)
84,897)
572)
-)
85,469)
323,810)
312,711)
NET ASSETS
DEFERRED CAPITAL GRANTS
ENDOWMENTS
Specific
General
RESERVES
Income and expenditure account
Revaluation reserve
Other reserves
21
22
23
TOTAL
Approved by Council on 18 December 2001
K. J. Hawkins
Treasurer
Professor Sir Chris Llewellyn Smith
Provost and President
17
J. W. Foster
Director of Finance
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
BALANCE SHEET AS AT 31 JULY 2001
Note
2001)
£’000)
Restated)
2000)
£’000)
Tangible assets
Intangible assets
Investments
11
12
13
267,830)
672)
7,360)
275,862)
248,227)
315)
7,156)
255,698)
ENDOWMENT ASSET INVESTMENTS
14
80,726)
85,274)
413)
100,708)
-)
-)
101,121)
378)
84,889)
2,200)
5,399)
92,866)
(78,071)
(63,554)
23,050)
29,312)
379,638)
370,284)
FIXED ASSETS
CURRENT ASSETS
Stores
Debtors
Short term deposits
Cash at bank and in hand
15
CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
16
NET CURRENT ASSETS
TOTAL ASSETS LESS CURRENT LIABILITIES
CREDITORS: AMOUNTS FALLING DUE
AFTER MORE THAN ONE YEAR
17
(57,786)
(57,612)
PROVISIONS FOR LIABILITIES AND CHARGES
18
(2,222)
(2,275)
319,630)
310,397)
19
153,777)
140,781)
20
80,351)
375)
80,726)
84,905)
369)
85,274)
85,127)
85,127)
84,342)
84,342)
319,630)
310,397)
NET ASSETS
DEFERRED CAPITAL GRANTS
ENDOWMENTS
Specific
General
RESERVES
Income and expenditure account
21
TOTAL
Approved by Council on 18 December 2001
K. J. Hawkins
Treasurer
Professor Sir Chris Llewellyn Smith
Provost and President
18
J. W. Foster
Director of Finance
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
STATEMENTS OF TOTAL RECOGNISED GAINS AND LOSSES AND
OF CASH FLOW
STATEMENT OF CONSOLIDATED TOTAL RECOGNISED GAINS AND LOSSES
Note
Surplus/(deficit) after depreciation of assets and tax
School of Slavonic and East European Studies reserves at 1 August 1999
Bloomsbury Bioseed Fund Ltd reserves at 1 August 2000
Diminution of endowment asset investments
Endowment income retained for the year
School of Slavonic and East European Studies endowments at 1 August 1999
New endowments
Unrealised surplus on revaluation of investment property
35
20
20
20
22
2001)
£’000)
2000)
£’000)
862)
-)
1,105)
(10,245)
3,218)
-)
2,479)
730)
(182)
988)
-)
(2,215)
5,480)
1,422)
1,575)
185)
(1,851)
7,253)
RECONCILIATION TO CLOSING RESERVES AND ENDOWMENTS
Opening reserves and endowments
Total recognised gains and losses for the year
)170,743)
(1,851)
Closing reserves and endowments
168,892
STATEMENT OF CONSOLIDATED CASH FLOW
Note
2001)
£’000)
2000)
£’000)
25
28
29
3,555)
2,881)
(2)
(8,732)
(8,528)
5,531)
(12)
(20,722)
Cash outflow before use of Liquid Resources and Financing
Management of Liquid Resources
Financing
26
30
(2,298)
2,200)
(187)
(23,731)
14,153)
(255)
Decrease in cash in the year
26
(285)
(9,833)
Net Cash inflow/(outflow) from Operating Activities
Returns on Investments and Servicing of Finance
Taxation
Capital Expenditure and Financial Investment
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS
1. FUNDING COUNCIL GRANTS
Recurrent Grant - HEFCE
Deferred Capital Grants released in year
2001
£’000
2000
£’000
119,666
5,584
112,864
4,657
125,250
117,521
2001
£’000
2000
£’000
18,966
22,700
3,068
3,060
507
7,439
18,547
21,912
2,102
2,377
508
6,603
55,740
52,049
2001
£’000
2000
£’000
106,355
34,645
93,278
30,511
141,000
123,789
42,165
64,191
10,285
8,951
5,790
843
8,084
691
38,771
54,506
10,102
8,295
5,393
635
5,646
441
141,000
123,789
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
Grants
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
Income from research grants and contracts includes deferred capital grants released in the year of £4,500,000
(2000 - £4,125,000).
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
4. OTHER OPERATING INCOME
Residences and catering
Other services rendered
Health authorities
Released from deferred capital grants
Other income
2001
£’000
2000
£’000
12,621
24,410
22,605
2,474
22,582
12,462
25,583
18,614
2,208
16,772
84,692
75,639
Income from residences and catering includes deferred capital grants released in the year of £9,000 (2000 - £9,000).
5. ENDOWMENT INCOME AND INTEREST RECEIVABLE
Income from endowment asset investments (Note 20)
Other interest receivable
2001
£’000
2000
£’000
2,865
2,736
2,818
3,080
5,601
5,898
2001
£’000
2000
£’000
223,179
18,070
21,564
205,247
17,240
19,631
262,813
242,118
£
£
156,134
150,873
6. INFORMATION REGARDING EMPLOYEES
Staff costs:
Salaries and wages
NI contributions
Pension costs
Emoluments of the Provost and President:
C Llewellyn Smith
The emoluments of the Provost and President, UCL’s Chief Executive, are shown on the same basis as for higher paid staff.
UCL’s pension contributions to USS are paid at the same rates as for other academic staff and amounted to £21,858 in the year (2000
- £19,795).
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
6. INFORMATION REGARDING EMPLOYEES – continued
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 consultancy work, both of which are funded from non - HEFCE funds, but excluding employers’ pensions
contributions:
2001
2000
No.
No.
£50,001
£60,001
£70,001
£80,001
£90,001
£100,001
£110,001
£120,001
£130,001
£140,001
£150,001
£160,001
£170,001
£180,001
£190,001
-
£60,000
£70,000
£80,000
£90,000
£100,000
£110,000
£120,000
£130,000
£140,000
£150,000
£160,000
£170,000
£180,000
£190,000
£200,000
192
129
67
42
38
13
35
15
3
7
1
2
1
157
114
82
40
17
32
7
14
6
3
1
1
The average number of staff employed, both full and part time, during the year was 8,789 (2000 - 8,635).
Compensation for loss of office in respect of two higher paid employees totalled £210,104 in the year, of which £85,775 was
reimbursed by the NHS.
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
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
Repairs and 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
Other costs
2001
£’000
2000
£’000
6,771
18,300
24,016
4,077
5,923
4,015
5,425
5,086
17,148
2,220
1,585
7,645
9,053
4,576
79
61
1,346
9,487
5,752
20,367
20,787
3,299
5,433
4,120
4,258
4,754
14,644
2,027
1,573
7,008
8,342
4,159
96
50
1,413
9,034
126,813
117,116
2001
£’000
2000
£’000
300
2,110
3,884
271
2,067
3,644
6,294
5,982
8. INTEREST PAYABLE
Bank loans and other loans wholly repayable within five years
Loans not wholly repayable within five years
Finance leases
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
9. ANALYSIS OF EXPENDITURE BY ACTIVITY
Staff
Costs
£’000
Other
Operating
Expenses
£’000
132,809
11,498
76,640
2,004
7,382
22,646
9,834
13,965
9,328
44,823
6,771
26,372
12,661
12,893
2,053
3,830
411
2,724
835
4,500
1,100
9,876
71
105
149,498
21,661
125,963
11,928
47,460
35,378
23,243
262,813
126,813
6,294
19,211
415,131
2001
Academic departments
Academic services
Research grants and contracts
Residences and catering
Premises
Administration
Other expenses
Interest
Payable Depreciation
£’000
£’000
The depreciation charge has been funded by:
Deferred capital grants released (Note 19)
General income
Total
£’000
12,567
6,644
19,211
Staff
Costs
£’000
Other
Operating
Expenses
£’000
116,968
10,137
71,218
2,141
6,372
20,335
14,947
18,368
7,775
33,939
5,752
25,896
12,576
12,810
2,074
3,637
271
2,021
584
4,605
722
9,303
52
89
137,357
18,496
109,762
10,689
45,208
32,963
28,117
242,118
117,116
5,982
17,376
382,592
2000
Academic departments
Academic services
Research grants and contracts
Residences and catering
Premises
Administration
Other expenses
The depreciation charge has been funded by:
Deferred capital grants released
General income
Interest
Payable Depreciation
£’000
£’000
Total
£’000
10,999
6,377
17,376
The 2000 figures for staff costs and other operating expenditure have been restated following a reclassification of costs in the ‘other
expenses’ category.
10. PROFIT ON DISPOSAL OF FIXED ASSETS
During the year fixed assets were disposed of resulting in profits which were disclosed as extraordinary items:
(a)
Profit on disposal of fixed asset investment – £1.5 million arising from an asset distribution in a residential property company,
prior to winding-up, in which UCL held a share.
(b)
Profit on disposal of tangible fixed assets – £2.2 million arising from the sale of two properties at the Royal Free and UCL
Medical School.
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
11. TANGIBLE ASSETS
UCL
Land and Buildings
)
Freehold) Leasehold) Equipment)
£’000)
£’000)
£’000)
Total)
£’000)
Cost
At 1 August 2000
Reclassify fixtures and fittings to buildings
Adjust accounting treatment of prior years disposals
Additions at cost
Disposals
At 31 July 2001
147,094)
45,073)
(34)
26,507)
-)
218,640)
84,612)
6,888)
-)
4,285)
(367)
95,418)
97,152)
(51,961)
-)
8,086)
-)
53,277)
328,858)
-)
(34)
38,878)
(367)
367,335)
Depreciation
At 1 August 2000
Reclassify fixtures and fittings to buildings
Adjust accounting treatment of prior years disposals
Charge for year
Disposals
At 31 July 2001
16,790)
17,237)
(34)
7,616)
-)
41,609)
13,556)
1,105)
-)
3,629)
(198)
18,092)
50,285)
(18,342)
-)
7,861)
-)
39,804)
80,631)
-)
(34)
19,106)
(198)
99,505)
Net Book Value
At 31 July 2001
177,031)
77,326)
13,473)
267,830)
At 31 July 2000
158,140)
76,839)
13,248)
248,227)
Consolidated
Land and Buildings
)
Freehold) Leasehold) Equipment)
£’000)
£’000)
£’000)
Total)
£’000)
Cost
At 1 August 2000
Reclassify fixtures and fittings to buildings
Adjust accounting treatment of prior years disposals
Additions at cost
Disposals
At 31 July 2001
147,075)
45,073)
21)
26,507)
-)
218,676)
85,696)
6,888)
16)
4,285)
(367)
96,518)
97,714)
(51,961)
(20)
8,221)
-)
53,954)
330,485)
-)
17)
39,013)
(367)
369,148)
Depreciation
At 1 August 2000
Reclassify fixtures and fittings to buildings
Adjust accounting treatment of prior years disposals
Charge for year
Disposals
At 31 July 2001
16,790)
17,237)
(13)
7,622)
-)
41,636)
13,639)
1,105)
16)
3,656)
(198)
18,218)
50,452)
(18,342)
14)
7,933)
-)
40,057)
80,881)
-)
17)
19,211)
(198)
99,911)
Net Book Value
At 31 July 2001
177,040)
78,300)
13,897)
269,237)
At 31 July 2000
158,121)
77,840)
13,643)
249,604)
The declared value of buildings for insurance purposes (day one basis) as at 1 August 2001 was £848.8 million (2000 - £699.4 million).
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
12. INTANGIBLE ASSETS
Consolidated and UCL
Patents
£’000
Cost
At 1 August 2000
Additions at cost
At 31 July 2001
1,497
546
2,043
Amortisation
At 1 August 2000
Charge for year
At 31 July 2001
1,182
189
1,371
Net Book Value
At 31 July 2001
672
At 31 July 2000
315
13. INVESTMENTS HELD AS FIXED ASSETS
Monies held on long term deposits
Other investments
Investment in subsidiaries
Investment property
Consolidated
2001
2000
£’000
£’000
2001
£’000
UCL
2000
£’000
5,766
826
3,925
5,510
1,238
3,195
5,766
472
1,122
-
5,510
1,234
412
-
10,517
9,943
7,360
7,156
Included in monies held on long term deposits is £5.7 million (2000 - £5.5 million) over which there is a legal charge.
The deposit represents a security fund to meet the obligations under finance leases (Note 17).
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
13. INVESTMENTS HELD AS FIXED ASSETS - continued
The following UCL wholly owned (unless indicated otherwise) 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:
UCL Trading Ltd
UCL Investments Ltd
UCL Properties Ltd
UCL Residences Ltd
UCL Enterprises Ltd
UCL Cruciform Ltd
Stanmore Implants Worldwide Ltd
Somerstown Community Sports Centre Ltd
Freemedic Plc
Bloomsbury Bioseed Fund Ltd (70%)
Contracting, consultancy and other commercial activities.
Property investment.
Property development and investment.
Commercial lettings of accommodation.
General commercial trading.
Exploitation of intellectual property in the field of bio-medicine.
Design and manufacture of orthopaedic implants.
Operation of sports centre.
Exploitation of intellectual property at the Royal Free campus.
Investment in biotechnology start-ups.
14. ENDOWMENT ASSET INVESTMENTS
Consolidated and UCL
2001)
£’000)
Balance at 1 August 2000
School of Slavonic and East European Studies at 1 August 1999
Net additions
Diminution on valuation
2000
£’000
85,274)
-)
5,697)
(10,245)
79,012)
1,360)
7,117)
(2,215)
80,726)
85,274)
Represented by:
Fixed interest securities
Equities
Cash
30,633)
41,376)
8,717)
31,056)
47,494)
6,724)
Total endowment asset investments
80,726)
85,274)
Endowment assets at cost
71,120)
73,241)
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
15. DEBTORS
Consolidated
Restated
2001
2000
£’000
£’000
Amounts falling due within one year:
Invoiced debtors
Research grants and contracts
Local health authorities/hospitals
Halls of residence debtors
Tax recoverable from Inland Revenue
Advances to members of staff
Amounts owed by group undertakings
Other debtors and prepayments
Amounts falling due after one year:
Amounts owed by group undertakings
Other debtors and prepayments
UCL
2001
£’000
Restated
2000
£’000
5,840
59,679
9,191
1,250
33
1,648
20,333
4,891
48,076
6,938
948
6
1,621
19,289
4,703
59,679
9,191
1,250
33
1,648
2,174
19,942
3,977
48,076
6,938
948
6
1,621
1,948
19,054
97,974
343
82,112
2,088
100,708
2,321
84,889
The 2000 figure for research debtors has been reduced by £2,610,000 following a reclassification of imprest balances from creditors
to debtors.
16. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Consolidated
Restated
2001
2000
£’000
£’000
Bank loans and overdrafts
Research grants received on account
Purchase ledger creditors
Other creditors including taxation
Obligations under finance leases
Accruals and deferred income
Amounts owed to group undertakings
8,501
29,957
10,227
17,166
204
12,366
78,421
9,990
24,852
3,184
20,163
187
5,494
63,870
UCL
2001
£’000
Restated
2000
£’000
8,493
29,957
10,130
17,084
204
12,186
17
78,071
9,959
24,852
3,050
20,089
187
5,328
89
63,554
The 2000 figure for research creditors has been reduced by £2,610,000 following a reclassification of imprest balances from creditors
to debtors.
17. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Consolidated and UCL
2001
£’000
Obligations under finance leases
Cruciform building - Private Finance Initiative
42,403
15,383
57,786
2000
£’000
42,522
15,090
57,612
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 leases will be met from payments which amount to approximately £4 million per annum.
Security is provided to the Lessors by way of annual payments into a security deposit (Note 13).
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
18. PROVISIONS FOR LIABILITIES AND CHARGES
Consolidated and UCL
Pension)
Provision)
£’000)
Balance at 1 August 2000
2,275)
Utilised in year
Transfer from income and expenditure account
(172)
119)
Balance at 31 July 2001
2,222)
19. DEFERRED CAPITAL GRANTS
)
Land and Buildings
Freehold) Leasehold) Equipment)
£’000)
£’000)
£’000)
UCL
Balance at 1 August 2000
Reclassify fixtures and fittings to buildings
Grants received in year
Disposals
Contribution to depreciation for the year
Balance at 31 July 2001
Consolidated
Balance at 1 August 2000
Reclassify fixtures and fittings to buildings
Grants received in year
Disposals
Contribution to depreciation for the year
Balance at 31 July 2001
29
Total)
£’000)
84,626)
12,044)
16,606)
-)
113,276)
34,239)
257)
2,637)
(169)
36,964)
21,916)
(12,301)
6,443)
-)
16,058)
140,781)
-)
25,686)
(169)
166,298)
(4,646)
(1,452)
(6,423)
(12,521)
108,630)
35,512)
9,635)
153,777)
)
Land and Buildings
)
Freehold) Leasehold) Equipment)
£’000)
£’000)
£’000)
Total)
£’000)
84,626)
12,044)
16,606)
-)
113,276)
35,426)
257)
2,637)
(169)
38,151)
21,916)
(12,301)
6,443)
-)
16,058)
141,968)
-)
25,686)
(169)
167,485)
(4,646)
(1,498)
(6,423)
(12,567)
108,630)
36,653)
9,635)
154,918)
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
20. ENDOWMENTS
Consolidated and UCL
Specific)
General)
Total)
£’000)
£’000)
£’000)
Balance at 1 August 2000
Additions
Diminution of endowment asset investments
Income for the year
Transferred to income and expenditure (Note 5)
84,905)
2,473)
(10,245)
6,083)
(2,865)
369)
6)
-)
-)
-)
85,274)
2,479)
(10,245)
6,083)
(2,865)
Balance at 31 July 2001
Representing:
Fellowships scholarships and prize funds
Chairs and lectureships funds
Other funds
80,351)
375)
80,726)
10,455)
8,598)
61,298)
-)
-)
375)
10,455)
8,598)
61,673)
80,351)
375)
80,726)
21. INCOME AND EXPENDITURE ACCOUNT
Consolidated)
2001)
2000)
£’000)
£’000)
UCL)
2001)
2000)
£’000)
£’000)
Balance at 1 August 2000
Bloomsbury Bioseed Fund Ltd acquired reserves (Note 35)
School of Slavonic and East European Studies acquired reserves
Transfer from revaluation reserve
Surplus/(deficit) for the year
84,897)
(43)
-)
-)
862)
83,399)
-)
988)
692)
(182)
84,342)
-)
-)
-)
785)
83,101)
-)
988)
692)
(439)
Balance at 31 July 2001
The income and expenditure account is nominally allocated to:
Departmental reserves
Earmarked project reserves
Revenue reserve
85,716)
84,897)
85,127)
84,342)
54,774)
35,718)
(4,776)
44,757)
44,950)
(4,810)
54,774)
35,718)
(5,365)
44,757)
44,950)
(5,365)
85,716)
84,897)
85,127)
84,342)
22. REVALUATION RESERVE
Consolidated)
2001)
2000)
£’000)
£’000)
Balance at 1 August 2000
Revaluation of Investment Property
Transfer to income and expenditure reserve
Balance at 31 July 2001
UCL)
2001)
2000)
£’000)
£’000)
572)
730)
-)
1,079)
185)
(692)
-)
-)
-)
692)
-)
(692)
1,302)
572)
-)
-)
23. OTHER RESERVES
Consolidated)
2001)
2000)
£’000)
£’000)
Balance at 1 August 2000
Bloomsbury Bioseed Fund Ltd acquired reserves - Government grants (Note 35)
-)
1,148)
-)
-)
Balance at 31 July 2001
1,148)
-)
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
24. CAPITAL COMMITMENTS
Consolidated and UCL)
2001)
2000)
£’000)
£’000)
Commitments contracted at 31 July
Authorised but not contracted at 31 July
34,010)
108,224)
29,991)
5,590)
142,234)
35,581)
25. RECONCILIATION OF CONSOLIDATED OPERATING SURPLUS/(DEFICIT)
TO NET CASH INFLOW/(OUTFLOW) FROM OPERATING ACTIVITIES
2001)
£’000)
Restated)
2000)
£’000)
851)
(170)
Items not involving cash movements:
Depreciation
Amortisation of intangible assets
Deferred capital grants released to income
Increase/(decrease) in stores
Increase in debtors
Increase/(decrease) in investments
Increase in creditors
Decrease in provisions
19,211)
189)
(12,567)
(110)
(15,917)
(510)
15,586)
(172)
17,376)
78)
(10,999)
444)
(16,505)
3)
3,088)
(678)
Items which are not operating activities:
Profit on disposal of fixed asset investments
Profit on disposal of tangible fixed assets
Interest receivable
Interest payable
Investment income
(1,493)
(2,206)
(2,736)
6,294
(2,865)
(222)
(1,027)
(3,080)
5,982)
(2,818)
Net Cash inflow/(outflow) from Operating Activities
3,555)
(8,528)
Operating surplus/(deficit) before tax
26. ANALYSIS OF CHANGES IN NET DEBT
)
1 August 2000)
£’000)
Cash)
Flows)
£’000)
Other)
Changes)
£’000)
31 July 2001)
£’000)
6,724)
6,434)
(9,990)
3,168)
1,993)
(3,767)
1,489)
(285)
-)
-)
-)
-)
8,717)
2,667)
(8,501)
2,883)
2,200)
(2,200)
-)
-)
(187)
187)
(204)
(204)
(57,612)
5,615)
(5,789)
(57,786)
(52,431)
3,317
(5,993)
(55,107)
Cash at bank and in hand
Endowment assets (Note 14)
Deposits repayable on demand
Overdrafts (Note 16)
Deposits repayable at short notice
Debt due within one year (Note 16)
Debt due after one year (Note 17)
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
27. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
2001)
£’000)
Decrease in cash in the period
Decrease in deposits repayable at short notice
Increase in debt
(285)
(2,200)
(191)
Change in net debt
(2,676)
Net debt at 1 August 2000
(52,431)
Net debt at 31 July 2001
(55,107)
28. RETURNS ON INVESTMENTS AND SERVICING OF FINANCE
2001)
£’000)
2000)
£’000)
Income from endowments
Other interest received
Interest paid
6,083)
2,413)
(5,615)
8,298)
2,699)
(5,466)
Net cash inflow from returns on investments and servicing of finance
2,881)
5,531)
2001)
£’000)
2000)
£’000)
(36,813)
(546)
(222)
(3,704)
(41,285)
(31,066)
(393)
(200)
(9,260)
(40,919)
Cash acquired on merger with School of Slavonic and East European Studies
Cash acquired on acquisition of Bloomsbury Bioseed Fund Ltd
Proceeds from disposal of fixed asset investments
Proceeds from disposal of tangible fixed assets
Capital grants received towards the purchase of tangible assets
Endowments received
-)
2,703)
1,679)
6)
25,686)
2,479)
1,082)
-)
1,075)
1,059)
15,406)
1,575)
Net cash outflow from capital expenditure and financial investment
(8,732)
(20,722)
2001)
£’000)
2000)
£’000)
Mortgage and Loan Capital repayments
(187)
(255)
Net cash outflow from financing
(187)
(255)
29. CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT
Purchase of tangible fixed assets
Purchase of intangible fixed assets
Purchase of fixed asset investments
Net purchase of endowment asset investments
Total payments to acquire fixed and endowment assets
30. FINANCING
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
UCL also operates to two smaller defined benefit schemes for non-academic staff.
The Federated Pension Scheme (FPS) for Middlesex Hospital Medical School staff which since merger with UCL on 1 August 1987
has become closed to new entrants.
The Royal Free Hospital School of Medicine (RFHSM) Pension and Assurance Scheme, operated for 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.
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 1999 and for the Royal Free Hospital School of Medicine
Pension and Assurance Scheme on 1 August 2000. For the purposes of reporting under FRS17 a valuation of both schemes was
undertaken on 31 July 2001, and details are given below.
RFHSM Pension
FPS (1645) & Assurance Scheme
Valuation date
Valuation method
Inflation assumption
Increase for pensions
Increase for deferred pensions
Investment return
Salary scale increases per annum
Discount rate for liabilities
Projected over/(under)-funding
Funding level
Present value of liabilities
Fair value of the scheme assets
31-Jul-01
31-Jul-01
Projected unit
Projected unit
2.50%
2.50%
2.75%
7.00%
4.50%
6.00%
2.75%
2.75%
2.75%
6.90%
4.80%
5.80%
£7.5 million
£(3.6) million
244.0%
65.5%
£5.169 million
£12.6 million *
£10.5 million
£7 million
* Represents cash held on a Deposit Administration account at valuation date. The investment guarantees a return each year and in
addition a declared bonus.
£’000
The total pension costs for UCL were:
Contribution to USS
Contribution to SAUL
Contribution to NHS
Contribution to RFHSM Pension & Assurance Scheme1
Contribution to FPS2
Contribution to other pension schemes
17,061
2,900
1,470
122
11
21,564
1
In view of the underfunding in the RFHSM Pension and Assurance Scheme the Employers contributions will increase to 29.7%,
from 7.0%, with effect from 1 October 2001.
2
Employers contributions are currently Nil to the FPS scheme.
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
33. RELATED PARTY TRANSACTIONS
Transactions with subsidiaries of UCL have been eliminated on consolidation and no disclosure of these transactions has therefore
been given. UCL has no related party transactions which require disclosure under FRS 8.
34. CONTINGENT LIABILITY
UCL is a member of UM Association (Terrorism) Ltd, a university mutual company limited by guarantee, formed to provide cover
for losses arising from acts of terrorism. If the association suffers a shortfall in any one year, members are liable for their pro rata share.
The scheme’s ability to pay claims is derived from one of the following sources:
(a) The reserve fund accumulated from the net contributions of Members, approaching £10 million;
(b) £15m ‘internal’ loan facility from Member institutions (UCL is not a participating institution);
(c) £300m aggregate layer of ‘excess’ cover obtained through the Lloyds Insurance market (structured to provide up to two single
maximum losses of £150 million each);
(d) In any indemnity year before the year has been closed, the Board may call for a supplementary contribution to be paid by each
member entered for that indemnity year (whether or not such institution remains a member at the date of such direction) of an
amount that the Board thinks fit. All supplementary contributions levied are to be calculated pro rata to the Advance
Contributions (less any return of them) made in the relevant indemnity year.
35. ACQUISITION OF SUBSIDIARY
During the year ended 31 July 2001, UCL acquired a 70% shareholding in Bloomsbury Bioseed Fund Limited.
Share capital and reserves on acquisition were as follows:
UCL (70%) Minority (30%)
£’000
£’000
Share Capital
Reserves:
Restricted Government grants
Income and expenditure account
TOTAL
Total
£’000
700)
300)
1,000)
1,148)
(43)
492)
(19)
1,640)
(62)
1,105)
473)
1,578)
1,805)
773)
2,578)
UCL (70%) Minority (30%)
£’000
£’000
Total
£’000
Share capital and reserves at 31 July 2001 were as follows:
Share Capital
Reserves:
Restricted Government grants
Income and expenditure account
TOTAL
35
700)
300)
1,000)
1,148)
(74)
492)
(32)
1,640)
(106)
1,074)
460)
1,534)
1,774)
760)
2,534)
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
36. INSTITUTE OF OPHTHALMOLOGY
INCOME AND EXPENDITURE ACCOUNT
2001)
£’000)
2000
£’000
2,541)
405)
5,275)
3,975)
173)
2,581)
428)
4,523)
2,696)
256)
12,369)
10,484)
7,646)
5,321)
6,783)
4,339)
12,967)
11,122)
(598)
(638)
2001)
£’000)
2000
£’000
3,950)
511)
9,957)
3,944)
674)
3,831)
562)
8,738)
3,380)
653)
19,036)
17,164)
Staff costs
Other operating expenses
11,939)
6,508)
11,216)
5,407)
Total expenditure
18,447)
16,623)
589)
541)
INCOME
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Endowment income and interest receivable
Total income
EXPENDITURE
Staff costs
Other operating expenses
Total expenditure
DEFICIT FOR THE YEAR
37. INSTITUTE OF NEUROLOGY
INCOME AND EXPENDITURE ACCOUNT
INCOME
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Endowment income and interest receivable
Total income
EXPENDITURE
SURPLUS FOR THE YEAR
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
NOTES TO THE ACCOUNTS (Continued)
38. INSTITUTE OF CHILD HEALTH
INCOME AND EXPENDITURE ACCOUNT
2001)
£’000)
2000)
£’000)
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Endowment income and interest receivable
6,212)
1,043)
18,202)
169)
5,679)
6,089)
1,031)
15,570)
4,273)
232)
Total income
31,305)
27,195)
Staff costs
Other operating expenses
20,204)
10,562)
17,350)
9,920)
Total expenditure
30,766)
27,270)
539)
(75)
2001)
£’000)
2000)
£’000)
Funding Council grants
Academic fees and support grants
Research grants and contracts
Other operating income
Endowment income and interest receivable
2,790)
3,078)
1,593)
1,588)
230)
2,744)
3,088)
1,140)
1,491)
239)
Total income
9,279)
8,702)
Staff costs
Other operating expenses
Depreciation and interest payable
6,360)
2,320)
610)
6,088)
1,918)
644)
Total expenditure
9,290)
8,650)
(11)
52)
INCOME
EXPENDITURE
SURPLUS/(DEFICIT) FOR THE YEAR
39. EASTMAN DENTAL INSTITUTE
INCOME AND EXPENDITURE ACCOUNT
INCOME
EXPENDITURE
(DEFICIT)/SURPLUS FOR THE YEAR
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UNIVERSITY COLLEGE LONDON
REPORTS AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2001
FINANCIAL SUMMARIES (Unaudited)
2001
£’000
2000
£’000
1999
£’000
1998
£’000
1997
£’000
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
125,250
55,740
141,000
84,692
5,601
117,521
52,049
123,789
75,639
6,499
5,898
104,928
48,993
126,194
72,043
37
7,538
93,275
47,465
115,401
63,148
10,934
83,929
42,880
96,299
56,598
6,760
Total income
412,283
381,395
359,733
330,223
286,466
Staff costs
Other operating expenses
Interest payable
Depreciation
262,813
126,813
6,294
19,211
242,118
117,116
5,982
17,376
221,412
114,906
2,582
13,846
200,763
103,424
3,527
10,711
173,863
89,720
3,882
9,327
Total expenditure
415,131
382,592
352,746
318,425
276,792
(2,848)
(1,197)
6,987
11,798
9,674
1,493
2,206
1,027
-
-
-
851)
(170)
6,987
11,798
9,674
(2)
(12)
(9)
-
-
849)
(182)
6,978
11,798
9,674
-
-
-
-
(182)
6,978
11,798
9,674
INCOME
EXPENDITURE
(DEFICIT)/SURPLUS FOR THE
YEAR BEFORE DISPOSAL OF
FIXED ASSETS AND BEFORE TAX
Profit on disposal of fixed assets investments
Profit on disposal of tangible fixed assets
SURPLUS/(DEFICIT) FOR THE
YEAR AFTER DISPOSAL OF
FIXED ASSETS BUT BEFORE TAX
Taxation
SURPLUS/(DEFICIT) FOR THE
YEAR AFTER DISPOSAL OF
FIXED ASSETS AND TAX
Minority interest
13
SURPLUS/(DEFICIT) FOR THE YEAR
862)
NOTE
(i) The above summary includes mergers with a number of institutions which in the years of merger achieved turnover as follows:
The Institute of Child Health (1996-97)
The Institute of Neurology (1997-98)
The Royal Free Hospital School of Medicine (1998-99)
The Eastman Dental Institute (1999-00)
The School of Slavonic and East European Studies (1999-00)
£ 22,466,000
£ 15,734,000
£ 32,312,000
£ 8,702,000
£ 4,001,000
(ii) The 1999 figures were restated for the inclusion of The Eastman Dental Institute. The 1998 figures were restated for the
inclusion of The Royal Free Hospital School of Medicine. The 1997 figures were restated for the inclusion of The Institute of
Neurology. There is no restatement of prior years’ figures for the other mergers.
38