The financial statements are prepared in sterling which is the functional currency of the group and rounded to the nearest £’000. The University is a public benefit entity and therefore has applied the relevant public benefit requirement of the applicable UK laws and accounting standards. The University is registered with the Office for Students.
GOING CONCERN The University’s activities, together with the factors likely to affect its future development, performance and position, are set out in the Strategic review incorporating the operational review which forms part of the Board of Governors’ Integrated Report. The Board of Governors’ Financial Review also describes the University’s financial position, its cash flows, liquidity position and borrowing facilities.
The financial statements have been prepared on a going concern basis which the Board of Governors consider to be appropriate for the following reasons. The Board of Governors have prepared cash flow forecasts for a period of 44 months from the date of approval of these financial statements. After reviewing these forecasts, the Board of Governors is of the opinion that, taking account of severe but plausible downsides, including the anticipated impact of COVID-19 the University will have sufficient funds to meet their liabilities as they fall due over the period of 12 months from the date of approval of the financial statements (the going concern assessment period). The Board of Governors has considered the future cash flows of the University in December 2019 when approving the OfS Financial Forecast for submission to the Office for Students. In response to COVID-19 there was a Special Standing Committee meeting on the 4th May 2020 to discuss the University’s financial contingency planning. At the meeting scenario modelling that had been undertaken was presented and reviewed. This modelling was based upon the December 2019 OfS Financial Forecast as its starting point, with the key stress tests under consideration being:
• Reduced tuition fee income • Reduced student retention rate • Loss of accommodation, catering and conference income The Committee also discussed the mitigation actions already implemented by management, including a freeze in staff recruitment of all but essential posts and a pause on expenditure classed as non-essential to the running of the University. The Committee recommended that more work be
undertaken at reducing expenditure for 2020/21, particularly on staff costs, which culminated in a voluntary severance scheme being conducted in July 2020. The 2020/21 Budget, approved by the Board of Governors in July 2020, incorporated lower expectations regarding recruitment and accommodation, catering and conference income, to ensure that the University would remain financially sustainable should these circumstances crystallise. The University has no undrawn lending facilities and the budgeted cash flow does not require any additional facilities within the next 12 months. The budget does not breach any covenant thresholds on our existing facilities with the Triodos Bank and Allied Irish Bank. Having reviewed the scenario modelling performed, and the mitigation actions taken, the Board of Governors is confident that the University will have sufficient funds to continue to meet their liabilities as they fall due for at least 12 months from the date of approval of the financial statements and therefore have prepared the financial statements on a going concern basis
BASIS OF CONSOLIDATION At 31 July 2020 the University held significant controlling interest in Winchester Business School Limited, Winchester Management School Limited and the University of Winchester Academy Trust due to a majority of the share capital of the entities being held by employees of the University of Winchester. These companies have been dormant since incorporation, therefore these financial statements do not consolidate the results of these companies. The financial statements do not include the income and expenditure of Winchester Student Union as the
University of Winchester
The University’s financial statements have been prepared in accordance with United Kingdom Accounting Standards, including Financial Reporting Standard 102 (FRS 102) and the Statement of Recommended Practice: Accounting for Further and Higher Education (HE SORP 2019). They have also been prepared in accordance with the ‘carried forward’ powers and duties of previous legislation (Further and Higher Education Act 1992 and the Higher Education Act 2004) and the new powers of the Higher Education and Research Act 2017 during the transition period to 31 July 2019, the Accounts Direction issued by the Office for Students (OfS 2019.41), the Terms and conditions of funding for higher education institutions issued by the Office for Students (OfS 2018.15) and the Terms and conditions of Research England Grant.
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BASIS OF PREPARATION
Integrated Annual Report 2019-20
Statement of principal accounting policies
