WARWICK STUDENTS' UNION
ANNUAL REPORT AND CONSOLIDATED FINANCIAL STATEMENTS
For the period from 29 June 2010 to 31 July 2011
COMPANY REGISTRATION NUMBER: 07297865 CHARITY NUMBER: 1136894
CONTENTS PAGE
Legal and Administrative Information Annual Report of the Board of Trustees Statement of the Board of Trustees' Responsibilities Independent Auditors' Report
1 -6 7 - 19 20 21 - 22
Group Statement of Financial Activity
23
Balance Sheets
24
Consolidated Cash Flow Statement
25
Principal Accounting Policies
26 - 29
Notes to the Financial Statements: Note 1 Note 2 Note 3 Note 4
Charitable Activity and Support Costs Governance Costs Net Incoming Resources for the Period Staff Costs
30 - 31 31 32 32 - 33
Note 5 Note 6 Note 7 Note 8 Note 9
33 34 34 35 - 36 36
Note 10 Note 11 Note 12
Trustees' Remuneration and Expenses Tangible Fixed Assets Capital Commitments Fixed Asset Investments Stocks Debtors Creditors Provisions for Liabilities and Charges
Note 13 Note 14 Note 15
Restricted Funds Designated Funds Analysis of Net Assets between Funds
38 38 39
Note 16 Note 17 Note 18
Lease Commitments Cash Flow Statement Pension Scheme
39 40 41
Note 19 Note 20
Related Party Transactions Merger
42 43
WARWICK STUDENTS' UNION For the period ended 31 July 2011
37 37 38
LEGAL AND ADMINISTRATIVE INFORMATION UNION
WARWICK STUDENTS' UNION
CHARITABLE STATUS
Warwick Students' Union is a charitable company limited by guarantee. Warwick Students' Union is a charity established under the Education Act 1994. Warwick Students' Union charity registered with the Charity Commission for England and Wales on 15 July 2010. Registered UK charity number: 1136894
COMPANY
Warwick Students' Union is a charitable company limited by guarantee registered in England and Wales on 29 June 2010. Registered company number: 7297865
REGISTERED OFFICE
WARWICK STUDENTS' UNION University of Warwick Gibbet Hill Road COVENTRY CV4 7AL
BOARD OF TRUSTEES
Search and Nominations Committee ensures that Warwick Students' Union has effective systems for the appointment and training of trustees and that the membership of the Board of Trustees is appropriate.
Sabbatical Officers 2010-2011
2011-2012
Appointed D Stevens S Ruston S Stanley C Luck A White G Whitworth L Boe
President / Chair Education Finance Communications Societies Sports Welfare
1 August 2010
L Boe S Ruston G Whitworth C Luck M Rogers C Sury I John
President Education Union Development Democracy Societies Sports Welfare
1 August 2011
WARWICK STUDENTS' UNION For the period ended 31 July 2011
1
Resigned 31 July 2011
1 August 2010 1 August 2010
31 July 2011
1 August 2010 1 August 2010
31 July 2011
1 August 2010 1 August 2010
1 August 2011 1 August 2011 1 August 2011 1 August 2011 1 August 2011 1 August 2011
re-elected re-elected re-elected re-elected
LEGAL AND ADMINISTRATIVE INFORMATION BOARD of TRUSTEES continued UNIVERSITY of WARWICK STUDENTS' UNION
Student Trustees
B Wood S Stanley
Appointed
Vice Chair
24 November 2008
13 July 2011
24 November 2008
28 June 2010
24 November 2008
28 June 2010
24 November 2008
28 June 2010
16 February 2009
28 June 2010
* *
24 November 2008
31 July 2010
9 March 2009
13 July 2011
* * *
10 May 2010
31 July 2010
10 May 2010
31 July 2010
10 May 2010
31 July 2010
* *
A Clarey C Watts M Wassermann
External Trustees
T Smeaton S P Baylis L C Morrison T W I King J Ryder
Resigned
On 1 August 2010 the trade, assets and liabilites transferred from University of Warwick Students' Union (an unincorporated exempt charity) to Warwick Students' Union (an incorporated exempt charity). The designated trustees also transferred to the new entity, Warwick Students' Union. Board of Trustee members marked with an asterisk (*) transferred to Warwick Students' Union.
WARWICK STUDENTS' UNION Student Trustees
Appointed
A Clarey
29 June 2010
C Watts
29 June 2010
Resigned
T Evans V N J Fowler J L E Wolfson
1 August 2010
13 July 2011
1 August 2010
13 July 2011
C Olgilvie A K S Mou S Cragg
1 August 2011
WARWICK STUDENTS' UNION For the period ended 31 July 2011
1 August 2010
1 August 2011 1 August 2011
2
LEGAL AND ADMINISTRATIVE INFORMATION BOARD of TRUSTEES continued WARWICK STUDENTS' UNION continued External Trustees
Appointed
T Smeaton S P Baylis
1 August 2010 1 August 2010
13 July 2011
L C Morrison
1 August 2010
12 October 2011
T W I King
1 August 2010
J Ryder
1 August 2010
SENIOR MANAGEMENT Chief Executive
Resigned
Appointed J Clements
WARWICK STUDENTS' UNION For the period ended 31 July 2011
14 July 2008
3
LEGAL AND ADMINISTRATIVE INFORMATION COMPANY
STUDENTS' UNION SERVICES WARWICK LIMITED
GOVERNING INSTRUMENT
The company is a limited company with share capital. It is governed by its Memorandum and Articles of Association.
COMPANY REGISTERED NUMBER DIRECTORS
2197761 The following director was appointed on 1 August 2010 and resigned on 31 July 2011: S Stanley The following director was appointed on 1st August 2010: G Whitworth The following director was appointed on 18 November 2010: A H Smith The following director was appointed on 1 August 2011: C Sury
COMPANY SECRETARY
J Clements
REGISTERED OFFICE
SUHQ Warwick Students' Union University of Warwick Gibbet Hill Road Coventry CV4 7AL
WARWICK STUDENTS' UNION For the period ended 31 July 2011
4
LEGAL AND ADMINISTRATIVE INFORMATION COMPANY
MEMBERSHIP SOLUTIONS LIMITED
GOVERNING INSTRUMENT
The company is a limited company with share capital. It is governed by its Memorandum and Articles of Association.
COMPANY REGISTERED NUMBER DIRECTORS
5525449 The following director has held office since incorporation 2 August 2005: C Horton The following director was appointed on 29 November 2007: S Gilling The following director was appointed on 12 July 2008: J Clements The following director was appointed on 1 August 2009: J Bonsall The following directors were appointed on 1 August 2010 and resigned on 31 July 2011: D Stevens S Stanley The following directors were appointed on 1 August 2011: L Boe G Whitworth
COMPANY SECRETARY
J Clements
REGISTERED OFFICE
SUHQ Warwick Students' Union University of Warwick Gibbet Hill Road Coventry CV4 7AL
WARWICK STUDENTS' UNION For the period ended 31 July 2011
5
LEGAL AND ADMINISTRATIVE INFORMATION BANKERS
NatWest plc 24 Broadgate Coventry West Midlands CV1 1ZZ Barclays Bank plc 25 High Street Coventry West Midlands CV1 5QZ
SOLICITORS
Band Hatton & Co 1 Copthall House Station Square Coventry West Midlands CV1 2FY Bates Wells and Braithwate London LLP 2 - 6 Cannon Street London EC4M 6YH
AUDITORS
WARWICK STUDENTS' UNION For the period ended 31 July 2011
BakerTilly UK Audit LLP Chartered Accountants St Philips Point Temple Row Birmingham B2 5AF
6
ANNUAL REPORT OF THE BOARD OF TRUSTEES The Board of Trustees of the Union submit their Annual Report for the period ended 31 July 2011 which includes the administrative information set out on pages 1 to 6 together with the audited accounts for the year. This is the first year that the Board of Trustees have presented this in accordance with the Accounting and Reporting by Charities published in March 2005 (Statement of Recommended Practice 2005).
MEMBERS OF THE UNION Full Members All registered students of the University of Warwick except those who exercise their right not to be a member under clause 22 (c) c) of the Education Act 1994. Sabbatical Officers of the Union are full members of the Union. Associate Members Those persons admitted to membership by the Union Council or a delegated officer, who have paid any required fee.
STRUCTURE, GOVERNANCE AND MANAGEMENT Warwick Students' Union (the Union) is constituted under the Education Act 1994 as a charity with internal rules and regulations approved by University Council, the governing body of the University of Warwick. The Union's charitable objects under the Act, to advance the University's educational purposes by providing representation and support for the students of the University of Warwick, are supplemented by the further object of helping members to develop their own charitable activities as participants in civil society. Following the publication of the Charities Act 2006, Warwick Students' Union has moved from the traditional unincorporated association model and has registered as a charity with the Charity Commission and incorporated as a company limited by guarantee, as of 1 August 2010.
BOARD OF TRUSTEES The Union is administered by its Board of Trustees comprising of:- up to five appointed external lay members - up to six appointed full student members who are not Sabbatical Officers - up to seven student Sabbatical Officers (including the President of the Union) The President of the Union acts as Chair of the Board of Trustees. The appointed Student Trustees are recruited to the Board and selected by the Trustees and Union Council to serve a maximum term of two years.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
7
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued BOARD OF TRUSTEES continued Officers of the Union The Officers of the Union are: - Sabbatical Officer Trustees - Chair and Deputy Chair of Union Council - Chairs and members of Union Standing and Representation Committee There are seven Sabbatical Officer Trustees including a President, Deputy President and a Sabbatical Officer with responsiblity for finance. The Sabbatical Officers are officer trustees elected through a secret ballot by the members each year, normally serving for one year in office but can serve a second term if re-elected. These are full time posts remunerated as authorised by the Education Act and the Memorandum and Articles of Warwick Students' Union. Trustees Induction and Training Upon appointment all trustees receive a variety of information through their induction. Trustees are briefed on their legal obligations and other trustee responsibilities. The Sabbatical Officers are new to the Board every year, so they undergo more intensive, in depth training to ensure that they are fully aware of their roles and responsibilities and can perform their duties to the best of their abilities as soon as possible. There is an on-going training programme for Trustees for issues which may occur during their term of office.
TRUSTEES POWERS AND RESPONSIBILITIES Trustees' General Authority The Board of Trustees has ultimate responsibility for the financial matters and procedures of the Union. The Board of Trustees may choose to prohibit the implementation of any policy recommended by Union Council which has financial implications if it is passed without a realistic financial plan, is not legal or may not be in the best interests of the Union. The Board of Trustees is assisted by committees where appropriate and has delegated the day-to-day running of Warwick Students' Union to the Chief Executive. Committees The Board of Trustees meets at least five times a year to receive reports from committees, Sabbatical Officers, Senior Management and the Chief Executive, to review the Union's performance and administration generally and to agree policy issues arising, subject to consultation with Union Council.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
8
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued STRUCTURE, GOVERNANCE AND MANAGEMENT continued Committees continued The Board of Trustees is supported by four committees which focus on certain key aspects of Warwick Students' Union governance and management:-
The Executive Committee The Search and Nominations Committee The Audit and Risk Committee The Finance and Human Resources Committee
The Executive Committee This consists of the Sabbatical Officer Trustees and Part Time Officers. The Executive Committee covers aspects of student voice such as representation and campaigning focusing on policy implementation. Search and Nominations Committee This ensures that new trustees are recruited, inducted and developed properly. They also have responsibility for recruitment of the Chief Executive. Audit and Risk Committee This monitors the Union's finances, risk profile and other aspects which could impact on Warwick Students' Union's organisational health as well as ensuring that the Union is complying with relevant legislation. Finance and Human Resources Committee This examines issues relating to finance. It scrutinises the management and annual accounts, financial plans and annual budgets. It also monitors issues relating to staff including the staff survey results, pay changes, training and development as well as staff policies. UNION COUNCIL The Union operates on democratic principles, working for and with our members, the students of the University of Warwick. The voice of students is represented by Union Council, elected by and from members of the Union. The Unions' policy making bodies are: - General Meetings - Referenda - Union Council Union policy may be amended by resolution of a Referendum, General Meeting or Union Council. The composition and proceedings of Union Council are set out in the Bye Laws.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
9
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued STRUCTURE, GOVERNANCE AND MANAGEMENT continued UNION COUNCIL continued Policies passed by Referendum cannot be overturned without a further Referendum or General Meeting. Policies passed by General Meetings cannot be overturned without being debated and voted on at a further General Meeting. The Union maintains a policy file and record of lapsed policies. Policies lapse after two years unless renewed by Union Council who will specify the next renewal date. The Union Council receives a quarterly report from the Trustees.
RELATIONSHIP WITH THE UNIVERSITY OF WARWICK The relationship between the University and the Union is established in the Charter, Statutes, Ordinances and Regulations of the University. The Union receives a block grant from the University and occupies a building owned by the University Foundation Fund which is leased to the Union at an agreed rent. There is no reason to believe that the block grant or equivalent support from the University of Warwick will not continue for the foreseeable future, as the Education Act 1994 imposes a duty on the University to take such steps as are reasonably practicable to ensure that the Union operates in a fair and democratic manner and is accountable for its finances. Warwick Students' Union therefore works alongside the University of Warwick to ensure that the affairs of the Union are properly conducted and that the educational and welfare needs of the Union's members are met.
RISK MANAGEMENT The Trustee Board has examined the main strategic business and operational risks faced by the Union. A risk register has been established and is updated at least annually. Where appropriate, systems and procedures have been established to mitigate the risks the Union faces and these are periodically reviewed to ensure that they continue to meet the needs of the Union. Budgetary and internal control risks are minimised by the implementation of procedures for authorisation of all transactions and projects. Procedures are in place to ensure compliance with the health and safety of staff, volunteers and participants on all activities organised by the Union. These procedures are periodically reviewed to ensure they continue to meet the needs of the Union.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
10
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued AIMS, OBJECTIVES AND ACTIVITIES Our Mission Warwick Students' Union - creating a better experience for students at Warwick. Our Objects The objects of the Union are the advancement of education of students at the University of Warwick for the public benefit by:(i) promoting the interests and welfare of students at Warwick Students' Union during their course of study and representing, supporting and advising students. (ii) being the recognised representative channel between students and the University of Warwick and any other external bodies; and (iii) providing social, cultural, sporting and recreational activities and forums for discussions and debate for the personal development of its students. Our Values We are:-
Democratic, student led, member focussed and representative the Independent voice of Warwick students Ethical, fair, principled, transparent and environmentally sound Fun, friendly, vibrant and entertaining Informative, supportive, knowledgeable, responsive and useful Enriching, helping students develop and nurture their aspirations Accesssible, diverse, welcoming, tolerant and inclusive
In pursuit of this vision, the Union will ensure the diversity of its membership is recognised, valued and supported and as such has established departments and services for use by its members and to support its work with the University of Warwick and other organisations on behalf of students. These include the Union's Advice and Welfare Centre, Democracy and Representation Office, Student Activities and Development Office, the Student Resources Centre, the Venue, Bars and Catering outlets. The Executive Officers represent students by sitting on key committees and working groups of the University of Warwick. This ensures that the student voice is heard and responded to at all levels of the University to enhance the student experience. Student representatives now sit on and contribute to over 30 University committees and through the Staff - Student Liaison Committee system (SSLC) approximately 650 students effectively liaise with University departments to raise student concerns and work to improve the teaching and learning experiences of students.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
11
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued AIMS, OBJECTIVES AND ACTIVITIES continued The Union's Executive Officers also meet regularly with Local Authorities, local Primary Care Trusts and other providers of public services affecting students. To further enhance the student experience, Warwick Students' Union involves and supports students from all walks of life to get involved with both the University and local community by actively promoting the benefits of volunteering in student-led activities such as Warwick Volunteers and the Inspire scheme. This involves students visiting comprehensive schools in the West Midlands area to talk about their lives as students with pupils who may not have considered embarking on a course in higher education. Warwick Students' Union also supports approximately 75 sports clubs and 300 student societies offering students a wide range of academic, social, cultural, charitable and interest based groups. Students have the opportunity to meet new people and share their interests as well as develop transferrable skills.
ACHIEVEMENTS AND PERFORMANCE The 2010-11 year was a year of transition as it was the final year of the previous strategic plan. Warwick Students' Union achieved the following published objectives for 2010-11:
Objective
Achievement
Our purpose: Number of people who feel Warwick SU has contributed positively to their time at Warwick (source: Big 5 Survey)
Target at least 85% - achieved 82% The result was higher than anticipated and a real cause for celebration at a time when the Union was looking to the future as part of the update of the new Strategic Plan.
Representation: Achieve Voter Turnout of 30% of members in Officer Elections
Voter turnout 356 ahead of the 5,200 target A really pleasing result. It is hoped that this strong performance can be built on with the work currently underway on the Democracy Review.
Involvement: Increase the number of students joining sports clubs and societies
Memberships increased by 528 on 16,350 target Warwick Sport in particular did well with over 6,000 student memberships covering a wide variety of activities from archery, ice hockey to ballroom dancing
WARWICK STUDENTS' UNION For the period ended 31 July 2011
12
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued ACHIEVEMENTS AND PERFORMANCE continued Objective
Achievement
Engagement: % of students who feel the SU listens to feedback (source: Big 5 Survey)
Target at least 50% - achieved 29% This result was disappointing and the Union looked closely at ways in which both feedback could be collated and the positive impacts and actions taken communicated back to members. Rant Week and Have Your Say were introduced as well as an information campaign - You Said We Did. Work on this will be on-going.
Our people: Achieve IIP Accreditation 2011
Achieved
Our finances: Achieve planned surplus of ÂŁ57k
Achieved a surplus of ÂŁ265k A really good result which helped to build back reserves
Environmental impact: Achieve at least a silver level in Green Impact Awards
Achieved Gold
FUTURE PLANS: THE UNION'S STRATEGY for 2011 - 2014 During 2011 Warwick Students' Union launched it's new strategic plan for 2011-2014. This plan reflects the comments and feedback of members responding to questions and research undertaken by the Union. The Union's overall strategic objectives are reviewed every three years. The detailed actions identified in the plan will be reviewed each year to account for any changes to student population, changes to Union policy or changes as a result of the manifestos of the students elected to represent the members. The plan centres around seven key values (previously outlined in the Aims, Objectives and Activities section). These values will help the Union the create a better experience for students at Warwick.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
13
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued FUTURE PLANS: THE UNION'S STRATEGY for 2011 - 2014 continued Several key action points emerged from this review: From the Membership - The membership want greater exploitation of technology for communication, including work on the Union website to ensure it is up-to-date and attractive. - The importance of the Union operating ethically and with environmental impact in mind. - The importance of transparency around Union processes and structures. - There are frustrations around the bureaucracy with managing funds for societies. The procedures and regulations around these funds needs better explanation. Future Challenges - Pensions are in crisis in the UK and this will impact on the perception by staff of benefits. - There will be further legislative changes for pensions that require compliance. - The Union tries to do too much for it's resources and needs to ensure that it doesn't over promise and not deliver. - To build back the Union's reserves position after the financial impact of the redevelopment of the Union's facilties. - To maintain the Union's reputation with key stakeholders such as the University. Other Potential Impacts - The Government may change licensing laws to decrease alcohol sales. - There may be further increases to VAT. - Sponsorship opportunities may decrease in certain industry sectors. - Pay settlements may increase above the Union's financial plan estimates. - The Union's membership research is insufficient. Headline Key Performace Indicators (KPI's) Well run organisations set clear objectives each year and communicate these to everyone involved. A crucial component of these objectives is being able to see whether thay have been successfully achieved. The measures put in place are Key Performance Indicators (KPI's) and they are - in simple terms - the way of benchmarking achievement relating to aims for the year. Seven areas were identified for monitoring with KPI's during the 2011-12 financial year: -
Membership Participation: Membership numbers - Warwick Sport and Societies Federation Representation: Voter turn out in autumn and officer elections Communications: % of students voting that the website is at least average (Big 5 Survey) Staff: % of staff who feel valued by the Union (Staff Survey) Finance: Achieve or exceed budget surplus of ÂŁ49k for 2011-12 Impact: % of people who feel that the Union has contributed positively to their time at Warwick Environmental Impact: Achieve at least a silver Green Impact Award
WARWICK STUDENTS' UNION For the period ended 31 July 2011
14
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued FUTURE PLANS: THE UNION'S STRATEGY for 2011 - 2014 continued Review: Membership Services During 2011-12 there will be a review of Membership Services. This will look at the Union's strategy and members feed back. This will shape the key services delivered to students such as advice and welfare, representation, democracy and student activities for the Union going forward. Review: Democracy Running alongside the review of Membership Services will be the Democracy Review. This will look at the structures which allow members to participate and shape decision making. Part of this will be a fresh look at the current Sabbatical Officer roles to ensure that they reflect the views and needs of the Union's members.
FINANCIAL REVIEW As a result of the changes to the Charities Act 2006, Warwick Students' Union created a new company limited by guarantee on 29 June 2010 and registered with the Charity Commission on 15 July 2010. All the assets and liabilities held by the previous unincorporated membership association were transferred to the new company on 1 August 2010. These are the first accounts presented according to the Charity Commission's Statement of Recommended Practice (2005) format. Comparatives for 2009-10 relating to the unincorporated membership association have been restated to reflect SORP 2005 reporting. Income and Expenditure The overall surplus for the year was £265,297 (2010: £566,876). This represents 4% of total incoming resources and was £207,750 ahead of the budget for the year of £57,547. This was the second good financial year for the Union and the first full year of trade in the newly refurbished building. This enabled the Board of Trustees to approve £180,000 to be transferred from general reserves to a designated reserve for future building refurbishment. Total incoming resources increased by £272,495 to £6,689,923 (2010: £6,417,428). The grant contribution from the University was down overall by £124,723. This grant is made up of two elements recurrent and non-recurrent grant. The annual recurrent grant actually increased by £293,595 to £1,713,391 (2010: £1,419,798). This additional funding included a modest inflationary increase, contribution for increased pension costs and an amount to continue supporting the Union with the excellent work it undertakes on the Student-Staff Liaison Committees (SSLC'S). The prior year non-recurrent grant of £473,250 was a one-off award to assist the Union with the impact of the closure during the building redevelopment. The Food and Beverage outlets traded very well contributing £78,308 (2010: £54,421) and with income £250,507 ahead of last year - £2,478,250 (2010: £2,227,743). This was the first year of full
WARWICK STUDENTS' UNION For the period ended 31 July 2011
15
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued FINANCIAL REVIEW continued trade out of the newly refurbished building and strong trading performances were turned in by the Union's baguettes-to-order outlet: The Bread Oven, the Union's pub: The Dirty Duck and the Union's tea shop: CuriosiTea. The story wasn't the same for the Union's Venue, The Copper Rooms. Since the original proposal in 2006 for the building redevelopment the business model has changed. The market for live music is now very different and students social habits have changed. This is not just happening at Warwick. There is change nationally in the way that live music venues operate. Disappointingly the Venues did not increase income significantly - only £27,310 increase on last year to £1,252,757 (2010: £1,225,447). Costs also increased in line and action was taken during the year to scale back the programmes to minimise losses. The budget for the 2011-12 year is more realistic and to date the financial performance of the Venue is good. Total Resources Expended increased by £574,074 to £6,424,626 (2010: 5,850,552). This reflects the new rental charge payable to the University of Warwick Foundation Fund of £450,000 per annum for the Union buildings. Students' Union Services Warwick Limited This is the subsidiary company for non-primary purpose trading. Turnover for the company was down £87,962 on the previous year at £233,763 (2010: 321,725). The 2009-10 year included some one-off summer conference trade which was sadly not repeated in summer 2011. Students' Union Services Warwick Limited made a donation under gift aid of £118,461 (2010: £167,229) to Warwick Students' Union. This was a decrease of £48,768 on the previous year. It is anticipated that going forward Students' Union Services Warwick Limited will be impacted by the current economic climate and the budgetted operating profit for the 2011-12 financial year is £38,145. This reflects the reduction in conference and vacation bookings as well as income generated from external room hire. Membership Solutions Limited The 2010-11 financial year saw Membership Solutions Limited (MSL) making a transfer under gift aid to Warwick Students' Union for the first time of £125,658 (2010: nil). This was a good year for MSL with the delivery of the NUS website - NUS Connect see: http://www.nusconnect.org.uk/. Turnover for the company increased by £151,553 to £352,825 (2010: £201, 272). During the 2010-11 financial year MSL increased its client client base to approximately 30 students' unions nationally. MSL made profits on ordinary activities before taxation of £5,467 (2010: £28,957) finally utilising the brought forward losses from previous years.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
16
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued FINANCIAL REVIEW continued Net Assets and Cash Flow Total Net Assets increased by £265,297 to £327,727 (2010: £62,430). This consisted of the following movements: - the net book value of Total Fixed Assets fell by £37,858 to £109,578 (2010: £147,436). This is due to the transfer of Tangible Fixed Assets at net book value on 1 August 2010 as detailed in Tangible Fixed Assets Note 6. - the Current Assets increased by £230,286 to £1,185,369 (2010: £955,083). This included an increase in cash balances and short term deposits of £217,084 (see Consolidated Cash Flow Statement). Debtor balances increased by £12,989 (Note 10) due to an increase in Trade Debtors. - the value of Creditors increased by £2,955 to £991,696 (2010: £988,741). This is mostly due to an increase in the amounts held as custodian funds for sports clubs and student societies (Note 11). - the value of Provisions for Liabilities was reduced to nil at year end (2010: £75,824) This was a provision set aside for redundancy costs following the staffing restructure in 2010. These results reflected a much healthier balance sheet position for the Union at 31 July 2011 as it builds back it's reserves. Reserves Free unrestricted general reserves at 31 July 2011 increased by £102,573 to £135,003 (2010: £62,430). The Board of Trustees also approved that £180,000 be set aside in a designated reserve for building refurbishment. At 31 July 2011 total unrestricted reserves were £315,003 (2010: £62,430) taking the reserves back to 2006-07 levels prior to the building redevelopment. This is a pleasing increase in reserves and the contribution for the year was ahead of budget. During the coming year the Board of Trustees will consider what level of reserves the Union will require to cover the Union for any unforseen changes in commercial operations as well as future investment in infrastructure. Custodian Funds Warwick Students' Union acts as a custodian for funds raised by the many sports clubs, student societies and RAG (raising and giving) affiliated to the Union. These funds are held in a separate bank account and the year end balances for each sports club and society are within the Union's creditor balance (see Note 11). The balance held for sports clubs and student societies at 31 July 2011 was £382,836 (2010: £324,450). This includes £7,321 held at the end of the year for distribution to charities.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
17
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued FINANCIAL REVIEW continued Custodian Funds continued The income and expenditure for the student sports clubs and societies is not reported within the Union's Statement of Financial Activity. During the financial year the sports clubs and societies received £1,541,106 of income. Included in this were grants from the Union of £173,023 for Warwick Sport and £45,933 from the Societies Federation for student societies. These grant awards were spent in the year and appear in the Union's Statement of Financial Activity as a cost in the "Student Activities, Societies and Sports Clubs" line. Future Funding Every year the Union produces a Five Year Plan. This process enables the Union to review the current and future financial performance of its activities. The plan (including the budget for the 2011-12 financial year) was approved by the Board of Trustees in June 2011. The budget for 2011-12 forecasts a surplus for the Union of £48,663 (representing 0.7% of income) and includes an approved block grant from the University of Warwick of £1,832,775 (2010: £1,768,325). The current Five Year Plan includes an annual block grant from the University of Warwick across the planning period of at least the level of the 2011-12 approved grant. Although the Union has no definitive guarantee that funding will continue from the University at these levels, the Union will continue it's dialogue with the University about the future and monitor the impacts of the changes in Higher Education Funding. The Capital Commitments note (Note 7) reports authorised but not yet contracted expenditure of £60,000 this is directly attributable to the refurbishment of the Union's Xananas restaurant. This project was delayed over the summer of 2011 and it is hoped that the majority of major work will be completed before the end of the financial year 31 July 2012. The Union is under going a review of Membership Services and any impacts on the capital plan will be included during the 2012 Five Year Plan. The Union potentially faces significant financial risk as a result of the current pension deficit reported from the Students' Union Superannuation Scheme (SUSS). This is a defined benefit scheme whose membership consists of students' unions and related bodies throughout the country (see Note 18). This scheme closed to future accrual on 30 September 2011. The Union's contributions towards the pension deficit will have doubled in two years from the level paid in 2009-10. The amount contributed at 31 July 2011 was £102,906 (2010: £72,060). Provision for increases in pension deficit contribution costs have been included in the current Five Year Plan based on the forecast on-going increase in contribution rate of 3.2% per annum.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
18
ANNUAL REPORT OF THE BOARD OF TRUSTEES continued INVESTMENT POLICY The Trustees objective is to invest surplus cash to best advantage with minimum risk. The Union has taken a prudent stance with funds being held in high interest bearing deposit accounts for periods not exceeding 6 months. Cash funds so invested are usually over a minimum balance of ÂŁ100,000 and must be placed with an approved and reputable banking institution. Investment returns in the year reflect the stated policy as well a the lower interest rates available due to market conditions. This policy will be reviewed in the coming year to ensure that it continues to reflect best advantage with minimum risk.
RESERVES POLICY Following the Union's registration with the Charity Commission the Trustees will be considering the level of free reserves required. Prior to incorporation and transfer to the incorporated charity limited by guarantee the Union's free reserves position was ÂŁ62,430 as set out in Note 15. Designated reserves are held to fund building refurbishment plans.
AUDITORS BakerTilly UK Audit LLP has indicated its willingness to continue in office.
STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS The Board of Trustees members who were in office on the date of approval of these financial statements have confirmed, as far as they are aware, that there is no relevant audit information of which the auditors are unaware. Each member of the Board of Trustees members have confirmed that they have taken all the steps that they ought to have taken as Board of Trustees members in order to make themselves aware of any relevant audit information and to establish that it has been communicated to the auditor. On behalf of the Board of Trustees.
L Boe President
G Whitworth Union Development Officer
8 February 2012
WARWICK STUDENTS' UNION For the period ended 31 July 2011
19
STATEMENT OF BOARD OF TRUSTEES RESPONSIBILITIES The Board of Trustees are responsible for preparing the Report of the Board of Trustees and the financial statements in accordance with applicable law and regulations. Charity law requires the Board of Trustees to prepare financial statements for each financial year. Under that law the Board of Trustees have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under charity law the Board of Trustees must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Union and the group and of the surplus or deficit of the group for that period. In preparing those financial statements, the Board of Trustees are required to:a) select suitable accounting policies and then apply them consistently; b) make judgements and estimates that are reasonable and prudent; c) state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements. d) prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and the Union will continue in business. The Board of Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the group's and the Union's transactions and disclose with reasonable accuracy at any time the financial position of the Union. They are also responsible for safeguarding the assets of the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
20
INDEPENDENT AUDITORS' REPORT to the Members of Warwick Students' Union We have audited the financial statements of the University of Warwick Students' Union for the period 29 June to 31 July 2011 on pages 23 to 43. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company's members those matters we are required to state to them in an auditor's 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 charitable company and the charitable company's members as a body, for our audit work, for this report, or for the opinions we have formed.
RESPECTIVE RESPONSIBILITIES OF BOARD OF TRUSTEES AND AUDITOR As explained more fully in the Statement of Trustees' Responsibilities, the Trustees (who are also the directors of the company for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's (APB's) Ethical Standards for Auditors.
SCOPE OF THE AUDIT OF THE FINANCIAL STATEMENTS A description of the scope of an audit of financial statements is provided on the APB's website at: www.frc.org.uk/apb/scope
OPINION ON FINANCIAL STATEMENTS In our opinion the financial statements: - give a true and fair view of the state of the group's and the charitable company's affairs as at 31 July 2011 and of its incoming resources and application of resources, including its income and expenditure, for the period then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and - have been prepared in accordance with the Companies Act 2006.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
21
INDEPENDENT AUDITORS' REPORT continued MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: - the charity has not kept adequate accounting records, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements are not in agreement with the accounting records and returns; or - certain disclosures of trustees' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit.
PAUL OXTOBY (Senior Statutory Auditor) For and on behalf of: BAKER TILLY UK AUDIT LLP Statutory Auditor Chartered Accountants St Philips Point Temple Row Birmingham B2 5AF 8 February 2012
WARWICK STUDENTS' UNION For the period ended 31 July 2011
22
GROUP STATEMENT OF FINANCIAL ACTIVITY
Note
Unrestricted
Designated
Restricted
Funds
Funds
Funds
£
£
£
2011 TOTAL £
2010 TOTAL £
INCOMING RESOURCES Incoming resources from generated funds:
Voluntary Income - University Grant
1,768,325
-
-
1,768,325
1,893,048
559,062
-
-
559,062
505,109
137,385
-
-
137,385
137,996
337
-
-
337
3,414
2,478,250
-
-
2,478,250
2,227,743
1,252,757
-
-
1,252,757
1,225,447
17,105
-
-
17,105
9,051
16,464
-
17,604
34,068
25,244
96,609
-
346,025
442,634
390,376
6,326,294
-
363,629
6,689,923
6,417,428
282,995
-
-
282,995
238,038
1
2,399,942
-
-
2,399,942
2,173,322
1
1,588,284
-
-
1,588,284
1,530,897
1
530,572
-
2,897
533,469
520,304
1
441,841
-
1,985
443,826
394,239
1
789,266
-
346,023
1,135,289
946,916
2
40,821
40,821
46,836
Activities for Generating Funds - Commercial income - Marketing and sponsorship Investment Income - Interest Receviable Incoming Resources from Charitable Activities - Food and beverage - Venues, events and entertainments - Administration and support services - Student services and representation - Student activities, societies and sports clubs TOTAL INCOMING RESOURCES RESOURCES EXPENDED Cost of Generating Funds - Commercial activities Charitable Activities for Students - Food and beverage - Venues, events and entertainments - Student membership services - Representation and affiliations - Student activities, societies and sports clubs Governance costs TOTAL RESOURCES EXPENDED
NET INCOMING RESOURCES for the PERIOD Transfers between Funds Fund Balances Brought Forward TOTAL FUNDS CARRIED FORWARD
14 / 15
6,073,721
-
350,905
6,424,626
5,850,552
252,573
-
12,724
265,297
566,876
(180,000)
180,000
-
-
-
62,430
-
-
62,430
(504,446)
135,003
180,000
12,724
327,727
62,430
On 1 August 2010 the assets, liabilities and trade of the University of Warwick Students' Union (an unincorporated exempt charity) were transferred to Warwick Students' Union (an incorporated exempt charity). All incoming resources and resources expended derive from continuing activities. The current year figures represent the trading activities from 1 August 2010 and the comparative period represents the transactions for the year 1 August 2009 to 31 July 2010. This statement of financial activity represents a consolidation of the income and costs for Warwick Students' Union, Students' Union Services Warwick Limited and Membership Solutions Limited. No separate Statement of Total Recognised Gains and Losses has been presented as all such gains and losses have been included in the statement of financial activities.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
23
BALANCE SHEETS
Company Registration Number: 07297865 GROUP 2011 Note
FIXED ASSETS Tangible fixed assets Investments
CURRENT ASSETS Stocks Debtors Short-term deposits Cash at bank and in hand
CREDITORS: Amounts falling due within one year
6 8
9 10
11
NET CURRENT ASSETS / (LIABILITIES)
2010
£
£
£
£
109,578 24,476
147,436 24,476
109,578 16,341
147,436 8,534
134,054
171,912
125,919
155,970
29,204 176,441 211,577 768,147
28,991 163,452 355,519 407,121
29,204 313,132 54,604 762,572
28,991 242,668 342,857 334,397
1,185,369
955,083
1,159,512
948,913
(991,696)
(988,741)
(956,289)
(959,748)
193,673
(33,658)
203,223
(10,835)
-
(75,824)
-
(75,824)
PROVISIONS for LIABILITIES NET ASSETS
2010
UNION 2011
327,727
62,430
329,142
69,311
13
12,724
-
12,724
-
14
135,003 180,000
62,430 -
136,418 180,000
69,311 -
327,727
62,430
329,142
69,311
REPRESENTING: CHARITABLE FUNDS Restricted Funds Unrestricted Funds - General - Designated TOTAL FUNDS
The financial statements on pages 23 to 43 were approved by the the Board of Trustees and authorised for issue on 8 February 2012 and are signed on its behalf by:
L Boe President
G Whitworth Union Development Officer
The Group Balance Sheet represents a consolidation of the Balance Sheets of Warwick Students' Union, Students' Union Services Warwick Limited and Membership Solutions Limited. WARWICK STUDENTS' UNION For the period ended 31 July 2011
24
CONSOLIDATED CASH FLOW STATEMENT
Note
2011 £
2010 £
17(a)
280,620
631,773
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE Interest receivable 17(a)
337
3,414
-
-
(63,873)
(159,613)
Net cash inflow from operating activities
Taxation CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT Payments to acquire tangible fixed assets
6
Increase in Cash in the Period
217,084
475,574
2011 £
2010 £
217,084
475,574
-
-
217,084
475,574
762,640
287,066
979,724
762,640
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
Increase in cash in the period Change in net funds resulting from non-cash flows
Movement in net funds in the period
17(b)
Net funds at 1 August
Net funds at 31 July
WARWICK STUDENTS' UNION For the period ended 31 July 2011
17(b)
25
PRINCIPAL ACCOUNTING POLICIES PRESENTATION OF ACCOUNTS The Union's Articles of governance require the trustees to prepare accounts for each financial year. These accounts represent a consolidation of the accounts of Warwick Students' Union and its subsidiary undertakings Students' Union Services Warwick Limited and Membership Solutions Limited.
BASIS OF ACCOUNTING The accounts have been prepared under the Charities Act 1993 on the historical cost convention in accordance with the Statement of Recommended Practice: "Accounting and Reporting by Charities" published in March 2005 (SORP 2005) and with applicable UK Accounting and Financial Reporting Standards (UK Generally Accepted Accounting Practice).
FUTURE FUNDING The current economic conditions create uncertainty particularly over the level of demand for the Union's services and the level of future income provided under the block grant agreement with the University of Warwick. The Union's forecasts and projections, taking account of reasonably possible changes in trading performance show that the Union should be able to operate within the level of its current facilities for at least twelve months from the date of approval of these accounts. The Union has held discussions with the University about future funding and no matters have been drawn to its attention to suggest that future funding may not be forthcoming at budgeted levels. The Trustees have a reasonable expectation that the Union 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.
MERGER AND COMPARATIVE AMOUNTS On 1 August 2010 the trade, assets and liabilities of the University of Warwick Students' Union (an unincorporated exempt charity) were transferred to Warwick Students' Union (incorporated registered charity). This transfer meets the definition of a group reconstruction in accordance with Financial Reporting Standard 6 - Acquisitions and Mergers - and has been accounted for in line with the principles of merger accounting. In line with the principles of merger accounting, comparative balances are shown throughout representing the activities of the University of Warwick Students' Union (an unincorporated body) for the period 1 August 2009 to 31 July 2010.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
26
PRINCIPAL ACCOUNTING POLICIES continued BASIS OF CONSOLIDATION The financial statements consolidate the financial statements of the charitable company and its subsidiary undertakings. Inter-group profits are eliminated on consolidation. The consolidation is carried out on a line-by-line basis. A separate Statement of Financial Activities (SoFA) for the charity itself is not presented because the charity has taken advantage of the exemption afforded by Section 408 of the Companies Act 2006 and paragraph 397 of the Charities SORP 2005. For the charitable company for the period ended 31 July:-
Incoming resources Resources expended
Net incoming resources
2011 ÂŁ
2010 ÂŁ
6,347,454 6,087,623
6,061,660 5,589,896
259,831
471,764
As disclosed in note 7 Fixed Asset Investments, the minority interest arising on the consolidation of Membership Solutions Limited has not been reflected in these consolidated financial statements on the basis that the value is not material.
INCOMING RESOURCES All income and capital resources are recognised in the accounts when the Charity is legally entitled to the income and the amount can be quantified with reasonable certainty. Income from commercial trading activities (net of Value Added Tax) is recognised as earned as the related goods and services are provided. Investment income is recognised on a receivable basis.
GRANTS The Union receives voluntary income from the University of Warwick in the form of a block grant and this is credited to the financial statements in respect of the period to which each grant relates.
RESOURCES EXPENDED Charitable expenditure comprises the direct and indirect costs of delivering public benefit. Overhead costs are apportioned to activities on a basis consistent with the use of the resources. Expenditure includes irrecoverable Value Added Tax.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
27
PRINCIPAL ACCOUNTING POLICIES continued TANGIBLE FIXED ASSETS Fixed assets are stated at cost less accumulated depreciation. Expenditure on individual capital items or groups of related items costing less than ÂŁ1,500 are written-off to the income and expenditure account in the year in which they occurred. Depreciation is provided to write-off the cost less the estimated residual value of tangible fixed assets by equal instalments over their estimated useful lives as follows: Building improvements Fixtures, fittings and office equipment IT equipment
3 - 10 years 3 - 5 years 3 years
The Union occupies premises provided by the University of Warwick Foundation.
INVESTMENTS Warwick Students' Union's fixed asset investments are valued at cost, as these assets are not readily saleable and a reliable market value is not readily available. The Board of Trustees value the shareholding in the subsidiary companies at net asset value.
LEASE CONTRACTS Rentals paid under operating leases are charged to income as the cost falls due.
STOCKS Stocks are valued at the lower of cost and net realisable value. Cost is computed on a first in, first out basis. Net realisable value is based on estimated selling price less the estimated cost of disposal.
TAXATION From 1 August 2010 Warwick Students' Union became a registered charity and therefore benefits from exemptions from taxation on its income and gains falling within Section 505 of the Taxes Act 1988 or Section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that they are applied to its charitable objectives. No tax charge has arisen in the year. Students' Union Services Warwick Limited The taxable profits of Students' Union Services Warwick Limited are donated under Gift Aid to the Union with the consequence that no taxation is payable by that company. Membership Solutions Limited The profits for the year for Membership Solutions Limited have been offset against losses brought forward for tax purposes. No taxation arises on the results of Membership Solution Limited.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
28
PRINCIPAL ACCOUNTING POLICIES continued FUNDS STRUCTURE Warwick Students' Union administers and accounts for a number of charitable funds, as follows: - Unrestricted Funds representing unspent income which may be used for any activity / purpose at the Broad of Trustees discretion. - Designated Funds set aside by the Board of Trustees to be spent on some specific purpose at its own discretion. The Board of Trustees intend to use some of these designated funds to finance future building refurbishment. - Restricted Funds raised and administered by Warwick Students' Union for specific purposes. This includes revenue received from a donor to be used for activities prescribed by the donor. - Custodian Funds entrusted to Warwick Students' Union for safekeeping, but not under its management control such as Sports Club and Society funds (including annual Raising and Giving). Such custodian activities are disclosed in the Annual Report, but as the funds are not managed by Warwick Students' Union they cannot be included in these accounts.
DEFINED BENEFIT PENSION SCHEME The group participates in the Students' Union Superannuation Scheme, a defined benefit scheme which is externally funded and contracted out of the State Second Pension. The fund is valued at least every three years by a professionally qualified independent actuary with the rates of contribution payable being determined by the Trustees on the advice of the Actuary. The scheme operates as a pooled arrangement, with contributions paid at a centrally agreed rate. As a consequence, no share of the underlying assets and liabilities can be directly attributed to the Union. Under the terms of FRS17, in these circumstances contributions are accounted for as if the Scheme were a defined contribution scheme based on actual contributions paid through the year. The scheme closed to future accrual on 30 September 2011. From 1 October 2011 the group participates in the National Union of Students' Pension Scheme, a defined contribution scheme proved by Aegon, a brand name of Scottish Equitable plc.
WARWICK STUDENTS' UNION For the year ended 31 July 2011
29
NOTES TO THE FINANCIAL STATEMENTS 1: CHARITABLE ACTIVITY AND SUPPORT COSTS Charitable Activity Costs
TOTAL
Other Operating
Support
£
Staff Costs £
Cost of Sales £
Expenses £
Costs £
2,399,942 1,588,284 533,469 443,826 1,135,289
935,541 421,431 214,411 140,320 70,137
803,818 592,893 -
144,244 117,511 15,360 62,211 413,565
516,339 456,449 303,698 241,295 651,587
6,100,810
1,781,840
1,396,711
752,891
2,169,368
Charitable Activity Cost Reallocation Food and Beverage Venues, Events and Entertainments Student Membership Services Student Representation and Affiliations Student Activities, Societies and Sports Clubs
Charitable Activity Costs Summary
Food and Beverage Venues, Events and Entertainments Student Membership Services Student Representation and Affiliations Student Activities, Societies and Sports Clubs
2011
2010
£
£
2,399,942 1,588,284 533,469 443,826 1,135,289
2,173,322 1,530,897 520,304 394,239 946,916
6,100,810
5,565,678
Student Representation expenses includes the affiliation fee for the National Union of Students' of £49,361 (2010: £49,347).
Support Costs
Marketing, IT &
Admin & General
TOTAL
Premises
Finance & HR
Communications
Management
£
£
£
£
£
30.0%
516,339 456,449 303,698 241,295 651,587
230,622 249,840 144,139 96,092 240,231
159,437 80,406 33,356 18,923 158,797
54,020 53,987 53,987 54,020 108,039
72,260 72,216 72,216 72,260 144,520
100.0%
2,169,368
960,924
450,919
324,053
433,472
Use
Support Costs Reallocation Food and Beverage Venues, Events and Entertainments Student Membership Services Student Representation & Affiliations Student Activities, Societies and Sports Clubs
23.8% 21.0% 14.0% 11.1%
Support Costs Summary Food and Beverage Venues, Events and Entertainments Student Membership Services Student Representation & Affiliations Student Activities, Societies and Sports Clubs
WARWICK STUDENTS' UNION For the period ended 31 July 2011
2011
2010
£
£
516,339 456,449 303,698 241,295 651,587
470,759 352,764 234,457 188,072 495,910
2,169,368
1,741,962
30
NOTES TO THE FINANCIAL STATEMENTS continued 1: CHARITABLE ACTIVITY AND SUPPORT COSTS continued Support costs are allocated on the following basis: -
Premises is allocated on space occupied Finance is allocated on total number of financial transactions HR is allocated based on staff costs Marketing, IT Services and Communications are pro-rata across all activities Administration and General Management are pro-rata across all activities
Finance and HR costs include:
- Pension deficit contribution - Redundancy and severance payments
Administration and General Management costs include:
- Insurance - Irrecoverable Value Added Tax
2: GOVERNANCE COSTS
Auditors Remuneration - Audit Fees Auditors Remuneration - Other Services Legal Fees - Preparation for incorporation and charity registration Professional Fees - Pension advice Other Legal and Professional Fees Board of Trustees - Committee expenses Board of Trustees - Travel reimbursements
WARWICK STUDENTS' UNION For the period ended 31 July 2011
31
2011 £
2010 £
102,906 -
72,060 100,160
102,906
172,220
2011 £
2010 £
65,756 133,958
58,615 124,020
199,714
182,635
2011 £
2010 £
20,000 5,250 3,264 7,500 4,474 127 206
18,000 1,250 26,620 341 556 69
40,821
46,836
NOTES TO THE FINANCIAL STATEMENTS continued 3: NET INCOMING RESOURCES FOR THE PERIOD Net incoming resources for the period is stated after charging: Auditors remuneration: - Audit Fees - Other Fees
Depreciation and amounts written-off Tangible Fixed Assets: - Owned Assets - Loss on Disposal of Assets
Operating lease rentals: - Plant and machinery - Buildings
4: STAFF COSTS
Wages and Salaries National Insurance Pension Costs
WARWICK STUDENTS' UNION For the period ended 31 July 2011
32
2011 £
2010 £
20,000 5,250
18,000 1,250
25,250
19,250
88,502 13,229
142,165 -
101,731
142,165
40,387 450,000
40,387 -
490,387
40,387
2011 £
2010 £
2,531,429 167,194 80,484
2,488,535 170,994 91,627
2,779,107
2,751,156
NOTES TO THE FINANCIAL STATEMENTS continued 4: STAFF COSTS continued The average staffing was as follows: Monthly Salaried Staff / Full Time Equivalent Weekly Paid Student Staff / Full Time Equivalent
The following number of employees received remuneration above £60,000 within the year: £70,000 - £79,999 £74,999
2011 Number
2010 Number
93 / 84 581 / 52
98 / 95 396 / 44
674 / 136
494 / 139
2011 Number
2010 Number
1
1
The above staff member was accruing retirement benefits under the pension scheme disclosed in note 18.
5: TRUSTEES REMUNERATION AND EXPENSES As well as having a role as a trustee of Warwick Students' Union the seven Student Sabbatical Officers perform a full time role to be the voice of students. They are authorised in the Union's governing document to represent students, undertake campaigning and support work as distinct from their trustee responsibilities. They listen to how students want things to be done, work with Warwick Students' Union staff, the Board of Trustees and partners to make it happen. They represent students to the University of Warwick, external organisations and the wider community. Each of the Student Sabbatical Officers were paid a salary of £18,117 during the year with a total cost to Warwick Students' Union of £140,320 (2010: £143,078) including salary and national insurance. The eleven other members Trustees of the Board were reimburseed a total of £206 (2010: £69) for personal travel and subsistence expenses in performing their role as trustee.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
33
NOTES TO THE FINANCIAL STATEMENTS continued 6: TANGIBLE FIXED ASSETS - GROUP AND UNION
Fixtures, Building
Fittings and
TOTAL £
Improvements
IT Equiment
£
£
Cost 1 August 2010
147,436
20,447
126,989
Disposal of asset Additions
(18,940) 63,873
(2,108) 17,904
(16,832) 45,969
31 July 2011
192,369
36,243
156,126
-
-
-
Disposal of asset Charge for the year
(5,711) 88,502
(350) 7,129
(5,361) 81,373
31 July 2011
82,791
6,779
76,012
Net Book Value 31 July 2010
147,436
20,447
126,989
31 July 2011
109,578
29,464
80,114
2011 £
2010 £
60,000
7,500
Depreciation 1 August 2010
7: CAPITAL COMMITMENTS Future capital expenditure: Authorised but not contracted
WARWICK STUDENTS' UNION For the period ended 31 July 2011
34
NOTES TO THE FINANCIAL STATEMENTS continued 8: FIXED ASSET INVESTMENTS
2011 £
2010 £
16,664 60 7,752
16,664 60 7,752
24,476
24,476
NUS Services
Shares in
TOTAL £
Limited
Group
£
£
8,534
8,332
202
(100)
-
(100)
95 60 7,752
60 7,752
95 -
16,341
16,144
197
Group Cost NUS Services Limited: deposit under Students' Unions central billing scheme NUS Services Limited: 'A' Shares NUS Services Limited: 'B' Shares
Union
Cost 1 August 2010 Disposal of shares - Students' Union Warwick Events Limited Additions - Membership Solutions Limited Additions - NUS Services Limited 'A' Shares Additions - NUS Services Limited 'B' Shares
31 July 2011
At the 1 August 2010 the fixed asset investments held by The University of Warwick Students' Union (an unincorporated exempt charity) transferred to Warwick Students' Union. Warwick Students' Union on holds equity share capital in the following unlisted companies: Students' Union Services Warwick Limited 102 ordinary shares of £1 each being 100% of issued ordinary shares. Students' Union Services Warwick Limited is registered and operates in Great Britain. The primary nature of the business being trading services on behalf of the charity. Turnover for the year ended 31 July 2011 was £233,763 (2010: £321,725) and profits of £118,461 (2010: £167,229) was generated which was donated to the Union under gift aid. Net assets at 31 July 2011 were £102 (2010: £102).
WARWICK STUDENTS' UNION For the period ended 31 July 2011
35
NOTES TO THE FINANCIAL STATEMENTS continued 8: FIXED ASSET INVESTMENTS continued Membership Solutions Limited Warwick Students' Union holds 95 £1 ordinary shares in Membership Solutions Limited, a company limited by shares registered in Great Britain, being 95% of its issued share capital. The primary nature of the business is the sale of membership and other IT related systems. Turnover for the year ended 31 July 2011 was £352,825 (2010: £201,272) and profit for the year of £5,467 (2010: £28,957) was recorded after the payment of a donation made under gift aid to the Union of £125,658 (2010: nil). Net liabilities at 31 July 2011 were £1,320 (2010: £6,787). The minority interest value of £273 arising on the consolidation of Membership Solutions Limited and the cumulative balance sheet value of (£71) has not been reflected in the consolidated financial statements on the basis of immateriality. The principal activity of Membership Solutions Limited is the sale of membership and other IT related systems.
Students' Union Warwick Events Limited This company ceased to trade and was dissolved on 1 August 2010. The £100 share capital held by the University of Warwick Students' Union was written-off on dissolution.
NUS Services Limited The Union holds shares in NUS Services Limited, a purchasing consortium for member student unions providing purchasing benefits through collective operations. NUS Services Limited also holds a deposit from the Union in respect of payment for monthly supplies of brewed and other products.
9: STOCKS
Goods for resale
WARWICK STUDENTS' UNION For the period ended 31 July 2011
GROUP 2011 £ 29,204
36
2010 £ 28,991
UNION 2011 £ 29,204
2010 £ 28,991
NOTES TO THE FINANCIAL STATEMENTS continued 10: DEBTORS
GROUP 2011 £
2010 £
UNION 2011 £
2010 £
Amounts falling due within one year: Trade debtors Amounts due from subsidiary undertakings Other debtors Prepayments and accrued income
11: CREDITORS
138,214
117,979
73,997
6,208
-
-
210,679
193,767
6,296
1,921
6,296
1,921
31,931
43,552
22,160
40,772
176,441
163,452
313,132
242,668
GROUP 2011 £
2010 £
UNION 2011 £
2010 £
Amounts falling due within one year: Trade creditors Amounts due to subsidiary undertakings
147,581
147,784
146,395
142,863
-
-
-
100
Amounts held for clubs and societies
382,836
324,450
382,836
324,450
Other taxation and social security
131,328
150,087
131,328
150,087
61,810
46,681
61,810
46,681
268,141
319,739
233,920
295,567
991,696
988,741
956,289
959,748
Other creditors Accruals and deferred income
Amounts held for clubs and societies represent balances held on behalf of these bodies, these funds have been generated separately from the activities of the Union and the use of these funds is directed by the individual club or society. Warwick Students' Union acts as a custodian for these funds.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
37
NOTES TO THE FINANCIAL STATEMENTS continued 12: PROVISIONS FOR LIABILITIES AND CHARGES
Staff Restructuring £
At 1 August 2010 Payments during the year
75,824 (75,824)
At 31 July 2011
-
13: RESTRICTED FUNDS 1 August 2010
Income
Expenditure
Transfers
31 July 2011
£
£
£
£
£
-
346,023 1,985 1,916 200 321 150 7,500 4,500 1,034
(346,023) (1,985) (200) (321) (150) (1,022) (170) (1,034)
-
1,916 6,478 4,330 -
-
363,629
(350,905)
-
12,724
Warwick Sport Campaigns Projects - Community Scheme Projects - Health Awareness Projects - Student Development Projects - Membership Surveys Projects - Inspire Scheme Projects - Internationalisation Proejcts - Environmental
All of the above restricted reserves represent funds received specifically for the identified activity and are either supported by service level agreements or one-off grant applications.
14: DESIGNATED FUNDS 1 August 2010
Income
Expenditure
Transfers
31 July 2011
£
£
£
£
£
-
180,000
180,000
-
180,000
180,000
Building Refurbishment
-
-
-
-
-
-
The designated reserve to finance building refurbishment was created to set aside funds for planned future development of facilities and refurbishment of trading areas.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
38
NOTES TO THE FINANCIAL STATEMENTS continued 15: ANALYSIS OF NET ASSETS BETWEEN FUNDS Fixed Assets £
Net Current Assets / (Liabilities) £
2011 Net Assets / (Liabilities) £
2010 Net Assets / (Liabilities) £
Restricted Funds
-
12,724
12,724
-
Designated Funds
-
180,000
180,000
-
125,721 8,332
10,499 (9,549)
136,220 (1,217)
69,311 (6,881)
134,053
193,674
327,727
62,430
General Funds:
Warwick Students' Union Subsidiary Undertakings
16: LEASING COMMITMENTS At 31 July 2011 Warwick Students' Union had annual commitments under non-cancellable operating leases as follows: GROUP AND UNION 2011 2010 £ £ Land and Buildings Operating leases expiring within: over 5 years 450,000 Plant and Machinery Operating leases expiring within: 2 to 5 years
WARWICK STUDENTS' UNION For the period ended 31 July 2011
39
40,387
40,387
490,387
40,387
NOTES TO THE FINANCIAL STATEMENTS continued 17: CASH FLOW STATEMENT
(a)
GROUP 2011 £
Reconciliation of net incoming resources for the year to net cash inflow / (outflow) from operating activities: Net incoming resources
265,297
566,876
(Increase) in stocks (Increase) in debtors
(213) (12,989)
(19,772) (56,333)
Increase / (Decrease) in creditors (Decrease) / Increase in provisions
2,955 (75,824)
(73,573) 75,824
Depreciation Loss on asset disposal Interest receivable
88,502 13,229 (337)
142,165 (3,414)
280,620
631,773
Cash Flow £
At 1 August 2010 £
Net cash inflow from operating activities
(b)
2010 £
Analysis of changes in net funds
At 31 July 2011 £
Cash at bank and in hand Short term deposits
768,147 211,577
361,026 (143,942)
407,121 355,519
979,724
217,084
762,640
The balances at 1 August 2010 represent the amounts transferred from the University of Warwick Students' Union (an unincorporated exempt charity) to Warwick Students' Union (an incorporated exempt charity).
WARWICK STUDENTS' UNION For the period ended 31 July 2011
40
NOTES TO THE FINANCIAL STATEMENTS continued 18: PENSION SCHEME The Union participates in the Students' Union Superannuation Scheme, which is a defined benefit scheme whose membership consists of employees of students' unions and related bodies throughout the country. Benefits in respect of service up to 30 September 2003 are accrued on a "final salary" basis, with the benefits in respect of service from 1 October 2003 to 30 September 2011 accruing on a Career Average Revalued Earnings (CARE) basis. With effect from 30 September 2011 the scheme closed to future accrual on 30 September 2011. The most recent valuation of the Scheme was carried out as at 1 October 2010 and showed that the market value of the Scheme's assets was £67,141,000 with these assets representing 58% of the value of benefits that had accrued to members after allowing for expected future increases in earnings. The deficit on an ongoing funding basis amounted to £47,869,000. The assumptions which have the most significant effect upon the results of the valuation are those relating to the rate of return on investments and the rates of increase in pensions over the period up to retirement and once in payment. The following assumptions applied at 1 October 2010:- The investment return would be 6.6% per annum before retirement and 4.6% per annum after retirement. - Pensions accrued on a CARE basis would revalue in line with RPI at 3.2% per annum and pensions accrued on the final salary basis would revalue in line with CPI at 2.7% per annum. - Present and future pensions would increase at rates specified by scheme rules with appropriate assumptions where these are dependent on inflation. The 2010 valuation set our recommended monthly contributions expressed in monetary terms intended to clear the on-going funding deficit oerva period of 20 years. These amounts are applied with effect from 1 October 2011 and will increase each year by 3.2%. They will be formally reviewed following completion of the next valuation due with an effective date of 1 October 2013. In addition to these contributions, The Union also pays its share of the scheme's levy to the Pension Protection Fund. The scheme closed to future accrual on 30 September 2011 but as the Scheme was still open to future accrual to 31 July 2011 the Union was also required to pay contributions towards the cost of benefits accrued by members in that year. The contribution rate (excluding deficit contributions) for the period from 1 August 2010 to 31 July 2011 applicable to this Union for the majority of members is 8.17% of Earnings for members and 9.38% of Earnings for the Union (17.3%/17.55% in aggregate). The contributions paid into the Scheme by the Union in respect of eligible employees for the year ended 31 July 2011 amounted to £183,390 (2010: £163,687), including funding deficit contributions.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
41
NOTES TO THE FINANCIAL STATEMENTS continued 19: RELATED PARTY TRANSACTIONS a)
Membership Solutions Limited The Union received a donation under gift aid from Membership Solutions Limited of £125,658 (2010: nil). The Union purchased £17,216 (2010: £17,216) of services from Membership Solutions Limited and provided £5,832 (2010: £38,564) of services.
Salary support, administrative and expenses Premises and equipment rental Interest charged on current account
b)
2011 £
2010 £
1,800 3,531 501
35,033 3,531 -
5,832
38,564
Students' Union Services Warwick Limited The Union received a donation under gift aid from Students' Union Services Warwick Limited of £118,461 (2010: £167,229). The Union paid £145 (2010: nil) in current account interest with Students' Union Services Warwick Limited and provided £48,174 (2010: £48,010) of services to Students' Union Services Warwick Limited.
Salary support, administrative and expenses Premises and equipment rental Interest charged on current account
WARWICK STUDENTS' UNION For the period ended 31 July 2011
42
2011 £
2010 £
7,272 40,752 150
7,274 40,736 -
48,174
48,010
NOTES TO THE FINANCIAL STATEMENTS continued 20: MERGER On 1 August 2010 the trade, assets and liabilities of the University of Warwick Students' Union (an unincorporated exempt charity) were transferred to Warwick Students' Union (an incorporated exempt charity). The assets and liabilities of the University of Warwick Students' Union (an unincorporated exempt charity) at the 1 August 2010 are set out below: Book Value ÂŁ Tangible Fixed Assets Investments
147,436 8,534
Stocks Debtors
28,991 242,668
Short Term Deposits Cash at Bank and In Hand
342,857 334,397
Total Assets
1,104,883
Creditors due within one year
(959,748)
Provisions for Liabilities
(75,824)
Net Assets
69,311
The results and financial position of the University of Warwick Students' Union (an unincorporated exempt charity) have been shown throughout these financial statements as comparative amounts as the group reconstruction fails to be treated as a merger in accordance with Financial Reporting Standard 6 - Acquisitions and Mergers. Prior to the transfer outlined above, the charity did not trade in the period 29 June 2010 to 31 July 2010.
WARWICK STUDENTS' UNION For the period ended 31 July 2011
43