Reports and Financial statements 2009 - the University Offices ...

Statement of principal accounting policies
Stocks and work in progress
Stocks are stated at the lower of cost and net realisable value after making provision for slow
moving and obsolete items.
Endowment funds
Endowment funds are classified under three headings:
Where the donor has specified that the fund is to be permanently invested to generate
an income stream for the general purposes of the University, the fund is classified as an
unrestricted permanent endowment.
Where the donor has specified that the fund is to be permanently invested to generate an
income stream to be applied for a restricted purpose, the fund is classified as a restricted
permanent endowment.
Where the donor has specified a particular objective other than the acquisition or
construction of tangible fixed assets, and that the University must or may convert the
donated sum into income, the fund is classified as a restricted expendable endowment.
Pension costs
The University contributes to a number of defined benefit pension schemes and accounts for
the costs in relation to these schemes in accordance with FRS 17 (Retirement benefits).
Where the University is unable to identify its share of the underlying assets and liabilities in
a scheme on a reasonable and consistent basis, it accounts as if the scheme were a defined
contribution scheme, so that the cost is equal to the total of contributions payable in the year.
For other defined benefit schemes, the assets of each scheme are measured at fair value, and
the liabilities are measured on an actuarial basis using the projected unit method and
discounted at an appropriate rate of return.The University’s share of the surplus or deficit of
the scheme is recognised as an asset or liability on the balance sheet.The current service cost,
being the actuarially determined present value of the pension benefits earned by employees
in the current period, and the past service cost are included within staff costs. Endowment
and investment income includes the net of the expected return on assets, being the actuarial
forecast of total return on the assets of the scheme, and the interest cost being the notional
interest cost arising from unwinding the discount on the scheme liabilities. All changes in the
pension surplus or deficit due to changes in actuarial assumptions or differences between
actuarial forecasts and the actual out-turn are reported in the statement of total recognised
gains and losses.
Segmental reporting
The University operates in a number of different classes of business. For the purpose of
segmental reporting as required by Statement of Standard Accounting Practice 25
(Segmental reporting), classes of business have been identified by reference to the nature of
activity, the nature of funding and the management organisation.
Reports and Financial Statements 75