2006 Annual Report - University of Salford

University of Salford 

Annual Report and Financial Statements 

for the year ended 31st July 2006

Contents 

Page 

Annual Report 1 

Vice-Chancellor’s Introduction 2-3 

Sharing knowledge forging partnerships 4-6 

Shaping graduates – supporting society 7-8 

Nurturing experiences – creating opportunities 9-10 

Maximising research – tackling issues 11-14 

Thinking globally – broadening horizons 15-17 

Encouraging recognition – celebrating success 18-21 

Statistics 22 

Financial Statements 23 

Membership of the Council 2005 - 06 24 

Financial Review 25-26 

Group Structure 26 

Statement of Primary Responsibilities 27 

Corporate Governance Statement 28-29 

Statement of the Council’s Responsibilities and Internal Control 30-31 

Report of the Independent Auditors to the Council of the University of Salford 32-33 

Consolidated Income and Expenditure Account 34 

Consolidated Statement of Historical Cost Surpluses and Deficits 35 

Consolidated Statement of Total Recognised Gains and Losses 35 

Consolidated Balance Sheet 36 

University Balance Sheet 37 

Consolidated Cash Flow Statement 38 

Statement of Principal Accounting Policies 39-40 

Notes to the Accounts 41-65

Annual Report & 

Financial Statements 

Annual Report



Vice-Chancellor’s introduction 


Taking stock – looking ahead 

The academic year 2005 – 2006 witnessed considerable 

achievements for the University in all aspects of its activity. 

Last year the University adopted a new and radically revised 

Strategic Framework for development over the next decade. 

The Strategic Framework 2005-2015 (available at 

www.planning.salford.ac.uk) aims to clearly set out how we 

intend to pursue our mission as an ‘enterprising university’. 

We intend to achieve internationally recognised excellence in: 

■ Education for capability. 

■ Research for the real world. 

■ Partnership with business and the community. 

As a leading enterprising university we will: 

■ Harness the skills, imagination and enthusiasm of our 

staff and students to work in close alliances with our 

external partners. 

■ Be innovative and effective in the application of new 

knowledge to individual, social and economic 

development, working across traditional disciplinary 

and professional boundaries. 

■ Seek continuous improvement in all aspects of our activities 

and in our responsiveness to the changing needs of our 

students, staff and external partners. 

Our programmes to educate and develop highly employable 

graduates and to draw on all those who can benefit from 

higher education are also included. As you will also see, our 

striking and highly successful engagement with ‘real world 

research’ continues to grow and, reflecting a new strategic 

goal, we are committed to internationalising all aspects of 

the University. 

The financial report and accounts show that the underlying 

performance of the University was sound, continuing the 

pattern of income growth that has been sustained in recent 

years. From 2006-7 our income will be further boosted by the 

advent of the new undergraduate student fee arrangements. 

However, much of this extra income will be needed to meet 

the substantial rises in staff pay that have been agreed, 

following the resolution of the lengthy and difficult industrial 

dispute in 2005-6 as well our plans for greatly increased 

expenditure on our campus. 

The first stages of this investment have been completed with 

the official opening of our new £22m Mary Seacole building 

for the Faculty of Health & Social Care by Dame Tanni 

Grey-Thompson in May 2006, and the extensive refurbishment 

of our Peel Park site. Work now continues to provide new 

student housing on campus, our £10m Law School building 

and brand new accommodation for our Faculty of Arts, Media 

& Social Sciences. 

■ Adopt a friendly, customer focused ethos, delivering to 

students an excellent experience of higher education; to 

staff, a rewarding and developing career; and to external 

partners, an effective and timely response to their 

changing needs. 

This Annual Report highlights some of the many ways in 

which we are already delivering these aspirations, with 

examples taken from our widening and increasingly 

internationally recognised work in Academic Enterprise. 

2 

The Mary Seacole building




Finally, I would like to thank all those staff and students who 

made our success over the past year possible. Several long 

serving and valued members of staff retired during this period 

and they leave with our special thanks and best wishes for 

the future. 

The proposed new Law School 

For the past two years we have been intensively examining 

how we organise and manage the University. The final report 

of the Deciding the Future group, which I chaired, was 

approved by Senate and Council at the end of 2006, following 

an intensive period of staff consultation on its recommendations. 

These are far-reaching and will be progressively implemented 

over the next two to three years. 

While it is not possible to list all those who have left us, I must 

make special mention of Dr Malcolm Winton, who retired in 

May 2006. Malcolm spent most of his career at Salford, for 

the last 14 years as our Registrar (only the second in the 

University’s history). He saw the University through some 

difficult times and we are all greatly in his debt. He is 

succeeded by Dr Adrian Graves who comes to us from Robert 

Gordon University and who has had a distinguished career in 

academic administration in the UK and Australia. 

Michael Harloe 

December 2006 

We recognise that many of the ways in which a ‘traditional’ 

university like Salford has operated in the past are no longer 

suitable for modern times and especially for a university 

committed to enterprise in all that it does. New ways need to 

be found both to strengthen and improve our management 

and to engage staff and foster a real feeling of involvement in 

the institution and in helping to shape its future. Staff support 

for change is evident in all parts of the University and now we 

shall work hard to deliver it. 

3



Sharing knowledge – forging partnerships 

Sharing knowledge - forging partnerships 

At the University of Salford, we know that real life presents 

daily challenges to business, industry and the community. 

That is why we are perfectly positioned to form effective 

partnerships – and to share and promote this knowledge and 

expertise at every opportunity. 

We have always maintained strong links with business and 

been rooted in the community. We play a valuable role in 

facilitating constructive knowledge sharing amongst 

organisations and society. Whether it’s through developing 

business partnerships, linking with community groups or 

encouraging collaboration amongst industries, the past year 

has consolidated our reputation as experts at ‘reaching out’ to 

business and the community. 

Supporting society 

The University of Salford is committed to contributing to the 

economic, social and cultural life of the community. 

Community Finance Solutions (CFS) was established after a 

team of Salford researchers developed a radical model for 

providing affordable credit. They use community-based 

financial institutions to help individuals, small businesses and 

communities acquire financial security. 

Now a thriving national organisation, CFS offers practical 

solutions to this problem – schemes like Community 

Reinvestment Trusts (CRTs), high street shops providing flexible, 

affordable loans and banking services. The Trusts provide a 

way of offering instant and affordable credit to people 

who usually have to rely on legal, but unscrupulous 

‘doorstep moneylenders’. 

There are now ten urban and three rural CRTs in the UK, and 

they lend £5m to more than 6,000 people. This year, the 

Treasury has made them a priority initiative as part of its 

financial inclusion strategy. 

In November 2005 the CFS team were presented with the 

Times Higher Education Supplement Award for research and 

development of these Trusts. 

Speaking about the award, Liz Thomas, Senior Advisor on 

Widening Participation for the Higher Education Academy, 

said: “This is an exciting and very impressive project that has 

had an impact on communities across the UK. It is an 

excellent example of using research to inform practical 

developments at the local level and political change at the 

national level.” 

Pioneering practices 

Our Academic Enterprise division has developed a unique 

benchmarking partnership called UPBEAT – University 

Partnership to Benchmark Enterprise Activities and 

Technologies. This pioneering assessment tool is led by the 

University in partnership with four UK universities and a 

consortium of European universities in order to drive 

continuous improvement in all outreach activities to business 

and the community. 

The project was developed when staff at our Academic 

Enterprise division discovered that, apart from monitoring the 

financial success of outreach work, there was no holistic way 

of measuring the social and economic benefits of a project. 

Using a unique four-scale matrix system, UPBEAT has the 

ability to accurately assess what difference outreach projects 

have made business and the community. 

During the past year, the UPBEAT team has worked with 

several initiatives to evaluate their success and is in the process 

of collaborating with another five universities on the project. 

4




Innovation Cells 

CAMPUS 

At Salford, we continuously develop and extend new 

partnership arrangements in order to maintain our position as 

an enterprising university at the leading edge. Our ‘Innovation 

Cells’ project puts external organisations in touch with staff 

and students in order to get good ideas off the ground – and 

transform them into realistic business propositions. 

The University’s business club - the first of its kind in the UK - 

celebrated its 25 year anniversary in June 2006. The Campaign 

to Promote the University of Salford (CAMPUS) was created in 

1981 to promote links between the University and its external 

partners, and through those links to help support the 

University’s goals and aspirations. 

Each ‘Cell’ – or group – enables small teams of like-minded 

creative people from across the University to develop real 

products and services that are ready for market, 

Innovation Cells meet regularly and, using the programme’s 

unique step-by-step process, consider issues such as problem 

solving, idea generation and patenting. Each Cell member has 

access to useful business contacts, academic expertise and a 

small budget. 

The organisation provides members with access to the 

University’s wide-ranging expertise and facilities, and organises 

a varied programme of events for them. There are now over 

170 organisations enjoying membership and over 300 

associates and supporting members. In November 2005 

Professor Peter Bowker was appointed as CAMPUS’s fourth 

director to replace Mike Goldsmith, who retired. 

Worldwide partnerships 

One member recently launched his idea to commercialise 

veterinary prosthetics – the development of artificial limbs for 

animals. With the support of the Innovation Cells, what 

started as a good idea has now been developed into a 

fully-functioning brand – and has already started trading 

with veterinary practices across the UK. 

From affordable art and educational games to aqua-natal 

classes and childbirth DVDs, in the past year our Innovation 

Cells have helped business and industry to really take 

advantage of our commercially viable products and services. 

The University develops and maintains many strong links with 

organisations abroad as well as in the UK. In the past year, for 

example, we have forged partnerships with Cyprus College in 

the country’s capital, Nicosia. Salford now has an agreement 

with the College whereby Cypriot students spend their third 

year studying on our English Language, Computer Science or 

Music programmes. 

In July, the School of Media, Music & Performance’s Dr Mick 

Wilson was invited to Cyprus College to help establish a new 

BA Music Performance degree. Salford was selected because 

of our music programmes’ strong international reputation 

and Mick provided expertise in music teaching and 

curriculum development. 

Artificial limbs for animals 

5




Leading edge facilities 

At Salford, we optimise our state-of-the-art facilities for the 

mutual benefit of our partners and ourselves. In February 2006 

a new addition to our ever-increasing resources was the Think 

Lab, a cutting edge laboratory enabling staff across the 

University to engage in the latest research supported by 

advanced Information and Communications Technology. 

Featuring interactive exchanges, virtual displays and video 

conferencing, the Think Lab is the most advanced facility of its 

kind in Europe. It combines futuristic interior design with the 

very latest in communication and virtual reality technology. 

The brainchild of staff from the Institute of the Built & Human 

Environment and the Information Research Institute, the 

£1.3m centre was funded by the Science Research and 

Investment Fund. 

To begin the process, the KTP team at Salford is approached 

by a company, based anywhere in the country, that needs help 

with a strategic problem – the launch or development of a 

product, for example. 

Once they’ve approached the University, a source of expert 

knowledge is identified – in the form of a University of Salford 

academic –who is going to help them. When the initial 

contact between the company and the academic has been 

made we develop the proposal for submission to the 

Department of Trade and Industry. To date, all our 

submissions have been approved. 

During the past year our KTPs have gone from strength to 

strength, with staff and students joining forces with four new 

businesses including The Hilly Clothing Company, 

manufacturers of hi-tech running apparel, and local 

wholesalers Valves Instruments Plus. 

It has already gained the attention of high profile business 

people, including former BBC broadcaster and North West 

Development Agency Director, Felicity Goodey, who sits on the 

Think Lab Advisory Group. 

Knowledge Transfer Partnerships 

Salford was one of only two universities to pilot Knowledge 

Transfer Partnerships (KTPs) exactly 30 years ago. KTPs are 

Government-funded three-way collaborations between an 

academic, a company that needs their expertise and a recent 

graduate recruited to work on a project for that business. It is 

the job of our Academic Enterprise division to bring all three 

together and establish the partnership. 

The Think Lab 

6

Shaping graduates – supporting society 




At Salford, we’re committed to producing graduates with the 

skills, creativity, confidence and adaptability to succeed in the 

workplace and make a positive contribution to society. 

Salford graduates are prominent in business, industry and 

non-governmental organisations worldwide. It’s no surprise 

that over 90% of our graduates gain employment or go on to 

further study within six months of graduating. 

Employability strategy 

Our new Employability Strategy is designed to consolidate and 

enhance existing initiatives within the University and to ensure 

that all our students have the opportunity to engage in 

learning that enhances their employability. 

The Strategy recognises how we have led the way in this 

regard and consolidates our long-standing experience 

developing opportunities for both work-related and 

work-based learning opportunities within our degree 

programmes. It also aims to ensure that all of our students 

have the opportunity to engage in learning that develops their 

key enterprise and employability skills. 

In addition, the Strategy further develops and enhances good 

curriculum design, informed by engagement with employers 

and professional bodies, as well as access to careers education, 

information and guidance; opportunities for volunteering; and, 

through the provision of structured and supported processes, 

personal and professional development planning. 

The introduction of this Strategy therefore builds on existing 

good practice at the University and demonstrates our ongoing 

commitment to the enhancement of the employability of all 

our graduates. 

Personal Development Planning 

All students at Salford are provided with opportunities to 

invest in their personal and academic development through a 

process called Personal Development Planning (PDP). This 

provides a framework within which students are encouraged 

to reflect upon their own learning, performance and 

achievement and to plan for their personal, educational and 

career development. 

In the last year we continued implementing processes of PDP 

in line with the University’s aim to make processes available to 

all students. The introduction of PDP demonstrates our 

ongoing commitment to ensuring our graduates are provided 

with opportunities to develop the necessary skills required to 

become successful ‘lifelong learners’. 

Key Skills 

Key skills are sometimes referred to as 'transferable skills'. 

The ability to articulate, evidence and transfer the key skills 

of communication, numeracy, information technology, team 

work, problem solving and managing one’s own learning, 

has been recognised by employers and universities as being 

essential to improving employability and supporting personal 

development and lifelong learning. 

The Salford Key Skills Project initiated the development of 

the curriculum to embed key skills in all aspects of teaching, 

learning and assessment, to ensure our graduates will be 

better prepared to succeed in a competitive and fast-moving 

job market. This year, work undertaken through the Key Skills 

project informed our Employability Strategy. 

7




Volunteering@Salford 

First destination statistics 

Our Volunteering@Salford scheme promotes and supports 

volunteering by staff and students in local communities. 

Volunteering has a number of benefits for both staff and 

students, including increasing employability, acquiring new 

skills and building confidence, and making a difference to 

local communities. 

Students who have undertaken volunteering placements as 

part of Independent Learning Modules have spoken of having 

gained valuable experience, and the majority have continued 

to volunteer with the organisations. Volunteering has also 

been shown to be popular with employers, (in research 

undertaken by TimeBank in 2004). Indeed, 81% of employers 

surveyed viewed employees who do voluntary work positively. 

Our careers advisors collect data on the first destination of 

leavers (as at six months after graduation). The figures for 

those who graduated in 2005 entering employment have 

remained strong in a graduate market that has not been as 

buoyant as the previous year. 

Once again, the statistics show a below average level of 

unemployment. This figure is down slightly this year, matched 

by an equivalent rise in people going into further study and 

training. There continues to be a high proportion of Salford 

graduates finding work in the North West region, many with 

small and medium sized companies and in the public and 

health sectors. 

One recent example of a Volunteering@Salford project is 

Summerville Primary School, the first school in Salford to be 

awarded a Green Flag as an Eco School. Our volunteers 

developed a nature area in the school grounds – including a 

wildlife pond and woodland walk. The partnership continues 

to grow between the school and the University, with related 

projects in development. 

Work is also underway to develop themed volunteering 

events and projects, and there are new initiatives to support 

student-led volunteering, including environmental volunteering 

and an International Conversation Club to support the 

relationship between international and home students. 

Graduates at the Lowry 

8

Nurturing experiences – creating opportunities 




The University of Salford is committed to providing a top 

quality learning and working experience for everyone, 

regardless of background. We focus on attracting and 

retaining all students who are able to benefit from our 

excellent learning opportunities. 

The last year has provided many opportunities for further 

improving the staff and student experience and opening up 

new opportunities for learning. 

Salford Young People’s University 

It was another good year for Salford Young People’s University 

(SYPU), our unique residential summer school giving 

youngsters who wouldn’t normally consider higher education 

a taste of university life. This summer an unprecedented 331 

young people aged 11 to 15 took part in three programmes. 

For the first time, all ten boroughs of Greater Manchester 

attended the Year 8 programme (ages 11-12), making this the 

first regional summer school programme funded by Aimhigher 

Greater Manchester. The participants enjoyed courses in 

sports, art, performing art and technology and were 

supervised by our team of 32 student group leaders. 

The Year 8 graduation ceremony was again very popular with 

over 800 people attending. Paul George, a Salford graduate 

from Leisure Management, spoke at the graduation about his 

life as a world championship body builder and how university 

had helped him realise his dreams of owning and running 

a gym. 

Feedback from the young people’s parents revealed that 83% 

of them had not attended university and that 99% strongly 

agreed or agreed that they now felt more confident about 

their child going on into higher education. 

SYPU is planning to involve undergraduates in a research 

programme to track and measure the impact of SYPU over the 

past seven years. This work will provide a basis for further 

development and provide essential data to bid for additional 

funding. It will also offer further opportunities for our 

undergraduates to gain invaluable work experience and 

increase their employability. 

Student experience 

To reinforce our commitment to providing our students with 

the best possible experience during their time at Salford, we 

have formed a dedicated Student Experience Group. The 

Group has been looking at initiatives designed to further 

improve students’ overall time with us – during both their 

study and their leisure time. 

A total of 21 Student Liaison Representatives (SLRs) were 

appointed for the 2006-07 academic year. A joint initiative 

between the University and the Students’ Union, the positions 

are funded by our Academic Development Fund and involve 

the SLRs being paid for their time. Each SLR acts as a conduit 

between their particular School and the wider University and 

provides valuable feedback on general issues, ensuring that 

the voice of the students is considered at the strategic 

planning stage. 

The University is also implementing Salford’s first ever Student 

Experience Survey from October 2006 to provide staff with 

valuable information about the student experience. The 

Student Experience Survey will comprise two stages – 

qualitative (eg focus groups/in-depth interviews) and 

quantitative (where students rate services, etc online). The 

Survey is intended to help the University develop an 

understanding of our students’ expectations and perceptions. 

This, in turn, will enable us to set goals for service 

improvement which could be used to monitor progress. 

With other initiatives underway, including a Vice-Chancellor’s 

newsletter to students, an improved student intranet channel 

and a new-look induction pack, the Student Experience Group 

continues its work to enhance our students’ time at Salford. 

9




Staff awards 

Innovative courses 

At Salford, we aim to instil a sense of achievement within all 

our staff by recognising and rewarding outstanding success. 

Every year, dedicated teams of staff and individuals throughout 

the University are presented with merit awards. Teams can 

nominate themselves or be nominated by others and 

individuals are put forward by their managers. The criteria 

include outstanding job performance, achievement of a 

significant objective, attitude to work and service provided. 

Last year’s awards were highly successful, with a large number 

of strong nominations from both academic and support staff. 

Director of Personnel Malcolm Willis said: “We were delighted 

with the number of nominations. It’s all about recognising 

and rewarding the teams that have put in the extra effort to 

make a difference. The quality of the nominations was a real 

tribute to all the teams concerned.” 

Salford is renowned for its relevant, ground-breaking 

programmes which effectively prepare students for the world 

of work. We were the first university in the country to offer a 

course in Popular Music and our pioneering Stand-Up Comedy 

module boasts Phoenix Nights comedian Peter Kay as one of 

its graduates. 

The past year has seen several new additions to our portfolio 

of innovative courses. New for 2006 is our unique BA 

Journalism and War Studies – the only undergraduate degree 

combining the two disciplines in the UK. This course combines 

the expertise of professional journalists with one of the largest 

teams of military historians in the country. Ideal for budding 

war correspondents, students have access to a fully equipped 

modern newsroom with all the latest technology. 

We have teamed up with Preston-based Myerscough College 

to launch a new foundation degree in Watersports Leisure 

Management. The degree was developed due to the job 

opportunities created by the popularity of England’s northern 

lakes. The course will focus on the business side of the 

industry, covering issues such as book-keeping, safety 

and the environment. 

Team awards 

Salford is now one of only a handful of universities offering a 

course in Zoology, the study of animals and their biological 

processes. The degree features practical training and students 

are encouraged to take a placement year – for which no 

tuition fees are payable for new students – with a major 

company linked to a public health laboratory, wildlife trust or 

research organisation. 

10

Maximising research – tackling issues 




At Salford, we are renowned for carrying out excellent 

research in multidisciplinary areas of study. Our academics 

have never been afraid of embracing real-world problems by 

utilising our highly-rated research capabilities to provide 

practical solutions that make a positive difference. 

In September 2006 and for the second year running, The 

Sunday Times rated Salford as a Gold Standard of Excellence 

for its ‘elite’ research in the field of the Built Environment. The 

ranking was based on the University’s Built & Human 

Environment (BuHu) Research Institute’s 5* rating in both the 

1996 and 2001 Research Assessment Exercise (RAE). BuHu is 

the only built environment research institute to achieve this 

status – and the largest in its field in the UK. 

This consolidates our reputation for outstanding research 

capability. We are in the top third of universities for research 

and are one of only 32 to be awarded the highest possible 

rating of 6* for aspects of our research. In addition to BuHu, 

our Informatics Research Institute (IRIS) achieved this status. 

A 6* rating is awarded when the majority of work in a 

research area assessed in the last two RAEs has been of 

international importance. 

More generally, this year saw the culmination of a five year 

effort during which the number of research active staff has 

increased by more than 50%, whilst maintaining our high 

quality level. During the past year our researchers have 

undertaken many high-profile research projects, with a 

particular focus on current and emergent real life issues. 

Model car to solve energy crisis 

With the pressure on to find alternatives to petrol and diesel 

which add to global warming, a tiny model car prototype is 

helping our scientists to develop life-sized hydrogen-fuelled 

cars. 

Professor Keith Ross and a team from the Institute for 

Materials Research, were awarded a £500,000 European 

Commission grant in April to investigate ways to store 

hydrogen in vehicles. 

They developed the model to show a possible way of keeping 

the gas - which could take industry one step closer to 

manufacturing hydrogen cars. 

Keith said: “Hydrogen is already known as a potentially safer, 

more economical and more environmentally-friendly 

alternative to petrol-powered cars. 

“We will be co-ordinating international research over the next 

five years to solve the one remaining problem – how to store 

hydrogen on board a car. This represents the final piece of 

the jigsaw in the quest to manufacture eco-friendly cars.” 

Professor Keith Ross with his hydrogen powered car 

11




Best foot forward for the MoD 

New development in the fight against super-bugs 

Our researchers are helping the Ministry of Defence (MoD) to 

improve things for soldiers’ feet and backs – a project which 

could ultimately save their lives in combat situations. 

Earlier this year a team of Salford researchers invented a 

unique coating to be used in the fight against antibioticresistant 

super-bugs such as MRSA. 

Scientists from the Institutes of Health & Social Care Research 

(IHSCR) and Materials Research (IMR) have worked with 

machines, computers and human volunteers to enhance the 

army’s combat footwear and backpacks in order to improve 

infantry performance. 

The team, headed by Professor David Sheel, devised a novel 

coating system which, when applied to a surface, forms a 

durable coating that kills bacteria within minutes. What’s 

more, the coating continues to destroy bacteria for a long 

period afterwards due to its ability to ‘regenerate’. 

The results have recently been submitted to the MoD and 

University staff anticipate it won’t be too long before British 

foot soldiers across the globe are benefiting from 

biomechanically proven boot and backpack designs. 

Regeneration occurs when ultraviolet rays - present in sunlight 

- are used on the surface for a few hours to return the 

antibacterial effect. The coating will then continue to kill 

bacteria alighting on the surface. 

The Institute of Materials Research’s Dr Moji Moatamedi led 

the team investigating footwear performance. 

“Our brief was to study how tread patterns – the intricate 

design on outer shoe soles – affect the performance of 

soldiers’ combat boots. The MoD gave us five different boot 

designs to compare and contrast. From that information, we 

were able to recommend the most effective tread pattern.” 

The team used machinery to simulate the human foot and 

measure how each boot design responded to skidding on soft 

surfaces like mud, sand and snow. This information was then 

translated into a 3D computer simulation. 

The coating is extremely durable despite being only a few tens 

of nanometres thick. It also resists wear and tear which would 

compromise many other antibacterial coatings. 

With recent publicity concerning MRSA and the ineffectiveness 

of many hospitals in maintaining regular cleaning practices, 

this technology offers a simple solution. 

David is now exploring how this technology can be spread. 

He said: “This substance can be used in areas where biocidal 

surfaces are beneficial; such as hospitals, where it could help 

to make a real difference to patients.” 

12 

Biomechanically proven boot




Parasite researchers visit ‘roof of the world’ 

Skin-to-skin contact affects babies’ futures 

In May a team of Salford researchers visited Tibet to help the 

Chinese Government to save lives in semi-nomadic Tibetan 

communities through field-work tracking the spread of the 

life-threatening parasite Echinococcus. 

The Biosciences Research Institute team discovered that the 

parasite is widespread among people in the region known as 

the ‘roof of the world’. 

The scientists investigated how Echinococcus is spread by 

infected dogs, livestock and small mammals to the human 

population. The parasite causes hydatid cysts which may form 

in the brain, bones, lungs or liver. It can lie dormant for up to 

20 years, making it difficult to detect in areas which have poor 

access to modern medical facilities. 

The team are currently reporting their work to the Chinese 

Government which has made tackling the parasite a top 

priority for health improvement in western China. 

Our midwifery lecturer Mary Price received her doctorate in 

August for research into cuddling. 

Mary, who teaches at the School of Health Care Professions, 

spent five years studying mother and baby relationships 

at Rochdale Infirmary to see what effect early physical 

contact has. 

She found that there are huge benefits to be had by mothers 

making skin-to-skin contact with their babies – especially in 

the hour just after birth. 

She believes that without this initial contact a child’s whole 

future life could be affected. Her findings have been adopted 

by Rochdale Infirmary’s maternity unit and she hopes they will 

soon be spread to other hospitals across the country. 

Since the story has been released in the media, Mary has been 

in high demand, with articles published in national 

newspapers and even as far away as Mumbai and Turkey; 

meaning that even more hospitals could adopt her findings. 

At Salford, we are committed to furthering the 

Mary Price and the importance of skin-to-skin contact 

13




New game for Ordsall Hall 

Visitors to Salford’s historic Ordsall Hall can now discover even 

more about the way life would have been in Tudor times, 

thanks to a new game from Salford designers. 

The new game allows visitors to walk around a virtual model 

of the hall and examine objects. Each object is accompanied 

by information to help visitors gain a real appreciation of life in 

a Tudor manor house. 

For the more anarchic visitors there is also a part of the game 

which allows people to run around the hall in the role of an 

archer, shooting targets and scoring points. 

The team believe that this provides visitors with a more 

accessible and fun way of learning about Ordsall Hall’s exhibits 

- especially for the numerous school parties who go to the hall 

each year. 

Ordsall Hall 

Programme Leader for the Master’s Programme in Creative 

Games, Mathias Fuchs, said: "Projects like this are part of a 

major growth industry known as ‘serious games’. They really 

help make museum exhibits more effective and more fun.” 

14

Thinking globally – broadening horizons 




At Salford we are commited to furthering the internationalisation 

of the University and encouraging everyone to ‘think 

internationally’ in all their activities. Whether it’s through 

making the curriculum and our research more international, 

developing partnership arrangements with overseas institutions 

or establishing a regional presence abroad, internationalisation 

is one of our major priorities. 

The past year has consolidated the work of our International 

Strategy Committee, with a number of positive international 

developments within the University. 

Top quality for European exchanges 

In April we received an internationally recognised award for 

the high quality of our European exchange programmes, one 

of only 12 in the UK and 38 across the whole of Europe. 

The European Quality (E-Quality) Label recognises the 

University’s excellent management and promotion of the 

Erasmus programme, the European Commission’s mobility 

programme for higher education students, teachers and 

institutions. 

Salford branches out to China 

Earlier this year Salford expanded its business activity to 

Chengdu, South West China. The University now develops and 

manages networks and partnerships in Chengdu to enhance 

its profile in teaching and applied research. It also supports 

new initiatives and provides the University with regular news 

and updates about educational developments 

in China. 

The initiative – which is in partnership with Salford City 

Council – is running as part of the China-Britain Business 

Council’s Launchpad scheme, which helps British organisations 

do business in China. 

Mr Xu Dongsheng (Tiger) was appointed as Project Manager 

of the venture. Formerly Head of Foreign Affairs at the Office 

for British Higher Education Programmes and the Chinese 

Service Centre for Scholarly Exchange, Tiger will be responsible 

for overseeing all of the University’s activity in China. 

The E-Quality assessment panel named Salford as a ‘dynamic 

organisation’ for the administration and promotion of 

Erasmus. In particular, the ‘excellent materials’, ‘good use of 

ICT’ and the ‘daily message facility’ were commended. 

In recognising the University’s award, David Hibler, Assistant 

Director of the UK Socrates-Erasmus Council, said: "The 

European E-Quality Label provides wider recognition of the 

work which universities undertake for Erasmus and European 

activities. The quality of the applications was high, and we 

hope that this award will contribute to raising the profile of 

the Erasmus programme." 

Mr Xu Dongsheng (Tiger) 

15




Salford welcomes Malaysian research dignitaries 

United nations 

A host of dignitaries and higher education chiefs were at the 

University in June for a major event at which top UK and 

Malaysian universities launched a new research collaboration 

initiative. Political figures and university vice-chancellors 

convened for the International Conference of the Malaysian 

Research Group (MRG), which this year was hosted by Salford. 

MRG is a network of Malaysian researchers worldwide. 

The event culminated in a ceremony, at which the University of 

Salford signed a memorandum of understanding with several 

Malaysian universities, pledging to collaborate on future 

academic research activity. The agreement is aimed at 

strengthening research ties between Salford and its 

counterparts in Malaysia. 

Malaysia’s Government is keen to develop the country as a 

regional educational research hub and the conference will 

explore this potential. In addition, Brian Iddon, MP for Bolton 

South East, delivered an opening speech on the opportunities 

and challenges facing the UK and international academic 

research communities. 

Vice-Chancellor Professor Michael Harloe, said: “We are 

delighted to host this event and to have been chosen as a 

preferred partner for research collaboration. This is recognition 

of our world-class research standing and we look forward to 

working further with our Malaysian partners on this important 

and groundbreaking initiative.” 

Our inaugural Overseas Consultants’ Conference in March 

helped to reinforce Salford’s commitment to students from 

outside the UK who choose to study here with us. 

International consultants from Bolivia, Bulgaria, China, Cyprus, 

Hong Kong, India, Jordan, Malaysia, Nigeria and Turkey were 

invited for the five day event to learn the latest about student 

life and the University’s programmes in order that they can 

offer advice to those around the world who want to come and 

study in the UK. 

The University employs experienced advisors throughout the 

world from Amman to Zhejiang to help students select the 

most appropriate programme of study, apply for a visa and 

complete the application process. 

Salford staff top the jet-set 

Salford came top of all UK universities in July for the number 

of our academic staff who travel to European partner 

institutions to deliver Erasmus sponsored guest lectures. 

Figures from UK Socrates-Erasmus, the scheme which 

encourages student and teacher travel, revealed that a total of 

49 Salford academics took part in a teaching staff exchange 

in 2003-04. 

The data included 146 higher education institutions active in 

Erasmus exchanges that year, of which 92 sent fewer than 

seven staff and 30% sent between eight and 19 staff. 

Exchanges are part of a proactive approach by the University 

to encourage both staff and students to develop an 

international outlook and dimension to their work. 

16 

Conference of the Malaysian Research Group 

Piera Gerrard, Head of the University’s International Relations 

Office, said: “We are delighted to be leading the way in this 

area with so many of our staff developing European links and 

travelling overseas. We are keen to encourage our new 

students to do the same - they won’t have to pay any tuition 

fees for the 12 months they work during a placement 

year abroad.”




Academic advises French Prime Minister 

Asia-Link 

In May a Salford academic was invited to join a commission 

organised by the Prime Minister of France to reform the 

university system. 

Professor John Keiger was appointed by the Prime Minister, 

Dominique de Villepin, to help counter the high levels of 

unemployment amongst the French youth. This is a major 

issue in France and has recently led to protests and disorder on 

the streets of Paris. 

John was appointed because of his in-depth knowledge of the 

British and French education systems. He was the only 

foreigner on the group which is made up of vice-chancellors, 

industrialists, academics and a journalist. The commission 

interviewed student groups, trade unions, industrialists and 

civil servants before submitting a report in June. 

Mission to China 

In May Vice-Chancellor Professor Michael Harloe accompanied 

Minister for Higher Education Bill Rammell MP to China. The 

delegation, which also included the Vice-Chancellors of 

Nottingham and Liverpool Universities, visited Beijing and 

Shanghai, as well as Hong Kong, where the Minister signed an 

agreement pledging closer cooperation with Hong Kong 

universities. The trip will be followed up in November, when 

Professor Harloe and Pro-Vice-Chancellor for Teaching and 

Learning, Jane Hanstock have been invited to take part 

in a mission to Hong Kong strengthening university-touniversity 

links. 

In March the School of Art & Design took part in the 

prestigious international design management symposium, D2B 

in Shanghai. The conference brought together design 

management academics and professionals from across 

the world. 

Our involvement was the culmination of an Asia-Link 

Programme led by Salford in which the University worked with 

Copenhagen Business School, Denmark; Politecnico di Milano, 

Italy; University of Stockholm, Sweden; Tsinghua University, P.R. 

China; Shanghai Jiao Tong University, P.R. China; Harbin 

Institute of Technology, P.R. China; King Mongkut’s Institute of 

Technology, Ladkrabang, Thailand – amongst the top 

universities in their respective countries. 

The Europe-Asia Design Management Network was a unique 

two year EU funded project focussing on curriculum 

development of postgraduate design management 

programmes within EU and Asia; and to foster sustainable 

educational links between EU, Chinese and Thai higher 

education institutions. As well as the D2B symposium, our 

involvement included the reciprocal exchange of academic 

staff in order to assess teaching and develop new Masters 

taught modules in International Design Management. 

17



Encouraging recognition – celebrating success 


‘Dream come true’ for fashion student 

Students scoop top prize at TV awards 

Salford student Laura Kay has designs on a long career in 

fashion after scooping a top national award. 

Laura, from Burnley, took a step closer to fulfilling her dream 

of becoming a top designer when she was crowned Clothes 

Show Live Young Designer of the Year in December. Asked to 

design an outfit inspired by the glitz and glamour of Las 

Vegas, Laura beat off competition from 300 other entrants 

and was in the line-up of just ten wannabe designer finalists. 

Her victory means she will have a head start to a career in 

fashion design, with £2,000 prize money and a two-week 

internship with leading British designer Julien MacDonald. 

Public servant success 

Complementary therapist Peter Mackereth won the 

Guardian newspaper’s Public Servant of the Year 2005 

award in November. 

A group of Salford media students was awarded a top prize at 

the prestigious annual Royal Television Society Awards at the 

Midland Hotel in Manchester in November. 

The successful students – all budding filmmakers, presenters 

and journalists – joined the ranks of the BBC’s Gordon Burns 

as they won Best Regional Current Affairs Programme and 

Best Newcomer Award. 

Master’s degree documentary, Displaced, a film about Russian 

immigrants living in Manchester, beat the BBC into second 

place by winning Best Regional Current Affairs Programme. 

The Society broke with tradition for Best Newcomer by 

awarding joint first place to all three Channel M nominations - 

Laura Fogg (reporter, Channel M News), Gerard McLaughlin 

(presenter, Interference & Reel North) and the Reel North 

Production Crew 2004/05. The latter two nominations 

originate from Salford University, whilst Laura Fogg accepted 

the award on behalf of Channel M News. 

Peter, who splits his work between the School of Community, 

Health Sciences & Social Care, at Salford, and Manchester’s 

Christie Hospital, scooped the prestigious national honour at 

an awards ceremony. 

The prize was for his work at the Christie Hospital, where he 

has single-handedly transformed the complementary therapy 

service for cancer patients. 

Peter said: “I’m totally bowled over and honoured. After 

beavering away for years, this award is the most wonderful 

affirmation that we’re providing something patients want, 

value and see as part of their treatment at the Christie.” 

The Royal Television Society Awards 

18




Young Investigator brings WWII documents to life 

Julie’s design for life 

A Salford scientist was awarded the title of Outstanding Young 

Investigator in January for his groundbreaking work providing 

instant access to digitally restored archives - including those 

from Second World War Nazi concentration camps. 

The Informatics Research Institute’s Dr Apostolos 

Antonacopoulos created digital technology able to analyse 

paperwork from the Polish Stutthof concentration camp, 

extract historical data and create a ‘virtual archive’ – so 

archivists can access information at the click of a button. The 

project is the outcome of EU funding. 

Apostolos is the first UK researcher to have won the title. He 

said: “Previously, archivists have had to search through 

mountains of paperwork to retrieve information. Our 

technology allows them to retrieve this information 

electronically in a fraction of the time.” 

When Julie Trueman decided to change careers from doctor to 

interior designer she could never have guessed that success in 

her new field would come so quickly. 

But in May, the Salford interior design student found out that 

she’d won the prestigious RSA (Royal Society for the 

Encouragement of Arts, Manufactures and Commerce) award 

for best Design for Patient Safety. 

Julie was presented with a £3,000 cheque to spend on future 

projects. What’s more, she also had the bed that she created 

as part of an innovative new hospital ward shown on the front 

cover of the April edition of the RSA journal. 

Sexual health ‘mystery shoppers’ win NHS award 

Stutthof was one of the few concentration camps whose 

paper records were not destroyed by the SS. The number of 

victims is estimated at 85,000. 

A ‘mystery shopper’ initiative in which 19 young people went 

undercover to put sexual health services in Tameside and 

Glossop to the test won a Greater Manchester NHS Award 

in April. 

The University of Salford spin-out company, Contraception 

Education, was the sexual health trainer for the Tameside and 

Glossop Mystery Shopper Project. Organisers were presented 

with a finalist award in the Stop, Look and Listen category at a 

ceremony at the New Century Hall, Manchester. 

The ‘mystery shoppers’, a team of 19 young people, were 

trained in sexual health by the University’s nursing lecturer, 

Barbara Hastings-Asatourian. They then visited a series of 

drop-in centres in the area – acting as ordinary members of 

the public in order to rate the service they received. 

Dr Apostolos Antonacopoulos awarded the title of 

Outstanding Young Investigator 

The young people’s findings resulted in seven key 

recommendations for the improvement in services in the area. 

This report, based on the mystery shoppers’ experiences and 

observations, has been incorporated into NHS plans. 

19




Sibling success for annual fund 

World Cup footballer graduates from Salford 

Our 2006 Annual Fund student callers pledged a whopping 

£60,396 for the University in March – and brother and sister 

Roy and Sonia Chohan drummed up record-breaking amounts. 

Together, the Chohans raised £7,200 worth of pledges, and 

were each awarded Caller of the Week during the six week 

telephone campaign to raise cash pledges from ex-students. 

It might not have equalled the pressure of having over a billion 

fans cheering him on, but for former Chinese international 

footballer Maozhen Su, receiving his MSc in Management in 

July rated as one of his most memorable achievements. 

And he’s now hoping his new-found skills will help him 

become the new Alex Ferguson. 

The funds raised by the team – including the Chohans – is 

already benefitting students and staff by contributing towards 

scholarships and bursaries; student clubs; buildings and 

facilities; and academic research, among other things. 

Maozhen had an illustrious playing career, making over 50 

appearances for his country and playing in China’s first ever 

World Cup finals game in 2002. He spent most of his career 

playing in China but had trials with Manchester United. 

His familiarity with the city and recommendations from friends 

led him to start a Graduate Diploma in Management and 

English in 2004 after injuries forced him to retire from football. 

He said: “I was so happy at Salford that I thought I should stay 

for my Master’s. My next step is to use my new management 

skills to become the greatest coach in China. My target is 

to be as good as Sir Alex Ferguson, Jose Mourinho and 

Arsene Wenger.” 

The Chohans raised £7,200 worth of pledges 

20 

Former Chinese international footballer Maozhen Su,





for the year ended 31st July 2004 

Salford student launches glossy African magazine 

A journalism student from the University of Salford launched 

the first ever African celebrity magazine in the UK in August. 

Student editor Gitau wa Njenga was been backed by the 

University to develop JAMBO magazine – a 68 page full colour 

glossy featuring African content including news and features 

on celebrity gossip, fashion, lifestyle and health. 

The first run of 15,000 issues were be distributed in over 200 

outlets across the UK, mainland Europe, sub-saharan Africa 

and America for the first issue. The launch is being supported 

by extensive investment and circulation is expected to reach 

25,000 per month after the first quarter. 

Gitau said: “JAMBO will put African celebrities on the 

international map through first-class photo-journalism. Our 

aim is to reach diverse African communities around the globe 

who seek an intelligent read that gives them a broader 

perspective on the world.” 

Front cover of the first issue of JAMBO 

Student editor Gitau wa Njenga 

21



Statistics 

Statistics 

Student numbers by mode 

2005/06 

2004/05 

Full 

time 

Part 

time 

Total 

Full 

time 

Part 

time 

Total 

Undergraduate 

12,915 

3,235 

16,150 

12,854 

2,982 

15,836 

Postgraduate – taught 

1,145 

2,311 

3,456 

1,105 

2,540 

3,645 

Postgraduate – research 

318 

260 

578 

309 

309 

618 

Total 

14,378 

5,806 

20,184 

14,268 

5,831 

20,099 

Full-time students by domicile 

2005/06 

2004/05 

Undergraduate 

Home 

12,222 

O/seas 

693 

Total 

12,915 

Home 

12,028 

O/seas 

826 

Total 

12,854 

Postgraduate – taught 

Postgraduate – research 

699 

159 

446 

159 

1,145 

318 

565 

150 

540 

159 

1,105 

309 

Total 

13,080 

1,298 

14,378 12,743 

1,525 

14,268 

Male:Female student ratio among all full-time undergraduates and postgraduates 

Sex 

2005/06 2004/05 

Male 

Female 

48% 

53% 

48% 

53% 

Known destinations of UK/EU graduates 

Destination 

2005 Leavers 

2004 Leavers 

Entered employment 

Employment and study 

Further study or training 

Believed unemployed 

70.5% 

12.5% 

12.5% 

4.5% 

71.3% 

12.7% 

10.2% 

5.8% 

22





for the year ended 31st July 2006 

23



Membership of the Council 2005 - 06 

Membership of the Council 2005-06 

Ex-officio Members 

Chancellor 

Sir Martin Harris 

Pro-Chancellor 

Mr R Batters 

Vice-Chancellor 

Professor M Harloe 

Pro-Vice-Chancellors 

Professor P S Barrett 

Mr M Garrity 

Miss H J Hanstock 

Professor J A Powell 

Representative Members 

Salford City Council 

Councillor W B Pennington 

Association of Greater Manchester Authorities 

Councillor D Lancaster 

Appointed Members (Court) 

Dr N Chamberlain 

Ms F Goodey 

Mr D C Longley 

Dr C Tyler 

Mr C Wells (Vice-Chair of Council and Chair of Estates 

Committee) 

Appointed Members (Senate) 

Professor S Donnelly 

Mrs M Butler 

Professor S Donnelly 

Professor B Longhurst 

Professor C A Roberts 

Professor D Storey 

Professor R Towell 

Co-opted Members 

Members co-opted by the Council 

Mr T Britten 

Ms L Clarke 

Mr A Gibson (Chair of Council) 

Mr J Greenough (Chair of Finance Committee) 

Mrs J Procter (Chair of Personnel Committee) 

Mr N Renfrew 

Mr K Simmons (Chair of Audit Committee) 

Mr J C Willis 

One member of the Academic Related Staff of 

the University 

Mrs C Hughes 

One member of the Non-Academic Staff of the 

University not paid on academic related scales 

Miss J Yates 

Two members of the Students’ Union 

Ms T Robert 

Ms S Winter 

24

Financial Review 



Financial Review 

Scope of the Financial Statements 

1 The Financial Statements comprise the consolidated 

(Group) results of the University of Salford (University) and 

its subsidiary undertakings. The Group structure is set out 

on page 26. 

Income and Expenditure Account 

2 The Group Income and Expenditure for the years to 31 

July are summarised as follows:- 

2005-06 

Restated 

2004-05 

£m £m 

Income 146.8 141.4 

Expenditure – Recurrent 145.5 141.5 

Surplus/(Deficit) before Arts & 

Media Development Costs 1.3 (0.1) 

Expenditure – Arts & Media 

Development Costs 3.9 - 

(Deficit) before Exceptional 

Property Costs and Company 

Disposals (2.6) (0.1) 

3 The University’s income in 2005-06 rose by £5.4m (3.8%) 

compared with the previous year. The main increases were 

in Funding Council grants and education contracts with 

the National Health Service. 

4 Recurrent Expenditure increased by £4.0m (2.8%). Staffing 

costs, excluding the cost of early retirements and voluntary 

severance, rose by £2.8m (3.5%) reflecting annual pay 

increases and internal promotions. The recurrent pay bill 

represents some 58.4% of expenditure which is slightly 

less than the average for the sector. There was a fall of 

£0.8m in retirement and severance costs. Other Operating 

Expenses increased by £1.0m (2.1%). 

5 There was, however, expenditure of £3.9m relating to the 

development costs on a proposed Arts and Media Centre. 

The scheme is currently under review due to a need to 

control costs. In the light of this, capitalisation of 

expenditure is not currently considered appropriate. 

6. The underlying result for the year, a Surplus of £1.3m 

before Arts & Media development costs and exceptional 

charges, represents a sound performance. Exceptional 

charges of £1.6m related to the impairment costs and 

demolition of a number of redundant buildings. The 

Group’s result assessed on the basis of historical cost, that 

is excluding depreciation charges which result from 

property valuations, was a deficit of £2.4m (2005: surplus 

£1.5m). The result has reduced income and expenditure 

reserves excluding pension liabilities to £39.3m which 

exceeds the net pension liability of £26.3m leaving net 

reserves of £13m. 

Balance Sheet 

7. On 31 July 2006 the University’s land and buildings were 

re-valued by Dunlop Haywards, Chartered Surveyors. These 

assets were valued at £152.6m compared to an original 

Net Book Value of £125.3m and the Revaluation Reserve 

was therefore increased by £27.3m. 

8. The Group made capital investments during the year of 

£12.9m (2005:£28.8m). Of this amount some £8.3m was 

invested in buildings, including the completion of a new 

Health Faculty Building, which was opened in October 

2005, and a continuing programme of major 

refurbishments. The University’s Peel Park Campus and 

Allerton Building have been upgraded and the Meadow 

Road Campus was vacated and demolished. Some £4.6m 

was spent on major equipment purchases. 

9. Of the capital investment £4.2m was financed through 

capital grants received and the remainder was financed 

from internal resources pending the draw down of loan 

finance and the generation of capital receipts from the 

disposal of some land and student residences. The Group’s 

net liquid funds reduced temporarily by £12.8m to £4.2m. 

10. The University’s long term borrowings are comparatively 

low within the Higher Education Sector and the University 

plans to finance further capital investment through 

borrowing. The University has facilities with Barclays Bank 

to borrow £6m for the Law School and £50m to finance 

the revised Arts and Media Centre in due course. 

25



Financial ReviewFinancial Review 

Student Numbers 

11. The numbers of students attending the University in 2005- 

06 are detailed in the Statistics section of the Annual 

Report. 

Professional Advisors 

12. Bankers Barclays Bank plc 

Internal Auditors Universities Internal Audit 

Consortium 

External Auditors Grant Thornton UK LLP 

Investment Managers Royal London Asset Management 

Tilney Fund Management 

Employment of Disabled Persons 

13. Applications for employment by disabled persons are 

always fully considered, bearing in mind the aptitudes of 

the applicant concerned. In the event of existing 

employees becoming disabled every effort is made to 

ensure that their employment with the University continues 

and that appropriate training is arranged. It is the policy of 

the University that the training, career development and 

promotion of disabled persons should, as far as possible, 

be identical with that of other employees. 

Employee Involvement 

14. The University places considerable value on the 

involvement of its employees and on good communication 

with them. The University publishes an official newsletter 

which is made available to all staff and separate 

supplements are published when the need arises. Staff are 

encouraged to participate in formal and informal 

consultation at University, Faculty and School level, 

sometimes through the membership of formal 

Committees. 

Conclusion 

15. The Council is satisfied that the Group 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 University intends to maintain its sound 

underlying financial position through sustained income 

generation and affordable investment in new 

developments. 

Professor M H Harloe 


12 December 2006 

Group Structure 

The principal subsidiaries of the University at 31 July 2006 are set out below:- 



(Health Services Training) Limited 

(Training) 


Enterprises Limited 

(Business Development, Consultancy 

and Investment Management) 

Skyscope Limited 

(Property Development 

- Dormant) 

26 

Crescent Purchasing Limited 

(Purchasing Services) 

Salford Software Limited 

(Software Marketing)

Statement of Primary Responsibilities 



Statement of Primary Responsibilities 

The Council is the executive governing body responsible for 

the finance, property, investments and general business of the 

University and for setting the general strategic direction of the 

institution. Its primary responsibilities may be summarised as 

follows: - 

1. Strategic planning 

(a) Considering and approving the mission and strategic plans 

of the institution, longer-term business plans, key 

performance indicators and annual budgets, and ensuring 

that these meet the interests of stakeholders. 

2. Monitoring effectiveness and performance 

(a) Ensuring the establishment and monitoring of systems of 

control and accountability, including financial and 

operational controls and risk assessment. 

(b) Monitoring institutional performance against plans and 

approved key performance indicators which, wherever 

possible and appropriate, are benchmarked against 

other institutions. 

(c) Monitoring its own effectiveness as a governing body and 

reporting thereon. 

(d) Putting in place suitable arrangements for monitoring the 

performance of the Vice-Chancellor and Registrar and 

Secretary. 

3. Finance 

(a) Ensuring the solvency of the University and safeguarding its 

assets. 

(b) Approving the financial strategy and the overall annual 

budget. 

(c) Receiving and approving annual accounts. 

4. Audit 

(a) Directing and overseeing the University’s arrangements for 

internal and external audit. 

5. Estate management 

(a) Approving and keeping under review an estates strategy 

that identifies the property and space requirements needed 

to fulfil the objectives of the University’s strategic plan. 

(b) Providing for a planned programme of maintenance for the 

University’s estate. 

(c) Considering and approving all capital projects and all 

disposals of land and property. 

6. Human resource management 

(a) Approving the University’s staffing strategy and policies, 

including remuneration policy. 

(b) Ensuring the University has clear procedures for handling 

internal grievances and for managing conflicts of interest. 

(c) Appointing the Vice-Chancellor and the Registrar and 

Secretary and setting the terms and conditions for these 

posts. 

7. Equality and diversity 

(a) Ensuring that the University has non-discriminatory systems 

in place to provide equality of opportunity for staff and 

students. 

(b) Approving the University’s access agreement with the 

Office for Fair Access and monitoring institutional 

performance against widening participation targets set 

therein. 

8. Health and safety 

(a) Oversight of the University’s arrangements for ensuring the 

health and safety of staff, students and other individuals 

while they are on the University’s premises and in other 

places where they may be affected by its operations. 

(b) Ensuring that the institution has a written statement of 

policy on health and safety. 

9. Students’ Union 

(a) Ensuring that the Students’ Union operates in a fair and 

democratic manner and is accountable for its finances. 

27



Corporate Governance Statement 


1. The University is committed to best practice in all aspects of 

corporate governance and seeks, in particular, to apply the 

principles set out in Part 1 of the Committee of University 

Chairmen (CUC) Guide for Members of Higher Education 

Governing Bodies in the UK published in November 2004. 

The purpose of this summary is to help the reader of the 

financial statements understand how the principles have 

been applied. 

2. In the opinion of the Council, the University currently 

complies with all the principles set out in the Guide with 

one exception. Current University of Salford practice 

diverges from CUC guidance in relation to the size of the 

Council. The University Council has reviewed this matter 

and considers that the present size of membership at 

Salford (37) is appropriate for an institution of the size and 

with the range of stakeholders and activities that this 

University has. To ensure that the University has access to 

the range of knowledge and skills that external members 

bring, that the Council retains a lay majority, and that 

internal stakeholder groups: management, staff and 

students are adequately represented necessitates a Council 

membership of the present order. 

3. The University is an independent corporation, whose legal 

status derives from a Royal Charter originally granted in 

1967. Its objects, powers and framework of governance are 

set out in the Charter and its supporting statutes, the 

latest version of which was approved by the Privy Council 

in 2004. 

4. The Charter and Statutes require the University to have 

three separate bodies, each with clearly defined functions 

and responsibilities, to oversee and manage its activities, as 

follows:- 

(a) The Council – is the executive governing body, responsible 

for the finance, property, investments and general business 

of the University, and for setting the general strategic 

direction. A statement of the primary responsibilities of the 

Council is provided on page 30. It has a majority of 

members from outside the University, described as lay 

members, from whom its Chairman and Vice-Chairman 

must be drawn. A full statement of the membership for the 

year 2005-06 is provided on page 24. None of the lay 

members receive any payment, apart from the 

reimbursement of expenses, for the work which they do for 


(b) The Senate – is the academic authority of the University 

and draws its membership from the academic staff and the 

students of the institution. Its role is to direct and regulate 

the teaching and research work of the University. 

(c) The Court – is a large, mainly formal body (somewhat akin 

to the shareholders’ meeting of a large public company). It 

offers a means whereby the wider interests served by the 

University can be associated with the institution, and 

provides a public forum where members of the Court can 

raise any matters about the University. The Court normally 

meets once a year to receive the Annual Report and 

Financial Statements of the University. In addition, major 

changes to the constitution of the University require the 

approval of the Court before they can be submitted to the 

Privy Council. A majority of the members of the Court must 

be from outside the University, representing the local 

community and other designated bodies with an interest in 

the work of the University, but the membership also 

includes representatives of the staff of the University (both 

academic and non-academic) and the student body. 

5. The principal academic and administrative officer of the 

University is the Vice-Chancellor who has a general 

responsibility to the Council for maintaining and promoting 

the efficiency and good order of the University. Under the 

terms of the Financial Memorandum between the University 

and the Higher Education Funding Council for England, the 

Vice-Chancellor is the Designated Officer of the University 

and in that capacity can be summoned to appear before the 

Public Accounts Committee of the House of Commons. 

6. Although the Council meets at least four times each 

academic year, much of its detailed work is initially handled 

by committees, in particular the Finance Committee, the 

Personnel Committee, the Estates Committee, the University 

Services Committee, the Nominations Committee, the 

Remuneration Committee and the Audit Committee. The 

decisions and recommendations of these committees are 

reported to the Council. These committees are formally 

28




constituted with written terms of reference and specified 

membership, including a significant proportion of lay 

members (from whom the Chairman is selected). The 

Finance Committee inter alia recommends to the Council 

the University’s annual revenue and capital budget and 

monitors performance in relation to the approved budgets. 

The Remuneration Committee determines the remuneration 

of the Vice-Chancellor and the Registrar and Secretary and 

sets the remuneration policy for senior staff. 

10. The University maintains a register of interests of members 

of the Council and Senior Officers, which may be 

consulted by arrangement with the Registrar and 

Secretary. The Statutes of the University specify that the 

Registrar and Secretary should act as Secretary of the 

Council. Any enquiries about the constitution and 

governance of the University should be addressed to the 

Registrar and Secretary. 

7. The Audit Committee meets at least three times a year, with 

the University’s external and internal auditors in attendance. 

The Committee considers detailed reports together with 

recommendations for the improvement of the University’s 

systems of internal control and management’s responses 

and implementation plans. It also receives and considers 

reports from the Higher Education Funding Council for 

England as they affect the University’s business and 

monitors adherence to the regulatory requirements. Whilst 

Senior Officers attend meetings of the Audit Committee as 

necessary, they are not members of the Committee and the 

Committee has power to meet the external auditors or 

internal auditors for independent discussions. 

8. As Principal Officer of the University, the Vice-Chancellor 

exercises considerable influence upon the development of 

strategy, the identification and planning of new 

developments and the shaping of the ethos of the 

institution. The Pro-Vice-Chancellors and the Senior Officers 

who comprise the Executive Group all contribute in various 

ways to this aspect of the institution, but the ultimate 

responsibility for what is done rests with the Council. The 

Executive Group and the Audit Committee receive regular 

reports from the internal auditors, which include 

recommendations for improvement. 

9. The University has embarked on a comprehensive review of 

its committee and management structures and this work 

will continue in 2006-07 with a view to introducing revised 

arrangements in 2007-08. 

29



Statement of the Council’s Responsibilities and Internal Control 

Statement of the Council’s Responsibilities 

and Internal Control 

1. As the Council of University of Salford, we have 

responsibility for maintaining a sound system of internal 

control that supports the achievement of policies, aims and 

objectives, while safeguarding the public and other funds 

and assets for which we are responsible, in accordance with 

the responsibilities assigned to the Council in the Charter 

and Statutes and the Financial Memorandum with the 

Higher Education Funding Council for England. 

2. The Council is responsible for keeping proper accounting 

records which disclose with reasonable accuracy at any time 

the financial position of the Group and to enable it to 

ensure that the Financial Statements are prepared in 

accordance with the University’s Charter of Incorporation, 

the Statement of Recommended Practice on Accounting in 

Further and Higher Education Institutions 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 the University, the Council, through its 

designated officer, the Vice-Chancellor, is required to 

prepare Financial Statements for each financial year which 

give a true and fair view of the state of affairs of the 

University and Group and of the surplus or deficit, and cash 

flows for that year. 

3. In causing the Financial Statements to be prepared the 

Council ensures that:- 

(a) suitable accounting policies have been selected and applied 

consistently; 

(b) judgements and estimates have been made that are 

reasonable and prudent; 

(c) applicable Accounting Standards have been followed, 

subject to any material departures disclosed and explained 

in the Financial Statements; 

(d) Financial Statements have been prepared on the going 

concern basis, unless it is inappropriate to presume that the 

Group will continue in operation. The Council is satisfied 

that it has adequate resources to continue in operation for 

the foreseeable future: for this reason the going concern 

basis continues to be adopted in the preparation of the 

Financial Statements. 

4. The Council takes reasonable steps to:- 

(a) 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 Higher Education Funding 

Council for England and any other conditions which the 

Higher Education Funding Council for England may from 

time to time prescribe; 

(b) ensure that there are appropriate financial and 

management controls in place to safeguard public funds 

and funds from other sources; 

(c) safeguard the assets of the Group and prevent and 

detect fraud; 

(d) secure the economical, efficient and effective management 

of the University’s resources and expenditure. 

5. The key elements of the Group’s system of internal financial 

controls, which is designed to discharge the responsibilities 

set out above include the following: 

(a) clear definitions of the responsibilities of, and the authority 

delegated to, heads of academic and administrative 

departments; 

(b) a medium or short term planning process supplemented by 

annual budgets; 

(c) regular reviews of academic and support service 

performance; 

(d) clearly defined and formalised requirements for approval 

and control of expenditure, with capital expenditure being 

subject to formal detailed appraisal and review according 

to approval levels set by the University Council; 

(e) comprehensive Financial Regulations, detailing financial 

controls and procedures, approved by the Finance 

Committee; 

6. The system of internal control is designed to manage rather 

than eliminate the risk of failure to achieve policies, aims 

and objectives. It can therefore only provide reasonable and 

not absolute assurance of effectiveness. 

30

Statement of the Council’s Responsibilities and Internal Control 



7. The system of internal control is based on an ongoing 

process designed to identify the principal risks to the 

achievement of policies, aims and objectives; to evaluate the 

nature and extent of those risks; and to manage them 

efficiently and economically. These procedures have been in 

operation throughout the year ended 31 July 2006. 

8. We have undertaken the following actions to embed our 

risk management strategy: - 

(a) Held a risk management workshop for senior staff to 

review the institution’s objectives and risks, and determine 

a control strategy for each of the significant risks. 

(b) Charged the University’s Senior Management Team with 

overseeing the management of risk. 

(c) Requested the Audit Committee to provide advice on the 

effectiveness of risk management. 

(d) Requested that the internal auditors adapt their audit 

planning arrangements, methodology and approach, so 

that the audit conforms to the latest professional standards 

reflecting the adoption of risk management. 

9. We have ensured that our meeting calendar and agendas 

enable risk management and internal control to be 

considered on a regular basis during the year. Risk 

management has been incorporated more fully into the 

corporate planning and decision making processes of the 

institution. 

10. We receive periodic reports from the Audit Committee 

concerning internal control, and we require regular reports 

from managers on the steps they are taking to manage 

risks in their areas of responsibility, including progress 

reports on key projects. 

11. The University’s internal audit service is provided by 

Universities Internal Audit Consortium (UNIAC) which 

operates to standards defined in the Higher Education 

Funding Council for England Audit Code of Practice and 

which was last reviewed for effectiveness by the Higher 

Education Funding Council for England Audit Service in 

May 2002. The internal auditors submit regular reports 

which include the head of internal audit’s independent 

opinion on the adequacy and effectiveness of the system 

of internal control, together with recommendations for 

improvement. 

12. During the year the University has changed its external 

auditors from KPMG LLP to Grant Thornton UK LLP and 

from 1 August 2006 KPMG LLP will take over as internal 

auditors from UNIAC. 

13. Our review of the effectiveness of the system of internal 

control is informed by the work of the internal auditors 

and the senior managers within the University who have 

responsibility for the development and maintenance of 

the internal control framework and by comments made 

by the external auditors in their management letter and 

other reports. 

Mr A Gibson 

Chairman 


31



Report of the Independent Auditors to the Council of the University of Salford 

Report of the Independent Auditors to the 

Council of the University of Salford 

We have audited the financial statements of the University of 

Salford for the year ended 31 July 2006 which comprise the 

income and expenditure account, the statement of historical 

cost surpluses and deficits, the statement of total recognised 

gains and losses, the balance sheets, the cash flow statement, 

principal accounting polices and notes 1 to 40 which have 

been prepared under the historical cost convention (as 

modified by the revaluation of certain fixed assets) and the 

accounting policies set out in the statement of principal 

accounting policies. 

This report is made solely to the Council as a body. Our audit 

work has been undertaken so that we might state to the 

Council those matters we are required to state to them in an 

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 University and the Council as a body, 

for our audit work, for this report, or for the opinions we 

have formed. 

Respective responsibilities of the council 

and Auditors 

As described in the statement of the Council's responsibilities 

and internal control, the Council is responsible for the 

preparation of financial statements in accordance with the 

Accounts Direction issued by the Higher Education Funding 

Council for England, the Statement of Recommended Practice 

- Accounting for Further and Higher Education, applicable law, 

and United Kingdom Accounting Standards. Our responsibility 

is to audit the financial statements in accordance with relevant 

legal and regulatory requirements and International Standards 

on Auditing (UK and Ireland). 

We report to you our opinion as to whether the financial 

statements give a true and fair view and are properly prepared 

in accordance with the Statement of Recommended Practice- 

Accounting for Further and Higher Education. We also report 

to you whether in our opinion, monies expended out of funds 

from whatever source administered by the University for 

specific purposes were properly applied for those purposes and 

where relevant managed in accordance with appropriate 

legislation and whether monies expended out of funds 

provided by the Higher Education Funding Council were 

applied in accordance with the financial memorandum and 

any other terms and conditions attached thereto. 

We also report to you our opinion as to whether the 

information given in the Financial Review is consistent with the 

financial statements. We also report to you if, in our opinion, 

the University has not kept proper accounting records, if we 

have not received all the information and explanations we 

require for our audit. 

We read the Financial Review and the Corporation 

Governance Statement and consider the implications for our 

report if we become aware of any apparent misstatement 

within it. Our responsibilities do not extend to any 

other information. 

Basis of audit opinion 

We conducted our audit in accordance with International 

Standards on Auditing (UK and Ireland) issued by the Auditing 

Practices Board and the HEFCE Code of Practice. 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 University's Council in the 

preparation of the financial statements, and of whether the 

accounting policies are appropriate to the University's 

circumstances, consistently applied and adequately disclosed. 

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 any 

other irregularity or error. In forming our opinion we also 

evaluated the overall adequacy of the presentation of 

information in the financial statements. 

32

Report of the Independent Auditors to the Council of the University of Salford 



Opinion 

In our opinion: 

• The financial statements give a true and fair view of the 

state of affairs of the University of Salford and the group as 

at 31 July 2006, and of the deficit of income over 

expenditure of the group for the year then ended; and the 

statements have been properly prepared in accordance with 

the Statement of Recommended Practice-Accounting for 

Further and Higher Education; the information given in the 

Financial Review is consistent with the financial statements 

• In all material respects, income from the Higher Education 

Funding Council for England and income for specific 

purposes and from other restricted funds administered by 

the institution have been applied only for the purposes for 

which they were received. 

• In all material respects, funds have been applied in 

accordance with the University's Statutes and where 

appropriate in accordance with the financial memorandum 

with the Higher Education Funding Council for England. 

Grant Thornton UK LLP 

Registered Auditors 

Chartered Accountants 

Manchester 


33



Consolidated Income and Expenditure Account 

Consolidated Income and Expenditure Account 

for the Year Ended 31 July 2006 

Note 

Before 

Exceptional 

Items 

Exceptional 

Items 

Total 

2005-06 

Restated 

2004-05 

Income 

£’000 

£’000 

£’000 

£’000 

Funding Council Grants 

1 

57,929 

57,929 

53,337 

Tuition Fees and Education Contracts 

2 

52,307 

52,307 

49,526 

Research Grants and Contracts 

3 

7,456 

7,456 

9,164 

Other Income 

4 

28,448 

28,448 

28,122 

Endowment and Investment Income 

5 

612 

612 

1,243 

Total Income 

146,752 

- 

146,752 

141,392 

Expenditure 

Staff Costs 

Other Operating Expenses 

Depreciation 

Interest Payable 

Total Expenditure 

6 

7 

8 

9 

10 

86,351 

49,011 

8,210 

1,926 

145,498 

3,845 

3,845 

86,351 

52,856 

8,210 

1,926 

149,343 

84,308 

47,991 

7,542 

1,609 

141,450 

Deficit Before Exceptional Items, Tax and Minority Interest 

1,254 

(3,845) 

(2,591) 

(58) 

Share of operating surplus in associated undertakings 

16 

- 

16 

- 

Deficit on Continuing Operations After Depreciation of Fixed 

Assets at Valuation and Before Exceptional Items and Taxation 

1,270 

(3,845) 

(2,575) 

(58) 

Exceptional Items 

11 

- 

(1,610) 

(1,610) 

(4) 


Assets at Valuation and Disposal of Assets but before Taxation 

and Minority Interests 

1,270 

(5,455) 

(4,185) 

(62) 

Taxation 

12 

- 

- 

- 

- 

Equity Minority Interests 

- 

- 

- 

(1) 


Assets at Valuation, Disposal of Assets, Taxation and 

Minority Interests 

1,270 

(5,455) 

(4,185) 

(63) 

Transfer from Accumulated Income within Specific Endowments 

25 

63 

- 

63 

215 

(Deficit)/Surplus for the Year Retained within General Reserves 

27 

1,333 

(5,455) 

(4,122) 

152 

The results for the year ended 31 July 2005 have been restated to reflect the full implementation of FRS17 (See Note 13). 

34

Consolidated Statements 



Consolidated Statement of Historical Cost 

Surpluses and Deficits 


Restated 

Note 2005-06 2004-05 

£’000 £’000 

Deficit on Continuing Operations before Taxation and 

Minority Interests (4,185) (62) 

Difference between Historical Cost Depreciation and 

the Actual Charge for the Year calculated on the 

Revalued Amount 26 1,267 1,394 

Release from Revaluation reserve relating to disposals and 

demolitions 26 503 - 

Historical Cost (Deficit)/Surplus for the Year before 

Taxation and Minority Interests (2,415) 1,332 

Historical Cost (Deficit)/Surplus for the Year after Taxation, 

Exceptional Items , Minority Interests and Transfers in Respect 

of Specific Endowments (2,352) 1,546 

Consolidated Statement of Total 

Recognised Gains and Losses 


Restated 

Note 2005-06 2004-05 

£’000 £’000 

Deficit on Continuing Operations after 

Depreciation of Fixed Assets at Valuation, Disposal of Assets 

and Taxation before Minority Interests (4,185) (62) 

Endowment Interest 25 35 44 

Endowment Donations 25 49 122 

Revaluation of Property 26 27,322 - 

Disposal of SUBEL Minority Interest 11 - (45) 

Actuarial Gain/(Loss) Recognised on the Pension Schemes 38(b) 47 (2,187) 

Total Recognised Gains/(Losses) for the Year 23,268 (2,128) 

Prior Year Adjustment 13 (16,375) - 

Total Recognised Gains/(Losses) for the Year since the 

last Financial Statements 6,893 (2,128) 

Reconciliation 

Opening Reserves, Endowments and Minority Interests as Originally Reported 70,683 69,995 

Less Prior Year Adjustment 13 (16,375) (13,559) 

Restated Reserves, Endowments & Minority Interests 54,308 56,436 

Total Recognised Gains/(Losses) for the Year 23,268 (2,128) 

Closing Reserves, Endowments and Minority Interests 77,576 54,308 

35



Consolidated Balance Sheet 

Consolidated Balance Sheet 

as at 31 July 2006 

Restated 

Note 2006 2005 

£’000 £’000 

Fixed Assets 

Tangible Assets 14 162,520 132,119 

Investments 15 80 58 

162,600 132,177 

Endowment Asset Investments 16 838 817 

Current Assets 

Stock 17 183 124 

Debtors 18 12,001 12,964 

Investments 19 3,909 15,843 

Cash at Bank and in Hand 306 1,219 

16,399 30,150 

Creditors: Amounts Falling Due Within One Year 20 (24,635) (29,876) 

Net Current Liabilities/Assets (8,236) 274 

Total Assets Less Current Liabilities 155,202 133,268 

Creditors: Amounts Falling Due After More Than One Year 21 (21,103) (22,953) 

Provisions for Liabilities 23 (621) (1,989) 

Net Assets Excluding Net Pension Liability 133,478 108,326 

Net Pension Liability 38(d) (26,288) (25,415) 

Net Assets Including Net Pension Liability 107,190 82,911 

Deferred Capital Grants 24 29,614 28,603 

Specific Endowments 25 838 817 

Reserves 

Revaluation Reserve 26 63,716 38,164 

Income and Expenditure Reserve 27 39,310 40,742 

Pension Reserve 28 (26,288) (25,415) 

Total Funds 107,190 82,911 

The Financial Statements on pages 34 to 65 were approved by the Council on 12 December 2006 and signed 

on its behalf by:- 



Mr J Greenough FCA, CPFA Chairman of Finance Committee 

Mr R Corner CPFA 

Director of Finance 

36

University Balance Sheet 





as at 31 July 2006 

Restated 

Note 2006 2005 

£’000 £’000 

Fixed Assets 

Tangible Assets 14 162,509 132,068 

Investments 15 2 2 

162,511 132,070 

Endowment Asset Investments 16 838 817 

Current Assets 

Stock 17 131 124 

Debtors 18 9,170 11,039 

Investments 19 3,909 15,843 

Cash at Bank and in Hand 219 1,084 

13,429 28,090 

Creditors: Amounts Falling Due Within One Year 20 (22,571) (28,545) 

Net Current Liabilities (9,142) (455) 

Total Assets Less Current Liabilities 154,207 132,432 

Creditors: Amounts Falling Due After More Than One Year 21 (21,103) (22,828) 

Provisions for Liabilities and Charges 23 (621) (1,989) 

Net Assets Excluding Net Pension Liability 132,483 107,615 

Net Pension Liability 38(d) (26,288) (25,415) 

Net Assets Including Net Pension Liability 106,195 82,200 

Deferred Capital Grants 24 29,614 28,603 

Specific Endowments 25 838 817 

Reserves 

Revaluation Reserve 26 63,716 38,164 

Income and Expenditure Reserve 27 38,315 40,031 

Pension Reserve 28 (26,288) (25,415) 

Total Funds 106,195 82,200 

The Financial Statements on pages 34 to 65 were approved by the Council on 12 December 2006 and signed on its 

behalf by:- 



Mr J Greenough FCA, CPFA Chairman of Finance Committee 

Mr R Corner CPFA 

Director of Finance 

37



Consolidated Cash Flow Statement 

Consolidated Cash Flow Statement 


Restated 

Note 2005-06 2004-05 

£’000 £’000 

Cash (Outflow)/Inflow from Operating Activities 32 (1,694) 6,614 

Returns on Investments and Servicing of Finance 33 (1,279) (322) 

Capital Expenditure and Financial Investment 34 (8,651) (24,597) 

Disposal of SUBEL 11 - (49) 

Management of Liquid Resources 35 11,679 10,567 

Financing 36 (968) 8,429 

(Decrease)/Increase in Cash in the Year (913) 642 

Reconciliation of Net Cash Flow to increase in 

Net Debt to the year ended 31 July 2006 

(Decrease)/Increase in Cash in the Year 37 (913) 642 

Decrease in Investments 37 (11,679) (10,567) 

New Loans 36 - (14,000) 

Repayment of Loans and Leases 36 968 5,571 

Movement in Net Debt in the Year 37 (11,624) (18,354) 

Net Debt at 1 August 2005 37 (7,283) 11,071 

Net Debt at 31 July 2006 37 (18,907) (7,283) 

38

Statement of Principal Accounting Policies 




1. Basis of Preparation 

These Financial Statements have been prepared in 

accordance with the Revised Statement of Recommended 

Practice (SORP): Accounting in Further and Higher 

Education Institutions and in accordance with applicable 

Accounting Standards. They conform to guidance 

published by Higher Education Funding Council 

for England. 

2. Basis of Accounting 

The Financial Statements are prepared under the historical 

cost convention modified by the revaluation of certain 

fixed assets. 

In preparing the financial statements for the current year, 

the University has adopted the following Financial 

Reporting Standards: 

the final transition arrangements requiring full adoption of 

FRS17 “ Retirement Benefits” 

FRS21 “ Events after the balance sheet date” 

FRS25 “ Financial Instruments : Disclosure and Presentation” 

FRS28 “ Corresponding amounts” 

FRS17 “ Retirement Benefits” 

During the year the University has changed the accounting 

policy with respect to retirement benefits, following the 

mandatory full implementation of FRS 17 "Retirement 

Benefits". FRS 17 requires that financial statements reflect 

at fair value the assets and liabilities arising from an 

employer's retirement benefit obligations and any related 

funding. The operating costs of providing retirement 

benefits are recognised in the period in which they are 

earned, together with any related finance costs and 

changes in the value of related assets and liabilities. The 

results for 2006 have been prepared on the revised basis, 

and the 2005 results have been restated to reflect this 

change in accounting policy. The impact of the prior year 

adjustment is disclosed in note 13 to the financial 

statements. Financial Reporting Standards 21,25 and 28 

had no impact on the University. 

3. Basis of Consolidation 

The consolidated Financial Statements include the 

University and its subsidiary undertakings. The results of 

subsidiaries acquired or disposed of during the period are 

included in the consolidated income and expenditure 

account from the date of acquisition or up to the date of 

disposal. Intra-group sales and profits are eliminated fully 

on consolidation. In accordance with Financial Reporting 

Standard (FRS) 2, the activities of the Student Union have 

not been consolidated because the University does not 

control those activities. 

4. Recognition of Income 

Income from research grants, contracts and other services 

rendered is included to the extent of the completion of the 

contract or service concerned. This is generally equivalent 

to the sum of the relevant expenditure incurred during the 

year and any related contributions towards overhead costs. 

All income from short-term deposits is credited to the 

income and expenditure account in the period in which it is 

earned. Income from specific endowments and donations is 

included to the extent of the relevant expenditure incurred 

during the year, together with any related contributions 

towards overhead costs. Recurrent grants from the Funding 

Councils are recognised in the period in which they are 

receivable. Non-recurrent grants from Funding Councils or 

other bodies received in respect of the acquisition or 

construction of fixed assets are treated as deferred capital 

grants and amortised in line with depreciation over the life 

of the assets. All other income is credited to the Income 

and Expenditure Account in the period in which it 

is earned. 

5. Maintenance of Premises 

The University has a rolling long term maintenance plan, 

which forms the basis of the ongoing maintenance of the 

estate. The costs of long term and routine corrective 

maintenance are charged to the income and expenditure 

account as incurred. 

6. Foreign Currency Translation 

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 either at year 

end rates or, where there are related forward exchange 

contracts, at contract rates. The resulting exchange 

differences are dealt with in the determination of income 

and expenditure for the financial year. 

7. Pension Schemes 

The three principal pension schemes for the University’s 

staff are the Universities Superannuation Scheme (USS), 

Greater Manchester Pension Fund (GMPF) and the Teachers 

Pension Scheme (TPS). All are defined benefit schemes 

which are externally funded and contracted out of the 

State Earnings Related Pension Scheme. Pension costs are 

assessed on the latest actuarial valuations of the schemes’ 

and in the case of USS and TPS (both multi-employer 

39




schemes’) the contributions are charged directly to the 

income and expenditure account as if the schemes’ were 

defined contribution schemes’. In the case of GMPF the 

schemes’ assets are included at market value and scheme 

liabilities are measured on an actuarial basis using the 

projected unit method; these liabilities are discounted at the 

current rate of return on AA rated corporate bonds. The 

post-retirement benefit surplus or deficit is included on the 

University’s balance sheet, net of the related amount of 

deferred tax. Surpluses are only included to the extent that 

they are recoverable through reduced contributions in the 

future or through refunds from the schemes. The current 

service cost and any past service costs are included in the 

profit and loss account within operating expenses and the 

expected return on the schemes’ assets, net of the impact of 

the unwinding of the discount on scheme liabilities, is 

included within other finance income. Actuarial gains and 

losses, including differences between the expected and 

actual return on scheme assets, are recognised, net of the 

related deferred tax, in the statement of total recognised 

gains and losses. 

8. Land and Buildings 

Land and Buildings are valued every 5 years in accordance 

with FRS15. The basis of valuation is a combination of the 

depreciated replacement cost and open market value. 

Additions in the intervening 5 years, prior to valuation are 

valued at cost. Land which is held freehold is not depreciated 

as it has an indefinite life. Buildings are depreciated over 

their expected useful lives up to a maximum of 50 years. 

Where building works are carried out to improve buildings, 

the refurbishment costs are capitalised and depreciated over 

their useful economic life. Where buildings are acquired with 

the aid of specific grants they are capitalised and depreciated 

as above. The related grants are treated as deferred capital 

grants and released to income over the expected useful life 

of the buildings. A review for impairment of fixed assets is 

carried out if there are significant events, or changes in 

circumstances which indicate that the carrying amount of the 

fixed assets may not be recoverable. 

9. Equipment 

Equipment, including computers and software, costing more 

than £20,000 per individual item or group of related items is 

capitalised in the year of acquisition. Capitalised equipment 

is stated at cost and depreciated on a straight line basis over 

its expected useful life of between 3 and 20 years. 

Equipment which is not capitalised is charged to the Income 

and Expenditure Account as incurred. Where equipment is 

acquired with the aid of specific grants (except for research 

grants) it is capitalised and depreciated as above. The related 

grants are treated as deferred capital grants and released to 

income over the expected useful life of the equipment. In 

the case of research grants the equipment is capitalised and 

depreciated over the period of the research grants. The 

related research grants are treated as deferred capital grants 

and released to income over the life of the research grant. 

10. Leased Assets 

Costs in respect of operating leases are charged on a 

straight line basis over the lease term. 

11. Investments 

Fixed asset investments that are not listed on a recognised 

stock exchange are carried at historical cost less any 

provision for impairment in their value. Endowment asset 

investments are included in the balance sheet at market 

value. Current asset investments are included in the 

balance sheet at the lower of their original cost and net 

realisable value. 

12. Stocks 

Stocks are estimated at the lower of their cost and net 

realisable value. Where necessary, provision is made for 

obsolete, slow moving and defective stocks. 

13. Taxation 

The University is an exempt charity within the meaning of 

schedule 2 of the Charities Act 1993 and as such is a charity 

within the meaning of section 506 (1) of the Income and 

Corporation Taxes Act (ICTA) 1988. Accordingly, it is 

potentially exempt from taxation in respect of income or 

capital gains received within categories covered by section 

505 of the ICTA 1988 or section 256 of the Taxation of 

Chargeable Gains Act 1992, to the extent that such income 

or gains are applied to exclusively charitable purposes. The 

University receives no similar exemption in respect of Value 

Added Tax (VAT). The University’s subsidiary companies are 

subject to Corporation Tax and VAT in the same way as any 

commercial organisation. 

14. Liquid Resources 

Liquid resources include sums on short-term deposits 

with recognised banks and building societies and 

government securities. 

15. Provisions 

Provisions are recognised when the Group has a present 

legal or constructive obligation as a result of a past event 

and it is probable that a transfer of economic benefit will be 

required to settle the obligation and a reliable estimate can 

be made of the amount of the obligation. 

40

Notes to the Accounts 




1 Funding Council Grants 2005-06 2004-05 

£’000 £’000 

Higher Education Funding Council 

Teaching Funds 43,104 41,850 

Research Funds 7,923 6,201 

Other 4,459 3,140 

Release of Land & Buildings Grants (Note 24) 1,230 1,109 

Release of Equipment Grants (Note 24) 1,213 1,037 

57,929 53,337 

2 Tuition Fees and Education Contracts 2005-06 2004-05 

£’000 £’000 

Full-time Students 12,156 11,509 

Full-time Students Charged Overseas Fees 10,853 10,741 

Part-time Students 4,719 4,189 

Research Training Support Grants 501 544 

Other Teaching Contracts 23,587 21,940 

Short Courses 491 603 

52,307 49,526 

3 Research Grants and Contracts 2005-06 2004-05 

£’000 £’000 

Research Councils 2,900 3,461 

UK Charities 465 292 

Central Government 2,037 2,022 

Industry 96 287 

European Union Central 1,607 2,190 

European Union Other 92 213 

Other Overseas 148 181 

Release of Equipment Grants (Note 24) 111 518 

7,456 9,164 

4 Other Income 2005-06 2004-05 

£’000 £’000 

Residencies, Catering and Conferences 8,419 7,941 

Other Services Rendered 15,483 16,242 

Other Income Generating Activities 4,246 3,614 

Release of Land & Buildings Grants (Note 24) 195 208 

Release of Equipment Grants (Note 24) 105 117 

28,448 28,122 

41




5 Endowment and Investment Income 

Restated 

2005-06 2004-05 

£’000 £’000 

Investment Income and Other Interest Receivable 518 1,321 

Allocated to Standardisation of Pension Benefits to 

Former University College Staff Provision (Note 23) (34) (34) 

Allocated to Specific Endowments (Note 25) (35) (44) 

Net return on pension scheme 163 - 

612 1,243 

6 Staff Costs 2005-06 2004-05 

Number Number 

The staff numbers by major category (including senior post holders) 

employed by the University during the period, expressed as full-time equivalent:- 

Academic 1,063 1,083 

Administrative, including clerical and manual 1,530 1,481 

2,593 2,564 

Restated 

2005-06 2004-05 

£’000 £’000 

Wages and Salaries 70,211 68,531 

Social Security Costs 5,756 5,471 

Other Pension Costs (Note 38) 8,998 8,100 

84,965 82,102 

Early Retirement and Voluntary Severance 1,386 2,206 

86,351 84,308 

Emoluments of the Vice-Chancellor 2005-06 2004-05 

£’000 £’000 

Salary 189 168 

Benefits in Kind 1 1 

Sub Total 190 169 

Pension Contributions 51 24 

Total Emoluments 241 193 

In 2004-05 the University’s contributions on behalf of the Vice–Chancellor to the University Superannuation 

Scheme (USS) were paid at the same rates as for the other academic staff and amounted to £23,546. In 

2005-06 the University reviewed the Vice-Chancellor’s pension arrangements in anticipation of the introduction 

of pension simplification legislation on 6 April 2006. The University agreed to revise the Vice-Chancellor’s 

arrangements on the basis that no additional costs should be incurred by the University. This resulted in the 

Vice-Chancellor leaving the superannuation scheme with effect from 31 March 2006. The savings made by the 

University in terms of the employer’s contribution have been paid to the Vice-Chancellor in the form of the 

purchase of “added years” in 2005-06 (£34,309) and enhanced salary with effect from 1 April 2006 

(approximately 7% per annum). 

42




Remuneration of Other Higher Paid Staff Over £70,000 2005-06 2004-05 

(Including employer’s pension contributions, but excluding Number Number 

employer’s National Insurance) 

£ 70,001 - £ 80,000 15 13 

£ 80,001 - £ 90,000 8 2 

£ 90,001 - £100,000 1 2 

£100,001 - £110,000 2 2 

£110,001 - £120,000 1 - 

£120,001 - £130,000 - 1 

£170,000 - £180,000 1 - 

In 2005-06 a higher paid member of staff took early retirement. Additional pension contributions of £63,765 

were paid to USS and this is included in the relevant remuneration disclosure band. 

7 Other Operating Expenses 2005-06 2004-05 

£’000 £’000 

Fees and Invoiced Staff 2,173 2,501 

Staff Expenses (including travel, hospitality and conferences) 3,657 3,273 

Student Expenses 3,272 2,652 

Marketing 808 766 

Vehicle and Transport Costs 532 427 

Consumables 1,138 912 

Information Services 5,757 5,008 

Communications 1.208 1,105 

Stationery/Photocopying/Printing 1,849 1,809 

Equipment and Furniture 2,061 1,561 

Fees and Expenses 7,755 8,456 

Licences/Insurance/Subscriptions 2,241 2,138 

Catering 858 822 

Household Expenses 232 212 

Financial Charges 647 772 

Security 679 674 

Utilities/Rates/Rents 3,671 3,565 

Premises Maintenance 5,631 7,149 

Arts & Media Development Costs 3,845 - 

Subsidiary Company Expenditure 4,842 4,189 

52,856 47,991 

The status of a scheme to develop an Arts and Media Centre is currently under review. In the light of this, 

capitalisation of expenditure is not considered appropriate and the costs incurred to date have been written 

off to expenditure. 

43




7 Other Operating Expenses (Continued) 2005-06 2004-05 

£’000 £’000 

Fees and Expenses includes:- 

External Auditors’ Remuneration 45 46 

Other Services from External Auditor 25 56 

Internal Auditors’ Remuneration 142 106 

8 Depreciation 2005-06 2004-05 

£’000 £’000 

The depreciation charge has been funded by:- 

Deferred Capital Grant (Note 24) 2,854 2,989 

Revaluation Reserve (Note 26) 1,267 1,394 

General Income 4,089 3,159 

8,210 7,542 

Restated 

9 Interest Payable 2005-06 2004-05 

£’000 £’000 

Net Interest on Pension Schemes (Note 38c) 427 393 

Students’ Union Deposit Interest 66 70 

Bank and Other Loans not Wholly Repayable within Five Years 1,432 1,145 

Loan Interest Payable 1,925 1,608 

Other Interest Payable 1 1 

1,926 1,609 

The Students’ Union deposits funds with the University for onward investment with Royal London Asset 

Management and Tilney Investment Management. 

44




10. Analysis of Expenditure by Activity 

Staff Costs Other Depreciation Interest Total 

Operating 

Expenses 

Restated Restated 

05/06 04/05 05/06 04/05 05/06 04/05 05/06 04/05 05/06 04/05 

£000 £000 £000 £000 £000 £000 £000 £000 £’000 £’000 

Academic 

Departments 50,154 47,665 12,030 11,528 1,060 864 - 33 63,244 60,090 

Academic Services 5,508 5,170 5,031 4,274 531 509 - 15 11,070 9,968 

Administration 11,665 10,510 8,347 7,638 338 708 - 19 20,350 18,875 

Premises 5,484 5,200 9,183 10,420 4,962 3,878 1,433 996 21,062 20,494 

Exceptional 

Premises Costs - - 3,845 - - - - - 3,845 - 

Residencies, 

Catering and 

Conferences 2,596 2,388 4,418 3,861 1,092 929 - 167 8,106 7,345 

Research Grants 

and Contracts 3,767 4,714 1,603 2,310 111 518 - - 5,481 7,542 

Other Expenses 7,177 8,661 8,399 7,960 116 136 493 379 16,185 17,136 

86,351 84,308 52,856 47,991 8,210 7,542 1,926 1,609 149,343 141,450 

45




11 Exceptional Items 2005-06 2004-05 

£’000 £’000 

Demolition of Meadow Road Campus 313 

Loss on demolition of Venables Building 434 

Impairment on anticipated demolition of Allerton Annexe 627 

Impairment on anticipated demolition of Lankester Building 214 

Disposal of 60% of Unity Marketplace Ltd 22 

Loss on liquidation of Salford University Business Enterprises Ltd (SUBEL) in 

2004/05 

Net Assets Disposed:- 

Cash 122 

Less Minority Interest (45) 

Less Disposal Proceeds (73) 

Total Exceptional Items 1,610 4 

12 Taxation 

There is no UK Corporation tax payable by the various organisations within the Group. 

13 Prior Year Adjustment 

The prior year adjustment has arisen due to the full implementation of FRS 17, as disclosed within the 

principal accounting policies and the re-analysis of accumulated income within specific endowments. 

Consolidated Income and 2004-05 Re-analysis of FRS 17 2004-05 

Expenditure Account Original Endowment Restatement Restated 

Accounts Transfer Accounts 

£’000 £’000 £’000 £’000 

Endowment & Investment Income (959) 215 (499) (1,243) 

Staff Costs 83,573 - 735 84,308 

Interest Payable 1,216 - 393 1,609 

Transfer from Accumulated Income 

Within Specific Endowments - (215) - (215) 

Net Consolidated Income and 

Expenditure Impact 83,830 - 629 84,459 

46




Consolidated Balance Sheet 2005 Original FRS17 2005 Restated 

Accounts Restatement Accounts 

£’000 £’000 £’000 

Fixed Assets 132,177 - 132,177 

Endowments 817 - 817 

Net Current Assets 274 - 274 

Creditors: Amounts Falling Due After More 

Than One Year (22,953) - (22,953) 

Provisions for Liabilities and Charges (11,029) 9,040 (1,989) 

Net Assets Excluding Pension Deficit 99,286 9,040 108,326 

Pension Deficit - (25,415) (25,415) 

Net Assets Including Pension Deficit 99,286 (16,375) 82,911 

Deferred Capital Grants 28,603 - 28,603 

Specific Endowments 817 - 817 

Revaluation Reserve 38,164 - 38,164 

Income and Expenditure Reserve 31,702 9,040 40,742 

Pension Reserve - (25,415) (25,415) 

Total Funds 99,286 (16,375) 82,911 

University Balance Sheet 2005 Original FRS17 2005 Restated 

Accounts Restatement Accounts 

£’000 £’000 £’000 

Fixed Assets 132,070 - 132,070 

Endowments 817 - 817 

Net Current Liabilities (455) - (455) 

Creditors: Amounts Falling Due After More 

Than One Year (22,828) - (22,828) 

Provisions for Liabilities and Charges (11,029) 9,040 (1,989) 

Net Assets Excluding Pension Deficit 98,575 9,040 107,615 

Pension Deficit - (25,415) (25,415) 

Net Assets Including Pension Deficit 98,575 (16,375) 82,200 

Deferred Capital Grants 28,603 - 28,603 

Specific Endowments 817 - 817 

Revaluation Reserve 38,164 - 38,164 

Income and Expenditure Reserve 30,991 9,040 40,031 

Pension Reserve - (25,415) (25,415) 

Total Funds 98,575 (16,375) 82,200 

47




14 Tangible Assets Land & Buildings Assets in the Equipment Total 

Course of 

Construction 

Consolidated £’000 £’000 £’000 £’000 

Historical Cost/Valuation 

At 1 August 2005 124,099 20,616 25,212 169,927 

Revaluation at 31 July 2006 8,975 - - 8,975 

Additions 6,384 5,754 4,588 16,726 

Transfers 22,092 (22,092) - - 

Exceptional Arts & Media Development Costs - (3,845) - (3,845) 

Disposals (7,773) - (1,315) (9,088) 

At 31 July 2006 153,777 433 28,485 182,695 

Depreciation 

At 1 August 2005 20,653 - 17,155 37,808 

Revaluation at 31 July 2006 (18,347) - - (18,347) 

Charge for the Year 5,499 - 2,711 8,210 

Exceptional Impairment charge 1,200 - - 1,200 

Disposals (7,390) - (1,306) (8,696) 

At 31 July 2006 1,615 - 18,560 20,175 

Net Book Value 


At 1 August 2005 103,446 20,616 8,057 132,119 

Land and Buildings with a net book value of £53,481,000 and have been funded from Treasury 

sources.Should these Land and Buildings be sold the University would either have to surrender the proceeds 

to the Treasury or use them in accordance with the University’s Financial Memorandum with the Higher 

Education Funding Council for England.The Land and Building assets of the University are freehold and were 

revalued on 31 July 2006 by Dunlop Haywards (Property Consultants). 

2006 2005 

£’000 £’000 

The net book value of the Land and Buildings can be analysed as:- 

2006 Valuation Market Value 14,102 - 

2006 Valuation Depreciated Replacement Cost 137,941 - 

2004 Valuation Market Value - 6,922 

2001 Valuation Depreciated Replacement Cost - 83,186 

2001 Valuation Market Value - 2,400 

Historical Cost (Including Assets in the Course of Construction) 552 31,554 

152,595 124,062 

48




Land & Buildings Assets in the Equipment Total 

Course of 

Construction 

University £’000 £’000 £’000 £’000 

Historical Cost/Valuation 

At 1 August 2005 124,099 20,616 24,481 169,196 

Revaluation at 31 July 2006 8,975 - - 8,975 

Additions 6,384 5,754 4,563 16,701 

Transfers 22,092 (22,092) - - 

Exceptional Arts & Media Development Costs - (3,845) - (3,845) 

Disposals (7,773) - (863) (8,636) 


Depreciation 

At 1 August 2005 20,653 - 16,475 37,128 

Revaluation at 31 July 2006 (18,347) - - (18,347) 

Charge for the Year 5,499 - 2,655 8,154 

Exceptional Impairment Charge 1,200 - - 1,200 

Disposals (7,390) - (863) (8,253) 

At 31 July 2006 1,615 - 18,267 19,882 

Net Book Value 


At 1 August 2005 103,446 20,616 8,006 132,068 

15 Investments 2006 2005 

£’000 £’000 

Consolidated 

Trade Investments 49 58 

Investments in associated undertakings 31 - 

80 58 

University 

Trade Investments 2 2 

49




Shares in Group Undertakings at 31 July 2006 represent investments, by the University and/or University of Salford Enterprises 

Limited in the following Companies which are all registered and operating in England and Wales. 

Company Name Principal Activity Class of Shares % Held % Held 

by the by the 

University Group 

Salford Software Limited Software Marketing Ordinary - 100.0 

University of Salford (Health Services Training) 

Limited Training Ordinary 100.0 100.0 

University of Salford Enterprises Limited Business Development , 

Consultancy and Investment 

Management Ordinary 100.0 100.0 

Skyscope Limited Dormant Ordinary 100.0 100.0 

Crescent Purchasing Limited Purchasing Services Ordinary - 100.0 

On 31 January 2006 Unity Marketplace Ltd (a group company that was 100% owned at 31 July 2005) issued further shares 

to e – Government Solutions Limited. The effect of this was to dilute the Group’s effective share holding from100% to 40%. 

This investment is accounted for using the equity method of accounting. 

Trade investments by University of Salford Enterprises Limited and/or University of Salford in Companies registered and 

operating in England and Wales comprise:- 

Photonics Research Systems Limited Consultancy Ordinary - 24.0 

AUR Hydropower Limited Dormant Ordinary - 14.8 

The Incubation Partnership Limited Dormant Limited by Guarantee - 25.0 

Super Services Limited Marketing Ordinary 2.0 2.0 

Sustainability North WestLimited Research Limited by Guarantee 50.0 50.0 

Video Arts Limited Media Training Ordinary - 0.2 

CVD Technology Limited Industrial Processes Ordinary - 20.0 

Learning Expanse Limited E-Learning Software Ordinary - 20.0 

The Protocol Lab Limited Construction Industry Software Ordinary - 20.0 

Unity Marketplace Limited Software Development Ordinary 40.0 40.0 

NFAB Limited Nanotechnology Ordinary 3.1 3.1 

Contraception Education Limited Board Game Ordinary - 7.5 

Foodparks UK Limited Business Parks Ordinary - 10.0 

One Central Park Limited Business Parks Ordinary - 20.0 

Innomet Limited Wire Manufacture Ordinary - 10.0 

The University also has a small shareholding in CVCP properties plc, a company set up by Universities UK to own its head 

office building in central London. The Group’s share of the turnover of this company is not considered to be material. 

50




16 Endowment Asset Investments 2006 2005 

£’000 £’000 

Consolidated and University 

At 1 August 2005 817 866 

Increase/(Decrease) 21 (49) 

At 31 July 2006 838 817 

All the endowment funds are invested in Short Term Investments in 

accordance with the treasury management policy of the University. 

17 Stock 2006 2005 

£’000 £’000 

Consolidated 

Building and Engineering Stores 109 100 

Catering Stock 22 24 

Work in Progress 48 - 

Goods for sale 4 - 

183 124 


Building and Engineering Stores 109 100 

Catering Stock 22 24 

131 124 

18 Debtors 2006 2005 

£’000 £’000 

Consolidated 

Amounts Falling Due Within One Year: 

Trade Debtors 5,413 6,323 

Amounts Due on Research Grants and Contracts 1,239 1,071 

Accrued Income 4,054 4,026 

Prepayments 1,295 1,544 

12,001 12,964 


Amounts Falling Due Within One Year: 

Trade Debtors 3,629 4,628 

Amounts Due on Research Grants and Contracts 1,239 1,071 

Accrued Income 3,076 3,998 

Prepayments 1,226 1,277 

Amounts Owed by Subsidiary Undertakings - 65 

9,170 11,039 

51




19 Investments 2006 2005 

£’000 £’000 


Short Term Investments 4,747 16,660 

Allocated to Endowment Investments (Note 16) (838) (817) 

3,909 15,843 

20 Creditors: Amounts Falling Due Within One Year 2006 2005 

£’000 £’000 

Consolidated 

Students’ Union Deposit 1,294 1,549 

Current Portion of Long Term Creditors 1,255 1,137 

Research Contract Payments Received on Account 1,920 2,082 

Trade Creditors 4,001 2,938 

Social Security and Other Taxation Payable 2,662 2,699 

Other Payroll Creditors 1,085 994 

Accruals 5,675 9,465 

Other Creditors 189 199 

Deferred Income 6,554 8,813 

24,635 29,876 


Students’ Union Deposit 1,294 1,549 

Current Portion of Long Term Creditors 1,255 1,087 

Research Contract Payments Received on Account 1,920 2,082 

Trade Creditors 3,177 2,617 

Social Security and Other Taxation Payable 1,892 1,824 

Other Payroll Creditors 1,085 994 

Accruals 5,473 9,214 

Other Creditors 189 210 

Deferred Income 4,786 5,783 

Amounts Due to Subsidiary Undertakings 1,500 3,185 

22,571 28,545 

52




21 Creditors: Amounts Falling Due After More Than One Year 2006 2005 

£’000 £’000 

Consolidated 

Deferred Income 280 240 

Other Creditors - 929 

Repayable Grant from HEFCE 125 125 

Mortgages Secured on Residential and Other Property 20,698 21,659 

21,103 22,953 


Deferred Income 280 240 

Other Creditors - 929 

Repayable Grant from HEFCE 125 - 

Mortgages Secured on Residential and Other Property 20,698 21,659 

21,103 22,828 

22 Borrowings 2006 2005 

22 (a) Bank Loans and Mortgages £’000 £’000 

Consolidated 

Amounts Falling Due Within 1 Year 1,130 1,137 

Amounts Falling Due Within 1 to 2 Years 1,181 1,130 


Amounts Falling Due After 5 Years or More 16,984 16,815 

21,828 22,796 


Amounts Falling Due Within 1 Year 1,130 1,087 



Amounts Falling Due After 5 Years or More 16,984 16,815 

21,828 22,746 

22 (b) Analysis of Loans 

Date Loan Security Date Interest Balance 

Obtained Repayable Rate £’000 

1996 Centenary Building 2021 Variable on Libor 3,208 

2001 None 2011 Variable on Libor 2,130 

2004 Mary Seacole Building 2030 Fixed at 5.86% 16,490 

University & Consolidated Total 21,828 

The University has also arranged for a £50m loan facility at a fixed rate to be drawn down by December 2008. 

53




23 Provisions for Liabilities and Charges 

Provision for Enhanced Pension Standardisation Total 

Residential Benefits Payable of Pension 

Accommodation to Retired Staff Benefits to Former 

Lease 

University College 

Salford Staff 

£’000 £’000 £’000 £’000 


As previously reported at 1 August 

2005 1,366 9,040 623 11,029 

Prior Year Adjustment - (9,040) - (9,040) 

Restated at 1 August 2005 1,366 - 623 1,989 

Expenditure in Year (1,366) - (127) (1,493) 

Interest on Funds (Note 5) - - 34 34 

Transfer from Income and 

Expenditure Account - - 91 91 

As at 31 July 2006 - - 621 621 

The prior year adjustment relates to the introduction of FRS 17 and the reclassification of enhanced pension 

benefits payable to retired staff within the pension scheme deficit. 

24 Deferred Capital Grants 

Land & Buildings Equipment Total 

£’000 £’000 £’000 


Higher Education Funding Council Grants 

At 1 August 2005 20,977 2,004 22,981 

Grant Received 1,767 2,398 4,165 

Released to Income and Expenditure (Note 1) (1,230) (1,213) (2,443) 

Exceptional Release on anticipated demolition of 

Lankester Building (Note 11) (359) - (359) 

At 31 July 2006 21,155 3,189 24,344 

Other Grants 

At 1 August 2005 5,173 449 5,622 

Grant Received - 59 59 

Released to Income and Expenditure (Notes 3,4) (195) (216) (411) 

At 31 July 2006 4,978 292 5,270 

Total 

At 31 July 2006 26,133 3,481 29,614 

At 1 August 2005 26,150 2,453 28,603 

54




25 Specific Endowments 2005-06 2004-05 

£’000 £’000 


At 1 August 2005 817 866 

Additions 49 122 

Interest (Note 5) 35 44 

Expenditure for Year (63) (215) 


2005-06 2004-05 

£’000 £’000 

Representing: 

Prize Funds 251 231 

Chair and Lectureship Funds 112 124 

Other Funds 475 462 


26 Revaluation Reserve University Consolidated 

£’000 £’000 

At 1 August 2005 38,164 38,164 

Transferred to Income and Expenditure Account (Note 27) (1,267) (1,267) 

Transfer to Income and Expenditure Account on disposal and demolition of buildings (503) (503) 

Revaluation of properties at 31 July 2006 (Note 14) 27,322 27,322 

At 31 July 2006 63,716 63,716 

27 Income and Expenditure Reserve University Consolidated 

£’000 £’000 

Balance previously reported at 1 August 2005 30,991 31,702 

Prior Year Adjustment (Note 13) 9,040 9,040 

Restated Balance at 1 August 2005 40,031 40,742 

Transferred from Revaluation Reserve (Note 26) 1,267 1,267 

Transfer from Revaluation Reserve on disposal and demolition of buildings 503 503 

Transfer to Pension Reserve (Note 28) 920 920 

Deficit for the Financial Year (4,406) (4,122) 

As at 31 July 2006 38,315 39,310 

28 Pension Reserve University Consolidated 

£’000 £’000 

Balance previously reported at 1 August 2005 - - 

Prior Year Adjustment (Note 13) (25,415) (25,415) 

Restated Balance at 1 August 2005 (25,415) (25,415) 

Actuarial Gain (Note 38b) 47 47 

Transferred from Income and Expenditure Reserve (Note 27) (920) (920) 

Pension Reserve at 31 July 2006 (26,288) (26,288) 

55




29 Financial Commitments 2006 2005 

£’000 £’000 

At 31 July the annual commitments under non-cancellable 

operating leases were as follows: 

Consolidated 

Land and Buildings 

Within One Year 279 1,583 

Between Two and Five Years 134 358 

Over Five Years 57 57 

470 1,998 

Other 

Within One Year 100 - 


Over Five Years - - 

561 660 


Land and Buildings 

Within One Year 279 1,583 


Over Five Years 21 21 

434 1,962 

Other 

Within One Year - - 


Over Five Years 461 - 

561 660 

30 Capital Commitments 2006 2005 

£’000 £’000 


Commitments Contracted at 31 July 7,376 15,262 

Authorised but not Contracted at 31 July 64,849 53,275 

31 Contingent Liability 

Recent decisions handed down by the European Court of Justice (ECJ) may increase the liability for pension of 

UK part time employers, such as the University of Salford. The implications of the ECJ decision are unclear 

and clarification is still awaited, following appeals lodged as a result of test cases through an employment 

tribunal. In view of this uncertainty, no financial provision has been made in the financial statements in 

relation to this matter. 

56




32 Reconciliation of Consolidated Operating Deficit to 

Restated 

Net Cash (Outflow)/Inflow from Operating Activities 2005-06 2004-05 

£’000 £’000 

Deficit before Taxation (4,185) (62) 

Depreciation 8,210 7,542 

Exceptional Fixed Assets Charges 1,583 - 

Disposal of Unity Marketplace Ltd/SUBEL (Note 11) 22 4 

Deferred Capital Grants Released to Income (Note 24) (3,213) (2,989) 

Investment Income (Note 5) (612) (1,243) 

Interest Payable and Similar Charges (Note 9) 1,926 1,609 

Increase in Stocks (59) (23) 

Decrease/(Increase) in Debtors 891 (3,206) 

(Decrease)/Increase in Creditors (5,809) 4,966 

Decrease in Provisions (1,368) (1,306) 

Difference Between Pension Charge and Pension Contributions (Note 27) 920 1,322 

Net Cash (Outflow)/Inflow from Operating Activities (1,694) 6,614 

Restated 

33 Returns on Investments and Servicing of Finance 2005-06 2004-05 

£’000 £’000 

Income from Endowments (Note 25) 35 44 

Income from Short Term Investments (Note 5) 612 1,243 

Interest Paid (Note 9) (1,926) (1,609) 

(1,279) (322) 

34 Capital Expenditure and Financial Investment 2005-06 2004-05 

£’000 £’000 

Tangible Assets Acquired (Note 14) (12,881) (28,826) 

Endowment Assets (Purchased)/Disposed (Note 16) (21) 49 

Investments (Purchased)/Disposed (Note 15) (22) 30 

Deferred Capital Grants Received (Note 24) 4,224 4,028 

Endowments Received (Note 25) 49 122 

(8,651) (24,597) 

35 Management of Liquid Resources 2005-06 2004-05 

£’000 £’000 

Movement in Students’ Union Deposit (255) 320 

Movement in Investments 11,934 10,247 

Net Cash Inflow from Management of Liquid Resources 11,679 10,567 

57




36 Analysis of Changes in Consolidated Financing 2005-06 2004-05 

£’000 £’000 

At 1 August 2005 22,796 14,367 

Loan from Barclays Bank Repayable by 2030 - 14,000 

Repayments of Amounts Borrowed (968) (5,571) 

Net Amount Borrowed during the year (968) 8,429 

At 31 July 2006 21,828 22,796 

37 Analysis of Changes in 1 August 2005 Cash Flow 31 July 2006 

Consolidated Net Funds £’000 £’000 £’000 

Investments 15,843 (11,934) 3,909 

Students’ Union Deposit (1,549) 255 (1,294) 

14,294 (11,679) 2,615 

Cash at Bank and in Hand 1,219 (913) 306 

Debt Due Within One Year (1,137) 7 (1,130) 

Debt Due Over One Year (21,659) 961 (20,698) 

(7,283) (11,624) (18,907) 

38 Pension Schemes 

The three principal schemes for the University’s staff are the Universities Superannuation Scheme (USS), the 

Teacher’s Pension Scheme (TPS) and the Greater Manchester Pension Fund (GMPF). 

The total pension cost for the University and its subsidiaries was:- 

2005-06 2004-05 

£’000 £’000 

USS -Note 38(a) 5,026 4,736 

GMPF-Note 38(b) 3,029 2,375 

TPS -Note 38(c) 933 965 

Other Pension Schemes 10 24 

Ongoing Pension Costs (Note 6) 8,998 8,100 

USS Early Retirement Costs 592 502 

GMPF Curtailments and Settlements 66 31 

TPS Curtailments and Settlements 144 901 

Total Pension Costs 9,800 9,534 

58




38(a) Universities Superannuation Scheme (USS) 

The University participates in the Universities Superannuation Scheme, a defined benefit scheme, which is 

externally funded and contracted out of the State Second Pension. The assets of the scheme are held in a 

separate trustee administered fund. Under the definitions set out in FRS 17 (Retirement Benefits) the USS is a 

multi-employer pension scheme and the University is unable to identify its share of the underlying assets and 

liabilities of the scheme. Accordingly the University has taken advantage of the exemption in FRS 17 and has 

accounted for its contributions to the scheme as if it were a defined contribution scheme. The cost 

recognised within the Income and Expenditure Account is therefore equal to the contributions payable to the 

scheme for the year. 

The latest actuarial valuation was at 31 March 2005.The main results and assumptions of the valuation of the 

USS are as follows:- 

Latest Actuarial Valuation date 31 March 2005 

Valuation method 

Projected Unit 

Value of assets 

£21,740m 

Value of past service liabilities 

£28,308m 

Deficit 

£6,568m 

Funding level for accrued benefits 77% 

Investment return per annum for past service liabilities 4.5 % 

Salary increase per annum for past service liabilities 3.9% 

Pension increases per annum for past service liabilities 2.9% 

Investment return per annum for future service liabilities 6.2% 

Salary increases per annum for future service liabilities 3.9% 

Pension increases per annum for future service liabilities 2.9% 

The actuary also valued the scheme on a number of other bases as at the valuation date. Using the Minimum 

Funding Requirement prescribed assumptions introduced by the Pensions Act 1995, the scheme was 126% 

funded at that date; under the Pension Protection Fund regulations introduced by the Pensions Act 2004 it 

was 110% funded; on a buy-out basis (i.e. assuming the Scheme had discontinued on the valuation date) the 

assets would have been approximately 74% of the amount necessary to secure all the USS benefits with an 

insurance company; and using the FRS17 formula as if USS was a single employer scheme, the actuary 

estimated that the funding level would have been approximately 90%. 

The University contribution rate required for future service benefits alone at the date of valuation was 14.3% 

of salaries but it was agreed that the University contribution rate will be maintained at 14% of salaries. 

Surpluses or deficits which arise at future valuations may impact on the institution’s future contribution 

commitment. An additional factor which could impact the funding level of the scheme is that with effect 

from 16 March 2006, USS positioned itself as a “last man standing” scheme so that in the event of the 

insolvency of any of the participating employers in USS, the amount of any pension funding shortfall (which 

cannot otherwise be recovered) in respect of that employer will be spread across the remaining participant 

employers and reflected in the next actuarial valuation for the scheme. 

59




38(b) Greater Manchester Pension Fund (GMPF) 

The University participates in the GMPF, which is an externally funded defined benefit pension scheme, which 

is contracted out of the State Second Pension, where contributions payable are held in a trust separately from 


The following information is based upon a full actuarial valuation of the fund as at 31 March 2004 updated 

to 31 July 2005 and 31 July 2006 and a full actuarial valuation at 31 March 2001 updated 31 July 2004 by a 

qualified independent actuary (Hymans Robertson). 

31 July 2006 31 July 2005 31 July 2004 

Inflation 3.1% 2.8% 2.9% 

Rate of increase in salaries 4.6% 4.3% 4.4% 

Rate of increase in pensions 3.1% 2.8% 2.9% 

Discount rate for liabilities 5.1% 5.0% 5.8% 

The assets in the scheme, of which the University’s share is estimated at 0.96% (2004/2005 0.95%, 2003/04 

0.98%), and the expected rates of return were: 

Value at Value at Value at 


£’000 £’000 £’000 

Equities 5,515,700 5,043,000 4,190,000 

Bonds 1,408,100 1,188,000 1,019,000 

Property 794,000 684,000 618,000 

Cash 617,300 595,000 359,000 

Total Market Value of Assets 8,335,100 7,510,000 6,186,000 

Long term Long term Long term 

Rate of Return Rate of Return Rate of Return 

Expected at Expected at Expected at 


Equities 7.7% 7.3% 7.9% 

Bonds 4.7% 4.7% 5.4% 

Property 5.7% 5.4% 6.7% 

Cash 4.8% 4.5% 4.5% 

2006 2005 2004 

£’000 £’000 £’000 

University’s Estimated Asset Share 80,081 71,350 60,602 

Present Value of Scheme Liabilities (93,874) (84,431) (72,033) 

Present Value of Unfunded Liabilities (4,617) (4,568) (4,252) 

Total Value of Liabilities (98,491) (88,999) (76,285) 

Deficit in the Scheme (18,410) (17,649) (15,683) 

60




Analysis of the Amount Charged to the Income and Expenditure Account 

2005-06 2004-05 

£’000 £’000 

Service Cost 2,993 2,258 

Past Service Cost 36 117 

Curtailments and Settlements 66 31 

Total Operating Charge 3,095 2,406 

Analysis of Net Return on Pension Scheme 

2005-06 2004-05 

£’000 £’000 

Expected Return on Pension Scheme Assets 4,647 4,352 

Interest on Pension Scheme Liabilities (4,484) (4,444) 

Net Return 163 (92) 

Amounts Recognised in the Statement of Recognised Gains and Losses 

2005-06 2004-05 

£’000 £’000 

Actual Return Less Expected Return on Pension Scheme Assets 3,642 8,402 

Experience Gains and Losses Arising on the Scheme Liabilities (52) 415 

Change in Financial and Demographic Assumptions Underlying the 

Scheme Liabilities (3,543) (10,205) 

Actuarial Gain/(Loss) recognised in Statement of Gains and Losses 47 (1,388) 

Movements in Deficit during Year 

2005-06 2004-05 

£’000 £’000 

(Deficit) in Scheme at beginning of year (17,649) (15,683) 

Current Service Charge (2,993) (2,258) 

Contributions 1,827 1,637 

Contributions in respect of Unfunded Benefits 297 283 

Past Service Costs (36) (117) 

Impact of Settlements and Curtailments (66) (31) 

Net Interest/Return on Assets 163 (92) 

Actuarial Gain/(Loss) 47 (1,388) 

(Deficit) in Scheme at end of year (18,410) (17,649) 

61




(38(b) Greater Manchester Pension Fund (GMPF) Continued) 

History of Experience Gains or Losses 

2005-06 2004-05 2003-04 2002-03 2001-02 

Difference Between the Expected and 

Actual Return on Assets: £’000’s 3,642 8,402 2,029 (6) (9,467) 

% of Scheme Assets 4.5% 11.8% 3.3% 0.0% (18.8%) 

Experience Gains/(Losses) on Scheme 

Liabilities: £’000’s (52) 415 29 (4,448) 576 

% of Scheme Liabilities (0.1%) 0.5% 0.0% (6.2%) 1.1% 

Total Amounts Recognised in Statement 

of Gains and Losses Amounts - £’000’s 47 (1,388) 1,964 (12,592) (4,455) 

% of Scheme Liabilities 0.0% (1.6%) 2.6% (17.7%) (8.3%) 

38(c) Teachers’ Pension Scheme (TPS) 

Under the definitions set out in FRS 17 (Retirement Benefits), the TPS is a multi-employer pension scheme. The University is 

unable to identify its share of the underlying assets and liabilities of the scheme. Accordingly, the University has taken 

advantage of the exemption in FRS 17 and has accounted for its current service contributions to the scheme as if it were a 

defined contribution scheme. 

The Teachers’ Pension Scheme is an unfunded defined benefit scheme. Contributions on a “pay as you go” basis are credited to 

the Exchequer under arrangements governed by the Superannuation Act 1972.The pension cost is assessed every five years in 

accordance with the advice of the Government Actuary. The assumptions and other data that have the most significant effect 

on the determination of the contribution levels are as follows:- 

Latest actuarial valuation 31 March 2001 

Actuarial method 

Prospective Benefits 

Investment returns per annum 7.0% 

Salary scale increases per annum 5.0% 

Market value of notional assets at date of last valuation 

£102,010m 

Proportion of members’ accrued benefits covered by the actuarial value of the assets 100% 

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Following the implementation of Teachers’ Pensions (Employers’ Supplementary Contributions) Regulations 2000, the 

Government Actuary carried out a further review on the level of employers’ contributions. The University paid contributions of 

13.5% from 1 April 2003 to 31 July 2006. 

A number of early retirement benefits have been granted to TPS members and in this case the University is able to identify its 

share of the liabilities relating to early retirement. Prior to the introduction of FRS17 this was shown as part of the enhanced 

benefits payable to retired staff in Note 23. 

The major assumptions used were: - 


Total Interest Rate for Calculating Interest on 

Pension Liabilities 6% 6% 6% 

Net Interest Rate to Discount Scheme Liabilities 2.5% 2.5% 3% 

2006 2005 2004 

£’000 £’000 £’000 

Present Value of Unfunded Liabilities 7,879 7,766 6,222 

Analysis of the Amount Charged to the Income 

and Expenditure Account 

2005-06 2004-05 

£’000 £’000 

Curtailments and Settlements 144 901 

Analysis of Net Return on TPS Scheme Early 

Retirements 

2005-06 2004-05 

£’000 £’000 

Interest on Pension Liabilities 427 301 

Analysis of Amounts Recognised in Statement 

of Recognised Gains and Losses 

2005-06 2004-05 

£’000 £’000 

Changes in Financial & Demographic Assumptions 

Underlying the Scheme Liabilities - (799) 

63




38(c) Teachers’ Pension Scheme (TPS) (Continued) 

Movements in Deficit During Year 2005-06 2004-05 

£’000 £’000 

(Deficit) in Scheme at Beginning of Year (7,766) (6,223) 

Contributions in respect of Unfunded Benefits 459 458 

Impact of Settlements and Curtailments (144) (901) 

Interest and Pension Liabilities (427) (301) 

Actuarial Gain/(Loss) - (799) 

(Deficit) in Scheme at End of Year (7,878) (7,766) 

History of Experience Gains or Losses 

2005-06 2004-05 2003-04 2002-03 2001-02 

Total Amounts Recognised 

in Statement of Gains and 

Losses Amounts - £’000’s - (799) (70) (72) (1,035) 

% of Scheme Liabilities - (10.29%) (1.12%) (1.16%) (18.23%) 

38(d) 

Pension Scheme Summary 

The implementation of FRS 17 ‘Retirement Benefits’ resulted in the pension scheme deficits and actuarial 

(losses)/gains being included in the Financial Statements as follows:- 

2005-06 2004-05 

£’000 £’000 

Balance Sheet – Pension Scheme Deficits 

Greater Manchester Pension Fund – Note 38(b) (18,410) (17,649) 

Teachers Pension Scheme Early Retirement – Note 38(c ) (7,878) (7,766) 

(26,288) (25,415) 

2005-06 2004-05 

£’000 £’000 

Statement of Total Recognised Gains & Losses 

Actuarial Gains/(Losses) 

Greater Manchester Pension Fund – Note 38(b) 47 (1,388) 

Teachers Pension Scheme Early Retirement – Note 38(c) - (799) 

47 (2,187) 

64




39 Access Funds 

2005-06 2004-05 

£’000 £’000 

Balance Brought Forward 182 238 

HEFCE Grants 1,294 1,402 

Interest Earned 25 33 

Administration Costs (66) (29) 

Disbursed to Students (1,254) (1,462) 

Balance Carried Forward 181 182 

Access Funding Council grants are available solely for students and the University acts only as paying agent. 

The grants and related disbursements are therefore excluded from the Income and Expenditure Account. 

40 Related Party Transactions 

Due to the nature of the University’s operations and the composition of the Council, being drawn from local 

public and private sector organisations it is inevitable that transactions will take place with organisations in 

which a member of the Council may have an interest.In particular Mr W B Pennington is Councillor of Salford 

City Council and Mr D Lancaster is a Councillor of Salford City Council representing the Association of 

Greater Manchester Authorities. 

All transactions involving organisations in which a member of the Council may have an interest are declared 

and conducted at arms length, in accordance with the University’s Financial Regulations and normal 

procurement procedures. 

The University has taken advantage of the exemption allowed by Financial Reporting Standard 8 not to 

disclose transactions between group companies. 

The Salford University Students’ Union has a close relationship with the University. The financial transactions 

between the two organisations can be summarised as:- 

2005-06 2004-05 

£’000 £’000 

Annual Grant Paid to Students’ Union from University 715 669 

Travel Agency and Other Services Paid to Students’ Union from University 188 466 

Payments made to the University from Students’ Union for Services Provided (152) (141) 

At the 31 July 2006 Student’s Union had £1,294,000 (2005: £1,549,000) invested with the University of 

Salford as detailed in Note 20. 

65



Notes 

Notes 

66

Notes 



Notes 

67



Notes 

Notes 

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2006 Annual Report - University of Salford

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