2006 Annual Report - University of Salford

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Annual Report & Financial Statements Consolidated Cash Flow Statement Consolidated Cash Flow Statement for the Year Ended 31 July 2006 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 Annual Report & Financial Statements 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
Page 1 and 2: University of Salford Annual Report
Page 3 and 4: Annual Report & Financial Statement
Page 5 and 6: Vice-Chancellor’s introduction An
Page 7 and 8: Sharing knowledge - forging partner
Page 9 and 10: Shaping graduates - supporting soci
Page 11 and 12: Nurturing experiences - creating op
Page 13 and 14: Maximising research - tackling issu
Page 15 and 16: Maximising research - tackling issu
Page 17 and 18: Thinking globally - broadening hori
Page 19 and 20: Thinking globally - broadening hori
Page 21 and 22: Encouraging recognition - celebrati
Page 23 and 24: Encouraging recognition - celebrati
Page 25 and 26: Financial Statements Annual Report
Page 27 and 28: Financial Review Annual Report & Fi
Page 29 and 30: Statement of Primary Responsibiliti
Page 31 and 32: Corporate Governance Statement Annu
Page 33 and 34: Statement of the Council’s Respon
Page 35 and 36: Report of the Independent Auditors
Page 37 and 38: Consolidated Statements Annual Repo
Page 39: University Balance Sheet University
Page 43 and 44: Notes to the Accounts Annual Report
Page 69 and 70: Notes Annual Report & Financial Sta

2006 Annual Report - University of Salford

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