AnnuAL rePOrt 2011 - Winchester College

A rePort froM
the ChAIrMAn
of the fInAnCe
CoMMIttee
The finance Committee has
responsibility, delegated from the
governing Body, for the financial
well-being of the College. In practice
this means working closely with the
headmaster, the Bursar and their
colleagues to manage the viability of
the College in the short term, and also
to control well into the future the flow
of income (principally school fees)
and expenditure (both current
expenses and maintenance and the
capital spend which keeps up and
improves the fabric of the College).
Unsurprisingly, this is something of
a balancing act, with the sustainability
of the founder’s vision at its core.
We want to attract bright boys
who can benefit from the College’s
approach to education. This means
both providing value to those families
who have a choice of schools, and
assisting through bursaries those
whose financial constraints would put
a Winchester education beyond them.
It means attracting and retaining
in the right numbers the talented
teaching and support staff that make
this education possible.
It means providing accommodation
which need not be luxurious, but must
not be an obstacle to effective study.
“ We want to attract bright boys who can benefit from
no report on finances would
the College’s approach to education. This means both
be complete without some figures,
providing value to those families who have a choice of
which are encouraging on the one
schools, and assisting those whose financial constraints
hand, but require new and significant
would put a Winchester education beyond them,
progress on the other.
through bursaries.”
Current financial performance
ChArLes sInCLAIr (B, 1961-66)
is encouraging in that the surplus
(‘net incoming resources’) in charity
accounts for the year to 31 August
2011 was £1,574,000, a good
improvement on the prior year
surplus of £947,000.
It means maintaining ancient which both bridge current shortfalls
school fees made up most of our
(and modern) buildings and grounds and help to build the long-term real
income, but did not cover educational
which have provided an inspirational value of the endowment. The Works
expenses. It was investment income,
setting for intellectual and athletic Committee oversees the daily challenge
grants and donations that largely
endeavour for past generations, and of the necessary maintenance and
met this shortfall and created the
which are more than ever needed enhancement of the fabric of the
overall surplus.
for our future.
College, yet with limited resources.
The income from the College’s
It means finding the resources for The disbursements Committee
property investments and investment
a continuing proud musical tradition, ensures that donations are properly
portfolio does not of itself provide
to which the Quiristers make a unique and efficiently spent in accordance
sufficient income to cover current
contribution, and for a technology base with donors’ wishes, and so enables
shortfall. Yet it remains fundamental
both for pure educational purposes the College to report back properly.
that sufficient investment income
and the efficient running of the
As to the finance Committee
should be retained to contribute
College as a whole.
itself, robin fox retired as its
to long-term real growth in the
These balances could not be Chairman in June 2011, after a
investment assets.
managed without a first-class executive most distinguished 15 years as fellow,
Whilst we are not, as a charity,
staff and a combination of Committees and as sub-Warden. his involvement
profit driven, we must manage our
which provide an effective managing in the College’s affairs was so extensive
income so as to cover our aspirations
and control network. The Investment that his Chairmanship of the
for both the bursary programme and
Committee, a sub-committee of the finance Committee seemed effortless
our maintenance and project needs.
finance Committee, has oversight and so all the more daunting to
This is where the activities of
of the investment portfolio, and the me as his successor, with less than
the development Committee and
agricultural and residential estates. a year’s experience as a fellow.
the development executive become
The Audit and risk Committee My appointment was made possible
crucial, because, as we stand,
provides an independent view to by the strength and experience of
the College’s finances are perhaps
the governing Body on the financial the three continuing Committee
too finely balanced.
reports of the College, and of the members: robert sutton, formerly
risks inherent in the College’s
senior partner of Macfarlanes;
operations including its finances. robert Woods, a seasoned managing
The development Committee is director from the maritime world;
responsible for sustaining and and Mark Loveday, formerly senior
enhancing the flow of donations partner of Cazenove.
our project load, including
the modernisation of new hall,
the development of two existing
properties for investment or College
use, and the next round of Commoner
house refurbishments, has brought
into sharp focus the need for deeper
financial capacity. With our current
resources, near-term needs can be
met, and projects financed. In the
medium-term, our bursary
aspirations and campus development
will not be financeable without a
growing donor and donations base.
only that way will we be able to
balance the demand for expendable
income with real growth of our
asset base over time, and the
competing needs of current and
future beneficiaries of the College.
Charles sinclair
Chairman of the Finance Committee
32 WINCHESTER COLLEGE AnnUAL rePort 2011
33
5
3
4
2
6
College investments
1 Agricultural property 64.1%
2 Commercial property 5.1%
3 Woodlands 2.2%
4 residential property 7.6%
5 fixed interest 1.7%
6 equities 11.1%
7 hedge funds 4.4%
8 Private equity 1.3%
9 Commodities 1.3%
10 Cash 1.2%
A good return
7
8 9 10
64.1 %
To balance current and future needs,
the College aims to:
• maintain (at least) the value of the
investments in real terms;
• produce a consistent and sustainable
amount to support current
expenditure; and
• deliver these first two objectives
within acceptable levels of risk.
At 31 August 2011 the total value of
the College’s long-term investments was
£63,481,000. The total return for the
year across all these investments was
+20%. They generated investment
income of £1,371,000 and a further
£742,000 was withdrawn from
capital under the College’s total return
investment approach.
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