Financial Statements & Members Report 2007-2008

LEEDS COLLEGE OF MUSIC

REPORT OF THE MEMBERS OF THE CORPORATION

AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 JULY 2008

LEEDS COLLEGE OF MUSIC MEMBERS’ REPORT AND FINANCIAL STATEMENTS for the year ended 31 July 2008 CONTENTS

Page number

Report of the Members of the Corporation

1

Statement of Corporate Governance and Internal Control

11

Statement of Responsibilities of the Members of the Corporation

17

Independent Auditors’ Report to the Corporation of Leeds College of Music

18

Income and Expenditure Account

20

Statement of Historical Cost Surpluses and Deficits

21

Statement of Total Recognised Gains and Losses 21

Balance Sheet

22

Cash Flow Statement

23

Notes to the Accounts

24

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REPORT OF THE MEMBERS OF THE CORPORATION The members present their report and the audited financial statements for the year ended 31 July 2008. Legal status The Corporation was established under The Further and Higher Education Act 1992 for the purpose of conducting higher education. The College is an exempt charity for the purposes of the Charity Act 1993. Mission (up to December 2008) The College’s Mission as approved by its members is: The College provides high-quality music education, enhanced by research and continually evolving to meet the needs of the profession and the community.

Strategic Plan 2005 – 2008 On the 5th August 2005, after the transfer of the College into the Higher Education sector on the 1st August 2005, the newly established HE Corporation approved the three-year strategic plan for the periods 2005/06 through to 2007/08. The College’s strategic objectives for the period 2005 – 2008 were to: 1. Develop the College’s position as the conservatoire for the Yorkshire and Humber region, and

to consolidate its role as a significant contributor to the cultural life of the city and the region.

2. Maintain and develop the College’s broad curriculum, embracing a range of major musical traditions and genres.

3. Reinforce the College’s leadership role in UK jazz education and to establish a distinctive position in popular music education.

4. Widen access to HE through participation in Aimhigher, and through new scholarship, bursary and outreach programmes.

5. Deliver FE courses which provide effective progression routes into the College’s higher education programmes.

6. Increase student success rates in FE to 50%.

7. Attract more applications from the most talented student performers, composers and producers.

8. Maintain a strong emphasis on equality and diversity, in particular through an increase in the percentage of applications from female students, and the maintenance of a high level of participation by students from relatively disadvantaged backgrounds.

9. Increase the number of students playing recognised “endangered species” instruments.

10. Support the continuation and development of research and scholarly activity to underpin learning and teaching.

11. Increase the number of new international (non-EU) student enrolments by 50% to 30 by 2007-08.

12. Maintain and develop strong links with conservatoires and other appropriate organisations in the UK and further afield.

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REPORT OF THE MEMBERS OF THE CORPORATION (CONTINUED) 13. Secure a level of funding adequate to support the costly nature of conservatoire provision,

and to deploy such funding to achieve significant enhancement of the quality, quantity and range of resources (human and other) available to support the fulfilment of the College’s mission.

14. Enhance quality of provision through targeted staff development activity, (especially to encourage staff to gain relevant professional qualifications) and through the application of rigorous quality assurance procedures.

15. Safeguard the financial stability of the College by providing budget contingencies at a minimum of 1.5% of turnover, and by maintaining cumulative reserves at a minimum of 12.5% of turnover.

Review of 2005 – 2008 Strategic Plan implementation The Strategic Plan 2005 – 2008 was an ambitious document, which contained 15 strategic objectives and 69 supporting actions. This was a period of considerable turbulence and uncertainty for the College; notwithstanding that, substantial progress was made, with 68% (47/69) of the actions being delivered in whole or in substantial part; a further 20% (14/69) being partially achieved and ongoing; and only 12% (8/69) being discontinued – almost all for lack of human and/or financial resources. Some key achievements were:

• Establishing the type and level of provision appropriate to a conservatoire • Establishing the College’s identity as the conservatoire for Yorkshire and the Humber • Curriculum developments such as new MA and Foundation Degree courses • Increasing FE success rates significantly • Activities designed to widen access to Higher Education and to develop research and scholarly

activity • Improving the quality and quantity of professional development opportunities available to staff

Less successful were:

• Securing the funding level needed to support the various developments described above, and to deliver a balanced budget

• Moving beyond mere compliance with Equality and Diversity legislation to being able confidently to justify the assertion that the College has “a strong emphasis on equality and diversity”

• Recruiting international students • Developing truly productive links with other conservatoires

Where still relevant and practical, undelivered objectives have been incorporated into the College’s new Strategic Plan, approved in December 2008.

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Mission and Strategic Plan 2009 – 2012 The Governing Body approved a new Strategic Plan in December 2008. The Plan articulates new Mission, Vision and Value statements, as well as identifying strategic aims and is the result of an extensive consultation process involving governors, staff, students and external stakeholders. Mission We aim to be the conservatoire of choice for forward-thinking musicians; renowned for the quality, distinctiveness and relevance of our provision, and the contribution that we make to the cultural life and economic prosperity of our city, our region and the wider world. Vision We enrich the lives of our students and our community by providing: a focus for high class music making in its many forms; an exceptional musical education informed by research and professional practice; and an enduring network of strategic partnerships Values We believe that: • Conservatoires provide an ideal education for performers, composers and music producers • Creative musicians should have experience of a broad range of genres, including Classical, Jazz,

Popular Music and Music Production, and of working in and with their communities • Leeds College of Music makes and should continue to make an important contribution to the

reputation and the cultural life of the City and its region • All our dealings should be based on mutual respect, transparency, the promotion of equality of

opportunity, and the celebration of diversity Core Aims 1 To provide high quality educational opportunities that meet the needs of students, the creative

industries, and the community, and which are consistent with the mission of a leading contemporary conservatoire for music

2 To provide excellent service in all aspects of our operation, continually raising the quality of the

student experience 3 To transfer knowledge beyond the organisation, and to increase participation in learning by under-

represented groups, thereby contributing to the cultural life and economic prosperity of the city and the region

Enabling Aims 4 To put people at the heart of our organisation, inspiring and developing our students, alumni and

staff to reach their full potential 5 To nurture a range of selected strategic partnerships to enhance the experience of our students,

alumni, staff and partners 6 To secure the resources necessary to sustain our continued development as the UK’s leading

contemporary conservatoire 7 To raise the profile of the College regionally, nationally and internationally

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Financial Performance In 2007/08 The Leeds College of Music earned income of £7.87 million and delivered in full against the targets set under its contract arrangements with the Higher Education Funding Council for England (HEFCE), the Learning Skills Council (LSC) and the Local Education Authorities. Notwithstanding this the College’s financial statements report a deficit (before FRS 17 provisions) of £316,000 in 2007/08. This follows reported deficits of £315,000 in 2006/07 and £557,000 in 2005/06. These deficits are a reflection of the fact that the current mix of the organisation’s activity, whilst generating sufficient revenue to cover its operating costs and finance obligations, does not generate sufficient to cover the significant depreciation charges (£542,000 in 2007/08) arising from its purpose built estate. The result of this insufficiency has caused reserves to be depleted with the balance on the Income and Expenditure account being -£58,000 at 31st July 2008. The reduction in reserves has resulted in the college breaching a covenant attached to the £3 million loan facility provided by its bankers. The bank have agreed to waive the covenant in respect of the 2007/08 results but the waiver was not effective at the balance sheet date, with the result that these long term loan liabilities are reported as current liabilities in the financial statements. The College’s financial position in 2008/09 has been assisted by HEFCE making available £425,000 of exceptional funding. This has enabled the College to set a balanced budget for the year, though it will not restore reserves to the level required to satisfy the bank’s covenant. The bank are unwilling to issue a waiver in advance of the 2008/09 results but they are suitably reassured by the College’s positive cashflow projections for the next 12 months, which clearly demonstrate the organisation’s ability to service its debt and to make all capital repayments that are due under the terms of the loans. Although the bank have assured the College of their ongoing support, the fact that they reserve their right to enforce the loan covenant in respect of the 2008/09 results is recognised as a material risk. The bank will have the legal right to demand immediate repayment of the loans in the event of the covenant being breached in July 2009, however, this risk is mitigated in part by the strong relationship that the College enjoys with its bankers, but more substantially by the College’s current performance against budget and by the strong positive cash position that results from the injection of the £425,000 exceptional funding from HEFCE. The College’s Board is, therefore, confident that it is appropriate for the organisation’s accounts for 2007/08 to have been prepared on a going concern basis. The College has, over the previous three years fought tenaciously to secure an increase in the funding payable by HEFCE for its distinctive conservatoire provision. The Board have now, however, accepted that the Funding Council cannot be persuaded to bring Leeds College of Music’s funding levels into line with those afforded to other conservatoires in the sector. They are consequently examining other means of securing the viability of the College’s operations. A range of strategic options is being considered to address the financial challenges that have given rise to the deficits of successive years. A solution will be identified and plans will be in place to safeguard the financial integrity of the organisation within the 2008/09 financial year.

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Curriculum Developments 2007/8 saw the end of the College’s validation arrangement with the University of Leeds, following the graduation of the final cohort of students enrolled on the BA Music Studies and BA Jazz Studies programmes. The University of Leeds decided to withdraw from all of its validation activities with effect from Summer 2009 in order to focus on its strategic objective to become a world-class research university. The College’s higher education portfolio is now validated solely by the Open University. 2007/8 saw the successful introduction of the Foundation Degree in Commercial Music Production and Recording, validated by the Open University. The course recruited to target (30), despite only being validated in May 2007. The MA Music and MA Jazz programmes were reviewed, in order to ensure that they are fit for purpose, and the revised versions were approved by the Open University in July 2008. The revised MA portfolio, which is no longer genre specific, comprises MA Performance and MA Composition. This has enabled students wishing to specialise in popular music practice to engage with the programmes. Students are also now able to apply specifically for practice-based Postgraduate Diplomas in Performance and Composition, which were previously only available as exit awards from the MA programmes. The College secured funding in August 2007 for 25 additional students for 2007/8 from the West Yorkshire Lifelong Learning Network, to support the expansion of its Foundation Degree programmes. Funding for a further 55 additional students was secured for the 2008/9 academic year to support expansion of the Foundation Degree programmes and to provide a progression route to the BA Music Production programme for students successfully completing Foundation Degrees. The College discontinued its BTEC National Diploma in Musical Theatre from 2008/9, due a reduction in the College’s LSC funding, the high cost of delivering the course and its relatively low level of funding. No intake was enrolled for 2008/9 and the final cohort will complete the course in Summer 2009. Quality Assurance The College underwent a successful Periodic Review of its remaining University of Leeds provision in October 2007. The College also underwent a successful Institutional Audit by the Quality Assurance Agency (QAA) in November 2007, its first engagement with the QAA. The audit team concluded that

• ‘confidence can reasonably be placed in the soundness of the institution's present and likely future management of the academic standards of the awards that it offers on behalf of the University of Leeds and the Open University.’

• ‘confidence can reasonably be placed in the soundness of the institution's present and likely future management of the quality of the learning opportunities available to students.’

In addition, the following features of good practice were identified:

• the annual programme evaluation process as a mechanism for annual course review • engagement with the music industry and expert professional practice • the pastoral support provided by the Student Services Unit.

The College secured a much more positive outcome from the 2007/8 National Student Survey, published in August 2008. The response to the overall satisfaction question rose 15 percentage points to 68% from its 2006/7 level of 53%. However, feedback clearly indicates that the College still needs to make significant improvements in the areas of course organisation and management, and timeliness and quality of feedback to students. The reorganisation of the academic management structure, undertaken during Summer 2008, was specifically intended to address the issue of course management. Research The College made a submission to the 2008 Research Assessment Exercise. This was the College’s first RAE return having been ineligible for previous exercises (which are undertaken about every 7 years) due to its former status as a Further Education College. The College put forward 4.83FTE staff and while mainly focused on jazz (performance, composition and critical musicology), the submission also included electro-acoustic composition.

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The College’s overall quality profile indicates that

• 10% of the submission was deemed to meet the standard for 4* (quality that is world-leading in terms of originality, significance and rigour.)

• 15% was deemed to meet the standard for 3* (quality that is internationally excellent in terms of originality, significance and rigour but which nonetheless falls short of the highest standards of excellence);

• 40% was deemed to meet the standard for 2* (quality that is recognised internationally in terms of originality significance and rigour);

• 35% was deemed to meet the standard for 1* (quality that is recognised nationally in terms of originality, significance and rigour);

• None of the College’s submission was designated unclassified (quality that falls below the standard of nationally recognised work, or work which does not meet the published definition of research for the purposes of this assessment).

The report notes that the College’s submission included some world-leading work in jazz history and performance.

The report notes the weaknesses in the College’s submission in terms of sustainability, research resources and support structures. In terms of a national comparison, the Times Higher Education in its 18th December 2008 produced a subject ‘league table’ for music based on a grade-point average calculation (scale: 0 to 4) derived from the published HEFCE RAE2008 data. Leeds College of Music is ranked joint 43rd (with the Guildhall School of Music and Drama, University of Westminster, Dartington College of the Arts and Salford University) out of 53 departments/institutions with a grade-point average of 2.00. The grade-point average profile for all 53 music submissions listed ranges from 3.45 (Royal Holloway) to 1.05 (Napier University) with an average of 2.69 (equates to 27th place). The Royal Academy of Music is the highest ranked conservatoire at joint 14th (2.90), the Royal College of Music is ranked 31st (2.34), Birmingham Conservatoire is ranked joint 32nd, and the Royal Northern College of Music is ranked joint 38th (2.20). The College also secured funding from the Joint Information Systems Committee (JISC) to undertake a project to development and implement a digital repository for jazz-based learning resources, JazzHubb. The project is due to be completed by March 2009.

Student numbers In 2007-08 the College has delivered activity that has produced £3,033 million in the HEFCE learning and teaching funding allocation funding (2006/07 - £2.654 million). The College had 688 HE full time equivalent students funded in 2007-08 (2006-07 – 563)). The College also delivered activity in 2007-08 that has produced LSC funding of £2,057,211 (2006-07 - £2,034,597). The LSC funding for 2007-08 resulted from 348 further education (FE) full time equivalent numbers (2006-07 – 375). During 2007-08 the College also provided, through its Access and Outreach Department, provision for 1,275 part time student enrolments funded from other sources. Student achievements Students continue to prosper at the College. The success rate for our undergraduate (BA Hons) year 2005 intake, graduating in 2007/08, was 81%. In FE the headline success rate for the cohort completing their studies in 2007/08 was also 81%.

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REPORT OF THE MEMBERS OF THE CORPORATION (CONTINUED) Planned maintenance programme The cost of the College’s planned maintenance programme over a period of 5 years is estimated to be £755,000. A new building fabric condition survey was commissioned during 2006 and was supplemented by a Mechanical and Electrical Engineering Services condition survey which gave the following annualised maintenance costs for the four year period commencing 2007/08.

2007/08 £’000

2008/09 £’000

2009/10 £’000

20010/11 £’000

2011/12 £’000

Planned maintenance and works outstanding at 1 August

8

-40

1

175

315

Average annual charge 57 106 235 199 160 Actual or planned expenditure (105) (65) (61) (59) (475) Planned maintenance works outstanding at 31 July

-40

1

175

315

-

The planned expenditure is significantly lower in 2008/09 and 2009/10 than the recommendations of the recent survey, but due to robust servicing contracts the College believes the life cycle of certain equipment can be extended. In 2010/11 the College plans to increase expenditure, which will be funded by a capital fundraising programme and via the estates strategy funding from HEFCE. Staff and student involvement The College encourages staff and student involvement through membership of formal committees, and the Governing Body itself includes two staff members and a student member. Staff and students were widely consulted in developing the College’s new strategic plan through a combination of planning events, focus groups and written feedback. The College considers good communication with its staff to be very important and to this end publishes a monthly staff newsletter during term time, to keep staff up to date on key areas as well as matters of general interest. Regular team meetings are also held throughout term time and the Principal and Chair hold open meetings termly with staff on key strategic issues. The Information and Consultation with Employees forum reports directly to the Finance and General Purposes Committee. There is also a Joint Consultative Committee which consults with the recognised trade union representatives and which also reports to the Finance and General Purposes Committee. Student feedback is invited through annual College satisfaction surveys, the National Student Survey and meetings between the Principal and course representatives . Taxation The College is an exempt charity for the purposes of the Charities Act 1993 and is not liable to corporation tax.

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REPORT OF THE MEMBERS OF THE CORPORATION (CONTINUED) Equality and Diversity Leeds College of Music celebrates and values diversity, and believes that it will benefit from engaging a workforce that is truly representative of society, thus allowing it to meet the needs of a similarly diverse student population. The College will treat all employees and students with respect and dignity, and seek to provide a positive working and learning environment free from discrimination, harassment and victimisation. Equality and Diversity Policy The College’s Equality and Diversity Policy takes account of current statutory requirements and impending legislation. The College recognises its responsibilities to the Race, Disability and Gender Equality duties and is developing a Single Equality Scheme with supporting action plans. This is in order to progress work towards achieving the specific requirements of the duties in the employment of staff and its learning provision for students. The Governors, Senior Management and Joint Management Group are committed to implementing the action plan. Regular progress reports are provided to managers through the Equality and Diversity Committee meetings and to the Board of Governors. Promotion of Equality and Opportunity Equality of opportunity is promoted through Diversity Days. These days are designed to raise awareness of the diverse cultural backgrounds of the staff and learners in the College. Equal Opportunities values and policies are promoted to the students through the Equality and Diversity tutorial programme. The College’s marketing material aims to project positive images of minority groups and seeks to positively encourage application for courses from under represented groups in the College. Equality and Diversity Annual Report 2007/08 The College produces an annual Equality and Diversity Report which is sent to the Equality and Diversity Committee and Governors. This report contains detailed statistical information about the profile of staff and students and the College, and reports on equality and diversity issues undertaken throughout the academic year. Ethnicity: Students

• 18% (434) of all students enrolling at the College in 2007/08 were from Black and Minority Ethnic Groups (Non White British).

• The Access and Outreach Department had 20% (268) BME students participating on AOD courses, which is 9.2% higher than the BME population of Leeds (Census 2001).

• 27% (196) of all students enrolling on HE courses were BME. This is significantly above the BME population of Leeds (which is 10.8%).

• FE courses had 20% (70) BME learners. • The ethnicity of 4% (91) of all students who enrolled on courses is not known (and these numbers

were taken out of the equation when calculating the percentages above). Ethnicity: Staff

• 75% (256) of members of staff have declared their ethnicity as White British. 21% (70) of staff declared their ethnicity as being from a Black or Minority Ethnic group. This is 10.2% higher then the local BME Census figure, which is 10.8% (Census 2001). The ethnicity of 4% (14) of staff is not known.

Gender: Students

• 38% (936) females enrolled on all courses in 2007/08. This is 14% lower then the female population of Leeds, which is 52% (Census 2001).

• AOD had the highest percentage of female students at 47% (658). HE had the lowest percentage of female students at 23% (171) and FE had 29% (107) female students.

• The male dominated figures for HE and FE are not unexpected given the subject material of many of the courses offered, however steps to encourage female participation are being taken.

Gender: Staff

• 62% (211) of staff at the college are male. 38% (129) of the staff at the college are female. This is 14% lower then the female population of Leeds, which is 52% (Census 2001).

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• Academic staff are split 72% (136) male to 28% (53) female, and business support staff are split 50% male (75) to 50% (76) female. The male dominated academic split again reflects the subject material of many of the courses offered.

Disability: Students

• 12% of all full time enrolments in 2007-08 declared a learning difficulty and/or disability, a total figure of 307 students.

• 13% of all AOD enrolments (177 students) declared a learning difficulty and/or disability. • 15% of all FE enrolments (54 students) declared a learning difficulty and/or disability. • 10% (76 students) of all HE enrolments declared a learning difficulty and/or disability. • For comparison purposes, it has not been possible to identify disability data for Leeds, however

nationally, 18% of the population has a declared disability. The HESA benchmark for Leeds College of Music is for 6.9% of the full-time undergraduate population to be in receipt of the Disability Support Allowance.

Disability: Staff

• 2% (7) of staff have declared a disability or learning difficulty. • The disability status of 4% (13) of staff members is unknown.

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REPORT OF THE MEMBERS OF THE CORPORATION (CONTINUED) Disclosure of information to auditors The members who held office at the date of approval of this report confirm that, so far as they are each aware, there is no relevant audit information of which the College’s auditors are unaware; and each member has taken all the steps that he or she ought to have taken to be aware of any relevant audit information and to establish that the College’s auditors are aware of that information. Approved by order of the members of the Corporation on 5 February 2009 and signed on its behalf by: _________________________________ A Linden Chairman _________________________________ Date

Professional advisers

Financial statements auditors

BDO Stoy Hayward LLP, 1 Bridgewater Place, Water Lane, Leeds LS11 5RU

Internal auditors

Grant Thornton UK LLP, St George House, 40 Great George Street, Leeds LS1 3DQ

Bankers

Lloyds TSB Bank plc, 1st Floor, 31-32 Park Row, Leeds LS1 5JD

Solicitors

Eversheds LLP, Bridgewater Place, Water Lane, Leeds LS11 5DR

Property advisers

Donaldsons, St Paul’s House, 23 Park Square South, Leeds, LS1 2ND

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL The College is committed to exhibiting best practice in all aspects of corporate governance. This summary describes the manner in which the College has applied the principles set out in Section 1 of the Combined Code on Corporate Governance issued by the London Stock Exchange in July 2003. Its purpose is to help the reader of the accounts understand how the principles have been applied. In the opinion of the Governors, the College complies with all the provisions of the Combined Code in so far as they apply to the higher education sector, and it has complied throughout the year ended 31 July 2008.. The Corporation The members who served the HE Corporation during the year and up to the date of signature of this report were as follows: Name Appointment/

Reappointment Term of Office

Resignation/ end of term of

office

Status of Appointment

Committees Served

Mr J Anderson 5/8/05 First 4/8/09 Academic staff

Mr C Brackley-Jones

2/11/05 First 1/11/09 Co-opted Education

Honorary Awards

Mrs C Fricker 1/8/05 First 31/7/09 Independent Audit Special

Mrs H Holehan 5/8/05 First 4/8/09 Co-opted

Business staff

Audit

Mr D Hoult

1/4/93

Not applicable

31/3/08

Principal

Finance & General Purposes

Honorary Awards Nominations

Quality & Standards Monitoring

Mr M Jackson 26/7/06 First 25/7/10 Independent Finance & General

Purposes

Mr P Jackson 1/8/05 First 31/7/09 Independent Finance & General Purposes

Nominations Remuneration

Ms S Kakar 1/8/05 First 31/7/09 Independent Honorary Awards

Quality & Standards Monitoring

Mr D Keen 22/5/08 Ex-officio 22/5/09 Student

Governor

Mr P Lawrence 22/3/06 First 21/3/10 Independent Audit

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED) Name Appointment/

Reappointment Term of Office

Resignation/ end of term of

office

Status of Appointment

Committees Served

Mr D Laycock 24/5/07 Ex-officio 28/1/08 Student Governor

Mr A Linden 1/8/05

First

31/7/09 Independent Finance & General Purposes

Remuneration Nominations

Mr P Meaden 1/4/08 Ex-officio Not applicable Principal Finance & General

Purposes Honorary Awards

Nominations Quality & Standards

Monitoring

Mr A Palmer 1/8/05 First 31/7/09 Independent Finance & General Purposes

Remuneration Special

Mr M Sims 1/8/05

First

31/7/09 Independent Honorary Awards Quality & Standards

Monitoring Remuneration

Special

Mr D Syers 1/1/07 First 31/12/10 Independent Finance & General Purposes

Health & Safety

Ms D Tomlin 9/11/06 First 9/11/10 Independent Honorary Awards Nominations

Special

Mrs C Watson 26/7/06 First 25/7/10 Independent

Audit Remuneration

Mr A V Wilson 9/11/06 First 8/11/10 Independent Special

Mr I Roe External member of the Audit Committee Dr Darren Sproston Academic Board representative on the Honorary Awards Committee Mr S Lindley External member of the Nominations Committee Mr R Crowther External member of Quality & Standards Monitoring Committee Mr J Pymm External member of Quality & Standards Monitoring Committee Mrs F Bagchi Clerk to the Governors

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED) It is the Corporation’s responsibility to bring independent judgement to bear on issues of strategy, performance, resources and standards of conduct. The Corporation is provided with regular and timely information on the overall financial performance of the College together with other information such as performance against funding targets, proposed capital expenditure, quality matters and personnel-related matters such as health and safety and environmental issues. The Corporation meets at least once each term. The Corporation conducts its business through a number of committees. Each committee has terms of reference, which have been approved by the Corporation. These committees are Audit, Finance & General Purposes, Honorary Awards, Nominations, Quality & Standards Monitoring, Remuneration and Special. The following College sub-committees, which have a Governor member and reports to the Corporation, also met during the year: Health & Safety Committee. An Appeals Committee meets as necessary on an ad hoc basis and its membership is determined as laid down in the terms of reference agreed by the Corporation. Full minutes of all meetings except those deemed to be confidential by the Corporation are available from the Clerk to the Governors at: Leeds College of Music 3 Quarry Hill Leeds LS2 7PD The Clerk to the Governors maintains a register of financial and personal interests of the Governors. The register is available for inspection at the above address. All Governors are able to take independent professional advice in furtherance of their duties at the College’s expense and have access to the Clerk to the Governors, who is responsible to the Board for ensuring that all applicable procedures and regulations are complied with. The appointment, evaluation and removal of the Clerk are matters for the Corporation as a whole. Formal agendas, papers and reports are supplied to Governors in a timely manner, prior to Board meetings. Briefings are also provided on an ad hoc basis. The Corporation has a strong and independent non-executive element and no individual or group dominates its decision-making process. The Corporation considers that each of its non-executive members is independent of management and free from any business or other relationship, which could materially interfere with the exercise of their independent judgement. There is a clear division of responsibility in that the role of the Chair of the Corporation and Principal of the College are separate. Appointments to the Corporation Any new appointments to the Corporation are a matter for the consideration of the Corporation as a whole. The Corporation has a Nominations Committee comprising five members including the Corporation Chair, which is responsible for the selection and nomination of any new member. The Corporation is responsible for ensuring that appropriate training is provided as required. Members of the Corporation are appointed for a term of office not exceeding four years. Remuneration Committee Throughout the year ending 31 July 2008, the College’s Remuneration Committee comprised the Chair of the Corporation the Chair of the Finance & General Purposes and two Business Governors. The committee’s responsibilities are to make recommendations to the Board on the remuneration and benefits of the Principal and other senior post-holders. Details of remuneration for the year ended 31 July 2008 are set out in note 8 to the financial statements.

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED) Audit Committee The Audit Committee comprises four members of the Corporation (excluding the Principal and Chair) and an external member. The committee operates in accordance with written terms of reference approved by the Corporation. The membership of the Audit Committee includes one member who is a College staff member (non–management), although technically this appointment does not comply with best practice under the Audit Code of Practice the committee feels that this member is able to provide a useful independent and objective view. The Audit Committee meets on a termly basis and provides a forum for reporting by the College’s internal auditors and financial statement auditors, who have access to the committee for independent discussion, without the presence of College management. The committee also receives and considers reports from HEFCE as they affect the College’s business. The committee actively promotes value for money (VFM), with an established VFM policy and the regular review of VFM strategy project updates during the year. The College’s internal auditors monitor the systems of internal control, risk management controls and governance processes in accordance with an agreed plan of input and regularly report their findings to management and the Audit Committee. Management is responsible for the implementation of agreed audit recommendations and internal audit undertakes periodic follow-up reviews to ensure such recommendations have been implemented. The Audit Committee also advises the Corporation on the appointment of internal auditors and external auditors and their remuneration for both audit and non-audit work. Both internal and external audits were re-tendered during 2005/06 for the annual financial year commencing 1st August 2006. BDO Stoy Hayward LLP were appointed as external auditors for 2006/07 and Grant Thornton UK LLP as internal auditors for the financial period commencing 2006/07. Both appointments are for a term of 5 years, subject to an annual performance review by the Audit Committee. Internal Control Scope of responsibility The Corporation is ultimately responsible for the College’s system of internal control and for reviewing its effectiveness. However, such a system is designed to manage rather than eliminate the risk of failure to achieve business objectives, and can provide only reasonable and not absolute assurance against material misstatement or loss. The Corporation has delegated day-to-day responsibility to the Principal, as Accounting Officer, for maintaining a sound system of internal control that supports the achievement of the College’s policies, aims and objectives whilst safeguarding the public funds and assets for which he is personally responsible, in accordance with the responsibilities assigned to him in the Financial Memorandum between the College and the Higher Education Funding Council for England. He is also responsible for reporting to the Corporation any material weaknesses or breakdowns in internal control. The purpose of the system of internal control The system of internal control is designed to manage risk to a reasonable level rather than to eliminate all risk of failure to achieve policies, aims and objectives; it can therefore only provide reasonable and not absolute assurance of effectiveness. The system of internal control is based on an ongoing process designed to identify and prioritise the risks to the achievement of College policies, aims and objectives, to evaluate the likelihood of those risks being realised and the impact should they be realised, and to manage them efficiently, effectively and economically. The system of internal control has been in place in Leeds College of Music for the year ended 31 July 2008 and up to the date of approval of the annual report and accounts. Capacity to handle risk The Corporation has reviewed the key risks to which the College is exposed, together with the operating, financial and compliance controls that have been implemented to mitigate those risks. The Corporation is of the view that there is a formal ongoing process for identifying, evaluating and managing the College’s significant risks that have been in place for the period ending 31 July 2008 and up to the date of approval of the annual report and accounts. This is a process which is regularly reviewed by the Corporation and it accords with the internal control guidance published by HEFCE in their circular letter number 25/2006 and also with HEFCE’s Accounts Direction to higher education institutions for 2006-07.

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED)

The risk and control framework The system of internal control is based on a framework of regular management information, administrative procedures including the segregation of duties, and a system of delegation and accountability. In particular, it includes:

• Comprehensive budgeting systems with an annual budget, which is reviewed and agreed by the corporation.

• Regular reviews by the Corporation of periodic and annual financial reports, which indicate financial performance against forecasts.

• Setting targets to measure financial and other performance • Clearly defined capital investment control guidelines • The adoption of formal project management disciplines, where appropriate

The College employs an internal audit service provider, who operates in accordance with the requirements of the Higher Education Funding Council’s Audit Code of Practice. The work of the internal audit service provider is informed by an annual reassessment and analysis of the risks to which the College is exposed, and annual internal audit plans are based on this analysis. The Corporation on the recommendation of the Audit Committee endorses the analysis of risks and the internal audit plan. At minimum annually, the Head of the Internal Audit service provider (HIA) provides the Corporation with a report on internal audit activity in the College. The report includes the HIA’s independent opinion on the adequacy and effectiveness of the College’s system of risk management, controls and governance processes as well as reassurance surrounding the adequacy of effectiveness, efficiency and economy of resources used. Review of effectiveness As Accounting Officer, the Principal has responsibility for reviewing the effectiveness of the system of internal control. The Principal’s review of the effectiveness of the system of internal control is informed by:

• The work of the internal auditors • The work of the executive managers within the College who have responsibility for the development and

maintenance of the internal control framework • Comments made by the College’s financial statement auditors in their management letters and other

reports.

The Principal has been advised on the implications of the result of his review of the effectiveness of the system of internal control by the Audit Committee, which oversees the work of the internal auditor, and a plan to address weaknesses and ensure continuous improvement of the system, which is in place. In particular, the Principal and senior management team accept the outcome of the 2008 internal audit review of risk management which recorded that, while the College’s risk management activities and controls were suitably designed to achieve the objectives required by management during the period under review, significant and adverse changes in financial position during 2007-08 and some senior staff changes led to formal risk management arrangements not operating effectively. It is also recognised that formal risk management arrangements had not been effective in adequately mitigating the financial risks facing the College. A number of significant changes in risk management arrangements were therefore introduced during 2008, including the formation of a dedicated risk management committee, the construction of a new risk register, and the requirement that all papers going to the Governing Body, the Academic Board, and their committees should include an evaluation by their authors of the inherent key risks, under a series of standard headings and against common criteria. As a result, the Principal’s opinion is that the College is now able to demonstrate that it has an effective risk management system which is suitably designed to achieve its objectives and which should provide reasonable assurance against material mis-statement or loss. The senior management team receives reports setting out key performance and risk indicators and considers possible control issues brought to their attention by early warning mechanisms, which are embedded within the departments and reinforced by risk awareness training. The senior management team and the Audit Committee also receive regular reports from internal audit, which include recommendations for improvement. The Audit Committee’s role in this area is confined to a high-level review of the arrangements for internal control. The Corporation’s agenda includes a regular item for consideration of risk and control and receives reports thereon from the senior management team and the Audit Committee. The emphasis is on obtaining the relevant degree of assurance and not merely reporting by exception. At its February 2009 meeting, the Corporation carried out the annual assessment on internal control for the year ended 31 July 2008 by considering issues dealt with in reports reviewed by it during the year together with any additional information necessary to ensure that the Corporation has taken account of all significant aspects of internal control within the College for the financial year ended 31 July 2008, including up to the date of approval of the annual report and financial statements.

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STATEMENT OF CORPORATE GOVERNANCE AND INTERNAL CONTROL (CONTINUED) Going concern After making appropriate enquiries, the Corporation considers that the College has adequate resources to continue in operational existence for the foreseeable future. For this reason they continue to adopt the going concern basis in preparing the financial statements. Approved by order of the members of the Corporation on 5 February 2009 and signed on its behalf by: __________________________________ Chairman – A Linden

__________________________________ Date __________________________________ Principal – P Meaden

__________________________________ Date

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STATEMENT OF RESPONSIBILITIES OF THE MEMBERS OF THE CORPORATION The members of the Corporation of the College are required to present audited financial statements for each financial year. Within the terms and conditions of the Financial Memorandum agreed between the Higher Education Funding Council for England and the Corporation of the College, the Corporation, through its Principal, is required to prepare financial statements for each financial year in accordance with the Statement of Recommended Practice (SORP) – Accounting for Further and Higher Education Institutions and other relevant accounting standards which give a true and fair view of the state of affairs of the College and the result for that year. In preparing the financial statements the Corporation has ensured that: • suitable accounting policies are selected and applied consistently; • judgements and estimates are made that are reasonable and prudent; • the financial statements have been prepared in accordance with the SORP and UK law; • applicable accounting standards have been followed subject to any material departures disclosed and

explained in the financial statements; and • financial statements are prepared on the going concern basis unless it is inappropriate to assume that

the College will continue in operation. The Corporation is also required to prepare a Members Report, which describes what it is trying to do and how it is going about it, including the legal and administrative status of the College. The Corporation is responsible for keeping proper accounting records which disclose with reasonable accuracy, at any time, the financial position of the College, and which enable it to ensure that the financial statements are prepared in accordance with the relevant legislation of incorporation and other relevant accounting standards. It is responsible for taking steps that are reasonably open to it in order to safeguard the assets of the College and to prevent and detect fraud and other irregularities. The Corporation is responsible for the mission and educational character of the institution, its strategic direction and the oversight of all its activities. The Corporation is also responsible for the financial health of the institution, including the approval of the annual budget and audited financial statements. Members of the Corporation are responsible for ensuring that funds from both the Higher Education Funding Council for England and the Learning and Skills Council (LSC) are used only in accordance with the Financial Memorandum with both the Higher Education Funding Council for England and the LSC. This responsibility also encompasses any other conditions that the Higher Education Funding Council for England may prescribe from time to time. Members of the Corporation must ensure that there are appropriate financial and management controls in place in order to safeguard public and other funds and ensure they are used properly. In addition, members of the Corporation are responsible for securing economical, efficient and effective management of the College’s resources and expenditure, so that the benefits that should be derived from the application of public funds by the Higher Education Funding Council for England are not put at risk. Signed on behalf of the Corporation _______________________________ A Linden Chairman ______________________________ Date:

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INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CORPORATION OF LEEDS COLLEGE OF MUSIC We have audited the financial statements of Leeds College of Music for the year ended 31st July 2008 which comprise the Income and Expenditure Account the Balance Sheet, the Cash Flow Statement, the Statement of Total Recognised Gains and Losses, Statement of Historical Cost Surplus and Deficits and the related notes. These financial statements have been prepared under the accounting policies set out on therein.

Respective responsibilities of the Members of the Corporation and Auditors As described in the Statement of Responsibilities of the Members of the Corporation the Corporation is responsible for preparing the annual report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) and the Statement of Recommended Practice on Accounting in Further and Higher Education Institutions. Our responsibility is to audit the financial statements in accordance with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland) and the Audit Code of Practice issued by the Higher Education Funding Council for England. 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 on Accounting in Further and Higher Education Institutions. We also report to you if, in our opinion, the information given in the Report of the Members of the Corporation is not consistent with the financial statements, the Corporation has not kept proper accounting records, if we have not received all the information and explanations we require for our audit, or if information specified by law regarding the remuneration of the Members of the Corporation or other transactions is not disclosed. We also report to you whether income from funding bodies, grants and income for specific purposes and from other restricted funds administered by the College have been properly applied only for the purposes for which they were received and whether income has been applied in accordance with the Statutes and, where appropriate, with the Financial Memorandum with the Higher Education Funding Council for England. We read the other information contained in the Report of Members of the Corporation and consider whether it is consistent with the audited financial statements. The other information comprises only the Statement of Corporate Governance and Internal Control, and the Statement of the Responsibilities of the Members of the Corporation. We consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the financial statements. Our responsibilities do not extend to any other information. Our report has been prepared pursuant to the requirements of the College’s statutes and for no other purpose. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of the College’s statutes or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability.

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INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF THE CORPORATION OF LEEDS COLLEGE OF MUSIC (CONTINUED) 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 Audit Code of Practice issued by the Higher Education Funding Council for England. 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 College in the preparation of the financial statements and of whether the accounting policies are appropriate to the circumstances of the College, 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 other irregularity or error. In forming our opinion, we also evaluated the overall adequacy of the presentation of information in the financial statements. Opinion In our opinion:

• the financial statements give a true and fair view, in accordance with United Kingdom Generally Accepted Accounting Practice, of the state of affairs of the College as at 31 July 2008 and of its deficit of income over expenditure for the year then ended;

• the financial statements have been properly prepared in accordance with the Statement of Recommended

Practice: “Accounting for Further and Higher Education Institutions”;

• income from the Higher Education Funding Council for England, the Learning and Skills Council, grants and income for specific purposes and from other restricted funds administered by the College have been applied for the purposes for which they were received; and

• income has been applied in accordance with the College’s statutes and where appropriate with the applicable

Financial Memorandums with the Higher Education Funding Council for England. Emphasis of matter – going concern In forming our opinion on the financial statements, which is not qualified, we have considered the adequacy of the disclosures made in note 1 to the financial statements concerning the College’s ability to continue as a going concern. The College is reliant on the continuing support of its bankers. The current loan covenants have been breached and are likely to remain breached for at least 12 months from the approval of these financial statements. Although the Governors expect the bank to continue to support the College despite this breach, they have no binding agreement from the bank. These conditions along with other matters disclosed in note 1 to the financial statements, indicate the existence of a material uncertainty which may cast significant doubt about the College’s ability to continue as a going concern. The financial statements do not include the adjustments that would result if the College was unable to continue as a going concern. BDO Stoy Hayward LLP Chartered Accountants and Registered Auditors Leeds Date

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INCOME AND EXPENDITURE ACCOUNT

Notes 2008 As restated

2007 £’000 £’000 INCOME Funding council grants 2 5,134 4,867 Tuition fees and education contracts 3 2,038 1,420 Research grants and contracts 4 133 128 Other income 5 552 541 Endowment and investment income 6 15 18

Total income 7,872 6,974

EXPENDITURE Staff costs 7 5,694 4,917 Other operating expenses 9 1,816 1,683 Depreciation 13 546 557 Interest payable 10 283 222

Total expenditure 8,339 7,379

Surplus/(Deficit) on continuing operations after depreciation of assets at valuation and before and after taxation (467) (405) Surplus/(Deficit) for the year transferred to accumulated income in endowment funds 12 (3) 5 Deficit for the year retained within general reserves (464) (410)

The income and expenditure account is in respect of continuing activities.

21

STATEMENT OF HISTORICAL COST SURPLUS AND DEFICITS


2007 £’000 £’000 Deficit on continuing operations before taxation (464) (410)

Difference between historical cost depreciation and the actual charge for the year calculated on the revalued amount 20 7 8

Historical cost deficit for the year before taxation (457) (402)

Historical cost deficit for the year after taxation (457) (402) STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES


2007 £’000 £’000 Deficit on continuing operations after depreciation of assets at valuation and tax (467) (405) Actuarial gain/(loss) in respect of pension scheme 28 (1,256) 241

Endowment income retained in the year - -

Total recognised losses relating to the period (1,723) (164)

Reconciliation Opening reserves and endowments 75 239 Total recognised losses for the year (1,723) (164)

Closing reserves and endowments (1,648) 75

22

BALANCE SHEET AS AT 31 JULY


2007 £’000 £’000

Fixed assets Tangible assets 13 12,170 12,497

Endowment assets 12 22 25

Current assets Stock 3 3 Debtors 14 307 463 310 466 Less: Creditors - amounts falling due within one year 15 (3,805) (765)

Net current liabilities (3,495) (299)

Total assets less current liabilities 8,697 12,223 Less: Creditors – amounts falling due after one year 16 (2,765) (5,789) Less: Provisions for liabilities and charges 18 (235) (227) Net assets excluding pension liability 5,697 6,207

Net pension liability 28 (1,886) (489)

Net assets including pension liability 3,811 5,718 Deferred capital grants 19 5,459 5,643 Endowment funds

Expendable 22 25

Total endowment funds 21 22 25

Income and expenditure account excluding pension reserve 22 (58) 258 Pension reserve 28 (1,886) (489)

Income and expenditure account including pension reserve 22 (1,944) (231) Revaluation reserve 20 274 281 Total reserves (1,648) 75

TOTAL 3,811 5,718

The financial statements on pages 17 to 38 were approved and authorised for issue by the Corporation on 05/02/2009 on its behalf on that date by:

Chairman:

Principal:

23

CONSOLIDATED CASH FLOW STATEMENT

Notes 2008 As Restated

2007 £’000 £’000 Net cash inflow from operating activities 23 466 172 Return on investments and servicing of finance 24 Income from endowments 7 18 Interest paid (281) (222)

Net cash outflow from returns on investment and servicing of finance (274) (204) Taxation - - Capital expenditure 25 Payments to acquire tangible assets (175) (398) Deferred capital grants received - 92

Net cash outflow from capital expenditure (175) (306) Cash inflow/(outflow) before management of liquid resources 17 (338)

Financing 26 Bank loan drawn down in year - 3,000 Loan repayment in the year - (1,471) Capital element of finance lease repayment (35) (213) Increase/(decrease) in cash in the year (18) 978

Reconciliation of net cash flow to movement in net debt Increase/(decrease) in cash in the year (18) 978 Cash inflow/(outflow) from new bank loan - (1,584) Loan repayment in year 27 35 268 Other non-cash movements in net funds - 585

Change in net funds 17 247

Net debt at 1 August (5,926) (6,173)

Net debt at 31 July (5,909) (5,926) In this statement, figures in brackets refer to cash outflows and all other figures are cash inflows to the College.

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NOTES TO THE ACCOUNTS 1. Accounting policies

Basis of preparation These financial statements have been prepared in accordance with the Statement of Recommended Practice (SORP): Accounting for Further and Higher Education Institutions 2007 and in accordance with applicable Accounting Standards. They conform to guidance published by HEFCE, in the Accounts Direction to higher education institutions for 2007-08 circular letter number 22/2007. The 2007 comparative figures have been restated to show revised treatment of endowment assets under the Statement of Recommended Practise (SORP): Accounting for Further and Higher Education Institutions 2007. This has altered the format of the Balance Sheet and Income and Expenditure Account, but has had no effect on the result for the year or on net assets. The financial statements have been prepared on a going concern basis. The College has loans of £3 million to which covenants are attached. The results for 2007/08 breached one of these covenants. The bank subsequently issued a waiver in respect of the breach but the waiver was not effective at the balance sheet date, requiring the long term loan liabilities to be reported as current liabilities in the accounts. Results forecast for 2008/09 indicate that there will be a further breach of the same covenant. The bank are unwilling to issue a waiver in advance of the event but, having reviewed the organisation’s cashflow forecast and ongoing budget projections it is expected that the bank will continue to support the College. The situation presents a significant degree of risk to the extent that, in the event that the covenant is breached in 2008/09, the bank reserve the legal right to demand immediate repayment of the loans. If the bank were to exercise this right it would render the College unable to realise its assets and to discharge its liabilities in the normal course of business. However, governors are confident that, given the College’s current, favourable, performance against budget, its relatively strong cash position resulting from the injection of £425,000 exceptional funding from HEFCE and the strong relationship that the College enjoys with its bankers, they can rely on the banks continued support for the foreseeable future and they have assumed that immediate repayment of the loans will not be demanded. Basis of accounting The financial statements are prepared in accordance with the historical cost convention modified by the revaluation of certain fixed assets. Recognition of income Income from tuition fees is recognised in the period for which it is receivable and includes all fees payable by students or their sponsors. The costs of any fees waived by the College are included as expenditure in note 9. Income from grants, contracts and other services rendered is included to the extent of the completion of the contract or service concerned. All income from short-term deposits and endowments is credited to the income and expenditure account in the period in which it is earned. Any income earned in excess of that applied to the restricted purpose of the endowment is transferred from the Income and Expenditure Account after the result for the year. The recurrent grants from HEFCE and the LSC represent the funding allocations attributable to the current financial year and are credited direct to the income and expenditure account. Recurrent grants are recognised in line with planned activity. Any under-achievement against this planned activity is adjusted in-year and reflected in the level of recurrent grant recognised in the income and expenditure account. Non-recurrent grants received in respect of the acquisition of fixed assets are treated as deferred capital grants and amortised in line with depreciation over the life of the assets. Pension schemes Retirement benefits to employees of the College are provided by the Teachers’ Pension Scheme (TPS) and the West Yorkshire Pension Fund (WYPF). These are defined benefit schemes and contracted out of the State Earnings Related Pension Scheme (SERPS). Contributions to the TPS are charged to the income and expenditure account, so as to spread the cost of pensions over employees’ working lives with the College in such a way that the pension cost is a substantially level percentage of present and future pensionable payrolls.

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The contributions are determined by qualified actuaries on the basis of quinquennial valuations using a prospective benefit method. The assets of the WYPF are measured using closing market values. WYPF liabilities are measured using the projected unit method and discounted at the current rate of return on a high quality corporate bond of equivalent term and currency to the liability. The increase in the present value of the liabilities of the scheme expected to arise from employee service in the period is charged to staff costs. The expected return on the scheme’s assets and the increase during the period in the present value of the scheme’s liabilities, arising from the passage of time, are included in pension finance costs. Actuarial gains and losses are recognised in the statement of total recognised gains and losses.

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NOTES TO THE ACCOUNTS (CONTINUED) 1. Accounting policies (continued) Enhanced pensions The actual cost of any enhanced ongoing pension to a former member of staff is paid by the College annually. An estimate of the expected future cost of any enhancement to the ongoing pension of a former member of staff is charged in full to the College’s income and expenditure account in the year that the member of staff retires. In subsequent years a charge is made to provisions in the balance sheet using the enhanced pension spreadsheet provided by the LSC. Tangible fixed assets Land and buildings Land and buildings at the Quarry Hill site are stated in the balance sheet at a 1996 valuation on the basis of depreciated replacement cost as the open market value for existing use is not readily obtainable. Other land and buildings acquired since this valuation are included in the balance sheet at cost. Leasehold land and buildings are depreciated on a straight-line basis over their expected economic life to the College of 60 years or, if shorter, the period of the lease. The new teaching block completed on the 1st August 2005 is being depreciated over 50 years. Where land and buildings are acquired with the aid of specific grants, they are capitalised and depreciated as above. The related grants are credited to a deferred capital grant account and are released to the income and expenditure account over the expected useful economic life of the related asset on a basis consistent with the depreciation policy. Finance costs, which are directly attributable to the construction of buildings, are not capitalised as part of the cost of those assets. Employee costs directly attributable to capital building projects have been capitalised. A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that the carrying amount of any fixed asset may not be recoverable. On adoption of FRS15, the College followed the transitional provision to retain the book value of land and buildings, which were revalued in 1996, but not to adopt a policy of revaluations of these properties in the future. These values are retained subject to the requirement to test assets for impairment in accordance with FRS 11. Equipment Equipment costing less than £500 per individual item is written off to the income and expenditure account in the period of acquisition. All other equipment is capitalised at cost and depreciated on a straight-line basis over its useful economic life of five years, except bar fixtures and fittings with a useful economic life of 10 years and a Bechstein Grand Piano, which is depreciated over a useful economic life of 15 years. Where equipment is acquired with the aid of specific grants, it is capitalised and depreciated in accordance with the above policy, with the related grant being credited to a deferred capital grant account and released to the income and expenditure account over the expected useful economic life of the related equipment. Leased assets The College has entered into a finance lease obligation for the new teaching block, handed over from the main contractors to the College on 1 August 2005. Finance leases are recorded in the College balance sheet (lessees balance sheet) as an asset and an obligation to pay future rentals. Rentals payable will be apportioned between the finance charge and a reduction of the outstanding obligation for future amounts payable. The new teaching block finance lease is reflected as both an asset and an obligation at the fair value of the asset. Costs in respect of operating leases are charged on a straight-line basis over the lease term.

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NOTES TO THE ACCOUNTS (CONTINUED) 1. Accounting policies (continued) Maintenance of premises The cost of routine corrective maintenance is charged to the income and expenditure account in the period it is incurred. Taxation The College 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 1988 (ICTA 1988). Accordingly, the College 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 College receives no similar exemption in respect of value added tax. Provisions Provisions are recognised when the College has a present legal or constructive obligation as a result of a past event, 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. Agency arrangements The College acts as an agent in the collection and payment of Learner Support Funds. Related payments received and subsequent disbursements to students are excluded from the Income and Expenditure account and are shown separately in note 33, except for the 5 per cent of the grant received which is available to the College to cover administration costs relating to the grant. 2. Funding Council grants Higher

Education Funding Council

Learning and Skills

Funding Council

2008 Total

2007 Total

£’000 £’000 £’000 £’000 Recurrent grant 3,033 1,921 4,954 4,712 Specific grant 19 5 24 - Releases of deferred capital grants (note 19) 41 115 156 155

Total 3,093 2,041 5,134 4,867

3. Tuition fees and education contracts 2008 2007 £’000 £’000 Tuition Fees: UK and EU higher education students 1,623 986 UK and EU further education students 35 41 Non European Union students 193 166

Total fees paid by or on behalf of individual students 1,851 1,193

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NOTES TO THE ACCOUNTS (CONTINUED)

3. Tuition fees and education contracts (continued) 2008 2007 Education contracts:

£’000 £’000

Local education authorities 54 90 Higher education income 110 117 Other contracts 23 20 Total education contracts 187 227

Total 2,038 1,420 4. Research grants and contracts income 2008 2007 £’000 £’000 Funding Council Grant 100 100 Other grant income 33 28

Total 133 128 5. Other income 2008 2007 £’000 £’000 Residences, catering and conferences 206 202 Other income generating activities 106 95 Releases of deferred capital grants (note 19) (non-funding council) 78 69 Other income 162 175

Total 552 541

6. Endowment and investment income 2008 2007 Income from expendable endowments 7 18

Other finance income (note 28) 8 -

Total 15 18

7. Staff costs The average monthly number of persons (including senior post-holders) employed by the College during the year, described as full-time equivalent, was:

2008 2007 No No Teaching departments - teaching staff 85 75 Teaching departments - other staff 15 17 Teaching support service 21 15 Other support services 1 1 Administration and central services 28 36 Premises 22 23 Other 5 5

177 172

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NOTES TO THE ACCOUNTS (CONTINUED) 7. Staff costs (continued) Staff costs for the above persons

2008 2007 £’000 £’000 Wages and salaries 4,839 4,234 Social security costs 323 296 Other pension costs 383 292 FRS 17 adjustments 149 95

5,694 4,917

Teaching departments - teaching staff 2,702 2,401 Teaching departments - other staff 329 249 Teaching support services 612 361 Other support services 46 43 Administration and central services 1,028 1,164 FRS 17 adjustments 149 95 Premises 492 473 Catering and residences 160 104 Staff restructuring 23 27 Redundancy/severance 153 -

Total 5,694 4,917

Total staff costs, split by type of contract, were: Employment costs for staff on permanent contracts 4,096 3,808 Employment costs for staff on short-term and temporary contracts 1,422 1,082 Redundancy/severance and staff restructuring costs 176 27

5,694 4,917

The restructuring costs were approved by the Institution’s remuneration committee. The number of senior post-holders and other staff who received emoluments including pension contributions and benefits in kind, in the following ranges was: Senior post-holders Other staff

2008

No 2007

No 2008

No 2007

No £100,001 to £110,000 - 1 - - £110,001 to £120,000 1 - - - Following job evaluation a new pay grading structure was introduced in August 2006 and staff were moved up on to the next point in the new pay grade structure. This resulted in a minimum pay award during 2007/08 of 3% for all staff, with some staff receiving additional increases through job evaluation regarding within the year.

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8. Senior post-holders emoluments Senior post-holders are defined as members of the senior management team and the Clerk to the Governors.

2008 2007 No No

The number of senior post-holders including the Principal was: 5 5

Senior post-holders' emoluments are made up as follows: 2008 2007 £ £ Salaries 282,464 254,371 Benefits in kind 1,248 1,728 Pension contributions 36,287 33,043

Total emoluments 319,999 289,142

The above emoluments include amounts payable to the Principal (who is the highest paid senior post-holder) of:

To 31 March

2008 From 1 April

2008 2008 2007 £ £ Salaries 67,819 36,667 104,486 90,417 Benefits in kind 432 - 432 576

68,251 36,667 104,918 90,993 Pension contributions 9,563 5,170 14,733 12,539

Total emoluments 77,814 41,837 119,651 103,532

The emoluments have been split to reflect that fact that a new Principal was appointed on 1 April 2008.

The pension contributions in respect of the Principal and senior post-holders are in respect of employer's contributions to the Teachers' Pension Scheme or West Yorkshire Pension Fund and are paid at the same rate as for other employees. The members of the Corporation other than the Principal and the staff members did not receive any payment from the College other than the reimbursement of travel and subsistence expenses incurred in the course of their duties. The Principal did not receive a pay increase in the year, in partial fulfilment of the Governors’ commitment to align the Principal’s salary with those of Principals’ of comparable specialist colleges. Other higher paid staff received an average pay increase of 9.08% for the year. No bonuses or other salary enhancements were awarded to senior post-holders. Overseas activities

The following costs were incurred during 2007/2008 in respect of overseas activities

Total and net costs to College

£ Senior post-holders 372 Other higher paid staff 868 Total 1,240

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9. Other operating expenses 2008 2007 £’000 £’000 Teaching departments 30 160 Teaching support services 283 158 Other support services 36 63 Administration and central services 530 466 General education 422 417 Premises costs - running costs 229 230 Premises costs - maintenance 80 91 Premises costs - rents and leases 11 16 Other income generating activities 12 16 Catering and residence operations 87 65 Other expenses 10 1 Research 86 - Total 1,816 1,683

Other operating expenses include: Auditors remuneration: External audit 17 17 Internal audit 18 15 Loss on disposal of tangible fixed assets 9 1 Hire of other assets - operating leases 34 76

10. Interest payable 2008 2007 £’000 £’000 On bank loan and overdraft Repayable within five years, not by instalments 170 46 Repayable wholly or partly in more than five years - 95 On finance leases 113 81

Total 283 222 11. Taxation

The College is not liable for any corporation tax arising out of its activities during this year.

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12. Endowment assets 2008 2007 £’000 £’000 Balance at 1 August 25 20 Increase/(decrease) in cash balances held for endowment funds (3) 5

Balance at 31 July 22 25

Represented by:

Cash at bank held for endowment funds 22 25 13. Tangible fixed assets

Long leasehold Equipment Total £’000 £’000 £’000 Cost or valuation At 1 August 2007 13,470 2,138 15,608 Additions 67 162 229 Disposals - (34) (34)

At 31 July 2008 13,537 2,266 15,803

Depreciation

At 1 August 2007 1,554 1,557 3,111

Charge for the year 320 226 546 Elimination in respect of disposals - (24) (24)

At 31 July 2008 1,874 1,759 3,633

Net book value at 31 July 2008 11,663 507 12,170

Net book value at 31 July 2007 11,916 581 12,497 Financed by capital grant 4,254 221 4,475 Other 7,409 286 7,695

Net book value at 31 July 2008 11,663 507 12,170 The transitional rules set out in FRS 15 Tangible Fixed Assets have been applied on implementing FRS 15. Accordingly the book values at implementation have been retained. The Quarry Hill site was valued in 1996 at depreciated replacement cost by a firm of independent chartered surveyors. The net book value of tangible assets includes an amount of £3,478,000 (2007: £3,552,000) in respect of assets held under finance leases. The depreciation charge on these assets for the year was £74,000 (2007: £74,000).

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NOTES TO THE ACCOUNTS (CONTINUED) 13. Tangible fixed assets (continued) The new teaching block is a PPP development attached to the north face of the existing College and has been developed by the Unite Group plc. Practical completion for the new building took place on the 1st August 2005. Further details are included in note 31. If land and buildings had not been revalued they would have been included in the balance sheet at the following amounts: 2008 £’000 Cost 13,193 Aggregated depreciation based on cost (1,804)

Net book value based on cost 11,389

14. Debtors 2008 2007 £’000 £’000 Amounts falling due within one year: Trade debtors 97 96 Other debtors 2 1 Prepayments and accrued income 208 366

Total 307 463

15. Creditors: amounts falling due within one year 2008 2007 £’000 £’000 Bank loans and overdraft 3,144 129 Obligations under finance lease 2 13 Payments received in advance 41 76 Trade creditors 154 139 Other taxation and social security 105 105 Accruals 313 252 Amounts owed to the LSC 46 51 Total 3,805 765

16. Creditors: amounts falling due after one year 2008 2007 £’000 £’000 Bank loans - 3,000

Obligations under finance lease 2,765 2,789

Total 2,765 5,789

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17. Borrowings

(a) Bank loans and overdraft

Bank loans and overdraft are repayable as follows:

2008 2007

£’000 £’000

In one year or less 3,144 129

Between one and two years - 18

Between two and five years - 177

In five years or more - 2,805

Total 3,144 3,129 The bank overdraft of £144,000 is repayable on demand. Bank loans repayable by instalments falling due within one year (2007: falling due between 1 August 2008 and 31 December 2033), totalling £3,000,000, are secured on the Quarry Hill site. The loan is split into three elements of £1,000,000, of which two elements are repayable at fixed rates (5.757% and 5.884%) and one at variable rates (0.28% above the bank’s base rate during the year and 0.56% above LIBOR after 1 October 2008). (b) Finance Leases The net finance lease obligations to which the institution is committed are:

2008 2007

£’000 £’000

In one year or less 2 13

Between one and five years 51 93

In five years or more 2,714 2,696

Total 2,767 2,802

18. Provisions for liabilities and charges

Enhanced

pension £’000

At 1 August 2007 227

Expenditure in the period (14) Transferred from income and expenditure account 22 At 31 July 2008 235 The enhanced pension provision comprises the College’s liability for enhanced pension costs relating to the cost of staff who have already left the College’s employ and commitments for reorganisation costs from which the College cannot reasonably withdraw at the balance sheet date. This provision has been calculated in accordance with LSC circular 05/02 updated from tables supplied in the LSC Accounts Direction information for 2007/08. HEFCE do not supply tables for updating this calculation.

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19. Deferred capital grants HEFCE LSC Other Total

£’000 £’000 £’000 £’000 At 1 August 2007 Land and buildings 64 4,294 840 5,198 Equipment 352 44 49 445

New grants received Equipment - - 50 50 Released to income and expenditure account:

Land and buildings (2) (101) (40) (143) Equipment (39) (14) (38) (91)

At 31 July 2008 Land and buildings 62 4,193 800 5,055 Equipment 313 30 61 404

Total 375 4,223 861 5,459

20. Revaluation reserve 2008 2007 Total Total At 1 August 281 289

Transfer from revaluation reserve to general reserve in respect of: Depreciation on revalued assets (7) (8)

At 31 July 274 281

21. Endowments

2008 2007 Total Total £’000 £’000 At 1 August 25 20

Investment Income 7 18 Expenditure (10) (13)

At 31 July 22 25

Represented by:

Accumulated Income 22 25

All endowments are restricted and expendable and are funds donated for the benefit of students, mainly in the form of prize awards.

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22. Movement on general reserves 2008 2007 £’000 £’000 Income and expenditure account reserve At 1 August (231) (70)

Deficit retained for the year (464) (410)

Transfer from revaluation reserve 7 8

Actuarial gain/(loss) in respect of pension scheme (1,256) 241 At 31 July (1,944) (231)

Balance represented by: Pension reserve (1,886) (489) Income and expenditure account reserve excluding pension reserve (58) 258 At 31 July (1,944) (231)

23. Reconciliation of operating deficit to net cash (outflow)/inflow from operating activities

Notes 2008

2007 £’000 £’000

Deficit on continuing operations after depreciation of assets at valuation (467) (405) Depreciation 13 546 557 Deferred capital grants released to income 19 (234) (224) Loss on disposal of tangible fixed assets 10 1 Interest payable 10 283 222 Pension cost less contributions payable 28 149 95 (Increase)/decrease in stock - (1) (Increase)/decrease in debtors 14 156 135 Increase/(decrease) in creditors 15 30 (190) (Decrease)/Increase in provisions 18 8 - Endowment and investment income 6 (15) (18)

Net cash inflow from operating activities 466 172

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NOTES TO THE ACCOUNTS (CONTINUED) 24. Returns on Investments and servicing of finance 2008 2007 £’000 £’000 Endowment Income 7 18 Interest paid (168) (141) Interest element of finance lease rental payment (113) (81)

Net cash outflow from returns on investments and servicing of finance (274) (204) 25. Capital expenditure and financial investments

2008 2007 £’000 £’000 Purchase of tangible fixed assets (175) (398) Deferred capital grants received - 92

Net cash inflow/(outflow) for capital expenditure and financial investment (175) (306)

26. Financing 2008 2007 £’000 £’000 Repayment of amounts borrowed - (1,471)

Capital element of finance lease rental payments (35) (213)

Bank finance drawn down - 3,000

Net cash inflow/(outflow) from financing (35) 1,316

27. Analysis of changes in net debt

At 1 August

2007 Cash flows Other non-cash

movements At 31 July

2008 £’000 £’000 £’000 £’000

Endowment Asset 25 (3) - 22 Overdraft (129) (15) - (144) Debt due within 1 year - - (3,000) (3,000) Debt due after 1 year (3,000) - 3,000 - Finance leases (2,802) 35 - (2,767)

Total (5,906) 17 - (5,889)

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NOTES TO THE ACCOUNTS (CONTINUED) 28. Pensions and similar obligations The College's employees belong to two principal pension schemes, the Teachers' Pension Scheme (TPS) for academic and related staff; and the Local Government Pension Scheme (LGPS) for non-teaching staff, which is managed by the West Yorkshire Pension Fund (WYPF). Both are defined-benefit schemes. Total pension cost for the year 2008 2007 £’000 £’000

Teachers Pension Scheme: contributions paid 232 170

West Yorkshire Pension Fund: Charge to the Income and Expenditure Account (staff costs) 332 217

Total pension cost for year 564 387

The pension costs are assessed in accordance with the advice of independent qualified actuaries. The latest full actuarial valuations of the TPS was at 31 March 2004 and the WYPF 31 March 2004. Teachers’ Pension Scheme

Under the definitions set out in Financial Reporting Standard 17 Retirement Benefits, the Teachers’ Pension Scheme (TPS) is a multi - employer pension scheme. The College is unable to identify its share of the underlying liabilities of the scheme. The College has taken advantage of the exemption of FRS17 and has accounted for the contributions to the scheme as if it were a defined contribution scheme.

The employers' contribution rates for the College for academic staff were: TPS - 14.10% of pensionable salaries from 1/8/07-31/7/08

The Teachers’ Pension Scheme is a statutory, contributory, unfunded, defined benefit scheme. The regulations under which the TPS operates are the Teachers’ Pensions regulations 1997, as amended. Teachers’ contributions and employers’ contributions are credited to the Exchequer on a ‘pay as you go’ basis under arrangements governed by the Superannuation Act 1972. A notional asset value is ascribed to the scheme for the purpose of determining contribution rates. The last valuation of the TPS related to the period 1 April 2001 - 31 March 2004. The GA's report of October 2006 revealed that the total liabilities of the Scheme (pensions currently in payment and the estimated cost of future benefits) amounted to £166,500 millions. The value of the assets (estimated future contributions together with the proceeds from the notional investments held at the valuation date) was £163,240 millions. The assumed real rate of return is 3.5% in excess of prices and 2% in excess of earnings. The rate of real earnings growth is assumed to be 1.5%. The assumed gross rate of return is 6.5%. As from 1 January 2007, and as part of the cost-sharing agreement between employers’ and teachers’ representatives, the standard contribution has been assessed at 19.75%, plus a supplementary contribution rate of 0.75% (to balance assets and liabilities as required by the regulations within 15 years); a Standard Contribution Rate (SCR) of 20.5%. This translates into an employee contribution rate of 6.4% and employer contribution rate of 14.1% payable. The cost-sharing agreement has also introduced, effective for the first time from the 2008 valuation, a 14% cap on employer contributions payable. The 2006 interim actuarial review, published in June 2007, did not recommend any changes to the SCR and concluded, as at 31 March 2006, and using the above assumptions, that the Scheme’s total liabilities amounted to £176,600 millions. A copy of the GA’s 2004 valuation report and 2006 interim valuation report can be found on the TeacherNet website at: www.teachernet.gov.uk/pensions.

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NOTES TO THE ACCOUNTS (CONTINUED) 28. Pensions and similar obligations (continued) FRS 17 Under the definitions set out in Financial Reporting Standard 17 (FRS 17) Retirement Benefits, the TPS is a multi-employer pension scheme. The College is unable to identify its share of the underlying assets and liabilities of the scheme. Accordingly, the College has taken advantage of the exemption under FRS 17 and has accounted for its contributions to the scheme as if it were a defined contributions scheme.

The College has set out above the information available on the scheme and the implications for the College in terms of anticipated contribution rates. West Yorkshire Pension Fund The WYPF is a funded defined-benefit scheme, with the assets held in separate trustee administered funds. The total contribution made for the year ended 31 July 2008 was £238,010 of which employers contributions totalled £150,055. The contribution rates for this year are 10.3% to 31 March 2008 and 10.9% from 1 April 2008 for employers and ranging from 5.5% to 6.0% to 31 March 2008 and ranging from 5.25% to 7.5% from 1 April 2008 for employees. Following the outcome of the 2004 Actuarial Valuation the employer contribution rates for the next 3 year period (2005/06 to 2007/08) will average 10.2%. The revised target employer contribution rate for the College at the end of the 6-year phasing period (2010/2011) is 12.4%. FRS 17 The following information is based upon a full actuarial valuation of the Fund at 31 March 2005 updated to 31 July 2006 by a qualified independent actuary

At 31 July At 31 July At 31 July 2008 2007 2006 Rate of increase in salaries 5.55% 4.95% 4.75%

Rate of increase for pensions in payment/inflation 3.8% 3.2% 3.0%

Discount rate for liabilities 5.9% 5.8% 5.1%

The assets in the scheme attributable to the College and the expected rates of return of the assets in the scheme were: Long-term

rate of return expected at

Value at 31 July

2008

Long-term rate of return

expected at

Value at 31 July

2007

Long-Term rate of return

expected at

Value at 31 July

2006 31 July 2008 £’000 31 July 2007 £’000 31 July 2006 £’000 Equities 7.5% 2,142 7.5% 2,228 7.0% 1,834 Government Bonds 4.8% 311 4.9% 241 4.4% 178 Other Bonds 5.9% 145 5.8% 117 5.1% 105 Property 6.5% 145 6.5% 157 6.0% 133 Cash 5.0% 142 5.75% 108 4.5% 155

Other 7.5% 261 7.5% 160 - 98 Total Market Value of assets 3,146 3,011 2,503 Present value of scheme liabilities (5,032) (3,500) (3,138) Deficit in the scheme (1,886) (489) (635) The College’s share of the assets in the scheme is 0.044%

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28. Pensions and similar obligations (continued) Reconciliation of present value of plan liabilities

2008

2007 £’000 £’000 At 1 August 3,493 3,131 Current service cost 237 217 Interest on pension liabilities 211 167 Member contributions 88 71 Past service cost 58 Actuarial (gains)/losses on liabilities 957 (88) Curtailments 37 Benefits/transfers paid (49) (5) At 31 July 5,032 3,493

Reconciliation of fair value of plan assets 2008 2007

£’000 £’000

At 1 August 3,004 2,496 Expected return on plan assets 219 167 Actuarial gains/(losses) on assets (299) 153 Employer contributions 183 122 Member contributions 88 71 Benefits/transfers paid (49) (5)

At 31 July 3,146 3,004

Reconciliation to balance sheet 2008 2007 £’000 £’000 Present value of plan liabilities (5,032) (3,493) Fair value of plan assets 3,146 3,004 Net liability (1,886) (489) Analysis of the amount charged to income and expenditure account 2008 2007 £’000 £’000 Employer service cost (net of employee contributions) 237 (217) Past service cost 58 - Effect of curtailments or settlements 37 -

Total operating charge 332 (217)

Analysis of pension finance income/(costs) 2008 2007 £’000 £’000 Expected return on pension scheme assets 219 167 Interest on pension liabilities (211) (167) Pension finance income/(costs) 8 -

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28. Pensions and similar obligations (continued)

Amount recognised in the statement of total recognised gains and losses (STRGL) 2008 2007

£’000 £’000 Actual return less expected return on pension scheme assets (299) 153 Experience gains and losses arising on the scheme liabilities (957) -

Change in financial and demographic assumptions underlying the scheme liabilities - 88 Actuarial gain/(loss) recognised in STRGL (1,256) 241

History of experience gains and losses

2008 2007 2006 2005 2004 Difference between the expected and actual return on assets: Amount £’000 (299) 153 174 229 36 percentage of scheme assets (9.5%) 5.1% 7.0% 11.0% 2.6% Experience gains and losses on scheme liabilities: Amount £’000 (957) - (94) 93 - percentage of scheme liabilities (18.9%) - (3.0%) 3.5% - Total amount recognised in STRGL: Amount £’000 (1,256) 241 (55) (76) - percentage of scheme liabilities (24.9%) 6.9% (1.8%) (2.9%) - 29. Capital commitments 2008 2007 £’000 £’000 Commitments contracted for at 31 July 8 - 30. Financial commitments At 31 July the College had annual commitments under non-cancellable operating leases as follows: Equipment 2008 2007

£’000 £’000 Expiring between one and two years inclusive - - Expiring between two and five years inclusive 34 49 31. Contingent liability

The College entered into contractual arrangements with Unite Plc in December 2003 relating to the new PPP teaching block and student accommodation build at the north side of the main College building. As part of these contractual arrangements the College entered into a Nominations Agreement with Unite Integrated Solutions Plc (1) relating to the new student accommodation completed and available for occupation in early September 2005, which terminates in 2034. This Nominations Agreement provides an 80% occupancy guarantee to Unite Integrated Solutions Plc (1) from September 2005; therefore the College has contracted into a contingent liability from 2006/07. No financial provision has been made in these accounts in relation to this matter as the student accommodation was achieved in 2007/08. 32. Related party transactions Under a collaborative agreement accounting and personnel services have been provided to Yorkshire Young Musicians. The Principal of Leeds College of Music is a trustee of this organisation. Under the terms of the agreement, there was no charge for these services.

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33. Access to learning funds & learner support funds

2008 2007 £’000 £’000 Access to learning funds HEFCE Access grants - access funds 21 27

- opportunity bursary - - Learner support funds LSC grants - childcare 4 4 LSC grants - residential bursaries 60 100 LSC grants - other 18 18 Interest earned 2 3 105 152 Disbursed to students (57) (94) Administration costs (5) (7) HEFCE & LSC funds repaid in year - (72) Balance unspent at 31 July, included in creditors 43 (21)

Funding Council Access to learning funds and learner support funds grants are available solely for students; the College acts as paying agent. The grants and related disbursements have therefore been excluded from the income and expenditure account.

Documents

Financial Statements & Members Report 2007-2008