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annual report and financial statements for the year ending 31 July 2013


VISION To be recognised as a modern civic university delivering solutions to the challenges of the 21st century

MISSION Our mission is to create and sustain a vibrant community for learning and knowledge where staff and students work together in an active and supportive partnership; providing opportunities to enrich our students, partners and wider society through education, training, research, scholarship and knowledge transfer.

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Liverpool John Moores University

About Liverpool John Moores University...

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Liverpool John Moores University

When the Liverpool Mechanics School of Art first opened its doors in 1825, few of the founding fathers could have speculated that 190 years later it would have grown into a global top 400 university, ranked in the top 100 universities in the world aged under 50. Today, Liverpool John Moores University (LJMU) has a clear vision to be recognised as a modern civic university delivering solutions to the challenges of the 21st century. Our extensive portfolio of high quality international foundation year courses, undergraduate and postgraduate degrees is informed not just by internationally acclaimed research but also extensive links with educational institutions, business, industry and other key organisations in the UK and around the world.

Staff Breakdown

6%

7%

6%

We remain intrinsically linked to the city of Liverpool and the communities we serve and our plan to create a connected university village signals yet another phase of development for the institution. This ambitious campus investment programme will benefit students, staff and other key stakeholders, creating both employment opportunities and a renewed sense of place and improved public realm within Liverpool city centre. LJMU is also committed to further extending its global reach through international student recruitment and forging new collaborations with higher education institutions, industry and other key organisations around the globe.

45%

36%

Academic Technical Adminstrative Research Manual

at a glance

n Annual turnover is ÂŁ172.4m (2012/2013)

n Expenditure ÂŁ166.3m (2012/2013)

n Underlying operational surplus ÂŁ6m (2012/2013)

n 22,585 students n 2,933 staff

n 250+ courses at undergraduate and postgraduate level The University continues to attract students from a wide range of backgrounds and countries around the world. LJMU successfully met its undergraduate recruitment targets for the 2012/2013 academic year.

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Liverpool John Moores University

People and places University structure LJMU is organised into four faculties with supporting professional services. Fifth Chancellor installed

City Campus supports students enrolled on undergraduate and postgraduate degrees in three Faculties: Science, Technology and Environment and Education, Health and Community

The Right Honourable, Sir Brian Leveson, who is a Lord Justice of Appeal, assumed the role of LJMU’s fifth Chancellor in March 2013, with an official inauguration ceremony in the Liverpool Anglican Cathedral. As Chancellor, his formal duties include presiding over graduation ceremonies and acting as an ambassador for the University, both at home and abroad. Sir Brian’s formal association with LJMU began in 2010, when he delivered a Roscoe Lecture entitled 'Criminal Justice in the 21st Century' for the University’s Foundation for Citizenship. He was made an Honorary Fellow of the University in July 2012.

New Pro-Vice-Chancellors appointed

Mount Pleasant Campus (Knowledge Quarter) supports students in the Faculty of Arts, professional and Social Studies

IM Marsh Campus supports students in the Faculty of Education, Health and Community

Three new Pro-Vice-Chancellors were appointed to help LJMU achieve its new strategic objectives. Professor Peter Byers is the new Pro-ViceChancellor (Education), Dr Edward Harcourt the new Pro-Vice-Chancellor (External Engagement) and Professor Robin Leatherbarrow the new ProVice-Chancellor (Scholarship, Research and Knowledge Transfer). Collectively, the Pro-ViceChancellors bring a wealth of experience gained within the higher education sector, both in the UK and internationally. Their appointments demonstrate the seriousness of LJMU’s commitment to delivering an exceptional student experience and outstanding graduate prospects as well as real impact outside the campus, through world-leading research, wealth creation and meaningful public engagement.

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Level of stuArts dyProfessional and Social Sciences 8091 7223.6 Education, area2717.7 Int/I Community and Leisure UK3168 2%

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Liverpool John Moores University

Establishing and enhancing the

student partnership

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Liverpool John Moores University

LJMU is committed to effective student representation across the University, from programme level to the Board of Governors, with student views being actively sought informally and via course representatives, student surveys and the election of student sabbatical officers in the Liverpool Students’ Union. Overall satisfaction with the LJMU learning experience, as recorded in the National Student Survey (NSS), has risen by 1% for the third year running; with 84% of final year students stating they were satisfied with the overall quality of their course. LJMU awarded over £7million in scholarships and bursaries in 2012/2013. Over 60% of students awarded a bursary or scholarship came from an under-represented group in higher education, such as those from low income households, disabled people, some ethnic groups and people who have been in care; the national average was 46%. Nearly 50% of LJMU students awarded a bursary had a household income less than £25,000 compared to the national average of 35%.

Supported by the Higher Education Academy, ChangeLiverpool is a joint initiative with LiverpoolSU, designed to enable students to both directly influence teaching and learning at the University and make a positive impact on the wider community through extra-curricular activities and volunteering.

A further £100,000 donation was received from the Yoko Ono Spirit Foundation for the John Lennon Imagine Awards which provide targeted financial and personal support to students who have been in local authority care or who are estranged from their parents.

at a glance National Student Survey 2013 results: n

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LJMU increased its overall student satisfaction by 1%, with 84% of final year students saying they were satisfied with the overall quality of their course. The fourth year in succession that LJMU has improved its overall student satisfaction rate 36 programmes secured overall satisfaction rates of 90% or above Learning Resources: student satisfaction increased by 3% to 88%, 4% above the sector average Assessment & Feedback: up 1% to 74%, 2% above the sector average Academic Support: up 1% to 81%, above the sector average by 1% Personal Development: up 1% to 82%, equal to the sector average Organisation and Management: up 4% to 78%, again equal to the sector average


Liverpool John Moores University

Excellence in learning, teaching and assessment

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Liverpool John Moores University

LJMU’s status as a top 400 university was consolidated by our improved performance in UK university league tables. LJMU is now ranked 30th out of 67 modern universities and 61st out of all UK universities for student satisfaction, according to the Sunday Times Good University Guide. Our annual Learning and Teaching Conference brought staff from across the University together to share innovative practice and debate issues critically important to learning and teaching at the institution. The University’s prestigious Learning and Teaching Awards were also presented to individuals and teams in recognition of their outstanding impact on the student learning experience. Examples of outstanding practice included the introduction of audio feedback and embedding research and evidence-based practice into the curriculum plus the work of the Student Mentoring Support Team in the Faculty of Education, Health and Community in supporting students during their studies at the University. Students too celebrated outstanding teaching and support services at the University through the annual LiverpoolSU Teaching Excellence Awards. Around 1,000 nominations submitted by 420 individual students were received, nearly double the number of nominations received in 2012.

The Institution of Mechanical Engineers (IMechE) awarded £5,000 to the LJMU Formula Student Team to help in their 2013 campaign.This funding is only available to one of the top three UK teams and reflects LJMUs’ outstanding performance in the competition, with the student team finishing 12th out of 102 teams from around the world. LJMU nursing students Simon Nielson and Jessica Partington were two of just 50 national ‘Care Makers’ hand-picked to bring the legacy of the Olympic Games into nursing. Selected out of 250 applicants, they are now working as advocates for Care, Compassion, Competence, Communication, Courage and Commitment, the six Cs set out by the Chief Nursing Officer for the NHS in England in the strategy for nursing and midwifery.

“It’s really great that the University helps small businesses like ours. Without the support of big institutions, such as LJMU, it would be impossible for us guys to get anywhere.” Philip Perera, Managing Director, Teabox Company When seven Business and Public Relations students announced they wanted to set up a company selling high-quality, loose-leaf tea few could have predicted how successful their online company would become. The student entrepreneurs won the Young Enterprise Start Up Awards supported by Santander and represented the UK at the European final. The TeaBox Company are now the main supplier of tea for LJMU’s Catering Department.

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Liverpool John Moores University

Graduate destinations For the fourth year in succession, LJMU has improved its overall graduate employment rates, with more students than ever securing prestigious graduate-entry positions. Unemployment rates have also declined for the fourth year in a row. This positive trend is set against a backdrop of rising graduate unemployment and increasing competition within a very challenging labour market. n n

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92% of students were in work or further study within six months of graduating The average salary for all LJMU graduates was £22,100, which compares very favourably to the UK average salary of £18,000–£22,500 The average salary for LJMU students in graduate-level roles was £24,500 67% of students secured graduate-entry professional jobs – an increase of 2% on last year’s results Unemployment rates for LJMU graduates declined by 1% to around 6% Approximately 64% of graduates were working in Merseyside 10


Liverpool John Moores University

Boosting employability Our unique World of Work Programme continues to boost student employment prospects and interest both in the UK and overseas. The Bronze stage is now fully integrated into the first year of every undergraduate degree programme at the University and over 90% of undergraduates successfully completed it this year. n Our World of Work Careers Centre won the 2013 Association of Graduate Careers Advisory Services Excellence Award for Technology. n Thanks to British Council funding, LJMU delivered training and consultancy on our World of Work Programme to universities and government departments in Morocco, Jordan and Tunisia. n Through the Career Accelerator Internship Programme, the University funded 50 internships to give 2012 graduates struggling to find employment CV-enhancing paid work experience. The programme has proved so successful that the University increased places on its graduate internship programme to 75. n 450 employers and employer organisations help deliver and shape our World of Work Programme via advisory boards, skills interviews and offering opportunities for students to complete work experience. n Exclusive internships offered to LJMU students by Everton Football Club and Sony Computer Entertainment Europe.

“LJMU's World of Work Programme really makes a difference to a graduates' employment and career prospects and provides employers with a tangible benchmark for quality.� Dan Davies, Head of Service & Solution Design, Ricoh UK 11


Liverpool John Moores University

at a glance

Embedding Research and Scholarship

Research funding 2012/2013 In 2012/2013, LJMU was awarded research grants worth over £9million. RESEARCH FUNDING BY FACULTY:

LJMU launched a major recruitment campaign during 2012/2013 aimed at attracting international, world-class academics to Liverpool. The campaign was a big success, with over 40 new staff appointed, reflecting the University’s renewed commitment to research and scholarship. The appointments support LJMU’s Research Excellent Framework submission and longer term will help to create a sustainable, healthy research environment that generates real excitement in the lecture theatres and seminar rooms as well as meaningful public engagement. Plus they have helped to improve staff student ratios, paramount for the long term future of the institution. A second major recruitment campaign was launched in 2014.

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Arts and Professional Studies: £126k

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Education Community and Leisure: £119k

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Health and Applied Social Sciences: £3.27m

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Science: £3.77m

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Technology and Environment: £1.89m

RESEARCH FUNDING SOURCES: n n n

UK Research Councils: £1.7m Health funding (NHS, Department of Health and local health authorities): £3.7m EU Framework programmes: £1.3m

NOTABLE RESEARCH CENTRE / INSTITUTE HIGHLIGHTS: n

Astrophysics Research Institute: £1.4m

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Centre for Public Health: £3.1m

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Research Institute for Sport and Exercise Sciences: £1.4m Built Environment & Sustainable Technologies Research Institute: £0.8m


Liverpool John Moores University

From developing cutting edge new technology to detect brain tumours to ground-breaking studies on the impact of the recession in UK cities, our researchers are helping to inform public policy, shape new laws, transform lives and improve the environment. We are also ranked in the top 25 English universities for PhD completion rates, with over 500 research students enrolled at the University. n

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LJMU’s conservation research using unmanned aerial vehicles or drones is being used to help protect endangered species such as orangutans and rhinos as well as mapping the wintering grounds of the barnacle geese in Scotland in collaboration with the Wildfowl and Wetlands Trust. Research produced by our Research Unit for Financial Inclusion into how credit unions are serving low-income communities in Northern Ireland was welcomed by the First Minister Peter Robinson. Credit unions serve around 34% of the NI population in comparison to just 2% of the population in Britain. In 2004, LJMU broke the mould by developing the world’s largest fully robotic telescope. Now we are planning to develop a successor facility that will build on the successes of the Liverpool Telescope in the field of ‘time domain astronomy’. Time domain astronomy covers observations of any astronomical object which changes in brightness or position over time. These include nearEarth objects like asteroids, cosmic explosions such as supernovae, and extrasolar planets. Playwright Willy Russell’s personal archive collection is now housed in LJMU’s Special Collections and Archives. The collection consolidates the University’s archives relating to the Everyman Theatre, the Unity Theatre and the Merseyside Youth Theatre (Fuse) Archive.

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According to LJMU psychology research itching is so contagious that just seeing a photo of something we imagine would itch – like ants or an insect bite – can trigger a physical response. The findings could be of benefit to patients with skin conditions like eczema. LJMU research argues that long necked sauropod dinosaurs - the largest land animals ever to walk the Earth – were so large because of the plant food they ate. LJMU and Mersey Care NHS Trust are leading a €5.4 million ‘Innovate Dementia’ project in the UK, linking the growing number of people with dementia across North West Europe. Researchers from the School of Sport and Exercise Sciences are working with coaches from Everton in the Community, Liverpool Football Foundation and Sportslinx on a unique Liverpool Primary Care Trust-funded project to investigate whether sport can be used to prevent children from starting to smoke. Olympians Rebecca Adlington and Steve Parry, who’s also an LJMU Honorary Fellow, and British Taekwondo athlete Martin Stamper have signed LJMU’s SmokeFree Sports Charter along with over 30 primary schools.


Liverpool John Moores University

Social and economic engagement Our aim is to be recognised globally as a modern civic university while still retaining our strong links with Liverpool, a true city of the world.

A life changing experience Choosing where to study is one of the most important decisions that our students will make in their lives and that’s why we are committed to giving them a truly life changing experience. Partnerships with business and cultural organisations give students opportunities to grow and flourish as individuals and graduate with bright future prospects. New and stronger partnerships have been established with Royal Liverpool Philharmonic, Liverpool Biennial, Tate Liverpool and Homotopia, resulting in new ways for students to engage with the arts, gain invaluable work experience and access the full range of cultural activities on offer in the city. n Students helped to curate three exhibitions for the 10th anniversary Homotopia Festival, two directly sourced from LJMU’s Special Collections and Archive. n LJMU is the highest ranking university in the Stonewall index of Britain's best employers for lesbian, gay and bisexual staff n The School of Art and Design officially opened its new Exhibition Research Centre, with an exhibition of the photography of the Belgian artist and photographer, Jacques Charlier, never seen in the UK before.

“Our partnership with LJMU demonstrates our shared commitment to providing inspirational opportunities for people of all ages and abilities to get involved in learning, music and the arts, and that everyone can and should get involved.” Vasily Petrenko, Liverpool Philharmonic Principal Conductor and LJMU Honorary Fellow 14


Liverpool John Moores University

Connecting with young people LJMU’s dedicated Outreach Team works with 300 primary and secondary schools and colleges primarily in Merseyside but also in areas such as Cheshire, Manchester, Lancashire, Cumbria, North Wales and Northern Ireland to inspire children and young people to strive to go to university. Set up by our Astrophysics Research Institute, the National Schools’ Observatory harnesses the power of the University’s fully robotic telescope on La Palma, Canaries to enable 2,500 schools and thousands of pupils across the UK to request high quality astronomical images. LJMU has received more than 50,000 observing requests and the work of the NSO and the ARI was showcased in a unique Galaxy Garden at the 2013 RHS Tatton Show. Since 1997, LJMU has led a campaign to recognise the inspiring actions of young people across the North West. To date over 900 primary and secondary schools, further education and sixth form colleges have joined our Good Citizenship Award Scheme. Ten new apprentices joined LJMU during 2012/2013 part of a pilot scheme to boost employment of young

people at the University. The apprentices, who were all aged 16 or 17, were based in the University’s Estate Management department, working in administration, catering, computer aided design, facilities management and in LJMU’s print unit. The scheme was part funded by Liverpool City Council through the Merseyside Apprenticeship Programme.

Working with business and industry LJMU is the lead higher education partner for the new Low Carbon and Superport University Technical College (UTC) to be based in North Liverpool. The UTC has a crucial role to play in providing young people with the skills, knowledge and competencies needed in Liverpool to deliver the City's Superport strategy. LJMU has a very strong tradition in preparing students for the engineering and logistics sectors and is working closely with employer partners to shape the curriculum that will be offered by the UTC. A new outreach project established by the General Engineering Research Institute (GERI) and funded by the European Regional Development Fund, is enabling North West companies to undertake research and development using our world-class engineering expertise and facilities. 15


Liverpool John Moores University

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Liverpool John Moores University

Campus investments LJMU’s plans to develop a connected university village go beyond just bricks and mortar. This major investment in Liverpool city centre will make a huge contribution to the city’s regional economy and provide new facilities and open spaces for staff, students and the wider community. Details of this ambitious 10 year campus investment programme are still being finalised but what is confirmed is that the IM Marsh Campus will close enabling all University activities to be located within Liverpool city centre. LJMU is already the greenest university in Liverpool, having been awarded First Class Honours in the 2013 People & Planet Green League – the UK's only comprehensive and independent green ranking of universities. Our plans to develop a connected walkable university village in Liverpool city centre reflect our ambitious plans to further reduce our carbon footprint and minimise our impact on the environment.

LJMU students now have access to hospital-standard facilities including virtual patients and a state-of-the-art birthing simulator following the completion of the £1.6 million School of Nursing and Allied Health Practice Suites. The suites show a patient’s journey from the home environment through to rehabilitation, with the latest clinical equipment for simulations and clinical skills development in child nursing, adult and mental health nursing, paramedic practice, social work and midwifery. There are also purpose built soundproof booths equipped with video camera and playback facilities.

£8.5million refurbishment of the Life Sciences Building completed

New 250-capacity Starbucks coffee shop at Byrom Street opened and landscaped courtyard to the rear of the James Parsons Building completed

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Liverpool John Moores University

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Liverpool John Moores University

Financial Statements 2013 19


Liverpool John Moores University

Operating and Financial Review Scope of the Financial Statements These are the consolidated statutory accounts of Liverpool John Moores University and its subsidiaries for the year ended 31 July 2013. Vision and Mission Our Vision is to be recognised as a modern civic university delivering solutions to the challenges of the 21st century. Our mission is to create and sustain a vibrant community for learning and knowledge where staff and students work together in an active and supportive partnership: providing opportunities to enrich our students, partners and wider society through education, training, research, scholarship and knowledge transfer. Strategic Objectives Our actions in pursuing our Vision and Mission are guided by our Strategic Framework for 2012 to 2017 which sets out a detailed roadmap for the University. Our strategic objectives are to be: n A university known for excellent teaching within an academically engaging and supportive student experience that produces graduates who, as citizens, are prepared for life and the world of work and are valued as contributors to society. n A university where scholarship is at our core and our Research Institutes are recognised as beacons of excellence that provide inspiration and motivation for staff, students and society. n A university which is true to its values and is recognised globally as a driving force that through partnership supports wealth creation, social well-being, culture and the arts within the city-region and beyond. Successful achievement of these outcomes will require strong focus, strategic management discipline and a clear and relentless pursuit of the principles of excellence. Robust mechanisms and structures are in place to deliver these requirements. Operations Students LJMU is one of the largest Universities in the UK with 22,800 students in Liverpool plus a further 3,000+ students enrolled on accredited University courses overseas. Actual full time equivalent numbers for 2012/13 were 18,550 a decrease of 6% compared with 2011/12. This decrease was as expected and primarily due to the large cohorts at level 4 in 2011/12 before the ÂŁ9,000 fee increase was applied in 2012/13. The 2012/13 recruitment was in line with planned control numbers for 2012/13. Several key business decisions have been taken in relation to the 20


Liverpool John Moores University

academic portfolio. These include changes to the Academic Framework and the closure of a number of programmes all designed to ensure the efficient delivery of a quality offering that is fit for purpose as we enter a period of uncertainty within an increasingly competitive market place. A revised Learning, Teaching and Assessment strategy has been developed to enhance the quality of the student experience in line with the new Strategic Framework.

international collaborations and graduated its first dual PhD student in 2013 from the University of Malaya. New agreements on student articulation were concluded with institutions in China and the University continues to be a strong partner of the Sino-British College in Shanghai, delivering BEng degrees in Industrial Electronics & Control and Manufacturing Systems. Significant progress has also been made in relation to maximising the mutual benefits of the LJMU/Study Group (SG) strategic partnership, kick started by an LJMU/SG Summit in Summer 2013 to agree a new, revitalised institutional approach to the partnership, including new IFY routes and the development of on-line products. The LJMU/SG International Study Centre (ISC), was recently review by QAA (as part of an assessment of 13 colleges offering provision in the name of Study Group Bellerbys). The key findings for the LJMU ISC were that there was confidence in the academic standards at the ISC, confidence in the quality of the learning opportunities at the ISC and reliance on the accuracy of information published about the ISC and its programmes.

Various improvements in the wider student experience have also been put in to place, such as improved access to learning materials via the virtual learning environment, enhanced student access to PCs, and better catering facilities. The most notable initiative, however, was the decision to establish a 15 day deadline for feedback to students on their coursework. This range of initiatives has resulted in a continued improvement in student satisfaction levels, as evidenced by the recent outcomes of the NSS. In turn, these improvements alongside improvements in a range of other measures have been reflected in improvement in LJMU’s league table positions. As shown above, student applications and recruitment remains buoyant despite the very challenging environment that universities are facing. LJMU continues to operate very effective widening participation and outreach activities which are identified in the Access Agreement recently approved by OFFA, e.g. the National Schools Observatory scheme continues to grow as schools use their access to the Liverpool Telescope. A new dimension has been the development of University Technical Colleges and LJMU was a lead sponsor for a successful bid for a UTC in Liverpool (Low Carbon and Super Port) to open in 2014.

LJMU delivered a new foundation year for Jaguar Land Rover. Successful students will be in a position to apply to enrol on either BEng Manufacturing Systems Engineering or BEng Industrial Electronics and Control Engineering in January 2014. Collaborative relationships with Employer Groups continue to flourish with members of National and Local Groups including Ricoh, The Army, Liverpool City Council, Aldi, SEMTA, The RAF, Royal Mail, GKN, Liverpool Chamber of Commerce, Tate Liverpool, DWF LLP, Co-operative Group, Enterprise Rent-A-Car, Bosch and BT).

The university continues to review and refresh its academic portfolio and has approved the development of a range of new programmes ranging from an LLM in Global Crime, Justice and Security to an MA in Fashion Innovation and Realisation.

In 2012 LJMU recorded the fourth successive year on year increase in the percentage of graduates achieving graduate level employment (66.7% of all graduates), the fourth successive annual decrease in unemployment (6.8% for all graduates) and third successive increase in positive outcomes (92.9% All graduates in work or further study).

The university continued to ensure that, wherever possible, programmes have Professional Statutory Regulatory Body accreditation. Of the 111 Key Information Set (KIS) course records 64 accreditations are recorded, including multiple accreditations on some programmes. There are 47 distinct KIS programme with one or more accreditations representing 42% of KIS records.

The World of Work Programme continued to be recognised as a best practice case study in nationally important publications and conferences in 2012/13 including from the University Alliance, the Higher Education Academy and The British Council. During the year over 5,000 students completed the Bronze, Silver or Gold stages of the World of Work Skills Certificate. The certificate continues to be designed, developed and delivered collaboratively with many employer partners and a Student Partner Group and is being continuously modified and improved following feedback.

In February 2012, a bid was successfully submitted to the HE STEM Sigma project and ÂŁ10,000 was awarded (to be match funded by the university) for the establishment of a Maths Resource and Support Centre (MRSC) at LJMU. This MRSC operates alongside existing study support provision. The MRSC opened in March 2012 and has now been operational for a full academic year. The centre has proven to be very successful and the university has taken a decision to open an additional centre shortly.

The World of Work skills certificate Bronze (self-awareness) stage has been successfully integrated into all Level 4 academic modules. Consequently 90% of Level 4 students completed this stage during the 2012/13 academic year. The university organised the first LJMU funded internships for unemployed graduates (50) and Level 5 students (65) which were highly successful.

Internationally the University is redoubling its efforts to recruit strongly from outside the EU and has a long-term goal of recruiting 15% of the student body in Liverpool from non-EU territories from a base of 4% in 2013 entry cohorts. Following an extensive review, new structures and procedures (including a competitive scholarship offer and centralised decision-making on international applications) are being put in place for the 2013-2014 recruitment cycle.

The university continues to share its knowledge and employability expertise by accepting invitations to work with universities and Governments to develop career development strategies in Jordan, Egypt, Morocco, Dubai, Abu Dhabi, USA, Vietnam, Spain, France, Malaysia and Thailand. The university accepted an invitation to present at The British Council Going Global Conference in Dubai. The university won the Association of Graduate Careers Advisory Services Award for Best Technology and was shortlisted for Awards for Career Education and Employer Engagement.

The University continues to expand upon its portfolio of 21


Liverpool John Moores University

Research & Scholarship In 2012-13 the University continued to focus its research efforts and resources in areas of demonstrable research excellence (Research Institutes and Centres). The institutional preparations for the Research Excellence Framework (REF2014) during the year have confirmed the presence of a number of emerging clusters of research activity across the University. Core HEFCE QR research funds (distributed based on RAE2008 performance) are primarily used to support academic staff costs in research-active areas. Non-HEFCE, competitively-won, research grant income has a vital role in supporting the research projects that staff undertake. Such funding increasingly makes a contribution to academic staff salaries through the full economic costing model. The strategic framework for the institution for 2012-17 provides a clear roadmap for the University for delivering excellence in research and scholarship that positively impacts on society and serves as an inspiration to students, fellow staff and the public. Highlights n Particular research strengths remain in STEM (e.g., astrophysics, built environment, life sciences, public health, electrical and general engineering, maritime) and STEM-related subjects (e.g., biological anthropology, sports sciences). Together these account for >90% of external research income to LJMU (from grants and HEFCE-QR). n Research grant income grew by 11% in 2012-13 compared to 2011-12, rising to £9.0m. In part this is reflective of the fact that the University is moving towards a more balanced portfolio of funders, reducing the high reliance on certain types of publicsector funding (NHS and local authority), who have come under significant budgetary constraints in recent years. n As at the end of July 2013 LJMU was managing a research grants portfolio of £42m (a reduction of £6m from the previous year). n £8.2m worth of new research grants were awarded to LJMU in 2012-13. n Based on sector-wide data for 2011-12 (HESA), LJMU is ranked 67th in the UK for research grant income and 5th in the NW region n UK Research Council income (the most competitive source of research funding) accounts for approximately 19% of our total research income, with ~72% of such funding in The Astrophysics Research Institute. n Funding from the European Framework programmes has steadily increased in recent years and now accounts for ~14% of the Institution’s total research income. The forthcoming Horizon 2020 programme (2014-20) will be a major target for collaborative bids. n Academic staff continue to submit substantive research grant bids to external organisations at a rate in excess of 230 grant bids per annum. An increasing number of such bids are collaborative with other HEIs in the UK and overseas. Success rates remain in line with our peer group, with the institution placing increased emphasis on providing enhanced support for staff in preparing high quality bids. n Strategic investment in research by the University in 2012-13 saw the appointment of 44 academic posts (both early career and well established researchers). These posts were targeted at areas of research excellence (notably Astrophysics and Sports Science but also Engineering, Biological Anthropology and English). Since their appointment, many of these staff have been active in seeking external funding and it is expected that this will have a very positive effect on research grant income in coming years. n A record number of research degrees were awarded by the University in 2012-13 (a total of 94 including 85 PhDs). n The University’s preparation for submission to the Research Excellence Framework (November 2013) is on track, with a submission expected in 17 Units of Assessment.

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the strategy will allow the University to benefit from demonstrating good leadership in an arena where stakeholder and service users expectations are rapidly raising and comparisons by students are increasingly being made. By delivering sustainable developments the University will continue to enhance its reputation, improve the well-being and productivity of building users and will maximise the efficient use of all its assets.

Commercial Enterprise, Knowledge Exchange and Student Entrepreneurship The University utilises income from the Higher Education Innovation Fund (HEIF) combined with core funds to ensure support for Commercial Enterprise, Knowledge Exchange and Student Entrepreneurship activity across the University. During the year, the professional service teams responsible for knowledge exchange, commercialisation, regional engagement and research were merged into a single team: Research & Innovation Services. This will ensure an integrated approach to these activities supporting both external clients and stakeholders as we as our own staff and students.

The University’s experience over the past year clearly demonstrates that substantial benefits can be achieved with modest but targeted investment if sustainable construction processes and practices are embraced from the start as a key performance requirement and the design and procurement processes managed effectively.

Highlights n Analysis of the Higher Education Business and Community Interaction survey (HE-BCIS) for 2011-12 showed the total annual value of LJMU’s interaction with business and the community was £13m (~£1.3m less than in 2010-11). This places the University 66th in the UK overall. n LJMU is ranked 46th in the UK for contract research income. n In 2012-13, the University’s commercial enterprise turnover totalled ~£3.9m, with the average contract size increasing by over 15% to £31,000. n The 2012-13 commercial enterprise turnover shows a modest increase of 3% on 2011-12, and was underpinned by a significant growth of new business replacing completed contracts ending 2011-2012 n A focus on local and national partners realised a 12% growth in UK income. n Growth in key areas of expertise including Sports and Exercise Science (primarily The Football Exchange), Astrophysics and Health and Social Care n Increased concentration on projects delivering multiple benefits including industry impact, student and graduate opportunities and curriculum enrichment. n Income from collaborative projects with industry funded by Technology Strategy Board (including KTPs) continues to rise. n In 2012-13, the University piloted and subsequently adopted a novel approach to commercialisation by developing a virtual IP marketplace (OpenLivin). This is a joint project (with University of Liverpool, Liverpool Local Enterprise Partnership and Technology Strategy Board) led by LJMU, based on the success of a JISC-funded project that utilises crowd-sourcing and crowd-funding approaches to assess the market interest on innovation arising from the University and its partners. A successful award of follow-on funding from IPO will extend this approach in 2013-14, to include an approach for funding match for projects. n In 2012-13 the number of students undergoing bespoke entrepreneurship training was 3564, the high profile and popular Start-Up Network attracted 204 new members and 20* Enterprise Fellowships were awarded to support the establishment of student businesses *20 bursaries awarded equates to 44 beneficiaries for 2012/13

Over the past twelve months the University has undertaken a significant amount of capital investment in its property portfolio and has made excellent progress delivering its on-going property development strategy. n The Redmonds Building is now home to three of LJMU’s largest academic schools: the Liverpool Screen School, the Liverpool Business School and the School of Law, and is specifically designed to give students access to ‘real world’ environments where they can hone their professional skills before entering the job market. Other facilities on offer to the 2,000 students using the building include: three large lecture theatres, a range of flexible teaching spaces, a lounge area and roof terraces. There are also several social learning areas and IT suites, all of which create not only a contemporary business environment, but also a resourceful and comfortable space where students may stay and work after lectures. n The John Foster building has undergone a significant change with the University identifying a substantial capital investment in the refurbishment of the site. Following a six month refurbishment programme, the John Foster Building now provides general teaching accommodation for the Faculty of Arts, Professional and Social studies. This strategy has allowed the University to terminate a number of leasehold interests and consolidate its activities in order to improve both space efficiency and the student experience. n The investment strategy for the Byrom Street Campus continues to progress well with the ongoing refurbishment of general teaching space, lecture theatres and specialist teaching and research facilities. n Over the past six months the University has undertaken a substantial investment in the refurbishment of a 1960’s laboratory building to provide first class research and teaching facilities for the School of Pharmacy. The recently refurbished Max Perutz Building now provides 3,000m² of modern state of the art research and teaching laboratories for both post graduate research activity and undergraduate programme delivery. n To improve the student experience the University has developed a new Social Zone in the heart of the Byrom Street Campus. The new building has been designed as a multifunctional space and will be used by both students and staff for a variety of activities. The open and informal area located on the ground floor of the James Parsons Building now provides a meeting place to eat, drink, get to know people, staying in touch with people and generally socialising in groups. The space also provides an area that may be utilised for open days and exhibitions.

Resources Capital Development The University’s current development strategy is predominantly driven by a mix of changing stakeholder expectations, rising energy costs, tightening regulations and a desire to deliver on the University’s Carbon Management strategy. The University development strategy has therefore been developed to create flexible space in order to respond to future trends reduce the risk from increased fuel bills and mitigate the need for future expensive retrofitting measures. Furthermore,

n At the University’s Tithebarn Street Building investment

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has continued over the past twelve months with further investment in the upgrading of both the general teaching accommodation and lecture theatre facilities. In addition the University has developed a range of specialist clinical practice suites and clinical areas. These “laboratory” type rooms will enable the students to experience the whole life span of a patient from injury/illness through to admission at hospital to leaving hospital and re-introduction and independence out in the community. This is an innovative approach that is being developed by the faculty and will provide very exciting and inspiring facilities for both students and staff. The new environment will provide an exceptional environment for use by all disciplines including, counselling, social work, mental health nursing, midwifery, child nursing, child health, public and primary care, paramedic, adult nursing and advanced practice. Environmental Sustainability The University continues to deliver on its sustainability agenda. The University has retained a first class honours award from the People and Planet Green League 2013 which is published in the Guardian. This provides an assessment of the full range of the University’s sustainability performance.

n There were upgrades and developments to several business systems, including the Real Time Information to HMRC and Pension Auto Enrolment. Significant progress was made with the Student Information System to ensure it is fit for purpose, acts as a “single source of truth” for student data and is accepted by its business users. Infrastructure investment also took place to enhance performance and increase the resilience of the Student Information System n Many servers were replaced to improve the performance and reliability of core services such as personal and group file stores.

LJMU has been awarded the Ecocampus environmental management system Silver award. EcoCampus is a national Environmental Management System and award scheme for the higher and further education sectors, enabling universities and colleges to identify, evaluate, manage and improve their sustainability and environmental practices. The University continues to deliver against its Carbon Management Plan which is assisting the University to face the future challenges, such as rising utility costs and compliance with legislation. It will also assist in controlling operating costs and making a significant contribution to government and HEFCE carbon reduction targets. The Plan is underpinned by various policies and strategies including the Environmental Policy, the Procurement Strategy, the Sustainable Procurement Policy, the Travel Plan, the Biodiversity Policy, the Carbon Management Policy, the Energy Policy, the Waste and Recycling Policy and the Print Strategy.

Future IT developments for the forthcoming year include:

n The attendance monitoring system will be deployed along with utilities to report on the demographic breakdown of students accessing career and welfare services. n In support of the university's ambition to become a modern civic university, IT facilities will be provided in the libraries for use by the local community. n A service catalogue will be developed to provide a framework for business users to access and find information about the services they require. n The IT Department will be restructured to ensure it is best positioned to meet the challenges it will face in the future, and to enable it to become more agile in support of the University strategic plan. n An infrastructure will be built to support Software-as-aService and provide enhanced mobile device and laptop support.

IT Developments n The student experience has been significant improved by enhancements to the PC availability and booking systems. The development of an IT Services information “pop up” system has resulted in keeping staff and students better informed of IT Service issues. n Security of the university’s Virtual Learning Environment has been considerably improved and the system was enhanced to include Statement Submission Manager, allowing student self-service enrolment on World-of-Work Silver and Gold levels n A technology enhanced attendance Monitoring System was developed and piloted, in support of the Academic Registry's commitment to improving pastoral care. n Systems supporting the Library functions, such as comprehensive search facilities for electronic and physical documents, were enhanced via the upgrade of local systems and by utilising cloud services as appropriate. Investments in data storage allowed the Willy Russell and Everyman archives to be made widely available. n Significant investment of around £500,000 has been made in the university’s computer network. The investment delivered higher performance and improved resilience across the whole University campus. n A solution was deployed to enable a more co-ordinated approach to managing IT related security incidents. This also improved the university’s ability to respond to internet based security incidents.

Sports Facilities An agreement with Liverpool City Council’s Sports and Leisure Division continues to provide the following facilities to students and staff:

n The provision of general access to a range of sports and leisure facilities across the Life Style venues. n To progressively allow the relocation of those academic programmes that have a sport related component which are currently delivered at the IM Marsh Campus to the Wavertree Centre. n To enable the Liverpool Students Union to provide facilities for its club and societies, presently provided either at IM Marsh or purchased from private providers.

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Results for the Year The University’s consolidated Income, Expenditure and Results for the year to 31 July 2013 are summarised as follows: 2012/13

2011/12

£000

£000

172,379 166,295

170,426 165,497

6,084

4,929

(22)

(250)

6,062

4,679

Share of Operating profit/(loss) in associate

(91)

(59)

Taxation

(57)

(57)

6,028

4,563

326

29

6,354

4,592

672

708

-

1,402

7,026

6,702

Income Expenditure Surplus after depreciation of assets at valuation and before tax Loss on disposal of fixed assets Surplus/(deficit) after depreciation of tangible fixed assets at valuation and disposal of fixed assets and before tax

Surplus/(deficit) after depreciation of tangible fixed assets at valuation, disposal of assets and tax Surplus/(deficit) for the year transferred to accumulated income in endowment funds Surplus/(deficit) for the year Difference between historical cost depreciation charge and the actual depreciation charge for the year on the revalued amount Realisation of property revaluation gains of previous years on disposal of assets Surplus/(deficit) for the year on a historical cost basis

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was mainly due to the completion of the Redmonds Building to Freehold Land and Buildings, and the current value reflects in the main, the spend on the John Foster Building refurbishment.

Financial Headlines n An underlying operating surplus of £9.3m n Historical cost surplus for the year £7.0m n Capital expenditure £16.3m

Cash deposits have decreased by £5m during the year, however the overall cash balances combining bank and deposits have remained broadly the same and in line with expectations. This encompasses over £16.3m spent on capital investment in the university.

n Income increase of 1.1% to £172.4m n Expenditure increase of 0.4% to £166.0m

Income and Expenditure Account 2012/13 has been an excellent year as a result of the continuing strategic approach to the finances of the university with an outturn surplus of £7.0m for the year. An underlying operating surplus of £9.3m was achieved. The annual FRS17 charge was £2.2m with the Pension liabilities in the Balance Sheet decreasing by £8.9m.

Governance and Risk n The University’s governance practices are consistent with the revised “Guide for Membership of Higher Education Governing Bodies in the UK” by the Committee of University Chairman (CUC), published in November 2004. n The University remains strongly committed to adopting best practice in terms of Governance and Management.

Total Income increased by 1.1% to £172.4m. The main changes were as a result of the reduction of HEFCE core funding and earmarked grants reducing by a further £20m. These decreases were offset by the changes to the student fee income.

n Risk management is incorporated into the corporate planning and decision making process of the Institution. The Risk Management Policy contains a definition of the Institution’s risk appetite, reflecting informal advice from the University’s internal auditors and members of the Board with specific expertise in this area.

Expenditure decreased by 0.4% to £166.0m. Staff costs have increased by 2.3% which reflects the continued investment in result of the investment in Strategic roles and staff/student ratios positions made through the. Other operating costs remained stable, but with additional charges of £2.5m impairment costs due to the revaluation of Land & Building during the year. The impact of FRS17 (Retirement Benefits) was a decrease to group surplus of £2.2m (2012/13 £2.62m).

Future During the last 12 months, LJMU has worked extremely hard to rise to the challenges presented by the changing political and economic climate, and the ramifications of the new fee regime. As a consequence, LJMU fully achieved its targeted home student control numbers for 2012/13 and 2013/14 whilst demonstrating enhanced retention rates for existing students. This is a significant achievement.

Balance Sheet The Balance Sheet has maintained its strength. Income and Expenditure Reserves excluding the Pension Reserve (associated with FRS17) are £72.5m showing a significant increase of £9.2m compared with the previous year. However following the interim property valuation the revaluation reserve has decreased by £10.7m. The pension liability reserve has decreased by £8.9m. Total reserves are now £34.9m compared to £27.5m the previous year. This is largely due to the £8.9m decrease in the FRS17 Pension reserve.

Notwithstanding, we will need to continue to work hard to ensure that this level of success is delivered in 2013/14 and onwards. This will be achieved by successful implementation of the 2012-17 Strategic Framework. This clearly sets out our ambitions for the coming 4 years.

Fixed Assets have decreased by £5.2m. Assets under Construction are £4.7m (11/12 £37.3m). The decrease

Conclusion 2012/13 has been an extremely successful year for LJMU. Significant investment in the staffing establishment and infrastructure has continued as demonstrated by the successful opening of the Redmonds Building. A surplus significantly in excess of budget has increased LJMU’s net worth before pension liabilities. This, coupled with the on-going delivery of the 2012-17 Strategic Framework and a significantly enhanced league table position, places LJMU in a strong position to manage the challenges and 26


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difficulties currently facing Universities in the light of the changing financial climate ahead.

The University’s vision gives a particular focus to the benefits that both students and society receive as a result of the University’s educational purpose. The vision is:

Mr Rod Hill Chairman

‘To be recognised as a modern civic university delivering solutions to the challenges of the 21st century’.

Delivering the Public Benefit Liverpool John Moores University (LJMU) is a Higher Education Corporation (HEC), as defined by the Education Reform Act 1988, and, as such, is an exempt charity with the charitable purpose of the advancement of education for the public benefit. The University achieves its charitable purposes by creating appropriate high quality opportunities that enable learning, advancement, development, and employment, and that these are open to as many individuals and communities as is achievable and sustainable. The Corporation is regulated by HEFCE by virtue of the Charities Act 2006, now consolidated into the Charities Act 2011.

LJMU’s core values are embedded in the University’s Strategic Plan, which illustrates clearly the University’s commitment to the public benefit. The Board of Governors is responsible for defining the strategic aims of the University and approved the Strategic Framework 2012-2017. The framework reflects the Board of Governors’ commitment to the public benefit as illustrated in the University’s mission statement and vision (above) and charitable purposes (below). LJMU’s charitable purpose, as perceived by its members and stakeholders, can be summarised as follows:

The primary beneficiaries of the University’s charitable purpose are: LJMU’s students who are directly engaged in learning, scholarly activity or research; the recipients of the University’s research and knowledge transfer activities, including the public, employers, and businesses; and, school children and alumni of LJMU who can engage in educational events organised by the University or use its academic facilities. The information provided from ‘Beneficiaries’ below is not an exhaustive list but a small sample of the University’s delivery of its charitable purpose across the breadth of the University.

n To create appropriate high quality opportunities that

enable learning, advancement, development, and employment, and that are open to as many individuals and communities as is achievable and sustainable. n To create and support opportunities for successful

participation by under-represented groups, as well as for continuing personal, professional and skills development for all members of the University.

Statement of Public Benefit The Board of Governors, also known as Trustees, have complied with their duty to have due regard to the guidance on public benefit published by the Charity Commission, and particularly to its supplementary public benefit guidance on the advancement of education, in accordance with the requirements of the HEFCE acting as principal regulator of English higher education institutions under the Charities Act 2011. The Charity Commission’s guidance on public benefit is also included as part of the induction process for new governors.

n To create an environment in which staff and

Mission, Vision and Aims LJMU’s mission is “to serve and enrich our students, clients and communities by providing opportunities for advancement through education, training, research and the transfer of knowledge”. The University’s mission, vision and aims therefore reflect LJMU’s commitment to the public benefit in terms of its charitable purpose for the advancement of education.

n To endeavour through partnership and enterprise to

students can engage in research that is innovative; that contributes to knowledge or to professional practice; that encourages personal and professional development; that enhances learning; or that is of social or economic importance to communities. n To reinforce the entire range of activities with a

culture of scholarship and with a growing body of specific research that is consistently of national and international standing and benefit.

impact upon economic development and regeneration, as well as social and cultural advancement, whether at local, national or international levels. Beneficiaries Students who attend the University benefit directly from the quality of the education they receive. The University’s World of Work Programme aims to ensure that every student is equipped with the skills they need to stand out from the crowd and to successfully engage in the world of work, either because they possess skills which are highly valued by employers or because they are well equipped to set themselves up in their own business. In

Since becoming a University, LJMU has grown substantially from around 8,000 students in 1988 to now more than 24,000 students studying across 4 faculties, with approximately 9,000 students graduating this year. This represents a substantial contribution to accessible Higher Education in the UK. 27


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the 2012/13 academic year the self-awareness statement (one of three that constitute the employer verified World of Work Skills Certificate) was made compulsory and integrated into the first year (Level 4) curriculum resulting in 4,700 students reflecting on and providing evidence of this essential employability attribute. In 2012/13 over 7,000 LJMU students engaged with the Skills Certificate. The World of Work Careers Centre is accredited against the Department for Business, Innovation and Skills EMQC Matrix Quality Standards. It offers a range of services designed to support graduates in their job hunting and these services are available to LJMU alumni for life. LJMU has seen four successive years of increase in the numbers of graduates securing managerial and professional employment and four successive years of decreasing graduate unemployment. In 2013/14 the World of Work Careers Centre is supporting Merseyside schools’ sixth forms by collaboratively developing a model of career planning which is based on the LJMU World of Work Skills Certificate.

Sporting Night Out” where research activity in sport and educational opportunities were delivered to over 100 local and disadvantaged school children and youths. The School is the co-partner (with Merchant Taylors Girls School, Crosby) in the national “Girls Go Gold” conference highlighting Sports Science as an educational and career option as well as demonstrating research work that underpins development of sports performance. This conference has invited over 300 school girls nationally with a high profile in sports and academia. The Face-2-Face with Sports Science programme won a Bronze Podium Award (associated with London 2012) and the research work of Dr Joe Causer in supporting the British Shooting Team in the run up to London 2012 won a Gold Research Award. The School hosts two new Knowledge Transfer Partnerships: the first with Prozone Ltd seeks to develop a long and successful collaboration accurately mapping sports performance on-line and in real time in multiple stadia around the world; the second is with Destination Youth Ltd, developing approaches and insights into childhood physical activity and health.

The Centre for Entrepreneurship support students and graduates who want to set up their own businesses and is part of the North West Higher Education Enterprise Champions ERDF project. The Centre provides support with developing business ideas, working as freelancers, launching products and services and growing an existing business. It also provides help with and access to professional networking opportunities, supportive academic staff and relevant business training.

Open Labs is a European-funded initiative at LJMU with developing successful research collaboration between University academics and small technology businesses. It is led by the Faculty of Arts, Professional and Social Studies. It aims to stimulate and support business/HEI collaboration and knowledge transfer. Higher education has a key role to play in developing the entrepreneurial capacity of the creative industries and encouraging enterprise activity. Open Labs develops partnerships with these businesses and works with areas of expertise with the University to take advantage of technology-enabled transformations in internet technologies. SMEs have access to University Research & Development with the potential to be turning into high growth opportunities with a global market reach.

LJMU’s Astrophysics Research Institute carries out internationally-leading research in areas ranging from the evolution of stars to the structure of the Universe. Within the University, it is responsible for the operation and development of the Liverpool Telescope as the world’s largest and most capable fully robotic telescope operating as a UK National Facility. Although the majority of the time on the telescope is devoted to serving the national and international research communities, time is also set aside specifically for public engagement, particularly for access by schools through LJMU’s National Schools’ Observatory (NSO) project.

To date the project has engaged and participated with over 400 companies within the North West which has resulted in a significant impact on a number of these. 26 new jobs have been created and 18 companies have reported that they have significantly improved their performance as a direct result of collaborations and support from Open Labs. There are numerous projects which are under development and are expected to deliver further benefits to the companies.

LJMU’s School of Sport and Exercise Sciences delivers innovative, research-led and employability focused undergraduate and postgraduate programmes that are supported by world class academics and state-of-the-art laboratory facilities. It is the only Sport and Exercise Science Department in the UK designated as a Centre of Excellence in Teaching and Learning.

The University’s Liverpool School of Art & Design (LSAD) has established 'Hunting in Packs'. This is a scheme in partnership with the Developer, Urban Splash, that will see 24 recent graduates occupying a shared creative studio hub in order to develop innovative new businesses and social enterprises. The graduates lease the space free of charge and are supported in the development of their businesses by relevant academic staff and the Centre for Entrepreneurship. LSAD has established the Exhibition Research Centre (ERC), which provides students and recent graduates to engage with a cutting edge and research based

The School of Sport and Exercise Sciences has continued its Research and Public Engagement activity. Under the continuing remit of “Face-2-Face with Sport Science”, a Royal Society grant partnership saw children from the Chesterfield School visit the University’s Tom Reilly Building on two occasions to observe and collect scientific data related to sports performance and health. The School recently supported the BBC 5-live “Big 28


Liverpool John Moores University

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exhibition programme. The ERC also stages public keynote lectures which further knowledge and debate about the history of exhibitions and examine new developments in the field. The ERC benefits recent graduates, artists and creatives in the city by exposing them to a research focused articulation of cutting edge developments in the field of exhibition making.

Benefit related to teaching and learning Some illustrations of the University’s contributions are: The Centre for Public Health (CPH) has an international reputation for quality in leading-edge research activities. The Centre offers expertise in a range of methodologies including health, research, evaluation, systematic reviews, surveillance, audit, epidemiology and statistics. CPH draws from a wide range of Honorary Lecturers and Professors based in the health services and other public bodies, both in the UK and abroad, in order to support multi-disciplinary approaches to public health. Through the CPH website at http://www.cph.org.uk/ , access is given to publications in high impact journals and work with the news and social media which aims to maximise free access to and use of public health research and evidence. Our research and, where appropriate, datasets are available for use by health professionals, academics and the public.

In addition to the ERC, LSAD maintains an active programme of more locally focussed exhibitions in the John Lennon Art and Design Building. The programme for this year includes 'Deaf School – the art school dance goes on forever', 'The Willie Russell Archive', and the RIBA President's Medals. These exhibitions benefit the broader community of the city by articulating its own history. In partnership with the Faculty of Arts in the University of Shanghai and the International Association of Art Critics LSAD has established the ‘John Moores Critics Awards’, an award to encourage participation and engagement with critical writing on a local basis and to stimulate debate about the nature of critical writing between the UK and China. The first edition of the prize took place in 2012 and the second is planned for 2014.

A senior member of staff in the Centre for Public Health was recently presented with the 2013 Alwyn Smith Prize at the Faculty of Public Health (FPH) Awards Ceremony which took place on 2 July 2013. The prize is awarded annually to the FPH member or fellow judged to have made the most outstanding contribution to the health of the public by either research or practice in community medicine and was originally endowed by Professor Alwyn Smith on his retirement as President of the FPH in 1986. A senior member of staff was recognised for his substantial contribution to public health research and advocacy including the FPH’s alcohol policy.

Research and technology transfer Impact is at the forefront of the University’s research activities, rooted in the need to demonstrate openly a public benefit to the public funding for research that extends beyond our academic peers and benefits the wider community through knowledge transfer. From developing cutting-edge new technology to detect brain tumours to policy-influencing studies about the impact of the recession on the UK’s regional cities, the University’s research base is helping to inform public policy, shape new laws, transform lives and protect and enhance the environment.

The Faculty of Technology and Environment’s School of Engineering, Technology and Maritime Operations delivered its first Summer School in conjunction with the Smallpeice Trust in July 2013. The Smallpeice Trust provides residential courses to promote engineering careers to young people. Forty 14 and 15 year old students from across the UK took part in an interactive introduction to offshore wind energy generation through a series of classes and lectures. Over four days the students competed in teams to design and build the components of an offshore wind generation system whilst gaining exclusive use of the University’s laboratories. They learnt about energy generation and the challenges faced by engineers in building, installing and maintaining offshore wind farms and in distributing this energy to domestic and industrial users. They also had an insight into the career opportunities in the industry when they attended a talk by Siemens.

The University’s research connections stretch across three continents, bringing opportunities for collaboration with some of the best minds, organisations and facilities from across the globe, in the process providing a stimulating and contemporary student learning experience. A thriving research base helps the University to engage globally, and embrace internationalisation to the benefit of its students, staff and partners. University academic staff are expected to publish the results of research they have undertaken in peer reviewed academic journals, to publish books, to submit and present to research conferences and to feed that research into their teaching. The University makes available publicly, via its website, access to its research archive and has collaborative and reciprocal arrangements in place with other university libraries for access or borrowing facilities for students and academic staff. Under an initiative entitled ‘Inspire’ the University has invested significantly in new research staff and is making careful and progressive preparations for the REF (Research Excellence Framework) 2014.

An academic member of staff from the School of Natural Sciences and Psychology is an expert upon the transmission and control of River Blindness in Africa. This disease causes irreversible blindness and skin disease, leading to social exclusion and poverty. The same academic member of staff is working with the Ministry of Health in Uganda and the Carter Center to 31


Liverpool John Moores University

characterise the disease in the north of the country and is advising upon disease elimination strategy. The infection has already been eliminated from a third of endemic areas, but in the north of the country it has found that it is spread by a different species of blackfly which may carry infection into other areas. Collaboration is therefore ongoing with the World Health Organisation African Programme for Onchocerciasis Control to see if transmission of the disease can cross the border into South Sudan and whether control efforts in the two countries will have to be co-ordinated.

biomedical engineering in order to engage North West (NW) based Small & Medium Sized Enterprises (SMEs) as core partners in collaborative Research & Technology Development (RTD) and Knowledge Exchange partnerships. n Opticon II: The Optical Infrared Co-ordination

Network for astronomy brings together all the national and international agencies and organisations which fund, support, develop and operate Europe’s facilities for optical and infrared astronomy. Opticon provides a framework allowing joint action to improve the quality of Europe’s infrastructures; to train new astronomers, especially those from Central Europe, in modern new research methods; to develop innovative technologies to enhance research quality; to plan for future developments; and, to work towards a strategic plan for Europe’s future research infrastructures.

The European Institute of Urban Affairs within the Faculty of Technology and Environment is a long established, high profile research and consultancy group with LJMU. Its key aims are to be a centre of international academic research excellence; a leading urban policy research group influencing national and international policy development; and, a resource for policy-makers and communities in the Liverpool city region, North West region and the UK. Some of its key projects have significantly influenced the decisions and behaviour of governments and major public organisations, including setting the government policy agenda for cities in the UK and Europe.

Student Access LJMU is proud of its longstanding record of reaching out to students from disadvantaged backgrounds and ensuring that the benefits of a university education are accessible to everyone with demonstrable academic ability irrespective of their social or economic background. The University’s longstanding and successful track record of widening participation is evidenced by its performance against Higher Education Statistical Agency (HESA) widening participation indicators. 96.6% of LJMU’s young students are from state schools, 16.5% from lower participation neighbourhoods and 37.2% from social classes NS-SEC 4-7 (as classed by HESA). The percentage of mature students with no previous higher education experience and from lower participation neighbourhoods is 20.2%, which is considerably higher than the UK average of 10.9%. 3% of LJMU students are in receipt of the Disabled Students’ Allowance and 9.7% of home students are from a BME background.

Economic Development The University’s Development Funding Office (DVF) seeks to help the University to capitalise on various funding opportunities that are available to support the University’s strategic plan. These include a wide range of UK and European sources, among them the European Regional Development Fund (ERDF) and the European Social Fund (ESF), Research and Technological Development (RTD) programmes, and the Erasmus student and staff exchange programme which promotes cultural and educational mobility throughout the EU. The DVF support a number of projects of which a small sample is listed below: n AFRESH (Activity and Food for Regional Economies

The University also provides funds to support students experiencing financial hardship and continues to invest in carefully targeted financial support for students from lower income backgrounds offering a holistic approach to help aid retention and progression.

Supporting Health), funded by the European Commission through the Seventh Framework Programme which aims to develop new research ideas and product and service innovation to foster healthy lifestyles.

In 2012/13 the profile of the students in receipt of a National Scholarship Programme (NSP) award shows that 21.14% were from a BME background, 8.05% were disabled students and 21.81% were mature students. These figures are higher than the percentage for new students that did not receive the NSP and demonstrate that, in addition to coming from a low income background, the award is targeting students that may be potentially experiencing other forms of disadvantage. The University will therefore continue to match-fund its Government allocation of the NSP by doubling the number of places and will monitor and evaluate the progression of students who receive this scholarship.

n GERI – The Faculty of Technology and

Environment’s ERDF funded outreach programme project - which brings together the staff and technical equipment of LJMU’s internationally renowned General Engineering Research Institute (GERI) within a centralised research laboratory complex in order to provide a dedicated facility for engineering research - has recently been extended having been awarded a further grant. The facility provides a high quality resource and knowledge base providing expertise in measurement, sensing, materials processing, advanced manufacturing and 32


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LJMU will also provide a bursary of £500 per annum to home full-time undergraduate students with a household income of £25,000 or less and will allocate £250,000 in 2014-15 to a student support fund. This fund will be directed at students who are most in need in order to aid retention. The University remains committed to ensuring that all students that are able to participate in higher education can do so regardless of their financial circumstances.

LJMU’s School of Sports Science, which has been involved with most Sport Relief challenges, providing training to David Walliams and Chris Moyles, among others, also provided training for John Bishop to ensure he completed his ‘Bishop’s Week of Hell’ for Sport Relief. This year has seen one of the team provide training and support for the Comic Relief Challenge to travel down the Zambezi River. Again this challenge has resulted in the raising of over £1 million to support projects related to children’s health and disease prevention in Africa.

Trading with Integrity As one of the largest employers in the Greater Merseyside region, LJMU continues to develop its approach to ethical trading. This is done through the purchase of Fair Trade goods where possible and appropriate, balancing always the benefits of developing educational opportunities for the citizens of the world with a careful consideration of the political, ethical and human rights records of the governments of those countries in which LJMU operates or recruits students.

In September 2012 LJMU played host to the Liverpool Biennial in a partnership agreement which saw one of Liverpool’s landmark buildings open to the public for the first time in history. The University’s Copperas Hill Building, formerly home to the Royal Mail, played host to three major exhibitions during the Liverpool Biennial 2012, the largest contemporary art festival in the UK. Newly commissioned and existing artworks and projects were presented in diverse locations, including unusual and unexpected public spaces as well as the city’s galleries, museums and cultural venues. LJMU is committed to supporting culture and the arts in the city of Liverpool and beyond. The Liverpool School of Art & Design enjoys collaboration with some of the world’s most significant cultural organisations enabling integration and engagement, which enhances the quality of research, academic provision and careers that the School can support the University’s graduates to achieve.

Community Engagement Some illustrations of the University’s contributions are: As a flag-ship of LJMU’s community engagement, the Roscoe Foundation for Citizenship promotes good citizenship amongst the young people in the Greater Merseyside region. More than 900 schools are engaged in the scheme, to promote good citizenship to school children by making awards to role models in society. The Foundation also runs the prestigious Roscoe Lecture series, securing high profile speakers from the national and international community to present thoughtprovoking public lectures that are free and open to the community in the North West. Audiences typically number over 1000 (and sometimes reach 2500) and tickets are free of charge. Speakers have included notable people from the fields of national and international politics and diplomacy, academia, religion and belief, journalism and entertainment. LJMU’s world-leading Astrophysics Research Institute owns and operates the World’s largest and most sophisticated Robotic Telescope, based in the Canary Islands (See 6.5.3 above), and time on this telescope is made available to the National Schools’ Observatory (NSO) alongside its function as a National Facility for research. The NSO now has approximately 4,000 teachers including those in some 1,400 secondary schools as registered users of the telescope and approximately 14,000 individual students have user accounts. Since the NSO was launched, almost 60,000 observations have been requested and delivered to schools across the UK. The NSO project is funded by LJMU and is offered free to registered school users. Expansion of the scope and reach of the NSO is being undertaken within the University’s Widening Participation agenda. The Institute also helped found, and continues to provide knowledge input to ‘Spaceport’, a locally based major tourist attraction, owned by Mersey Travel.

LJMU Geography and Wildlife Conservation students from the School of Natural Sciences and Psychology recently worked with children at St Albert’s Catholic Primary School in Stockbridge Village to create a new community orchard and outdoor learning zone behind their school. The students have been learning about the Mab Lane Community Woodland project as a case study in a new module called ‘Sustainable Natural Heritage’ which explores the cultural and social aspects of conservation and how it engages the wider community.

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Liverpool John Moores University BOARD OF GOVERNORS The University is an independent Higher Education Corporation whose authority derives from the Education Reform Act 1988, and the Further and Higher Education Act 1992. The Board of Governors derive their authority from the University’s Instrument and Articles of Government which was approved by the Privy Council on 5 March 1993, and revised in 1995 and 2002. The Instrument and Articles of Government state that the Board shall consist of not less than twelve and not more than twenty-four appointed members. The Board must decide what size it wishes to be. The Board currently consists of twenty members, of whom up to thirteen would be independent members, one nominee each from the Academic Board and two students, two staff governors and two co-opted members. The membership of the Board is completed by the Vice-Chancellor, who is the Chief Executive. In the period from 1 August 2012 membership of the Board of Governors has been as follows: -

Ex-officio Members Professor Nigel Weatherill External Independent Members Sir M Thornton Ms N. Benson Ms K Byrne Mr J Carson Ms C Dove Mr R Hill

Mr A Holroyd Mr P Hyland Sir B Massie Mr B McCann Mr G Morris Ms D Shackleton

Judge Elizabeth Steel Mr J Stopforth

External Co-opted Members Mr P Holme Mr C Williams

Vice-Chancellor & Chief Executive

Chairman and Pro Chancellor (Retired 31 March 2013) Chairman of Remuneration Committee Chairman of Nominations Committee Deputy Chairman of Finance Committee (Appointed 7 July 2013) Retired 1 July 2013 Retired 1 July 2013 Chairman of Finance Committee (Retired 31 March 2013) Chairman and Pro Chancellor (Appointed 1 April 2013) Chairman of Nominations Committee (Appointed 1 April 2013) Chairman of Remuneration Committee (Appointed 1 April 2013) (Retired 30 September 2013) Deputy Chairman of Employment Committee (Appointed 12 December 2012) Deputy Chairman of Audit Committee (Retired 30 September 2013) Chairman of Audit Committee (Appointed 1October 2013) Deputy Chairman of Audit Committee (Appointed 1 October 2013) Deputy Chairman Finance Committee (Retired 31 March 2013) Chairman of Finance Committee (Appointed 1 April 2013) Chairman of Audit Committee (Retired 30 September 2013) Deputy Chairman of the Board of Governors (Appointed 1 October 2013) Chairman of Remuneration Committee (appointed on 1st October 2013) Chairman of Employment Committee (Retired 11 December 2012)

Co-opted Governor from Education Sector Deputy Chairman of Employment Committee Chairman of Employment Committee (Appointed 12 December 2012) Co-opted Governor from Education Sector Appointed co-opted member of Audit Committee (Appointed on 4th February 2013)

Nominee Members Dr T Livsey Mrs J Murphy Mr P Abernethy Mr T Aldus Mr C Reid Mr D Cole

Staff Governor (Academic Board Nominee) (Retired 31 August 2013) Staff Governor (Academic Board Nominee) (Appointed 30 September 2013) Student Governor (Student President) (Retired 31 May 2013) Student Governor (Vice President Activities) ( Retired 6 July 2013) Student Governor (Student President) (Appointed 8 July 2013) Student Governor (Student Vice-President) (Appointed 27th September 2013)

Staff Members Professor P Lisboa Mr R McGee Ms D Fantin

Staff Governor (Teaching Staff) Staff Governor (Non-Teaching Staff) (Retired 5 July 2013) Staff Governor (Non-Teaching Staff) (Appointed 29 October 2013)

The Board of Governors are the Trustees of the University. 34


Liverpool John Moores University OFFICERS AND ADVISORS OF THE UNIVERSITY

Vice-Chancellor and Chief Executive

:

Professor Nigel Weatherill

Bankers

:

Barclays Bank plc. 6th Floor 1 Marsden Street Manchester M2 1HW

External Auditors

:

KPMG LLP St James’ Square Manchester M2 6DS

Solicitors

:

Davies Wallis Foyster 5 St Pauls Square Old Hall Street Liverpool L3 9AE

Internal Auditor

:

Deloitte LLP Horton House Exchange Flags Liverpool L2 3PG

RESPONSIBILITIES OF THE BOARD OF GOVERNORS OF LIVERPOOL JOHN MOORES UNIVERSITY In accordance with the Education Reform Act 1988, the Board of Governors of the University is responsible for the administration and management of the affairs of the University and is required to present audited financial statements for each financial year. The Board of Governors is responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the University, and to enable it to ensure that the financial statements are prepared in accordance with the Education Reform Act, the Statement of Recommended Practice on Accounting for Further and Higher Education Institutions and relevant Accounting Standards. In addition, within the terms and conditions of a Financial Memorandum agreed between the Higher Education Funding Council for England and the Board of Governors of the University, the Board of Governors, through its designated office holder, is required to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the University and of the surplus or deficit and cash flows for that year. In causing the financial statements to be prepared, the Board has ensured that: -

Suitable accounting policies are selected and applied consistently. Judgements and estimates are made that are reasonable and prudent. Applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements. Financial statements are prepared on the going concern basis unless it is inappropriate to presume that the University will continue in operation. The Board is satisfied that the University has adequate resources to continue in operation for the foreseeable future; for this reason the going concern basis continues to be adopted in the preparation of the financial statements.

The Board has taken reasonable steps to: -

-

Ensure that funds from the Higher Education Funding Council for England and the Training and Development Agency are used only for the purposes for which they have been given and in accordance with the Financial Memorandum with the relevant Funding Council and any other conditions which the Funding Council may from time to time prescribe. Ensure that there are appropriate financial and management controls in place to safeguard public funds and funds from other sources. Safeguard the assets of the University and prevent and detect fraud. Secure the economical, efficient and effective management of the University's resources and expenditure.

Mr Rod Hill Chairman 35


Liverpool John Moores University

Corporate Governance Statement 2012/13 The University is committed to adopting good practice in all aspects of corporate governance. It aims to conduct its business in accordance with the principles identified in the Committee on Standards in Public Life (selflessness, integrity, objectivity, accountability, openness, honesty and leadership) and the Committee of University Chairs (CUC) Guide for Members of Higher Education Governing Bodies in the UK, known prior to 2010 as the ‘Combined Code’ and now known as the ‘UK Corporate Governance Code’. The Board of Governors has adopted the CUC’s Governance Code of Practice and works to ensure that governance practice remains consistent with the principles of the Code. Summary of the University’s Structure of Corporate Governance The University is an exempt charity and as such is required to undertake activities, in accordance with its aims and objectives, which are for the public benefit. The University has had regard to the Charity Commission’s guidance on public benefit, and information on how the University has delivered its charitable purpose [the provision of Education] for the public benefit is set out on page 27. The University’s Board of Governors comprises lay, academic, student and other staff persons appointed under the provisions of the Education Reform Act 1998, the majority of whom are independent and nonexecutive. The composition of the Board of Governors is set out on page 34. The role of Chairman of the Board of Governors is separate from the role of the University’s Vice-Chancellor & Chief Executive. At the Board of Governors’ Meeting held on 30 September 2013 the position of Deputy Chairman of the Board was reestablished after the role had been fulfilled previously by the Chairmen of Committees. The matters reserved specifically to the Board of Governors for decision are set out in the Articles of Government of the University; the terms of reference of the Board and its Committees; and under the Financial Memorandum (FM) with the Higher Education Funding Council for England (HEFCE). The Board of Governors holds to itself the responsibilities for the educational character, the ongoing strategic direction and the financial solvency of the University. The Board approved the University’s new Strategic Plan 20122017 on 15 February 2012 which can be found at http://www.ljmu.ac.uk/Vice_Chancellor/123131.htm. In addition to its formal Board and Committee meetings, the Board holds a number of strategic workshops and a residential strategic event each year, affording it the opportunity to consider, contribute to and influence strategic issues at an early stage in their development. The Board is also responsible for approval of all major developments, including property developments, and is in receipt of regular reports from Executive Officers on the day-to-day operations of the University’s business and its subsidiary operations. The Board of Governors has a strong and independent non-executive element and no individual or group dominates its decision-making process. The Board is independent of management and free from any business 36


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Audit Committee and attends that Committee in his capacity of Vice-Chancellor & Chief Executive rather than as a Governor. The Board of Governors and its Committees review their terms of reference on a regular basis in the light of prevailing circumstances with a view, inter alia, to ensuring that they are embedding risk management effectively into their work. The Chairman of the Board of Governors was Sir Malcolm Thornton until 31 March 2013 and Mr Rod Hill from 1 April 2013. The Deputy Chairman of the Board is Ms Deborah Shackleton, appointed from 1 October 2013. The role of Deputy Chairman had been fulfilled by the Chairmen of Committees on a team basis before this date. The full Board of Governors, in the last financial year, met on 1 October 2012; 19 November 2012; 10 December 2012 (Governors’ Workshop); 30 and 31 January 2013 (Residential Strategic Event including an Extraordinary Meeting); 25 March 2013; 8 April 2013 (Extraordinary Meeting); and 1 July 2013. Up to the present date in the new financial year, the Board has met on 30 September 2013 and 18 November 2013.

or other relationship which could interfere materially with the exercise of its independent judgement. As a demonstration of the University’s stated commitment to place students ‘at the heart’ of its activities, the number of student Governors on the Board was increased from one to two in 2011/12. This is the maximum permitted under the relevant legislation. In addition, sabbatical officers from the Students’ Union attend meetings of the Strategic Management Team (SMT) on a monthly basis as a means of articulating the ‘student voice’ on matters of mutual interest. Upon commencing appointment, Governors are required to declare any pecuniary, family or other personal interest, direct or indirect, and this is noted in the Register of Members’ Interests. Governors are advised and expected to update their entry at any time as and when their circumstances change and the University also conducts an annual update in accordance with the recommendations of the CUC. The Registers of Interests for both the Board and the University’s Senior Management are published on the University website. Upon appointment Governors are also required to sign a ‘statement of confidentiality’.

The Finance Committee meets at least three times a year and recommends to the Board of Governors the University’s annual revenue and capital budgets after giving consideration to the financial health of the University. It also receives at each meeting reports on the University’s performance in relation to approved budgets, estate related capital investment plans and treasury management, and a financial report from the Liverpool Students’ Union (LiverpoolSU), which is a separate legal entity. The Chairman of the Finance Committee was Mr Rod Hill until 31 March 2013 and then Mr Graham Morris from 1 April 2013 who was Deputy Chairman before this date. Ms Kerry Byrne became Deputy Chairman of the Finance Committee from 7 July 2013. The Finance Committee, in the last Financial Year, met on 29 October 2012; 13 March 2013 and 17 June 2013. Up to the present date in the new financial year, the Finance Committee has met on 28 October 2013.

In accordance with the introduction of the Bribery Act 2010, the Governors have taken responsibility for establishing an anti-corruption culture formulated around the six general principles of: Proportionate procedures; Top-level commitment; Risk Assessment; Due diligence; Communication (including training); and Monitoring and Review. A statement of commitment from the Chairman of the Board of Governors outlines that the Board of Governors expects that all staff, associates and agents will conduct business in accordance with the highest standards of ethical behaviour and that any bribery, or any form of corruption, by a member of staff of the University will be considered gross misconduct and the member of staff may face dismissal. To ensure that all staff are aware of the new Bribery Act, which came into effect in 2011, a mandatory e-learning module has been developed which gives an overview of the legislation to help staff to understand their corporate and individual duties and responsibilities. Agents, consultants and business partners who work with, or on behalf of, the University must act with integrity and behave ethically. The University will terminate agreements with such agents, consultants and business partners in the event of any breach of anti-bribery law, corruption or unethical behaviour of which it becomes aware.

The Employment Committee meets at least three times a year and considers issues related to staffing and employment, including Health & Safety, in the University. The responsibilities of the Committee also encompass equality and diversity monitoring and the regulatory aspects of the University’s relationship with the student body. The Chairman of the Employment Committee was Her Honour E Steel DL until 11 December 2012 with Mr Paul Holme as the Deputy Chairman; Mr Paul Holme then became Chairman from 12 December 2012 with Mr Andrew Holroyd becoming the Deputy Chairman from the same date. In the last financial year the Employment Committee met on 22 October 2012; 25 February 2013; and 3 June 2013. Up to the present date in the new financial year, the Employment Committee has met on 21 October 2013.

The Board of Governors meets a minimum of four times a year and maintains several Committees: a Finance Committee; an Employment Committee; a Remuneration Committee; a Nominations Committee; and an Audit Committee. All of these Committees are formally constituted with terms of reference and comprise lay members of the Board of Governors only. The Chairman or Deputy Chairman of the Board are not members of the Audit Committee and there is no overlap in membership of the Audit and Finance Committees. The ViceChancellor & Chief Executive is not a member of the

The Remuneration Committee, which meets at least once a year, considers the performance and determines the annual remuneration of the Vice-Chancellor & Chief Executive and Senior Officers of the University. The Chairman of the Remuneration Committee was Sir Malcolm Thornton until 31 March 2013. Mr Rod Hill was Chairman of Remuneration Committee from 1 April 2013 37


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March 2013; 24 June 2013; and 15 July 2013. Up to the present date in the new financial year, the Audit Committee has met on 14 October 2013 and 4 November 2013.

until 30 September 2013 and then, in line with best practice for the Chairman of the Board who holds the primary relationship with the Vice Chancellor & Chief Executive not being the Chairman of the Remuneration Committee, the new Chairman, Ms Deborah Shackleton, Deputy Chairman of the Board, was appointed from 1 October 2013. The Remuneration Committee that decided pay arrangements for 2012/13 actually met on 18 June 2012. Up to the present date in the new financial year, the Remuneration Committee has met on 28 October 2013.

In the opinion of the Board of Governors, the governance practices of the University are consistent with the “Guide for Membership of Higher Education Governing Bodies in the UK”, published by the CUC in February 2009, and as superseded by the UK Corporate Governance Code in May 2010. The University had reported in its last Corporate Governance Statement that the University’s 7 most experienced Governors, defined as those serving in their (final) third term as at 1 September 2010, would be extended in office by two years from the date when their individual term of office would have concluded. This was to ensure continuity, stability and continuing effective governance during the succession to the position of ViceChancellor & Chief Executive, and in light of the unprecedented challenges in the HE sector at that time.

The Nominations Committee meets at least once a year and more regularly if necessary, and considers membership issues and appointments to vacancies on the Board for non-executive members. The Committee also advises the Board of Governors of attendance statistics on an annual basis and supports any necessary intervention that the Chairman of the Board should make in instances of low attendance. Issues around attendance are discussed by the Chairmen of Committees as part of performance review meetings with individual Governors, which Nominations Committee also oversees. The Chairman of the Nominations Committee was Sir Malcolm Thornton until 31 March 2013 and then succeeded by the new Chairman of the Board, Mr Rod Hill, from 1 April 2013. In the last financial year, the Nominations Committee met on 29 October 2012; 10 December 2012; 25 March 2013 and 17 June 2013. Up to the present date in the new financial year, the Nominations Committee has met on 28 October 2013.

During 2009 the Board of Governors conducted an indepth review of the effectiveness of institutional governance arrangements of the University and made proposals for forward action. Such an intensive effectiveness review is conducted every four years with any identified actions/enhancements implemented in the meantime as and when the need arises. The 2009 review determined that there continued to be a high level of satisfaction within the Board of Governors and the Executive with the current governance arrangements within the University, alongside a commitment to selfevaluation and continuous improvement. The recommendations arising from the review were implemented during 2009/10. The Board recognises that the maintenance of good corporate governance arrangements is an ongoing process and a programme of development in governance work was undertaken and implemented in 2010/11. With the appointment of a new Vice-Chancellor & Chief Executive in 2011 the University has recently gone through a major re-alignment exercise with a new minimal University committee structure. The Board of Governors has decided, therefore, that the realignment and new committee structure will need time to embed before carrying out the next in-depth review of the effectiveness of institutional governance arrangements. However, the Board has committed to ensuring that the Board’s committee structure is aligned with the new University committee structure and is appropriate to the University’s business needs. These issues will be considered by the Chairmen of the Board and Committees during 2013/14.

The Audit Committee, which meets at least four times a year (five in 2012/13), is responsible for overseeing the work of the external auditors (currently KPMG) and internal auditors (currently Deloitte) and considers detailed reports on the maintenance of the University’s systems of control, including management reports and implementation plans and also considers any recommendations for improvement of systems and controls. In line with government regulations, the Audit Committee has two members with the appropriate financial expertise and qualifications, having appointed an additional Co-opted Member to the Committee in February 2013. The Committee also receives and considers reports from HEFCE as they affect the University’s business, monitors adherence with regulatory requirements and reviews the University’s accounting policies. Whilst the Vice-Chancellor and other managers attend meetings of the Audit Committee as necessary, they are not members of the Committee. The Committee is empowered to meet any auditors on their own for independent discussions should this be decided to be necessary by either party. The Chairman of the Audit Committee was Ms Deborah Shackleton for the full financial year, but this changed in the new financial year when Ms Shackleton became the Deputy Chairman of the Board from 1 October 2013. The Deputy Chairman was Sir Bert Massie who became Chairman from 1 October 2013 with Mr Brian McCann becoming Deputy Chairman of the Audit Committee from 1 October 2013. Mr Andrew Holroyd joined the Audit Committee on 1 October 2013. The Audit Committee, in the last financial year, met on 8 October 2012; 5 November 2012; 18

2011/12 and 2012/13 was an exceptionally busy period for Governors during a time of great change for the HE sector with particular reference to the external environment, including the decision on fees and the subsequent Access Agreement. The University is also going through some major capital developments, which will require additional scrutiny and monitoring over the coming year and for which additional governance scrutiny has been introduced via a Steering Group.

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Liverpool John Moores University

Internal Control

accordance with the Bribery Act 2010.

The University’s Board of Governors is responsible for the University’s system of internal control and for reviewing its effectiveness. The system is designed to support the achievement of operational activities and to manage and limit the risk of failure to achieve policies, aims and objectives.

The Board of Governors’ agenda includes a regular item for consideration of any relevant risk item. The Board receives reports on risk and the Risk Management arrangements from SMT and the Audit Committee. The Internal Audit Plan is derived from a high level risk assessment of the University’s operations in consultation with University management and the assessment makes detailed reference to the University’s Strategy Map and Plan, risk register, pipeline of possible audits and previous internal audit reports.

The system of internal control is based on an ongoing risk management process designed to identify the principal risks to the achievement of the organisation’s objectives; to evaluate the nature and extent of those risks; and to manage them efficiently, effectively and economically. It is underpinned by compliance with the requirements of the core standards in:

The SMT and the Audit Committee receive regular reports from internal audit, which include any recommendations for development or improvement. The Internal Auditors, who operate to the standards defined in the HEFCE Accountability and Audit Code of Practice, submit regular reports, including independent opinion on the adequacy and effectiveness of the system of internal control, with any recommendations for enhancement.

n Governance n Financial Management n Risk Management

The University has the following processes and control arrangements in place:

The established processes for the identification, evaluation and management of the risks that the University faces were the subject of a major review in 2011/12 resulting in enhanced arrangements. All SMT members are required to have in place procedures for the identification, evaluation and management of risk both at the institutional level and in their local areas. All papers and reports presented to the SMT consider possible risk issues and appropriate key performance and risk indicators. The SMT receives regular reports setting out key risk indicators and considers possible control issues brought to its attention by early warning mechanisms which are embedded within the operational units. The Institutional Risk Register is reviewed on a regular basis and procedures for identifying risks refined. From 2012/13 all local risk registers are subject to annual review by SMT.

The University remains committed to best practice in Governance and Management. The principles of excellence underpin the University’s strategy (2012 to 2017), which itself is based on the four core themes of: Establishing and Enhancing the Student Partnership; Excellence in Learning, Teaching and Assessment; Embedding Research and Scholarship; and, Social and Economic Engagement. The Strategic Management System requires and ensures a regular review of the University’s strategic direction and performance. Progress against the strategy is monitored by the Strategic Management Team (SMT). The Strategy Management Director, as a member of SMT, and a dedicated Strategy Support Office have specific responsibility for oversight of the performance and delivery of the University’s strategy; as well as strategyrelated risk management.

Risk management is incorporated into the corporate planning and decision making process of the Institution. The Risk Management Policy contains a definition of the Institution’s risk appetite, reflecting informal advice from the University’s internal auditors and members of the Board with specific expertise in this area.

During 2012/13, the University has put in place a further strategic realignment of the organisational structure for implementation on 1 August 2013. This realignment is designed to further enhance the University’s ability to deliver the strategy through standardised faculty structures; common interfaces between faculties and central professional services; the appointment of three Pro-Vice-Chancellors with dedicated university-wide responsibilities for the core strategic themes; and, a minimal committee structure to oversee the key strategic activity and supporting initiatives.

Particular indicators of the effectiveness of the internal control systems during 2012/13 include: The most recent overall assessment from the HEFCE Assessment of Institutional Risk, dated 3 April 2013, was that LJMU was not at higher risk and was meeting the accountability obligations set out in the Financial Memorandum between HEFCE and Institutions.

The Board of Governors and the Board’s Committees review their terms of reference on a regular basis against prevailing conditions, with a view, inter alia, to agreeing how best to maintain risk assessment activity into their work. The terms of reference for the Audit Committee were reviewed and amended in November 2010 to take into account the new reporting requirements within HEFCE’s Financial Memorandum for regulations under the Charities Act 2006, and further amended on 3 October 2011 to take account of new duties in

The 2012/13 annual assessment statement by the Internal Auditors of the University’s system of internal control, including risk management and governance, reports that: ‘Based on the work which we have undertaken during the year, we are able to conclude that Liverpool John Moores University has a basically sound system of internal controls, which should provide substantial assurance regarding the effective achievement 39


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understanding across the University, training through workshops was provided across the Strategy Delivery Forum and for specific groups of employees. This will continue.

of the University’s objectives’. Assessment gradings for audits in 2012/13 were in the main either full or substantial. Two audits were graded as limited assessments. These audits were arranged as support to management in areas where action was consciously planned to resolve issues that had been identified by management and to further improve controls. The Internal Auditors advised that they were satisfied that the University was implementing the appropriate policies and meeting the recommendations from the internal audit fieldwork.

Policies in relation to Due Diligence, Anti Money Laundering and Terrorist Financing, and Gifts and Hospitality have been reviewed and where appropriate developed with changes implemented during the year. The University completed its agreed action plan to meet the recommendations of the 2009 Quality Assurance Agency (QAA) Institutional Audit in conjunction with an Assistant Director of the QAA. The University was notified by the QAA in December 2012 that it had fulfilled all requirements for follow-up action and that the audit was registered as completed.

The Office of Fair Access (OFFA) approved the University’s Access Agreement 2014-2015, which had been recommended by the SMT and endorsed by the Board of Governors. The Widening Participation Strategic Assessment submitted in the last financial year remains in place during a transitional period for HEFCE.

The Internal Auditors’ proposals arising from their review of the process of managing collaborative partnerships in 2011/12 have been considered as part of the review of operations in this area to meet the objectives in the Strategic Plan. Additionally, they have been used to inform the revision of processes related to the management of risk and the ongoing improvement of quality assurance and enhancement in relation to all provision including collaborative provision.

The Board of Governors approved the original Carbon Management Programme in March 2010, delegating responsibility for ongoing monitoring of the Programme to the Finance Committee. In so doing the University is demonstrating compliance with HEFCE’s requirement for oversight of the programme by the Board, and a nominated committee. The plan is currently being reviewed to ensure alignment with the new Estate master plan. The University’s Carbon Management Plan is currently 40% in progression towards achieving its 2015 target. This target will be revised through alignment with a new master plan. A revised plan will consider how we can achieve the statutory target of 34% by 2020 based on 1990 emissions. Monitoring of the Carbon Management Strategy is a responsibility of the University’s Estates Committee.

The University has implemented a two stage process for the approval of new collaborative partners and the approval of new programme development. An Initial Assessment of Strategic Fit (IASF) exercise is undertaken by the Academic Partnership Team to be approved by the relevant Dean. Once approved the full process of due diligence is undertaken. Following successful completion of the due diligence process the proposal for a new partnership is submitted to the Strategic Management Team for approval. New programme developments are considered by the Academic Planning Panel with recommendations being considered by the Education Committee for approval.

An Anti-Bribery Policy was agreed by the Board of Governors on 28 March 2011 and implemented thereafter. A Working Group was established to identify high risk areas and to prepare plans for implementing the policy. References to the Bribery Act 2010 have been included in documents and policies and a programme of communication about the Act was delivered in autumn 2011. Staff are required to undertaken an online training module on the Bribery Act 2010. An Anti-Bribery Follow Up internal audit has recently taken place and was reported to the Audit Committee in July 2012, receiving an overall substantial assessment. An assessment of high risk areas and the controls in place to counter fraud and prevent bribery was conducted in November 2012 by all members of the Strategy Delivery Forum (SDF), which comprises the University’s directorate. The Audit Committee had been reassured that the University was doing everything it could to ensure adequate procedures are in place to prevent bribery, fraud and corruption.

A Steering group chaired by the Pro-Vice-Chancellor (Education) and with representation from each faculty and the relevant professional services, has oversight of the preparations for the next Institutional Review which will take place during the 2015-16 academic session. As the revised chapters of the UK Quality Code are released by the QAA, a mapping exercise of University Strategy, policies and processes against the indicators in the new chapter is carried out; this is then followed by an audit, following which any necessary actions are identified and their completion monitored. Progress is reported through the appropriate University committee and periodically to the SMT and Academic Board. To support the management of the UKBA Highly Trusted Status Licence the University has appointed a UKBA Compliance Officer to ensure all Tier 4 activity complies with current sponsor guidance. Mock audits have been conducted (International Recruitment Agent activity) to ensure continued compliance and that the best practice processes are fully implemented. The University remains on stand-by for a routine UKBA Audit to be conducted. LJMU has signed up to the UKBA premium service,

Considerable work has been carried out within the University in the past years in connection with Fraud, Anti - Money Laundering, Anti- Bribery and Due Diligence through policies, workshops and on-line training modules. This is all essential as part of both legislation and reporting requirements and good practice. It is also recognised that having policies in place does not ensure compliance nor does it ensure understanding in all cases. Therefore to develop further and progress a greater 40


Liverpool John Moores University

period.

which provides information to the University in relation to the core measurable rates.

Following strategic realignment, there has been a revision in institutional policy in that requests for software solutions and developments are now submitted either to the IT Services Service Desk, or directly to the IT Projects Panel as successor to the Development Programme Steering Group. The IT Projects Panel has responsibility for the prioritisation and monitoring of all IT development requests deemed to be of a sufficient scale to warrant formal project management.

E-learning modules on data protection and freedom of information, and on diversity in the workplace have been introduced as essential training for all staff. The University has met the reporting requirements of both the Freedom of Information Act 2000 and the Data Protection Act 1998 for requests received, including handling the requests effectively.

The P2P (Procure to Pay) e-marketplace system - iprocurement and i-buy - has been used within the University since April 2011. All areas of the University now use some elements of the online procurement system. As a result of revisions to the University structure further roll out across the faculties and divisions will continue. The online system continues to be improved through development of workflow, increased number of suppliers, the introduction of e-invoicing and improvements in the actual usability of the system during 2012/13. The online system strengthens controls through the use of workflow processes over monitoring of budgets and authorisations of purchase orders and improves the efficiency of purchasing, receipting and invoice matching.

The University managed its occupational safety and health risks effectively, refining health and safety responsibilities, responding positively to changes in the Fire and Rescue Service’s automatic fire alarm response policy and making the required progress against the targets contained in the Safety and Health Services Action Plan 2012/13. The Occupational Health Unit, with new clinical leadership, continues to meet the Faculty of Occupational Medicine’s service standards, along with the University’s statutory requirements and those of professional bodies for students in vocational programmes. There was a slight decrease in the number of workplace accidents resulting in minor injuries. The number of accidents that were reported to the Health and Safety Executive increased from 2 to 10. The corresponding incidence rate for reportable accidents per 1,000 staff rose from 0.95 to 2.44, compared with the most recently published sector rate of 2.1 per 1,000 staff in 2012 and 4.45 per 1,000 staff (most recent Health and Safety Executive data for 2011/12).

The Diamond Report (Efficiency and Modernisation Task Group) from Universities UK (UUK) has set a target of 30% of Non-Pay spending to be achieved through collaborative procurement. LJMU is already making good progress towards this target with achievement of a saving of 24.5% of influenceable spend through collaborative procurement in 2011/12 (24.1% 2010/11).

The number of cases being referred to the Office of the Independent Adjudicator (OIA) in relation to student complaints and appeals continues to be low. In the calendar year 2012, ten complaints were closed by the OIA compared with seven in 2011. Of the ten complaints, the OIA decided that six were not justified, one was justified, one was partly justified and one was ineligible. One complaint was settled prior to a decision by the OIA.

The Audit Committee conducts a self-assessment every two years in order to satisfy itself and demonstrate that the Committee is committed to ensuring that it is continuing to fulfil its obligations as set out in its Terms of Reference and continuing to find ways of enhancing its effectiveness. The last review was held during September and October 2012 and reported to the Audit Committee on 5 November 2012 and which identified no serious issues of concern.

The governance of IT decision-making and strategy development was revised following the introduction of the new minimal LJMU Committee Structure. The IT Committee, chaired by the Registrar & Deputy Chief Executive, has now taken on the senior governance role, and development projects are managed by the IT Projects Panel, chaired by a Director of School and reporting to the IT Committee. A new LJMU IT Strategy has been progressed through the governance structure and is now pending approval by the SMT. Issues identified through the Internal Audit reviews of Data Security and Records Management and Identity and Access Management have been addressed, including the development of a Data Classification Policy and related Data Asset Register.

The Board of Governors is of the view that there is an ongoing process for identifying, evaluating and managing the University’s significant risks: that a process was in place for the year ended 31 July 2013; that it is regularly reviewed by the Board of Governors; and that it accords with internal control guidance for directors on the UK Corporate Governance Code as deemed appropriate for HE. The Risk Management Policy and Framework has been updated to reflect and align closely with the new Strategic Framework 2012-2017.

Inadequacies in the Student Information System (SIS), particularly in relation to the management of progression and assessment board processes, were resolved through the creation of a formal SIS Stabilisation Programme, led by a qualified Programme Manager and bringing together all internal and external inputs and resources required to render the system fit for purpose. The system has been used successfully through the major assessment board

Going Concern After making appropriate enquiries, the Board of Governors considers that the University has adequate resources to continue in operational existence for the foreseeable future. For this reason the Board continues to adopt the ‘going concern’ basis in preparing the financial statements. 41


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42


Liverpool John Moores University

INDEPENDENT AUDITOR’S REPORT TO THE BOARD OF GOVERNORS OF LIVERPOOOL JOHN MOORES UNIVERSITY We have audited the group and University financial statements (the ‘‘financial statements’’) of Liverpool John Moores University for the year ended 31 July 2013 which comprise the Group Income and Expenditure Account, the Group and University Balance Sheets, the Group Cash Flow Statement, the Group Statement of Total Recognised Gains and Losses and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). This report is made solely to the Board of Governors, in accordance with paragraph 13(2) of the University's Articles of Government and section 124B of the Education Reform Act 1988. Our audit work has been undertaken so that we might state to the Board of Governors those matters we are required to state to it in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Board of Governors for our audit work, for this report, or for the opinions we have formed.

have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

have been prepared in accordance with the Statement of Recommended Practice – Accounting for Further and Higher Education.

Opinion on other matters prescribed in the HEFCE Audit Code of Practice issued under the Further and Higher Education Act 1992 In our opinion, in all material respects: • funds from whatever source administered by the University for specific purposes have been properly applied to those purposes • funds provided by HEFCE have been applied in accordance with the Financial Memorandum and any other terms and conditions attached to them. Matters on which we are required to report by exception We have nothing to report in respect of the following matter where the HEFCE Audit Code of Practice issued under the Further and Higher Education Act 1992 requires us to report to you if, in our opinion: • the statement of internal control included as part of the Corporate Governance Statement is inconsistent with our knowledge of the University and group.

Respective responsibilities of the Board of Governors and auditor As explained more fully in the Statement of Responsibilities the Board of Governors on page 34 the Board of Governors is responsible for the preparation of financial statements which give a true and fair view. Our responsibility is to audit, and express an opinion, on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.

Mr Stephen Clark For and on behalf of KPMG LLP, Statutory Auditor Chartered Accountants St James’ Square Manchester M2 6DS

Scope of the audit of the financial statements An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the groups and University’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the Board of Governors; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Operating and Financial Review to identify material inconsistencies with the audited financial statements. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Date: 28 NOVEMBER 2013 The maintenance and integrity of the Liverpool John Moores University website is the responsibility of the Board of Governors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Opinion on financial statements In our opinion the financial statements: •

give a true and fair view of the state of the affairs of the Group and University as at 31 July 2013 and of the Group’s income and expenditure, recognised gains and losses and cash flows for the year then ended; 43


Liverpool John Moores University

providing pensions over the period during which the institution benefits from the employees' services. Variations from regular cost are spread over the expected average remaining working lifetime of Members of the Schemes after making allowances for future withdrawals.

STATEMENT OF PRINCIPAL ACCOUNTING POLICIES Basis of preparation These financial statements have been prepared in accordance with the statement of recommended practice (SORP – 2007): Accounting for Further and Higher Education Institutions and in accordance with applicable accounting standards.

Tangible fixed assets a. Land and buildings Land and Buildings are stated at valuation. The basis of valuation is either open market value for existing use or depreciated replacement cost. CB Richard Ellis, Chartered Surveyors, revalued the freehold and leasehold land and buildings at 31 May 2013. Valuations normally take place every 5 years, with an interim valuation in year 3. Freehold land is not depreciated. Buildings are depreciated over their expected useful lives of 50 years and leasehold buildings over the life of the lease. Assets in the course of construction are valued at cost and are not depreciated.

Basis of accounting The financial statements have been prepared under the historical cost convention, modified by the revaluation of certain land and buildings. Basis of consolidation The consolidated financial statements include the University and its subsidiary undertakings for the financial year to 31 July 2013. Intra-group sales and purchases are eliminated fully on consolidation. In accordance with FRS2, the activities of the Students Union have not been consolidated because the University does not control nor have significant influence over their managerial and financial policy decisions.

Where buildings are acquired with the aid of specific grants they are capitalised and depreciated as above. The related grants are treated as deferred capital grants and released to income over the expected useful life of the buildings.

Recognition of income

b. Maintenance of premises The cost of routine corrective maintenance is charged to the income and expenditure account in the period in which it is incurred.

Income from research grants, contracts and other services rendered is included to the extent of the completion of the contract or service concerned. This is generally equivalent to the sum of the relevant expenditure incurred during the year and any related contributions towards overhead costs. All income from short-term deposits is credited to the income and expenditure account in the period in which it is earned.

c. Telescope The Liverpool Telescope has been capitalised at cost and is being depreciated over 20 years. d. Heritage Assets The University owns a number of works of art which were donated or loaned during the last 10 years. These items are not included in the Financial Statements. Further information can be obtained in note 10.

Income from specific endowments and donations is included to the extent of the relevant expenditure incurred during the year, together with any related contributions towards overhead costs.

e. Equipment Equipment, including computers and software, costing less than ÂŁ5,000 per individual item, or group of related items, is written off to the income and expenditure account in the year of acquisition. All other equipment is capitalised at cost and depreciated over 4 years.

Recurrent grants from the Funding Council are recognised in the period in which they are receivable. Non-recurrent grants from Funding Council or other bodies received in respect of the acquisition or construction of fixed assets are treated as deferred capital grants and amortised in line with depreciation over the life of the assets.

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 life of the equipment.

Pension schemes The three pension schemes for the University's staff are the Teachers’ Pension Scheme (TPS), Universities Superannuation Scheme (USS) and the Merseyside Pension Fund (MPF). The schemes are defined benefit schemes, which are externally funded and contracted out of the State Earnings-Related Pension Scheme. The Funds are valued every five years (TPS) by actuaries using the entry age method, or three years (MPF and USS) by actuaries using the projected unit method, the rates of contribution payable being determined by the trustees on the advice of the actuaries. Pension costs are assessed on the latest actuarial valuations of the Schemes and are accounted for on the basis of charging the cost of

f. Leases Fixed assets held under finance leases and the related lease obligations are recorded in the balance sheet at the shorter of the fair value of the leased assets at the inception of the lease or the life of the asset as appropriate. The excess of lease payments over recorded lease obligations is treated as finance charges, which are amortised over each lease term to give a constant rate of charge on the remaining balance of the obligations. 44


Liverpool John Moores University

45


Liverpool John Moores University

46


Liverpool John Moores University

Rental costs under operating leases are charged to expenditure in equal annual amounts over the period of the leases. Investments Fixed asset investments that are not listed on a recognised stock exchange are carried at historical cost less any provision for impairment in their value. Current asset investments are included at the lower of their original cost and net realisable value. Stocks Stocks are valued at the lower of their cost and net realisable value. Where necessary, provision is made for obsolete, slow moving and defective stocks. Taxation status The University is an exempt charity within the meaning of schedule 3 of the Charities Act 2011 (formerly schedule 2 of the Charities Act 1993) and is considered to pass the tests set out in Paragraph 1 of Schedule 6 Finance Act 2010 and therefore meets the definition of a charitable company for UK corporation tax purposes. Accordingly, the University is potentially exempt from taxation in respect of income or capital gains received within categories covered by section 287 CTA2009 and sections 478-488 of the Corporation Tax Act 2010 (CTA 2010) (formerly section 505 of ICTA 1988) or section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that such income or gains are applied to exclusively charitable purposes. The University receives no similar exemption in respect of Value Added Taxation. Irrecoverable VAT on inputs is included within the cost of such inputs. Any irrecoverable VAT relating to Tangible Fixed Assets is included in their cost. The University’s subsidiary companies with the exception of JMU Building Services and Maintenance Ltd (which has the same Corporation Tax status as the University, and is not registered for VAT) are subject to corporation tax and VAT in the same way as any commercial organisation. Cash flows and liquid resources Liquid resources include sums on short-term deposits with recognised banks and building societies and government securities. Provisions Provisions are recognised when the University 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.

47


Liverpool John Moores University

CONSOLIDATED INCOME AND EXPENDITURE ACCOUNT For the year ended 31 July 2013 Note

2012/13 £000

2011/12 £000

1 2 3 4 5

53,932 104,398 9,047 4,664 338

72,750 83,007 8,127 6,023 519

172,379

170,426

6 8 10 11 7

101,079 48,974 8,888 2,575 4,779

98,783 53,227 7,761 5,726

8

166,295

165,497

6,084

4,929

Income Funding council grants Tuition fees and education contracts Research grants and contracts Other income Endowment and Investment income Total income Expenditure Staff costs Other operating expenses Depreciation Impairment Interest payable Total expenditure Surplus after depreciation of tangible fixed assets at valuation and before tax Loss on disposal of fixed assets

10

(22)

Surplus/(Deficit) after depreciation of tangible fixed assets at valuation and disposal of fixed assets and before tax

6,062

(250) 4,679

(91)

(59)

57

(57)

Share of operating (loss)/ profit in Associates 9 Taxation

Financial Statements 2013

Surplus/(Deficit) after depreciation of tangible fixed assets at valuation and tax

6,028

4,563

Transferred from/(to) endowment funds

20

326

29

Surplus/(Deficit) for the year

22

6,354

4,592

The income and expenditure account has been prepared in respect of continuing operations. CONSOLIDATED STATEMENT OF HISTORICAL COST SURPLUSES AND DEFICITS For the year ended 31 July 2013 Note Surplus/(Deficit) after depreciation of fixed assets at valuation and tax Difference between historical cost depreciation charge and the actual depreciation charge for the year calculated on the revalued amount Realisation of property revaluation gains of previous years on disposal of assets Historical cost surplus/(deficit) for the period after tax

48

21

21

2012/13 £000

2011/12 £000

6,354

4,592

672

708

7,026

1,402 6,702


Liverpool John Moores University

BALANCE SHEETS As at 31 July 2013

Fixed assets Tangible assets Investments Investment in associate: Share of net (liabilities)/assets

Note

Group

University

2013 £000

2012 £000

2013 £000

2012 £000

10 12

190,954 39

196,155 39

190,954 16,029

196,155 16,029

12

(89) 190,904

2 196,196

206,983

212,184

Endowment asset investments

13

1,324

1,434

1,324

1,434

Current assets Stocks and work in progress Debtors Short-term deposits Cash at bank and in hand

14 17 17

64 5,116 32,794 4,938 42,912

49 7,551 37,680 938 46,218

64 5,196 32,794 4,749 42,803

49 6,862 37,680 587 45,178

15

33,527

40,701

33,119

39,378

9,384

5,517

9,684

5,800

201,613

203,147

217,991

219,418

Creditors: Amounts falling due within one year Net current assets Total assets less current liabilities

16

45,398

46,035

61,556

62,193

Provisions for liabilities and charges

18

16,292

14,552

16,292

14,552

139,923

142,560

140,143

142,673

70,027

78,896

70,027

78,896

69,896

63,664

70,116

63,777

19

33,629

34,728

33,629

34,728

20 20

12 1,312 1,324

12 1,422 1,434

12 1,312 1,324

12 1,422 1,434

22

72,500

63,227

72,720

63,340

26

(70,027)

(78,896)

(70,027)

(78,896)

2,473

(15,669)

2,693

(15,556)

32,470

43,171

32,470

43,171

34,943

27,502

35,163

27,615

69,896

63,664

70,116

63,777

Net assets excluding pension liability Pension Scheme liability

26

Net assets including pension liability Represented by: Deferred capital grants Endowments Permanent Expendable Total Endowments Reserves Income and Expenditure Account excluding pension reserve Pension Reserve Income and Expenditure Account including pension reserve Revaluation Reserve Total Reserves

21

The 48-68 approved by the of Governors on 18onNovember 20132013. The financial financialstatements statementson onpage pages 27 towere 47 were approved byBoard the Board of Governors 18 November

Mr Rod Hill Chairman

Professor Nigel Weatherill Vice-Chancellor & Chief Executive

49

Financial Statements 2013

Creditors: Amounts falling due after more than one year


Liverpool John Moores University

CONSOLIDATED CASH FLOW STATEMENT For the year ended 31 July 2013 Note

2012/13 £000

2011/12 £000

Net cash inflow from operating activities

23

17,315

19,619

Returns on investments and servicing of finance

24

(2,492)

(2,812)

Taxation

23

Capital expenditure and financial investment

24

Cash outflow before use of liquid resources and financing Management of liquid resources

24

Financing

24

Decrease/(Increase) in cash in the year

57

(57)

(15,243)

(25,454)

(363)

(8,704)

4,886 (637)

(5,552) 9,364

3,886

(4,892)

2012/13 £000

2011/12 £000

Reconciliation of net cash flow to movement in net debt

Decrease/(Increase) in cash in the year

25

3,886

(4,892)

Cash (outflow)/inflow from increase in debt and lease financing

25

637

(9,364)

Cash (outflow)/inflow from movement in liquid resources

25

Change in net debt resulting from cash flows

(363)

Non cash movement on Endowments

25

Movement in net debt for year 2013

9 (354)

Net debt at 1 August 2012 Net debt at 31 July 2013

Financial Statements 2013

(4,886)

25

50 1

5,552 (8,704) 16 (8,688)

(6,743)

1,945

(7,097)

(6,743)


Liverpool John Moores University

STATEMENT OF CONSOLIDATED TOTAL RECOGNISED GAINS AND LOSSES For the year ended 31 July 2013 Note Surplus/(deficit) after depreciation of fixed assets at valuation and tax Endowment additions Endowment reclassification Unrealised (deficit)/surplus released on revaluation of assets Actuarial gain/(loss) in respect of pension scheme Total recognised (losses)/gains relating to the year

13 13 21 26

2012/13 £000

2011/12 £000

6,028 216 (10,029) 11,116

4,563 99 (615) (13,360)

7,331

(9,313)

2012/13 £000

2011/12 £000

28,935

38,248

7,331

(9,313)

36,266

28,935

Reconciliation

Opening reserves and endowments Total recognised gains/(losses) in year Closing reserves and endowments

Financial Statements 2013

51 1


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 1

Funding Council grants

Recurrent grant Specific grants Deferred capital grants released in year Buildings (note 19) Equipment (note 19)

2

Tuition fees and education contracts

Full-time students (UK and European Union) Full-time students charged overseas fees and other fees Part-time fees (UK and European Union) Other fees and NHS education contracts

3

Research grants and contracts

Research councils UK based charities Health & Hospitals Central and Local Government Other research grants and contracts

4

Financial Statements 2013

NCTL £000

2012/13 £000

2011/12 £000

45,203 2,419

1,810 2,639

47,013 5,058

68,036 2,533

1,231 619 49,472

11 4,460

1,231 630 53,932

1,202 979 72,750

2012/13 £000

2011/12 £000

74,781 7,868 2,800 18,949 104,398

53,058 7,775 2,260 19,914 83,007

2012/13 £000

2011/12 £000

1,574 475 2,900 986 3,112 9,047

Other income

2012/13 £000

Residences and Catering Other Services rendered Released from deferred capital grant (note 19) Other Income

5

HEFCE £000

Endowment and Investment income

Income from expendable endowments Income from permanent endowments Income from short-term deposits

52

1,458 369 2,623 1,228 2,449 8,127 2011/12 £000

1,052 2,557 210 845 4,664

717 3,232 315 1,759 6,023

2012/13 £000

2011/12 £000

9 329 338

16 503 519


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 6

Staff Costs

Salaries and wages Social security costs Pension costs (including FRS17 adjustment) Severance: Restructuring costs

Pension costs relating to enhanced pension provision (note 18)

2012/13 £000

2011/12 £000

80,279 6,472 11,315 98,066

79,950 6,367 11,063 97,380

2,050

229

100,116 963 101,079

97,609 1,174 98,783

2012/13 £

2011/12 £

213,840 6,660 220,500 33,600

186,677 760 187,437 27,867

2012/13 Number

2011/12 Number

930 1,165 160 2,255

967 1,095 159 2,221

2012/13 Number

2011/12 Number

2 2 2 6

5 5 6

Emoluments of the Vice-Chancellor Salary Benefits in kind Pension contributions

The average number of persons employed by the University during the year as expressed in full time equivalents was: Academic Support Other

Average remuneration of higher paid staff other than the Vice-Chancellor, excluding pension contributions: £100,000 - £109,999 £110,000 - £119,999 £120,000 - £129,999 £130,000 - £139,999

7

Interest payable

On bank loans, overdraft and other loans: Wholly repayable within five years Not wholly repayable within five years Other interest payable FRS17 Adjustment: Net interest on pension liabilities (note 26)

53

2012/13 £000

2011/12 £000

2,829 1 2,830

3,331 3,331

1,949

2,395

4,779

5,726

Financial Statements 2013

In addition to the above, severance pay of £78,679 was paid to a member of staff who had previously earned over £100k


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 8

Analysis of 2012/13 expenditure by activity Academic Academic services Research grants & contracts Residences & catering Premises Administration & central services General education Staff student facilities Other expenses Total per income and expenditure account

Other operating expenditure includes:

2012/13 £000

2011/12 £000

73,382 20,611 8,291 1,822 28,817 11,131 13,066 4,544 4,631

75,690 19,991 8,123 1,414 24,352 11,288 14,833 5,060 4,746

166,295

165,497

2012/13 £000

2011/12 £000

51

50

50 18 94 508

32 28 88 508

Auditors remuneration: External audit (of this amount £47k (2012 £43k) relates to the University) External auditors provision of non-audit services: Taxation Grant audits Internal audit Operating leases

The total expenses paid to or on behalf of 23 governors was £13k (2012 - £8k on behalf of 29 governors). This represents travel and subsistence expenses incurred in attending Board of Governors, Committee meetings and Charity events in their official capacity. 9

Taxation 2012/13

Financial Statements 2013

Current Tax: UK Corporation taxation at 24% Under/(Over) provision of taxation in prior years

54

2011/12

Group £000

University £000

Group £000

(57) (57)

(57) (57)

57 57

University £000 57 57


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 10

Tangible fixed assets

Group and University

Freehold Land and Buildings

Leasehold Land and Buildings

£000

£000

Assets Under Construction £000

150,566 6,464 (18,408) 34,469 -

9,424 1 (4,461) 472 -

37,294 7,779 (40,353) -

173,091

5,436

4,720

7,651 4,540 (9,955) (3) -

1,949 379 (304) -

-

2,233

2,024

Inherited Financed by capital grant Other

38,632 28,687 103,539

1,864 1,091 457

At 31 July 2013

170,858

At 1 August 2012

142,915

Telescope

Equipment

Total

£000

£000

£000

Cost or valuation At 1 August 2012 Additions Revaluation Re-classified Disposals At 31 July 2013

4,962 76 21 -

20,931 1,990 5,395 (6,395)

223,177 16,310 (22,869) 4 (6,395)

5,059

21,921

210,227

2,053 296 16 -

15,369 3,673 (18) (6,373)

27,022 8,888 (10,259) (5) (6,373)

2,365

12,651

19,273

4,720

1,422 1,272

949 8,321

40,496 32,149 118,309

3,412

4,720

2,694

9,270

190,954

7,475

37,294

2,909

5,562

196,155

Depreciation At 1 August 2012 Charge for the year Revaluation Re-classified Disposals At 31 July 2013

-

Net book value

The University’s freehold and some leasehold land and buildings were revalued at 31 May 2013 at open market value for existing use or depreciated replacement cost at £148.468m. In addition the remaining leased buildings are shown at the value of the lease. Included in land and buildings is land to the value of £15.223m that is not depreciated.

Should land and buildings that have been financed by exchequer funds be sold, the University may be required, under the terms of the Financal Memorandum with HEFCE, to surrender the proceeds. As at 31st July 2013 the net value of assets financed by exchequer funds is:

Freehold Land and Buildings Leasehold Land and Buildings Telescope Equipment

2013 £000

2012 £000

24,491 1,091 560 676 26,818

24,143 1,323 612 882 26,960

The University holds heritage assets, donated to the University with an insurance value of £57,000, and loaned to the University with an insurance value of £492,500. Heritage assets include paintings, vases and ceremonial maces. These assets are not recognised on the balance sheet.

55

Financial Statements 2013

Disposals of equipment were made during the year with a net book value of £22k.


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 11 Impairments During the year some freehold and leasehold land and buildings of the University were revalued in accordance with accounting policy at open market value for existing use or depreciated replacement cost. This revaluation resulted in an impairment in the cost of three buildings totalling £2.575m. This amount has been written off in the Income and Expenditure account in the year. 12

Investments

Group

Other Investments £000

Cost or valuation At 1 August 2012 and 31 July 2013

39

Other investments are in respect of shares in CVCP Properties PLC (1.0%) and Amaze Ltd (250,000 preference shares, redemption value £nil). University

Interest in Group Undertakings £000

Other Investments

Total

£000

£000

15,990

39

16,029

Cost or valuation Net book value at 1 August 2012 and 31 July 2013

Liverpool Science Park Limited is a company limited by guarantee. The company was incorporated on the 13 June 2003. Liverpool John Moores University, University of Liverpool and Liverpool City Council’s interest in the company is 24.5%, 24.5% and 51% respectively. The company commenced trading in November 2005. The net liabilities of the company for the year ended 31 March 2013 are £360,922 (2012 net assets £10,384), the group share of these being £88,426 (2012 net assets £2,544). The company’s financial year end was 31st March 2013. Investment in associate - group

Share of net assets/ (liabilities) at 1 August 2012

Liverpool Science Park Limited

Financial Statements 2013

13

2

Endowment asset investments

At 1 August 2012 Additions for the year Expenditure for the year Interest for the year Re-classification (note 19) Balance at 31 July 2013

Share of net assets/ (liabilities) for the year

Share of net assets/ (liabilities) at 31 July 2013

(91)

(89)

2013 £000

2012 £000

1,434 216 (335) 9 1,324

1,979 99 (45) 16 (615) 1,434

1,206 118 1,324

1,311 123 1,434

Represented by: Cash Deposits Debtors

56


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 14

Debtors

Group

Amounts falling due within one year

2013 £000

University 2012 £000

2013 £000

(reanalysed)

Trade debtors Prepayments Other debtors Amounts due from associated company Amounts due from subsidiary companies

994 2,606 1,384 132 5,116

1,939 3,227 2,385 7,551

2012 £000 (reanalysed)

754 2,602 1,380 132 328 5,196

1,423 3,216 1,828 395 6,862

Prior year figures have been reanalysed in respect of the classification of prepaid software and library licenses. Previously these balances had been included as Other Debtors; they are now included with in Prepayments. 15

Creditors

Group

Amounts falling due within one year HEFCE grants not applied Accruals - research grants Payroll deductions Bank loan Salix loan Amounts due to subsidiary companies Trade creditors Other creditors

16

2013 £000

2012 £000

2013 £000

2012 £000

2,587 12,944 2,509 538 99 2,869 11,981 33,527

2,011 16,398 2,287 538 99 7,269 12,099 40,701

2,587 12,944 2,509 538 99 1,455 2,840 10,147 33,119

2,011 15,677 2,287 538 99 1,090 7,226 10,450 39,378

Creditors

Group

Amounts falling due after one year Bank loan Salix Loan Intercompany leases

17

University

University

2013 £000

2012 £000

2013 £000

45,349 49 45,398

45,887 148 46,035

45,349 49 16,158 61,556

2012 £000 45,887 148 16,158 62,193

Interest rate risk profile of financial liabilities

Floating Rate Fixed Rate As at 31 July 2013

4,938 4,938

938 938

4,749 4,749

587 587

Short Term Deposits Group University 2013 2012 2013 2012 £000 £000 £000 £000 32,794 32,794

37,680 37,680

32,794 32,794

37,680 37,680

The short-term deposits are placed with banks at rates based on prevailing market rates at the time of the deposit. All balances were held in sterling. 2013 2012 £000 £000 Maturity of financial liabilities 637 587 1,614 43,197 46,035

Within 1 year or on demand Between 1 & 2 years Between 3 & 5 years Over 5 years

All financial liabilities relate to bank and loan debt.

57

637 637 1,657 43,741 46,672

Financial Statements 2013

Cash at Bank and in hand Group University 2013 2012 2013 2012 £000 £000 £000 £000


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 17

Interest rate risk profile of financial liabilities (continued)

The Bank loans are as follows: Original Value £m

Term Years

Fixed/Variable

Security

Interest rate

10.4 3.0 3.0 20.0 10.0 10.0

25 25 25 25 from 2013 18 from 2015 12 from 2011

Fixed to 2024 Variable Variable Fixed to 2038 Fixed to 2033 Fixed to 2023

Aldham Robarts LRC Assorted Properties Avril Robarts LRC Art and Design Academy Art and Design Academy Tom Reilly Building

7.985% 1.24% 1.26% 6.065% 6.36% 6.686%

There is also a 21 year lease in respect of the Avril Robarts Learning Resource Centre. Borrowing facilities The group has £20m undrawn borrowing facility available as at 31 July 2013. Total £000

Floating Rate Financial Liabilities £000

Fixed Rate Financial Liabilities £000

As at 31 July 2013

46,034

2,460

43,574

As at 31 July 2012

46,672

2,700

43,972

All the group’s creditors falling due within 1 year (other than bank and other borrowings) are excluded from the above table. 18

Provisions for liabilities and charges

Financial Statements 2013

Group and University

Pension Enhancements £000

Other £000

Total £000

At 1 August 2012 Utilised in the year Transfer from/(to) income and expenditure account

12,283 (833) 963

2,269 (777) 2,387

14,552 (1,610) 3,350

At 31 July 2013

12,413

3,879

16,292

The pension provision is in respect of pension enhancements payable to staff that have taken early retirement. The provision has been re-valued at 31 July 2013. Included within other provisions is a provision for restructuring costs of £1.591m (2012 £663k). Restructuring costs charged to the Income and Expenditure account in the current year totalled £2.050m. These were paid as a result of a programme of restructuring. In 2011/12 £229k was paid in relation to the cost of payments to staff in addition to the payments made under the University’s voluntary severance scheme, including any pension liabilities. The scheme came into effect in the first half of 2010 and closed at the end of May 2010 and was a proactive exercise to prepare for significant reductions in funding. During the year additional provisions of £1.560m were made, and £632k (2012 £2.316m) was paid out.

58


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 19

Deferred capital grants

Group and University Funding Council £000

Other £000

Total £000

At 1 August 2012 Buildings Equipment

26,815 1,106

5,809 998

32,624 2,104

Total

27,921

6,807

34,728

Income Buildings Equipment

341 383

343

341 726

Total

724

343

1,067

Released to income and expenditure Buildings (notes 1 and 4) Equipment (note 1 and 4)

(1,231) (607)

(122) (206)

(1,353) (813)

Total

(1,838)

(328)

(2,166)

At 31 July 2013 Buildings Equipment

25,925 882

5,687 1,135

31,612 2,017

Total

26,807

6,822

33,629

Included in the Buildings total of £31,612k is £813k relating to the Telescope enclosure which is shown in the Telescope category in Fixed Assets (Note 10). 20

Endowments

Group and University Restricted Expendable £000

Total 2013 £000

Total 2012 £000

12 12

1,299 123 1,422

1,311 123 1,434

1,872 107 1,979

Additions for the year Interest for the year Expenditure for the year Net

-

216 9 (335) (326)

216 9 (335) (326)

99 16 (45) (29)

Reclassification – Transferred to Deferred Capital Grants (note 19) –Transferred to income

-

-

-

(602)

-

-

-

(13)

12

1,312

1,324

1,434

12 12

1,180 132 1,312

1,192 132 1,324

1,311 123 1,434

Balances at 1 August 2012 Capital Accumulated income

Balances at 31 July 2013 Represented by: Capital Accumulated income

59

Financial Statements 2013

Restricted Permanent £000


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 21

Revaluation reserve

Group and University 2013 2012 £000 £000

Revaluations At 1 August 2012 Disposals (note 22) Revaluation Contributions to depreciation: Released in year (note 22) At 31 July 2013

22

Income and expenditure account

At 1 August 2012

Financial Statements 2013

32,470

43,171

University 2012 £000

Group 2012 £000

University 2013 £000

(15,669)

(9,011)

(15,556)

(8,622)

6,354 672 11,116

4,592 2,110 (13,360)

6,461 672 11,116

4,316 2,110 (13,360)

2,473

(15,669)

2,693

(15,556)

(70,027) 72,500

(78,896) 63,227

(70,027) 72,720

(78,896) 63,340

2,473

(15,669)

2,693

(15,556)

At 31 July 2013

23

45,281 (1,402) (708)

Group 2013 £000

Surplus/(deficit) retained for the year Transfer from revaluation reserve Actuarial gain/(loss) in respect of pension scheme

Balance represented by: Pension Reserve Income and Expenditure account excluding pension reserve

43,171 (10,029) (672)

Reconciliation of consolidated operating surplus to net cash flow from operating activities

2012/13 £000

2011/12 £000

Operating Surplus/(deficit) before taxation FRS 17 Depreciation (note 10) Impairments (note11) Taxation Loss on disposal of fixed assets Deferred capital grants released to income (note 19) Interest receivable (note 5) Interest payable less net interest on pension liabilities (Increase)/Decrease in stock Decrease/(increase) in debtors Increase/(Decrease) in creditors Increase (Decrease) in provisions (note 18) Endowment reclassification Fixed assets write off Share of loss/(profit) of associates

6,084 2,247 8,888 2,575 (57) 22 (2,166) (338) 2,830 (15) 2,436 (7,022) 1,740 91

4,679 2,628 7,761 57 250 (2,538) (519) 3,331 2 1,600 1,966 (444) 615 172 59

Net cash inflow from operating activities

17,315

19,619

60


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 24 Analysis of cash flows for headings netted in the cash flow statement Returns on investments and servicing of finance Interest received Interest paid Capital expenditure and financial investment Purchase of tangible fixed assets (note 10) Receipt of deferred capital grants (note 19) Management of liquid resources Cash placed on short term deposit (note 25) Financing Repayment of secured loan Repayment of Salix Loan Secured bank loan drawn down in year

25

Analysis of net debt

Cash in hand and at bank: Endowments General

At 1 August 2012 £000

Cash Flow £000 (114) 4,000 3,886

Debt due after one year Debt due within one year

(46,035) (637) (46,672)

99 538 637

Current asset investments

37,680 (6,743)

(4,886) (363)

2011/12 £000

338 (2,830) (2,492)

519 (3,331) (2,812)

(16,310) 1,067 (15,243)

(30,113) 4,659 (25,454)

(4,886)

5,552

(538) (99) (637)

1,311 938 2,249

26

2012/13 £000

Non Cash Change £000 9 9 637 (637) 9

(538) (98) 10,000 9,364 At 31 July 2013 £000 1,206 4,938 6,144 (45,299) (736) (46,035) 32,794 (7,097)

Pension schemes

Teachers’ Pension The Teachers’ Pension Scheme is an unfunded defined benefit scheme. Contributions for the year ended 31 July 2013 amount to £5,251,072 (2012 – £5,119,484). Contributions on a pay as you go basis are credited to the exchequer under arrangements governed by the Superannuation Act 1972. The pensions cost is assessed every five years in accordance with the advice of the government actuary. The assumptions and other data that have the most significant effect on the determination of the contribution levels are as follows: Latest actuarial valuation Actuarial method Gross rate of return Rate of real earnings growth Market value of assets at date of last valuation Proportion of members’ benefits covered by the actuarial value of the assets

61

31 March 2004 Prospective Benefits 6.5% per annum 1.5% per annum £163,240m 100%

Financial Statements 2013

The pension schemes for the University’s staff are the Teachers’ Pension Scheme (TPS), which is administered by the Teachers’ Pension Agency (TPA), the Universities Superannuation Scheme (USS), which is administered by Universities Superannuation Scheme Limited and the Merseyside Pension Fund (MPF), which is administered by Wirral Metropolitan Borough Council.


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 26

Pension schemes (continued)

Following the implementation of Teachers’ Pensions (Employers’ Supplementary Contributions) Regulations 2000 the government actuary carried out a further review on the level of employers’ contributions. With effect from 1 January 2007 the employers and employees contributions were 14.1% and 6.4% respectively. As of 1 April 2013 the employee’s contribution rates changed in accordance with the following table: Salary

Pension Contribution Rate

£0 – 14,999 £15,000 – 25,999 £26,000 – 31,999 £32,000 – 39,999 £40,000 – 74,999 £75,000 – 111,999 More than £112,000

6.4% 7.0% 7.3% 7.6% 8.0% 8.4% 8.8%

Under the definitions set out in Financial Reporting Standard 17 (Retirement Benefits), the TPS is a multi-employer pension scheme. The University is unable to identify its share of the underlying assets and liabilities of the scheme. Accordingly, the University has taken advantage of the exemption in FRS 17 and has accounted for its contributions to the scheme as if it were a defined contribution scheme. Universities Superannuation Scheme (USS) The University participates in the Universities Superannuation Scheme (USS), a defined benefit scheme which is contracted out of the State Second Pension (S2P). The assets of the scheme are held in a separate fund administered by the trustee, Universities Superannuation Scheme Limited. The latest triennial actuarial valuation of the scheme was at 31 March 2011. This was the second valuation for USS under the scheme-specific funding regime introduced by the Pensions Act 2004, which requires schemes to adopt a statutory funding objective, which is to have sufficient and appropriate assets to cover their technical provisions. The actuary also carries out regular reviews of the funding levels. In particular, he carries out a review of the funding level each year between triennial valuations and details of his estimate of the funding level at 31 March 2012 are also included in this note.

Financial Statements 2013

The triennial valuation was carried out using the projected unit method. The assumptions which have the most significant effect on the result of the valuation are those relating to the rate of return on investments (i.e. the valuation rate of interest), the rates of increase in salary and pensions and the assumed rates of mortality. The financial assumptions were derived from market yields prevailing at the valuation date. An “inflation risk premium” adjustment was also included by deducting 0.3% from the market-implied inflation on account of the historically high level of inflation implied by government bonds (particularly when compared to the Bank of England’s target of 2.5% for CPI which corresponds broadly to 2.75% for RPI per annum). To calculate the technical provisions, it was assumed that the valuation rate of interest would be 6.1% per annum, salary increases would be 4.4% per annum (with short term general pay growth at 3.65% per annum and an additional allowance for increases in salaries due to age and promotion reflecting historic scheme experience, with a further cautionary reserve on top for past service liabilities) and pensions would increase by 3.4% per annum for 3 years following the valuation then 2.6% per annum thereafter. The assumed life expectations on retirement are: Males (Females) currently aged 65

23.7 (25.6) years

Males (Females) currently aged 45

25.5 (27.6) years

At the valuation date, the value of the assets of the scheme was £32,433.5 million and the value of the scheme’s technical provisions was £35,343.7 million indicating a shortfall of £2,910.2 million. The assets therefore were sufficient to cover 92% of the benefits which had accrued to members after allowing for expected future increases in earnings. The actuary also valued the scheme on a number of other bases as at the valuation date. On the scheme’s historic gilts basis, using a valuation rate of interest in respect of past service liabilities of 4.4% per annum (the expected return on gilts) the funding level was approximately 68%. Under the Pension Protection Fund regulations introduced by the Pensions Act 2004 the Scheme was 93% funded; on a buy-out basis (i.e. assuming the Scheme had discontinued on the valuation date) the assets would have been approximately 57% of the amount necessary to secure all the USS benefits with an insurance company; and using the FRS17 formula as if USS was a single employer scheme, using a AA bond discount rate of 5.5% per annum based on spot yields; the actuary estimated that the funding level at 31 March 2011 was 82%. As part of this valuation, the trustees have determined, after consultation with the employers, a recovery plan to pay off the shortfall by 31 March 2021. The next formal triennial valuation is as at the 31 March 2014. If experience up to that date is in line

62


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 26

Pension schemes (continued)

with the assumptions made for this current actuarial valuation and contributions are paid at the determined rates or amounts, the shortfall at 31 March 2014 is estimated to be £2.2 billion, equivalent to a funding level of 95%. The contribution rate will be reviewed as part of each valuation and may be reviewed more frequently. The technical provisions relate essentially to the past service liabilities and funding levels, but it is also necessary to access the on-going cost of newly accruing benefits. The cost of future accrual was calculated using the same assumptions as those used to calculate the technical provisions but the allowance for promotional salary increases was not as high. Analysis has shown very variable levels of growth over and above general pay increases in recent years, and the salary growth assumptions built into the cost of future accrual based on more stable, historic, salary experience. However, when calculating the past service liabilities of the scheme, a cautionary reserve have been included, in addition, on account of the variability mentioned above. As at the valuation date the Scheme was still a fully Final Salary Scheme for future accruals and the prevailing employer contribution rate was 16% of salaries. Following UK government legislation, from 2011 statutory pension increases or revaluations are based on the Consumer Prices Index measure of price inflation. Historically these increases had been based on the Retail Prices Index measure of inflation. Since the previous valuation as at 31 March 2008 there have been a number of changes to the benefits provided by the scheme although these became effective from October 2011. These include: New Entrants Other than in specific, limited circumstances, new entrants are now provided on a Career Revalued Benefits (CRB) basis rather than a Final Salary (FS) basis. Normal pension age The normal pension age was increased for future service and new entrants, to age 65. Flexible Retirement Flexible retirement options were introduced. Member contributions increased Contributions were uplifted to 7.5%p.a. and 6.5% p.a. for FS Section members and CRB Section members respectively.

Pension increase cap For service derived after 30 September 2011, USS will match increase in official pensions for the first 5% If official pensions increase by more than 5% then USS will pay half of the difference up to a maximum increase of 10%. Since 31 March 2011 global investment markets have continued to fluctuate and following its peak in September 2011 inflation has declined rapidly towards the year end, although the market’s assessment of inflation has remained reasonably constant. The actuary has estimated that the funding level as at 31 March 2012 under the scheme specific funding regime had fallen from 92% to 77%. This estimate is based in the results from the valuation at 31 March 2011 allowing primarily for investment returns and changes to market conditions. These are sighted as the two most significant factors affecting the funding positions which have been taken into account for the 31 March 2012 estimation. On the FRS17 basis, using an AA bond discount rate of 4.9% per annum based on spot yields, the actuary calculated that the funding level at 31 March 2012 was 74%. An estimate of the funding level measured on a historic gilts basis at that date was approximately 56%. Surpluses or deficits which arise at future valuations may impact on the institution’s future contribution commitment. A deficit may require additional funding in the form of higher contribution requirements, where a surplus could, perhaps, be used to similarly reduce contribution requirements. USS is a “last man standing” scheme so that in the event of the insolvency of any of the participating employers in USS, the amount of any pension funding shortfall (which cannot otherwise be recovered) in respect of that employer will be spread across the remaining participant employers and reflected in the next actuarial valuation of the scheme. At 31st March 2013, USS had over 145,000 active members and the University has 34 active members participating in the scheme.

63

Financial Statements 2013

Cost Sharing If the total contribution level exceeds 23.5% of Salaries per annum, the employers will pay 65% of the excess over 23.5% and members would pay the remaining 35% to the fund as additional contributions.


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 26

Pension schemes (continued)

The total pension contribution to USS for the University was £295k (2012 £255k). The employer contribution rate payable by the University for the Financial Year was 16%. Surpluses or deficits, which arise at future valuations, may impact on universities’ future contribution commitment. Local Government Pension Scheme (LGPS) – Merseyside Pension Fund The LGPS 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 2013 was £3,444,308 (2012 £3,523,353). The agreed contribution rate for employers for the financial year was 10.5%. The employee rate paid is based on the whole time equivalent pensionable pay in accordance with the following table: Salary

Pension Contribution Rate

£0 – 13,500 £13,501 – 15,800 £15,801 – 20,400 £20,401– 34,000 £34,001 – 45,500 £45,501 – 85,300 More than £85,301

5.5% 5.8% 5.9% 6.5% 6.8% 7.2% 7.5%

The pensions cost is assessed every three years in accordance with the advice of a qualified independent actuary. All revisions to contributions were implemented from 1 April 2008. The assumptions and other data that have the most significant effect on the determination of the contribution levels are as follows: Latest actuarial valuation Actuarial method Investment returns per annum Pension increases per annum Salary scale increases per annum Market value of assets at date of last valuation Proportion of members’ accrued benefits covered by the actuarial value of the assets

31 March 2010 Projected Unit 6.75% per annum 3.0% per annum 4.5% per annum £4,706 million 78%

Financial Statements 2013

The following information is based upon a full actuarial valuation of the Fund at 31 March 2008 updated to 31 July 2013 by a qualified independent actuary. At 31 July 2013 2.4% 3.9% 2.4% 4.6%

Inflation Rate of increase in salaries Rate of increase for pensions Discount rate for liabilities

At 31 July 2012 2.2% 3.7% 2.2% 4.5%

The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The assumed life expectations on retirement age 65 are:

Retiring today Males Females Retiring in 20 years Males Females

64

At 31 July 2013 Years

At 31 July 2012 Years

21.8 24.7

21.8 24.6

23.7 26.6

23.6 26.5


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 26

Pension schemes (continued)

The University’s share of the assets in the scheme and the expected rates of return were: Long term rate of return expected at 31 July 2013 Equities Government Bonds Other Bonds Property Cash/liquidity Other

7.0% 3.3% 4.3% 5.7% 0.5% 7.0%

Total Market Value of assets

Value at 31 July 2013 £000

101,079 24,661 4,218 13,629 3,245 15,413

Long term rate of return expected at 31 July 2012

Value at 31 July 2012

7.0% 2.5% 3.4% 6.0% 0.5% 7.0%

79,887 21,627 5,407 11,760 2,703 13,787

162,245

£000

135,171

Analysis of the amount charged to income and expenditure account Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

Employer Service cost Curtailment costs/Past service

5,802 124

5,439 248

Total operating charge

5,926

5,687

Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

Expected return on pension scheme assets Interest on pension liabilities

7,767 (9,716)

7,928 (10,323)

Net pension finance (costs)

(1,949)

(2,395)

Amount recognised in the statement of total recognised gains and losses (STRGL) Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

Analysis of net pension finance (costs)

15,757 (4,641)

(6,635) (6,725)

Actuarial (loss)/ gain/recognised in STRGL

11,116

(13,360)

65

Financial Statements 2013

Actual return less expected return on pension scheme assets Change in financial and demographic assumptions underlying the scheme liabilities


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 26

Pension schemes (continued) Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

Deficit in scheme at 1 August 2012 Movement in year: Current service charge Contributions Past service/Curtailment cost Net interest on assets Actuarial gain/(loss)

(78,896)

(62,908)

(5,802) 5,628 (124) (1,949) 11,116

(5,439) 5,454 (248) (2,395) (13,360)

Deficit in scheme at 31 July 2013

(70,027)

(78,896)

In accordance with the revised FRS17 accounting standard, assets have been valued at realisable (i.e. bid) values for the year ended 31 July 2013. Analysis of the movements in the present value of the scheme liabilities Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

At the beginning of the year Current service cost Interest cost Contributions by scheme participants Actuarial losses and (gains) Benefits paid Curtailments

214,067 5,802 9,716 2,251 4,641 (4,329) 124

192,786 5,439 10,323 2,200 6,725 (3,654) 248

At the end of the year

232,272

214,067

Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

At the beginning of the year Expected rate of return on scheme assets Actuarial (losses) and gains Contribution by the employer Contributions by scheme participants Benefits paid

135,171 7,767 15,757 5,628 2,251 (4,329)

129,878 7,928 (6,635) 5,454 2,200 (3,654)

At the end of the year

162,245

135,171

Financial Statements 2013

Analysis of movement in the market value of the scheme assets

Reserves

University’s estimated asset share Present value of scheme liabilities Deficit in the scheme

Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

Year Ended 31 July 2011 £000

Year Ended 31 July 2010 £000

Year Ended 31 July 2009 £000

162,245 (232,272) (70,027)

135,171 (214,067) (78,896)

129,878 (192,786) (62,908)

113,972 (175,735) (61,763)

94,065 (158,024) (63,959)

66


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 26

Pension schemes (continued)

History of experience gains and losses Year Ended 31 July 2013 £000

Year Ended 31 July 2012 £000

Year Ended 31 July 2011 £000

Year Ended 31 July 2010 £000

Year Ended 31 July 2009 £000

(15,757) 9.7%

6,635 4.9%

(6,380) 4.9%

(7,124) 8%

12,591 13.4%

(4,641) 2%

(6,725) 3.1%

(4,665) 2.4%

(15,010) 8.5%

17,202 10.9%

11,116 4.8%

(13,360) 6.2%

1,715 0.9%

(5,886) 3.3%

4,611 2.9%

Difference between the expected and actual return on assets: Amount % of scheme assets Change in assumptions Amount % of scheme liabilities Total amount recognised in STRGL Amount % of scheme liabilities 27

Access funds

Balance at 1 August 2013 Funding Council grants Interest earned Disbursed to students Balance at 31 July 2012

2012/13 £000

2011/12 £000

29 490 1 520

92 521 2 615

(515)

(586)

5

29

Funding Council grants are available solely for students; the University acts only as paying agent. The grants and related disbursements are therefore excluded from the Income and Expenditure Account. 28

NCTL bursaries

Balance at 1 August 2012 NCTL grants

Balance at 31 July 2013 29

2011/12 £000

(6) 2,536 2,530

(34) 1,651 1,617

(2,267)

(25) (1,598)

263

(6)

2012/13 £000

2011/12 £000

381 -

508 381 -

381

889

Operating Leases

Non-cancellable operating lease rentals are payable as follows:

Less than one year Between one and five years More than five years

67

Financial Statements 2013

University administration fee Disbursed to students

2012/13 £000


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 30

Capital commitments 2012/13 £000

2011/12 £000

Capital expenditure contracted for, but not provided for in the financial statements Capital expenditure authorised by Board of Governors, but not yet contracted for

-

1,502 7,100

Balance at 31 July 2013

-

8,602

31

Related party transactions

No transactions in 2012/13 were identified which should be disclosed under Financial Reporting Standard 8 ‘Related Party Disclosures’. The Group has taken advantage of the exemption set out in FRS 8 and has not disclosed intra-group transactions. 32

Subsidiary undertakings

The subsidiary companies, with the exception of Liverpool John Moores (Malaysia) SDN.BHD are registered in England and Wales. Liverpool John Moores (Malaysia) SDN.BHD is registered in Malaysia and ownership in the UK is via circular transaction. All the subsidiary companies, wholly owned or effectively controlled by the University, are as follows: Company

Principle Activity

Status

JMU Property Development Company Ltd JMU Services Ltd owned JMU Learning Resource Centre Ltd owned

Property Development Company Academic enterprise

100% owned 100%

JMU Building Services and Maintenance Ltd 100% owned Liverpool Business School Ltd owned Liverpool John Moores (Malaysia) SDN.BHD 100% owned

Leasing of the Avril Robarts Learning

100%

Resource Centre Promotion of the advancement of education

-

By provision of funds to the University Dormant

100%

Promote and support collaborations within Malaysia

The University exercises a significant influence over the operations of JMU Building Services and Maintenance Limited, a company limited by guarantee. The University is the guarantor and the directors of the company must be appointed from officers or governors of the University, or members of the Company.

Financial Statements 2013

33

Ultimate Parent Organisation

Liverpool John Moores University is the ultimate parent organisation. Copies of the group accounts are obtainable from the Finance Director and Deputy Chief Executive, 4th Floor, Kingsway House, Hatton Garden, Liverpool, L3 2AJ.

68


Liverpool John Moores University

NOTES TO THE FINANCIAL STATEMENTS 31 July 2013 (continued) 30

Capital commitments 2012/13 £000

2011/12 £000

Capital expenditure contracted for, but not provided for in the financial statements Capital expenditure authorised by Board of Governors, but not yet contracted for

-

1,502 7,100

Balance at 31 July 2013

-

8,602

31

Related party transactions

No transactions in 2012/13 were identified which should be disclosed under Financial Reporting Standard 8 ‘Related Party Disclosures’. The Group has taken advantage of the exemption set out in FRS 8 and has not disclosed intra-group transactions. 32

Subsidiary undertakings

The subsidiary companies, with the exception of Liverpool John Moores (Malaysia) SDN.BHD are registered in England and Wales. Liverpool John Moores (Malaysia) SDN.BHD is registered in Malaysia and ownership in the UK is via circular transaction. All the subsidiary companies, wholly owned or effectively controlled by the University, are as follows: Company

Principle Activity

Status

JMU Property Development Company Ltd JMU Services Ltd owned JMU Learning Resource Centre Ltd owned

Property Development Company Academic enterprise

100% owned 100%

JMU Building Services and Maintenance Ltd 100% owned Liverpool Business School Ltd owned Liverpool John Moores (Malaysia) SDN.BHD 100% owned

Leasing of the Avril Robarts Learning

100%

Resource Centre Promotion of the advancement of education

-

By provision of funds to the University Dormant

100%

Promote and support collaborations within Malaysia

The University exercises a significant influence over the operations of JMU Building Services and Maintenance Limited, a company limited by guarantee. The University is the guarantor and the directors of the company must be appointed from officers or governors of the University, or members of the Company.

Financial Statements 2013

33

Ultimate Parent Organisation

Liverpool John Moores University is the ultimate parent organisation. Copies of the group accounts are obtainable from the Finance Director and Deputy Chief Executive, 4th Floor, Kingsway House, Hatton Garden, Liverpool, L3 2AJ.

68


www.ljmu.ac.uk LJMU Marketing and Corporate Communications Š April 2014

annual report and financial statements for the year ending 31 July 2013


Annual report and Financial statements for the year ending 31 July 2013