SOAS EXECUTIVE BOARD AGENDA

Transcription

1 SOAS EXECUTIVE BOARD AGENDA Monday 20 th August 2012 (Room 115) I II III IV V VI VII VIII Minutes To approve: minutes of the meeting held on 16 th July 2012 Action Points Matters Arising/Matters for Report Membership and Terms of Reference To consider: a paper from the Director KIS Update To receive: a paper from the Director of Finance & Planning Bench Fees To approve: a paper from the Director of Finance & Planning Incorporation of BUFDG To approve: a paper from Director of Finance & Planning Circulars To note: Circulars received [ attached] [Oral Updates] [Appendix A] [Appendix B, Annexes A,B C, D] [Appendix C] [Appendix D, Annex A] [Appendix E]

2 Executive Board Open Minutes _Chair Approved These minutes are for information only. Any corrections to the minutes will be recorded in the minutes of the subsequent meeting of the committee. SCHOOL OF ORIENTAL AND AFRICAN STUDIES EXECUTIVE BOARD Monday 16 th July 2012 MINUTES Members: Professor Paul Webley (Chair) Mr Graeme Appleby Mr Donald Beaton Professor Stephen Chan Professor Graham Furniss Mr Peter Mitchell Professor Anne Pauwels Professor Gurharpal Singh Professor Nirmala Rao Apologies: None 219. Minutes The minutes of the meeting on 25 th June 2012 were approved Action Points (i) MIN46 Resource Income Investment Plan EB noted that this item had been delayed and would be considered at a later meeting. (ii) MIN163 Handa Room EB noted that the position was still to be clarified and the Registrar & Secretary would report to a future meeting. (iii) MIN197(iii) Heads Forum The Pro-Director, Learning & Teaching reported that the discussions on student recruitment would be considered by the Student Recruitment Action Group and then feedback to Heads of Department. The Group would be expanded to include greater faculty representation as it would be looking at future strategies rather than process issues. (iv) MIN200 OFFA Agreement The Pro-Director, Learning & Teaching reported that two queries had been received in relation to the School s OFFA Agreement. The maximum fee for students on a study year abroad had been set at 15% of the standard fee by BIS, so had been reduced to The Agreement ~ 1 ~

3 Executive Board Open Minutes _Chair Approved had been amended to clarify how funding would be distributed under the National Scholarship Programme. (v) MIN213(i) OFFA Agreement EB noted that, as previously mentioned, the fee for students on a study year abroad had been set at 1350 in the Agreement. In addition to this the School would receive 2500 from HEFCE. This affected around 140 students and EB agreed that next academic year it would consider if the fee could be reduced to zero as this would be a very positive message to send to students studying language programmes Matters Arising / Matters for Report (i) London Confucius Institute The Director reported that Hanban was happy with the proposals discussed at the previous meeting. (ii) Wolfson Foundation EB noted that the School would be receiving continued funding under the Foundation s scholarship scheme for doctoral students in the humanities, of 234K over three years. (iii) Fulbright Chair The Director reported that the School should consider applying for one of the prestigious Fulbright Chair awards and he would circulate the details to the Deans. This would have a cost to the School of 27K p.a. for four years Key Information Set: Progress Report The Director of Finance & Planning reported that the Report showed progress so far on preparing for the KIS and the School was on track to complete the submission by the required date. Some of the data required for the submission had only been received from HEFCE at the end of the previous week. EB agreed it was important that staff, in particular those in faculties and student recruitment, had the opportunity to see the output in advance of it being published. This would allow the identification of areas of concern and preparation for any impact of the data and relevant communications. The Director of Finance and Planning said he would circulate something by the end of the week Circulars received EB noted the recent circulars. ~ 2 ~

4 APPENDIX A EXECUTIVE BOARD MEMBERSHIP & TERMS OF REFERENCE FOR EXECUTIVE BOARD Professor Paul Webley Professor Nirmala Rao Professor Graham Furniss Mr Graeme Appleby Professor Matt Craven Mr Donald Beaton Mr Peter Mitchell Professor Anne Pauwels Professor Gurharpal Singh Director Pro-Director, Learning & Teaching Pro-Director, Research & Enterprise Director of Finance & Planning Dean, Law & Social Sciences Registrar & Secretary Director of Human Resources Dean, Languages & Cultures Dean, Arts & Humanities TERMS OF REFERENCE SOAS Standing Order IV: Executive Board Executive Board reports to Governing Body. (i) The membership of Executive Board will comprise Chair: Director Ex-officio Members: Pro-Director (Learning & Teaching) Pro-Director (Research & Enterprise) Deans of Faculty Registrar & Secretary Director of Finance & Planning Director of Human Resources (ii) The Registrar & Secretary will nominate a Secretary. The Board will hold ordinary meetings as necessary and the quorum will be three members. (iii) The remit of the Board is to advise the Director on the exercise of his/her authority vested by the Charter and Standing Orders with respect to general matters of policy, planning and corporate strategy, making recommendations to Academic Board, Resources & Planning Committee and the Governing Body, as necessary. The Board will also act within delegated authority on behalf of other Standing Committees and will co-ordinate and progress School business. (iv) The Board will have the following terms of reference: (a) To advise the Director on the exercise of his/her authority in respect to planning and corporate strategy; (b) To advise senior academic and administrative officers on the exercise of their authority in respect of School policy and Codes of Practice; (c) To co-ordinate the academic and non-academic management of the School; (d) To oversee the conduct of business between major Committees; (e) To lead and co-ordinate the strategic planning process and Higher Education Funding Council for England returns and initiatives; 1

5 APPENDIX A EXECUTIVE BOARD (f) To approve strategies/sub strategies where this responsibility has been delegated from Governing Body; (g) To consider and prioritise strategic issues, taking account of the resource implications, setting appropriate budgets to enable the School to deliver its priorities, and approving expenditure as delegated by Governing Body; (h) To approve the School's non-academic policies, making recommendations for approval to Governing Body where Governing Body approval is required; (i) To receive reports from other Committees as appropriate. 2

6 APPENDIX B EXECUTIVE BOARD KEY INFORMATION SETS (KIS) UPDATE AS AT 14 AUGUST 2012 EB is asked to receive the following Report Executive Summary The School s KIS submission has been placed on the HEFCE Extranet. The KIS return is eligible for submission and all KIS course data has been input and is up-to-date with the exception of African Studies & Law; data on this final course will be completed once a course code has been received from UCAS. Sponsor: Graeme Appleby Director of Finance and Planning Recommendations That the School purchase SLC data to establish the likely salaries of SOAS students at stages later than 6 months from graduation. Financial Impact Difficult to quantify but KIS is likely to play a part in choice of university by prospective students. Risks How SOAS compares with other universities is difficult to estimate at this stage however, data regarding percentages of coursework/exam, scheduled teaching and guided learning hours have been shared with City University and some members of the 1994 Group. SOAS data is broadly in line with that submitted by the other institutions.

7 APPENDIX B EXECUTIVE BOARD Key Information Sets (KIS) Update as at 14 August 2012 Background KIS records need to be created and returned to HEFCE for all SOAS undergraduate programmes appearing on the UCAS website for entry in 2013/14. Full KIS documentation is available on the HESA website at The KIS submission timeline is attached at Annex A to this report. Progress on preparation for the KIS The School has submitted a KIS return which is eligible for sign-off. This data set has resubmitted to generate up-to-date outputs following the HEFCE of 8 August detailing the correction of an error in the generation of the NSS data in the HEFCE validation kit. KIS course information: Records for all KIS courses which are recruiting on the UCAS website for 2013 entry have been created except for: African Studies & Law (awaiting a course code from UCAS) HEFCE have confirmed that sign-off will re-open during the week beginning 24 September in order to allow institutions to sign off any data which has been submitted after the 22 August deadline. Lead staff member: Head of Admissions & Recruitment (for UCAS entry) Deadline for final upload: 24 September 2012 Lead staff member: Head of Planning (for KIS data update) Deadline for final upload: 27 September 2012 All learning and teaching and assessment details for SOAS modules and required partner institution modules have been collected and the data for KIS courses has been calculated and input into UNITe. Data on the UCAS Website: The suite of fees and financial support information has been entered on to the UCAS website by the Undergraduate Admissions Officer. This data will also be entered for African Studies & Law once the course code is available (see above). Lead staff member: Head of Admissions & Recruitment Deadline for final upload: 24 September 2012 KIS Submission Data must be signed off by the head of institution via the HEFCE Extranet (KIS Sign off Group) by 22 August 2012 Lead staff member: Director Deadline for final upload and signoff by Head of Institution: 22 August 2012

8 APPENDIX B EXECUTIVE BOARD Data on the SOAS Website HEFCE have released a slightly smaller widget template. Details of all available widget specifications are available on the HESA website at and this information has been passed to the Web Content Manager and the Web Developer. The widgets must be made available on all institutional websites by the end of October. Lead staff member: Web Content Manager Deadline: 31 October 2012 Review of KIS data Data can be uploaded to the HEFCE extranet up until 22 August 2012 and institutions who have submitted an error free return are able to review their output together with DLHE and NSS data supplied by HEFCE. The outputs from the HEFCE extranet will be used to generate the KIS widget data. An updated mock-up of the KIS can be found at thighereducation/keyinformationsets/kis_sample.pdf and is reproduced at Annex B. The data outputs from the SOAS KIS submission are attached at Annex C. SOAS data on salaries appears to be lower than the sector average, so the School should consider purchasing data from the SLC in order to establish whether the salaries of SOAS students are closer to the sector norms in later years. Data on continuation and degree classification do not form part of the widget, but are available via the Unistats website. We have been advised by HEFCE that where a KIS type 1 course cuts across two JACS subjects at the publishable level the two-subject rows will only be visible on the Unistats website and the data will not be displayed in the widget. (The KIS courses which fall into this category are highlighted in blue in the workbooks). The comparison data from City University and some members of the 1994 Group is attached at Annex D. This data was collected using the Guardian League Table subject mappings. It should be noted that SOAS only submitted KIS course type 1 data for comparison. SOAS data is broadly in line with that submitted by the other institutions. Institutions will be able to preview their results on the new official site from 17 September 2012 which will include the KIS widgets; the information will go live to the public one week later on 24 September Alison Hartrey Head of Planning 14 August 2012

9 APPENDIX B EXECUTIVE BOARD ANNEX A KIS Submission Timeline Date June 2011 September 2011 December February/1 March 2012 February/March 2012 March 2012 July 2012 August 2012 September 2012 October 2012 Action Timeline for the creation and publication of the 2012 KIS Publication of technical guidance available on HESA web-site (see Publication of updated technical guidance available on HESA web-site. HESA training seminars (see Submission system opens and validation kits issued for KISs to be published in September Institutions will have until August 2012 to finalise their data. The system will remain open throughout this period to allow institutions to manage their workloads and undertake quality assurance work. Publication of final update to technical guidance available HESA web-site. NSS and DLHE 2012 data added by HEFCE to KIS submissions. Final deadline for submission of KIS data and sign off by head of institution. Institutions will be able to preview their full KIS data at this point. Institutions preview new official web-site with KIS and associated widgets. New official web-site goes live; Unistats web-site closes. KIS widgets to be embedded and visible on all institutional web-sites. UCAS to include KIS data into course search web-site. KIS system re-opens for updates to September 2012 KISs, where necessary, for example to confirm fee information. Updates will be routinely published via the KIS widgets and official web-site.

10 APPENDIX B EXECUTIVE BOARD Updated mock-up of the KIS ANNEX B

11 APPENDIX B EXECUTIVE BOARD KEY INFORMATION SETS (KIS) ANNEXES C & D Please note: That due to the size of the Annexes, Annexes C & D are provided in excel spreadsheets and circulated separately to the main papers

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15 APPENDIX C EXECUTIVE BOARD Bench Fees EB asked to consider and, if appropriate, approve the following changes to the School s Bench Fees: An increase of 10% for applications from September 2012 to 31 July Also, The application of the inflator used for international tuition fees to bench fees at least for the next 2 years to avoid further erosion of their real value (after account is taken of inflation) unless there are academic reasons for doing otherwise Executive Summary Currently bench fees are set at 200 per month or 2,000 per year. The fees warrant review because: Fees have not been increased for some time, and have therefore been eroded by inflation. Following a recent VAT inspection, the School has been instructed to end its long-standing practice of treating bench fees as VAT free. Income from bench fees has, therefore, been reduced by the VAT due to the authorities. The paper proposes an increase to fees. Recommendations 1. Increase fees, by 10% and add the VAT to the increased fee [ 264 per month and 2,640 per annum] to recover some of the value eroded by inflation. The total VAT inclusive fee chargeable to the visitor would then rise to 3,168 per annum or per month 2. Faculties should be permitted to waive or discount the fees where there are academic reasons for doing so. 3. In order to avoid future reduction in the real value of bench fees the application of the inflation rate for international fees to bench fees for at least the next 2 years unless there are academic reasons for doing otherwise 4. The cost of the Central share of the waiver (50%) should be charged to the faculty that agrees to waive or discount the fee. The option will exist to fund some or all of the waived or discounted fee from the School s contingency budget if prior agreement is obtained. Financial Impact Financial impact is difficult to estimate but is likely to be around 20k- 25k per annum. Risks The increase in fees may be off putting to some of the less well resourced visitors but this is mitigated by the option for faculties to reduce or waive the fees on academic grounds. Equality implications There are no equality implications.

16 APPENDIX C EXECUTIVE BOARD Bench Fees 1. Introduction Currently bench fees are set at 200 per month or 2,000 per year. The fees warrant review because: Fees have not been increased for some time, and have therefore been eroded by inflation. Following a recent VAT inspection, the School has been instructed to end its long-standing practice of treating bench fees as VAT free. Since the VAT ruling income from bench fees has been reduced by the VAT due to the Revenue authorities. EB is asked to consider and, if appropriate, approve the following changes to the School s Bench Fees: An increase of 10% for applications from September 2012 to 31 July Also, The application of the inflator used for international tuition fees to bench fees at least for the next 2 years to avoid further erosion of their real value (after account is taken of inflation) unless there are academic reasons for doing otherwise. 2. Background 2.1 Bench Fees and VAT: - Currently bench fees are set at 200 per month or 2,000 per year. The rates were set when it was assumed that Bench fees at SOAS did not attract VAT. However following a recent VAT inspection, our decision to not charge VAT on bench fees was queried by Revenue and Customs and, following review, rejected. As the School been instructed by the Revenue to charge VAT, income from bench fees is reduced by the tax payable (so, for example,instead of receiving 2,000 for an annual bench fee it will receive 1,667 and the balance of 333 [i.e., 1,667*20%] will be paid over to the revenue authorities as VAT). 2.2 Bench Fees levels: - Bench fees have not been increased for a number of years and so have declined in real terms (i.e. after account is taken of inflation). A check of the University of Cambridge s website showed that a visiting Professor or a visiting fellow to their department of Education would be required to pay fees of 250 per month plus VAT. A quick review of various university web sites showed varying fee levels and approaches to charging but the comparison illustrates that there is scope to increase fees charged. 2.3 Bench Fee allocation: Once collected bench fees are shared equally between the host department/centre and Central Services. The share retained centrally contributes to the cost of supporting the visitor and the department s share is available for use by the department to support academic activities. 1

17 APPENDIX C EXECUTIVE BOARD Recommended Changes Recently the Finance department canvassed the views of the Deans on how change the School s bench fees in response to the outcome of the recent VAT inspection. The Deans were asked to consider the following 3 options; - 1) Continue to absorb the impact of the change of VAT treatment (and make it clear on our web site that fees are inclusive of VAT) 2) Add the VAT to the existing fee increasing the charge to the visitor by 20% [ 240 per month or 2,400 per annum] but maintaining SOAS income, or; 3) Increase fees, say by at least 10% and add the VAT to the increased fee [ 264 per month and 2,640 per annum] to recover some of the value eroded by inflation. The total VAT inclusive fee chargeable to the visitor would then rise to 3,168 per annum or per month. One reply was received from Arts and Humanities favouring option 3. Subsequently a further reply by an Assistant Dean in Law and Social Sciences favouring either option 2 or option 3 with the opportunity for faculties to discount or waive fees if the School gained significantly from collaborating on research with the academic visitor. It should be noted that, as part of the consultation process, the Administrator for the Centres and Programmes Office was contacted, (on the advice of the Pro Director of Research and Enterprise), and broadly the view here was that the existing fees should be reduced because they did not represent good value to academic visitors. Given the responses the Finance department therefore recommends:- 1. The adoption of option 3 above i.e. an increase in current bench fees of 10% taking them to 264 per month and 2,640 per annum and to add the VAT charge. This could raise revenues by around 20k to 25k per annum. 2. That faculties should be permitted to waive or discount the fees where there are academic reasons for doing so. 3. In order to avoid future reduction in the real value of bench fees the application of the inflation rate for international fees to bench fees for at least the next 2 years unless there are academic reasons for doing otherwise. 4. The cost of the Central share of the waiver (50%) should be charged to the faculty that agrees to waive or discount the fee. The option will exist to fund some or all of the waived or discounted fee from the School s contingency budget if prior agreement is obtained. 2

18 APPENDIX C EXECUTIVE BOARD Possible Developments In the medium term we may also wish to consider if we are happy with the structure of the fees. We could for example have a minimum charge (of two months equivalent) and then a standard charge thereafter which perhaps takes account of the fact that there is a certain minimum level of admin necessary for all visitors even for relatively short stays. Any change of fee structure may take a little so it proposed that we maintain the existing structure. 5. Conclusion. The recent VAT inspection has prompted a review of bench fees. EB is asked to consider and if appropriate approve the proposal to increase existing bench fees by 10% and to add the VAT charge. Barry Douglas Assistant Director of Finance August

19 APPENDIX D EXECUTIVE BOARD Incorporation of BUFDG EB is asked to approve the recommendation in the report Executive Summary The British Universities Finance Directors Group (BUFDG) is seeking to incorporate its activities into a company limited by guarantee. This incorporation will provide a legal framework for BUFDG and at a later stage, if appropriate, other professional associations within Higher Education so that they can operate with a reduced risk of liability for the officers and the organisations who are currently members of BUFDG and would become members of PHES. Recommendations To allow the School Executive Board is asked to allow the School to join the Company Limited by Guarantee known as Professional HE Services Ltd as a Guarantor member. Financial Impact N/A Risks Liability Equality implications None

20 APPENDIX D EXECUTIVE BOARD Proposed Incorporation of BUFDG (British University of Finance Directors) Executive Board is asked to allow the School to join the Company Limited by Guarantee known as Professional HE Services Ltd as a Guarantor member. The extent of the liability to the university is 10 (ten pounds), which will be payable to creditors in the event of an insolvent winding up of the company. In the event of a solvent winding up, the university is entitled to a share of assets remaining after payment of creditors. Alternatively, a University may choose to be an Ordinary Member of PHES. An Ordinary Member will have similar voting rights to a Guarantee Member and will also have to pay an annual subscription. An Ordinary Member will not be required to provide a guarantee on the winding-up of PHES nor entitled to share in any surplus assets. Ordinary membership is being offered as an alternative to Guarantor membership to ensure that as many Universities as possible become members of PHES but without excluding those who are unwilling or unable to commit to the Guarantee in the limited time available. However, ordinary members will not qualify to be members of the cost-sharing group and VAT will be payable on subscriptions (if subscriptions are no longer voluntary). The Company is the result of the incorporation of the unincorporated association, the British Universities Finance Directors Group, an organisation that has significant cash reserves, a sound business plan and competent management and governance structures. The Company s income is from subscription payments and training activities; it is not-for-profit and aims to cover costs of operation and maintain appropriate contingent reserves. No dividend will be paid by the company to its members. BUFDG will continue to operate as a brand under the umbrella of PHES Ltd., a structure that allows other professional organisations in Higher Education to share the benefits of a Company Limited by Guarantee. Further information is set out in the briefing note attached as Annex A Graeme Appleby Director of Finance & Planning 1

21 APPENDIX D EXECUTIVE BOARD ANNEX A BRIEFING NOTE Proposed Incorporation of British Universities Finance Directors Group ( BUFDG ) Introduction At BUFDG s Annual General Meeting it was resolved that the activities currently carried on by BUFDG should be transferred to a new company limited by guarantee. The favoured name for the new company, subject to obtaining the necessary approvals 1, is Professional Higher Education Services Limited ( PHES ). Pending the obtaining those approvals a company has been formed with the name Professional H E Services Limited. PHES will provide a legal framework for BUFDG and at a later stage, if appropriate, other professional associations within Higher Education so that they can operate with a reduced risk of liability for the officers and the organisations who are currently members of BUFDG and would become members of PHES. The anticipated benefits of incorporation Although BUFDG has historically been well managed and run, and so has substantial reserves and very modest commitments, the officers who make up the Executive Committee are currently personally liable for contracts entered into and other liabilities incurred on behalf of BUFDG. The proposed incorporation will mean that the limited company is liable for contracts and liabilities (rather than the individual committee members). A company limited by guarantee is a model which has been successfully adopted by other professional associations. Other anticipated benefits of incorporation include:- The ability to provide services to non-members, which cannot be provided under the current management structure; The ability to run conferences and collect commercial sponsorship income directly without using a conduit (member organisation); To regularise the tax position of the company (see further explanation below); and The ability to employ staff and to determine remuneration packages outside of a host university s policies and procedures. Membership of PHES There will be four categories of members of PHES:- Guarantor Ordinary Associate 1 Any company name that includes the words education or higher education requires approval from the Secretary of State for Education and BIS 2

22 APPENDIX D EXECUTIVE BOARD Affiliate All members will be organisations, not individuals within organisations. Guarantor, Ordinary and Associate members will pay an annual subscription determined by the Board and ratified by the Guarantor and Ordinary members in general meeting. Affiliate members will derive such status from their sponsorship of the BUFDG conference or other events and activities that may be held throughout the year. Each of the Universities whose finance directors and other officers are currently members of BUFDG have been invited to become Guarantor Members of PHES. Subject to agreeing to observe the Articles of Association of PHES Ltd, other organisations of Higher Education may apply to be guarantor members of PHES Ltd. As PHES is a company limited by guarantee, on admission as a Guarantor Member, a Guarantor Member agrees that it will contribute a sum of up to 10 towards the liabilities of PHES in the event of an insolvent winding-up whilst it is a member of the company (or within 12 months of its having ceased to be a member). The articles of association of PHES also provide that any surplus assets of PHES following a solvent winding-up of PHES will belong to the Guarantor Members. Associate members and Affiliate members will not have the right to nominate officers or vote. Guarantor Membership As stated above, a Guarantor Member can be required to pay a maximum of 10 towards the liabilities of PHES in the event of an insolvent winding-up of PHES. The Guarantor Member has no liability beyond this amount. There are significant advantages to being a guarantor member of the company insofar as a Guarantor member will also be a member of a Cost-sharing group for the purposes of accounting for VAT.The BUFDG executive (the Directors-in-waiting) have agreed that the new company, PHES Ltd, should arrange itself to be in a position to take advantage of the EU Cost sharing Exemption, which is being adopted into UK law from summer This would mean that any taxable supplies to [qualifying] members would become exempt. Any taxable supplies provided to non-members, or non-qualifying members, will be subject to VAT. Guarantor members will be qualifying members. Ordinary members will not. Ordinary Membership Alternatively, a University may choose to be an Ordinary Member of PHES. An Ordinary Member will have similar voting rights to a Guarantee Member and will also have to pay an annual subscription. An Ordinary Member will not be required to provide a guarantee on the winding-up of PHES nor entitled to share in any surplus assets. Ordinary membership is being offered as an alternative to Guarantor membership to ensure that as many Universities as possible become members of PHES but without excluding those who are unwilling or unable to commit to the Guarantee in the limited time available. 3

23 APPENDIX D EXECUTIVE BOARD However, ordinary members will not qualify to be members of the cost-sharing group and VAT will be payable on subscriptions (if subscriptions are no longer voluntary). Other categories of membership Associate members would have lower rights of access to information and services. It is anticipated that other sector organisations e.g. purchasing consortia, JISC, JANet, funding councils etc, will be invited take up Associate Membership. Affiliate members will have the lowest level of rights of access to information and services. It is anticipated that the organisations who support the annual conference, other events or activities during the year would be classed as affiliates in recognition of their support of the organisation. Membership for non-uk organisations It is proposed to allow non-uk universities to be associate members, allowing them access to all areas of the website and events, except those reserved for guarantor or ordinary members, or subsets of those groups, e.g. Finance Directors. The proposed Governance structure for PHES Ltd PHES Ltd will be the corporate parent of BUFDG. BUFDG will still exist as a brand but any contracts entered into will be in the name of PHES Ltd. PHES Ltd will have a Board, which, whilst BUFDG is the only brand operating under PHES Ltd., will act as the BUFDG executive Committee currently operates. If at such time as any other suborganisation is admitted to operate under PHES Ltd., the Board of PHES Ltd may meet only on matters relating to the running of the Company and the Executive Committee of BUFDG may hold separate meetings. The Articles of Association allow for this eventuality. The proposed Management Structure for PHES Ltd PHES will be managed by an Executive Board (similar to the current Executive Committee) supported by an Executive Director. The Executive Board will comprise four Directors, i.e. Chair, Deputy Chair, Secretary and Treasurer, regional representatives and any other co-opted members deemed appropriate by the Directors. The Directors will delegate responsibility for day-to-day management of the organisation and its staff to the Executive Director, who will work to fulfil objectives set by the Board, adhering to the financial strategy set out by the Treasurer and agreed by the Board. The current BUFDG staff It has been agreed with Loughborough University, which currently employs the BUFDG staff, that they will continue to employ any of the current staff and recharge their employment costs to PHES Ltd. if the employee and PHES wishes them to do so. The University will also agree to formalisation of joint contracts of employment. However, most of the staff are happy to transfer to PHES Ltd. under TUPE, and are aware of the implications of not being eligible to be members of USS or LGPS. It is envisaged that a stakeholder scheme will be put in place and compensatory salary adjustments will be made. All staff will be offered independent advice on TUPE and changing pension schemes. 4

24 APPENDIX D EXECUTIVE BOARD Loughborough would not employ any new staff, nor employ afresh any replacements for existing staff. The Tax position of BUFDG and PHES Ltd. Current position VAT Both the membership subscriptions and conference contribution are voluntary. The voluntary nature of subscriptions was tested at the 2011 AGM, where the membership confirmed that they were happy for the practice to continue whereby members who feel that they are unable to pay, have continued to access the full range of member facilities Because the subs are voluntary, then they fall outside the scope of VAT. BUFDG does not currently offer training courses to non- members BUFDG considers itself to be an eligible body and so the provision of Training courses is an exempt activity. Corporation Tax BUFDG does not currently submit income or corporation tax returns to HMRC. Subscription income is not considered to be trading income and so not subject to corporation tax. Income from training courses, which are delivered only to members, are considered to be exempt from corporation tax as mutual trading. Future position The incorporation itself should not alter the VAT position. The VAT position will only change if the nature of the relationship between BUFDG and its members changes, or the activities undertaken change. If the new company wishes to move away from the voluntary basis for subscriptions, to contract directly with the conference sponsors, or to cease to be an eligible body, then this would alter the current VAT position, because the activities would be taxable. However, the BUFDG executive has recommended that the new company should arrange itself to be in a position to take advantage of the EU Cost sharing Exemption, which is being adopted into UK law from summer This would mean that any taxable supplies to [qualifying] members would become exempt. Any taxable supplies provided to non-members, or non-qualifying members, will be subject to VAT. The new company will have to register for VAT if its taxable sales exceed the VAT registration threshold. In this situation, the new company would be partially exempt, and so will be able to recover some VAT on its purchases. Many commercial customers will be able to recover VAT levied on sales, and so will not be worse off. Corporation Tax Unlike the position for VAT, the incorporation could affect the corporation tax analysis for our current trading activities the analysis for subscription income which is not trading is unchanged. There are four key requirements for mutual trading (see BIM24020) : 5

25 APPENDIX D EXECUTIVE BOARD Complete identity, as a class, between the contributors to the mutual surplus and the participators therein (see BIM24105); and Arrangements which ensure that the surplus ultimately finds its way back to the contributors and no arrangements for it to go to anybody else (see BIM24110); and A reasonable relationship between the amount a person contributes to the surplus and the amount distributed to them on winding up (see BIM24115); and Arrangements that entitle the contributors to the common fund to control it (seebim24120). The most difficult and crucial condition is that any surplus on winding up must find its way back to the contributors; and this entitlement must be as contributors rather than as participators. This will be incorporated into the memorandum and articles of association. If the new company does meet the conditions for mutual trading, any surplus on transactions with members will be exempt from corporation tax. Any surplus arising from trading transactions with non-members would be taxable. If the new company does not qualify as a mutual trader, and/or if it trades with nonmembers, the company will have to register with HMRC and submit corporation tax returns. If the trading activity is both mutual and non-mutual, the corporation tax calculation would have to apportion reasonable costs to the non-mutual activity. Advice is that it would be very difficult for the new company to register as a charity to access the charitable tax reliefs. This is because the activities are not charitable (especially lobbying). If the new company were to qualify as a cost sharing group, transactions with members should be conducted on the basis of cost recovery ie any surplus will be negligible, and so corporation tax on these activities will be minimal. However the new company should return a surplus on its transactions with non-members. The new company should therefore include corporation tax in its evaluation of any activities with non-members. Advice is that if the company is keen to transact with non-members, it would be favourable NOT to qualify as a mutual trader. This is because as noted above the mutual and non-mutual activities would be treated as two separate trades. The surplus on mutual trading should be nil or even a loss. Whereas the surplus on transactions with non-members for tax purposes (after restricted cost allocations) would be significant. If the new company did not qualify as a mutual, then the company would be treated as having one single trade and would undertake a single calculation. This could be more favourable as the offset of expenses could be more generous. Implementation of the incorporation The incorporation is to be implemented in the following steps:- PHES has been formed as a company limited by guarantee. The articles of association of PHES set out details of how the company is to be managed and the different rights of its members. All of the universities whose finance directors and other officers are currently members of BUFDG have been invited, but are not obliged, to become Guarantor members once PHES has been formed. Membership applications are to be returned by 31 August Preparation for the transfer of all assets and liabilities of BUFDG including:- 6

26 APPENDIX D EXECUTIVE BOARD Negotiation with relevant universities and third parties for the transfer of leases and contracts; Informing and consulting with members of staff as to the proposed transfer; Establishment of appropriate pension arrangements for transferring employees (or appropriate compensatory adjustments in remuneration for loss of pension rights); Registration of PHES for VAT; Transfer of insurances; Establishment of bank accounts; and Preparation of a transfer agreement. Completion of the transfer. It is intended that the transfer of the undertaking and assets of BUFDG should be completed with effect from 1 August

27 APPENDIX E- EXECUTIVE BOARD Circulars Received 13 Jul - 16 Aug 2012 Type (UUK, UCEA etc) Date Received Title/Subject Attachments Can obtain in another format? Location Suggested Action SOAS action required Who by Deadline UCEA Update /7/ Pay Negotiations Dispute Resolution Meetings UNISON Letter 10 July \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ For information n/a UCEA Update /7/12 Engagement and wellbeing network meeting Terms of reference for the UCEA network on engagement and wellbeing in HE \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ Book a place for the engagement and wellbeing network meeting HR and ER specialists, Heads of Health and Safety 31/8/12 UCEA Update /7/12 UCEA Subscribers Meeting incorporating a report from the Employers Pensions Forum, Thursday 13 September 2012 Programme \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ Please reserve your HEI s places at this year s UCEA Subscribers Meeting via the UCEA website n/a UCEA Update /7/12 Local government pension scheme (lgps) 2014: employer consultation response Draft UCEA response to LGPS 2014 employer consultation \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ For information 25/7/12 UCEA Update /7/12 Employment mediation UCEA register of institutional contacts Pro forma for UCEA register of institutional mediation contacts \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ For information n/a UCEA Update /7/ Pay Negotiations Unite position and second dispute resolution meeting Unite letter dated 26 July 2012 \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ For information n/a Notice of publication of two Outcomes from IQER papers: Assessment and The student voice k/publications/circul arletters/pages/cl 1212.aspx For information n/a

28 APPENDIX E- EXECUTIVE BOARD Type (UUK, UCEA etc) Date Received Title/Subject Attachments Can obtain in another format? Location Suggested Action SOAS action required Who by Deadline UCEA Update /8/12 Occupational physicians - revalidation How to find your responsible officer \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ For information n/a HEFCE Circular Letter 20/2012 3/8/ National Student Survey: Reminder of embargoed publication of data F:\DIROFF\Committees\Exe cutive Board\Circulars - Directorate\Electronic Circulars\HEFCE Circulars\ For information n/a UCEA Update /8/12 National minimum wage accommodation offset \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ For information n/a UCEA Update /8/12 Consultation on proposals to simplify and clarify reporting requirements under RIDDOR 1995 RIDDOR consultation response form \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\UCEA Updates\ Respond as indicated in the letter. Health and Safety and Occupational Health professionals 5/10/12 HEFCE Circular Letter 21/2012 QAA Circular letter CL 13/12 9/8/12 HEFCE s Accounts Direction to higher education institutions for financial statements and revised Accounts Direction for /8/12 UK Quality Code for Higher Education, Chapter B10: Management of collaborative arrangements - draft for consultation k/publications/circul arletters/pages/cl aspx \\Gem3_admin\shared\Admi n\diroff\committees\exec utive Board\Circulars - Directorate\Electronic Circulars\HEFCE Circulars\ For information Governance, Finance, Audit, Management Respond as indicated in the letter. 19/10/12 n/a