Apprval Prcess and Arrangements fr University Cnsultancy Wrk 1 Intrductin Cnsultancy activities can be separated int tw types: thse undertaken in City s name (University cnsultancy) and thse undertaken by a member f staff in their wn name (private cnsultancy). In bth cases apprval fr such activities must be btained prir t cmmencement f wrk thrugh the individual's Dean f Schl. This dcument details the arrangements fr the apprval f University cnsultancy wrk and fr the distributin f incme arising frm University cnsultancy. Arrangements fr apprval f private cnsultancy are dcumented separately. In all cnsultancy wrk generated by City, University f Lndn, whether by academic r research staff wrking alne r as part f a grup, members f staff must first cnsult with their Dean f Schl t determine the mst apprpriate type f wrking arrangement. The decisin will depend n factrs such as: Amunt f wrk invlved and duratin f prject Resurces and effrt required (including use and impact n ther staff) Schl and Department incme generatin targets Amunt f interactin with ther wrk f the Schl and Department r elsewhere in City. Apprval must be btained in advance f starting the cnsultancy, by submitting full details f the prpsed wrk in accrdance with the Schl s lcal prcedures. 2 Cnsultancy as Part f an Agreed Jb Descriptin Cnsultancy undertaken as part f an individual's jb descriptin, but fr anther rganisatin utside City, is still part f that individual's cre cntract with City and, as such, payment is made t the individual fr their wrk as part f their cre cntract f emplyment with City (paid thrugh the Payrll Office). The amunt f time allcated t such cnsultancy and any incme targets will be agreed within the Schl. Members f staff will nt nrmally receive any additinal remuneratin fr such wrk. Hwever, Deans have flexibility t acknwledge the value f such wrk as necessary by releasing staff frm sme administrative r teaching duties r by prviding relevant develpment and training pprtunities. Staff are nt permitted t sub-cntract any cnsultancy r related activity expected t be cmpleted within their cre jb descriptin. 3 Additinal Cnsultancy Sme frms f University cnsultancy r ther related wrk are recgnised as being additinal t the standard wrklad f staff and are ften secured by persnal staff cntacts as a result f their expertise and reputatin, their City psitin r City's marketing effrts. The level f payment shuld be agreed in writing by all parties and the amunt f time allcated t such wrk shuld be agreed with the Dean f Schl in advance f cmmencement f the cnsultancy wrk. Where the Schl apprves this type f cnsultancy, the individual undertakes such wrk as a direct
emplyee f City, and City therefre has an interest in this activity and takes respnsibility fr the perfrmance, wrk utput, r any arising liability, but the respnsibility fr fulfilling any bligatins falls n the individual academic cnsultant. Academics are nt permitted t sub- cntract any Additinal Cnsultancy activity. 4 Services Rendered Cnsultancy Any cnsultancy activity undertaken by an academic r member f research staff emplyed by City, University f Lndn, r a grup f academics and/r research staff, which uses the facilities and/r resurces f City, including the use f equipment and staff time, will be treated as a Services Rendered cntract. Full details abut hw City manages such wrk can be btained frm the City Research Office. Services rendered cnsultancy nrmally attracts Full Ecnmic Cst (FEC) and is treated in mst cases administratively in the same way as a research cntract althugh the wrk invlved may nt be classified as research accrding t the Frascati definitin 1 (see als sectin 5 belw). As lng as such activity is apprved (see belw) the individual undertakes such wrk as a direct emplyee f City. City therefre has an interest in this activity and takes respnsibility fr the perfrmance, wrk utput, r any arising liability, but the respnsibility fr fulfilling any bligatins falls n each academic cnsultant. 5 Classificatin f wrk as Cnsultancy r Research It is imprtant that cnsultancy activity is assessed at the pint f issuing a cntract t determine whether it shuld be classified as research. Activity which is usually described as services rendered is classified separately frm research fr accunting and reprting purpses fr HESA and HEFCE. Incme recrded in City accunts under the heading f research has t meet set definitins, and in particular has t relate t wrk that meets the Frascati definitin f research (essentially riginal research leading t new findings rather than the applicatin f the results f prir research). City is nly able t include incme in its submissin t the Research Excellence Framewrk if it has been recrded as research incme in HESA. Sme cnsultancy activity includes the prductin f riginal research and the assciated incme may therefre be eligible fr classificatin as research. This needs t be cnsidered at the utset f the activity t ensure that the cntract is drawn up apprpriately using a frm f wrds which meets the requirements fr recrding activity as research, and when budget cdes are being set up t manage the incme. If the activity is nt eligible t be classified as research, the arrangements fr distributin f incme in this plicy will apply. Incentives fr cntract research are already prvided thrugh the distributin f a percentage f ttal incme and f the csted staff time int Schl and/r individual discretinary balance accunts under the City Research Sustainability plicy. 6 Apprval Prcess The fllwing prcedures shuld be fllwed in btaining apprval t undertake any type f University cnsultancy: Schl Apprval All requests t undertake University cnsultancy, whether as part f cre duties r therwise, shuld be submitted t the Dean f Schl fr prir apprval, using either the Applicatin fr a Grant r Cntract (AGC) Frm r the Request fr Apprval f Cnsultancy (nn-fec) frm as apprpriate (available frm City web pages n Research and Enterprise Supprt fr Staff), and in 1 The Measurement f Scientific and Technlgical Activities, The Prpsed Standard Practice fr Surveys f Research and Experimental Develpment (The Frascati Manual 1993 ), OECD, 1994, ISBN 92 64 14202 9
cnjunctin with any lcal Schl prcedures. Central University Apprval Fllwing the apprval f the Dean f Schl as abve, requests t undertake University cnsultancy must then be submitted t the City Research Office fr final apprval. The City Research Office will then assist with the necessary cntractual arrangements and setting up the prject n City s accunting system. 7 Cntractual and Financial Arrangements with Clients Fllwing apprval by the Dean, all University cnsultancy wrk must be cntracted with the relevant external party thrugh City. The cntract will be accepted by City by way f signature f the Vice-President (Research & Enterprise) r an authrised member f staff frm the City Research Office. By signing the cntract City accepts the cnsultancy as part f its business and the wrk undertaken is cvered under City s liability insurance cver. Any Intellectual Prperty Rights generated thrugh University cnsultancy will belng t City, althugh usually all rights in the results will transfer t the client, depending n the terms f cntract agreed between City and the client. Wherever pssible City will try t secure publicatin rights fr staff t use the results fr research and teaching purpses. 8 Csting and Pricing, Distributin f Incme and Management and Use f Funds It is imprtant that all cnsultancies are csted and priced accurately t ensure the full ecnmic csts f undertaking the wrk are clearly understd. It is imprtant that cmmercial clients are charged at an amunt equivalent t the Full Ecnmic Cst (FEC) and that the wrk is nt subsidised by ther activities r by public funds. It is als imprtant that csting and pricing activity is managed thrugh existing Schl financial prcedures prir t submissin t the City Research Office t ensure that it is cmplete and that the price is cst-effective and reasnable in cmparisn with ther similar activity acrss City (where applicable). Nte that the arrangements fr distributin f incme set ut belw d nt relate t incme derived frm cntract (r cmmissined) research r frm Cntinuing Prfessinal Develpment (CPD) activity where academic credit is awarded r certificatin f attendance is prvided in City s name, althugh depending n the basis n which the activity arises these may fall elsewhere within the scpe f the City Academic Cnsultancy plicy. Incentives fr cntract research are already prvided thrugh the distributin f a percentage f ttal incme and f the csted staff time int Schl r individual discretinary balance accunts under the City Research Sustainability plicy. (i) University Cnsultancy (nn-fec) In rder t encurage staff t undertake cnsultancy activity thrugh City rather than privately, where the wrk t be undertaken requires nly the time f the member f staff cncerned and nly basic use f facilities such as use f the City name and e-mail services, it may be undertaken as University cnsultancy withut the applicatin f the FEC prcess, with the apprval f the relevant Dean (r equivalent senir manager in the case f staff nt in a Schl). The Dean will be required t cnfirm that the activity can be delivered withut drawing n City resurces beynd the time f the member f staff cncerned; this will als be checked by the City Research Office while drawing up the cntract. City will issue a cntract and invice fr the wrk thrugh the City Research Office, and the member f staff may chse t have the subsequent incme transferred t their discretinary balance accunt and/r t receive a persnal payment thrugh the City payrll in accrdance with the arrangements set ut belw. In the case f a persnal payment tax and ther standard deductins will be made. Fr wrk in this categry f value up t and including 20k, the member f staff may pt t have the
full amunt, nce received by City, transferred t their discretinary balance accunt r t receive all r part f it as a persnal payment thrugh the City payrll. Fr wrk in this categry f value abve 20k and up t 50k, a deductin f 20% will be made frm the balance abve 20k, t be retained by the Schl. The member f staff may receive up t 20k as a persnal payment thrugh the City payrll as abve, with the remaining incme transferred t their discretinary balance accunt, r may have the full amunt less the Schl deductin transferred t their discretinary balance accunt. If apprpriate, the Dean may give apprval fr a persnal payment t be made thrugh the City payrll fr an amunt abve 20k. This must be explicitly signed ff by the Dean prir t the cnsultancy cntract being issued. An annual reprt will be made t the City Executive Cmmittee incrprating bth the data derived frm the annual reprting by Schls n private cnsultancy undertaken by academic staff and University cnsultancy activity including the number and size f persnal payments made t academic staff n this basis. Fr wrk in this categry f value abve 50k, the abve arrangements will apply fr the initial 50k and individual discussins will take place t agree n the distributin f the remaining incme. Illustrative example: Apprved cnsultancy wrk is undertaken bringing in 30k f incme. The member f staff pts t receive a persnal payment f 20k. The Schl retains 2k and the balance f 8k is transferred t the member f staff s discretinary balance accunt. T assist staff in determining hw t value their time relative t their salary, the City Research Office will prvide guidance n a basic daily rate that may be applied, based n the standard FEC calculatins fr staff time and estate cst. Staff will be free t charge a higher r lwer rate as apprpriate subject t the apprval f their Schl. (ii) University Cnsultancy (FEC) Where the cnsultancy wrk requires the use f City facilities beynd use f the City name and e-mail services, fr example technical r ther supprt staff time r the purchase r use f equipment, it must be csted and priced accurately thrugh Schl financial prcedures prir t submissin t the City Research Office t ensure that the full ecnmic csts f undertaking the wrk are clearly understd. Cmmercial spnsrs shuld nrmally be charged at an amunt at least equivalent t the Full Ecnmic Cst (FEC) s that the use f staff time and City resurces fr such wrk is nt subsidised by ther activities r by public funds. FEC is nly a figure fr guidance; where pssible and in line with market rates, the price charged t the spnsr shuld be abve the FEC equivalent. Hwever, there are sme special cases where the charge t the spnsr may be less, fr example where there are strategic benefits t City arising frm the cnsultancy activity. These decisins shuld be made within the apprval prcess, infrmed by the FEC figures. Accrding t FEC principles, the expenditure, and hence the cvering incming funds, is categrised int: Directly incurred cst (fr example salary csts fr staff t be emplyed t undertake sme f the wrk, travel and subsistence and equipment); and Cntributin t the running csts f the City Directly allcated cst fr clerical/technical staff time r facilities Directly allcated cst fr investigatr time Estates cst Indirect cst Subsidy (negative amunt, where the spnsr is charged less than FEC) r Surplus (psitive amunt, where the spnsr is charged mre than FEC). Any directly incurred cst has t be paid directly frm the funds received fr the wrk. Such expenses are managed by the Principal Investigatr thrugh the accunt set up fr the prject by the City Research Office in accrdance with the agreed budget. Any incme relating t the directly allcated cst fr clerical/technical staff time r facilities will be retained by the Schl as it relates t resurces made available at Schl level. The sum f directly allcated cst fr investigatr time, estates cst and indirect cst minus/plus subsidy/surplus is that part f the cntributin t the running cst f City which is the subject f distributin in the prpsals belw ( Distributable Cntributin ). The ttal value f the cnsultancy
cntract will generally be greater than the Distributable Cntributin as the frmer will include directly incurred csts (fr example researcher salary csts) and any directly allcated cst fr clerical/technical staff time and facilities. The threshlds belw have hwever been set t be cnsistent with the prpsed arrangements fr University cnsultancy (nn-fec). The fllwing distributin (nce the crrespnding incming funds frm the spnsr have been received by City) will be made fr incme frm University cnsultancy where FEC has been applied. Persnal payments frm the incme received will be permitted n a basis cnsistent with the arrangements fr University cnsultancy (nn-fec), but must be included in the riginal budget as a separate item f directly incurred cst fr agreement by the Schl as part f the FEC and apprval prcesses. If mre than ne member f staff is invlved, the basis fr divisin f incme as persnal payment r t discretinary balance accunts must be agreed during the initial csting prcess. Fr wrk in this categry with up t 20k f Distributable Cntributin, the member(s) f staff may pt t have the full amunt, nce received by City, transferred t their discretinary balance accunt(s) r t receive all r part f it as a persnal payment thrugh the City payrll. Fr wrk in this categry with between 20k and 50k f Distributable Cntributin, a deductin f 20% will be made frm the balance abve 20k, t be retained by the Schl. The member(s) f staff may receive up t 20k as a persnal payment thrugh the City payrll as abve, r a larger persnal payment where apprved by the Dean in advance f the cnsultancy cntract being issued, with the remaining incme transferred t their discretinary balance accunt(s), r may have the full amunt less the Schl deductin transferred t their discretinary balance accunt(s). Fr prjects with Distributable Cntributin abve 50k, the abve arrangements will apply fr the initial 50k and individual discussins will take place t agree n the distributin f the remaining Distributable Cntributin. Management and use f funds Discretinary balance accunts fr individual members f staff will be permitted fr the management f funds derived n this basis, alng with funds derived frm research grants and cntracts in accrdance with the existing City Research Sustainability plicy. Discretinary balance accunts may als exist at Department (r Faculty/Centre/Divisin) level fr Research Sustainability funds where this is the Schl plicy, and individual members f staff undertaking University cnsultancy may pt t transfer sme r all f their share f the Distributable Cntributin r f incme received thrugh University cnsultancy (nn-fec) int their Department s balance accunt fr wider use by their Department in supprt f research activities. This will ccur nly with the agreement f the member(s) f staff cncerned. Bth types f balance accunts will have the ability t carry frward unspent balances acrss financial years. They will be subject t the fllwing arrangements and restrictins: A financial cap: unspent balances remaining at the end f the financial year f 50k per member f staff and 100k per Department/Faculty/Centre/Divisin (where this applies). Once these limits are reached, any surplus will nrmally g twards the Schl s annual balance unless there is gd justificatin fr a breach f the limit n a temprary basis nly, fr example where there are apprved plans fr the use f funds in the fllwing year. Use f funds by an individual member f staff will require the apprval f their Head f Department (r equivalent) t ensure that the funds are being used fr a relevant purpse. Where the funds held are t be reduced by mre than 10k in any ne financial year, the prir apprval f the Schl Financial Cntrller will be required. The Schl Financial Cntrller will review expenditure and establish financial plans fr the fllwing year with all hlders f discretinary balance accunts during the annual budget review prcess s that planned expenditure can be built int budget prjectins in rder t avid significant variance in Schl accunts. Balance accunts are nt permitted t g int deficit (if they d they will be clsed dwn and subject t Schl review). Funds can nly be transferred int balance accunts nce invices have been paid, all directly incurred expenditure has been prcessed and the activity is finished t the satisfactin f the spnsr.
The funds held in these accunts, whether fr an individual member f staff r a Department (r equivalent), can nly be used t supprt City-based activity. This will include activity in supprt f research such as cnference attendance, purchase f equipment r bridging f research staff funded thrugh external cntracts, and match-funding arrangements fr any relevant Schl-based initiatives/schemes in supprt f research and enterprise. Further guidance and advice can be btained frm the City Research Office. Date f Issue: December 2012