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FINANCIAL AND ADMINISTRATIVE

POLICIES AND PROCEDURES MANUAL

OCTOBER 2008

SWANSEA METROPOLITAN UNIVERSITY

PRIFYSGOL FETROPOLITAN ABERTAWE

PURPOSE OF THE FINANCIAL AND ADMINISTRATIVE POLICIES AND

PROCEDURES MANUAL

The Policies and Procedures Manual of the University details the financial and administrative

policies and procedures that are to be followed by all managers in order to fulfil their

accountability requirements. It also describes the policies and procedures that will contribute

to the effective financial administration of the University.

The Policies and Procedures Manual is to be read subject to any other Act or law that is

applicable to the operations of the University.

The Policies and Procedures Manual emphasises that it is the responsibility of all managers of

the University to ensure that operating procedures and policies in their areas of responsibility

are consistent with the requirements of the Manual and to be accountable for the areas of

responsibility under their control.

The Manual is divided into three parts:-

Finance

Registry

Computing and Information Technology

In addition, managers will need to refer to the Staff Handbook for all policies and procedures

relating to human resource management, the Quality Handbook for policies and procedures

relating to academic quality issues and the Board of Governors Handbook for all policies and

procedures relating to governance.

FINANCIAL AND ADMINISTRATIVE

POLICIES AND PROCEDURES MANUAL

SECTION 1 - FINANCE



FINANCIAL POLICIES AND PROCEDURES

INDEX

Introduction.

FPP1 - Budget Preparation and Allocation.

FPP2 - Budgetary Control.

FPP3 – Grant Income and Proper Use of Funds (“Funds for the Purpose”)

FPP4 - Payment of Salaries and Wages.

FPP5 - Payment of Travelling and Subsistence Expenses.

-Supplement – Clarification of the definition of „Approved Journeys‟ for travel and

subsistence claims.

FPP6 - Orders for Works, Goods and Services.

FPP7 - Tendering Procedures.

FPP8 - Payment of Creditors.

FPP9 - Corporate Visa Purchasing Cards.

FPP10 – Centralised Purchasing Arrangements

FPP11 - Credit Income.

FPP12 - Tuition Fee Refunds.

FPP13 - Debt recovery and write-off.

FPP14 - Collection and Deposit Procedures and Bank Reconciliation.

FPP15 - Petty Cash.

FPP16 - Treasury Management.

FPP17 - Inventories, Stock and Security.

FPP18 - Insurance.

FPP19 - Unofficial Funds.

FPP20 - Catering

FPP21 - Halls of Residence

FPP22 - General Ledger and Chart of Accounts

FPP23 - Costing and Pricing.

FPP24 - Value for Money.

FPP25 - Subsidiary Companies.

FPP26 - Staff Companies

FPP27 - Gifts and Hospitality

FPP28 - Fraud and Corruption.

FPP29 - Retention of Documents.

FPP30 - Audit Requirements and Responsibilities

FPP31 - Controlled Stationery

FPP32 – Reporting of Losses

FPP33 – Risk Management Policy

FPP34 – Use of the University‟s Seal

ANNEXES

a) Financial Regulations

b) Approval limits in respect of expenditure.

c) Conditions of Contract for the Purchase of Goods. ) TBA

d) Conditions of Contract for the Purchase of Services. )

e) The Financial Memorandum between the Higher Education Funding Council for

Wales and the University.




INTRODUCTION

Under the terms of the Financial Memorandum between the University and the Higher

Education Funding Council for Wales, the University is required to have a sound system of

internal financial management and control. The broad policies which outline the framework

of that system of control are contained in the University‟s Financial Regulations which are

included as Annex A of the Finance section of this Manual.

The Financial Regulations are based on a model drawn up by the Chartered University of

Public Finance and Accountancy in consultation with universities, colleges and the Funding

Councils. However, as stated above, the Regulations set out only broad policies and, for

operational purposes, they need to be supplemented by more detailed policies and procedures.

The policies and procedures which follow provide the greater level of detail required.

Staff are reminded that:-

Compliance with the financial regulations is compulsory for all staff connected with the

University. A member of staff who fails to comply with the financial regulations may be

subject to disciplinary action under the University‟s disciplinary policy. Any such breach will

be notified to the Governing Body through the Audit Committee. It is the responsibility of

heads of departments to ensure that their staff are made aware of the existence and content of

the University‟s financial regulations and that an adequate number of copies are available

for reference within their department.

FPP1




FPP1 -BUDGET PREPARATION AND ALLOCATION

(refer also to Financial Regulation 3.)

1. The Vice-Chancellor and the Director of Finance and Resources must jointly prepare

in consultation with the Resources Group a draft budget, in a form agreed by the

Finance, Planning and Monitoring Committee, for discussion at Senior Management,

Deans and Directors‟ Group (SMDD) before the end of the May preceding the start of

the financial year. This report shall incorporate the five year rolling capital programme

required by HEFCW in support of its allocation of the Capital Investment Fund.

Budget holders are required to provide whatever information may be required for the

preparation of such estimates.

2. Following discussion by SMDD and subject to any review which may be necessary

following the receipt of formal funding notifications, the Vice-Chancellor and

Director of Finance and Resources shall jointly present detailed estimates for approval

by the Finance, Planning and Monitoring Committee as early as possible in the

Summer Term preceding the start of the financial year.

3. After approval by the Resources Group and the Governing Body each budget holder

shall be notified of his/her allocation of the approved budget by the Director of

Finance and Resources. The allocations will be informed by a weighted student

numbers based formula and an assessment of the total income and expenditure of cost

centres in the previous year. Notification of allocations shall constitute authority for a

budget holder to incur expenditure subject to the Financial Regulations, Policies and

Procedures of the University.

Contingency reserves may be withheld and consequently the total of all the shares

allocated to budget holders may be less than the total budget.

4. It shall be the duty of budget holders to manage within their approved budget.

Savings identified by budget holders may be carried forward for use in the following

financial year subject to limits to be determined annually. Overspends will also be

carried forward thereby reducing the following year‟s budget unless offset by

application of any contingency funds approved by the Vice-Chancellor.

5. Budget holders must submit a report to the Director of Finance and Resources, copied

to the Vice-Chancellor, in the following circumstances.

(a) If it becomes apparent that their approved budget will be materially exceeded.

Budget holders shall include in such a report their recommended options for

reducing other heads of expenditure in order to achieve the requisite saving; or

(b) If it becomes apparent that an overspending or underspending will materially

affect the implementation of policies reflected in the approved budget.

6. In day to day management of their approved budgets, budget holders must act

generally within the powers of delegation determined by the Vice-Chancellor and

Governing Body.

7. The Director of Finance and Resources shall prepare and the Senior Management,

Deans and Directors‟ Group and Board of Governors shall formally consider annually

a written report on actual expenditure for the preceding financial year. This report

should take the form of a supplement to the University‟s statutory accounts and shall

be based on the annual Transparent Costing return submitted to HEFCW.

8. The Director of Finance and Resources shall be responsible for ensuring that all

budget reports are supported by detailed working papers and shall ensure that such

working papers are made available to internal and external auditors if required.

January 2008

FPP2




FPP2 - BUDGETARY CONTROL


1. Budget holders shall ensure that adequate records are maintained to enable them to

effectively control the amounts committed against each head of expenditure budget or,

in the case of detailed income budgets, to effectively monitor the collection of

amounts due.

Generally, such information will be held centrally within systems managed by the

Director of Finance and Resources and it should not be necessary for budget holders

to maintain duplicate records.

2. The minimum information to be recorded shall be as follows:-

(a) Budget Allocation

The approved budget should be input into the accounting system and verified

by the Director of Finance and Resources. Any virements between budget

heads should also be verified by the Director of Finance and Resources.

(b) Salaries and Wages Payments

- A minimum of one record for each category of employee.

- Total budget for the year

- Each month

Total payments

Budget for month

Variation for month with explanation

Cumulative variation

(c) Other Payments

- Total budget for year

- Details of commitments/payments

i.e. Date of order

Official order number

Name of supplier

Amount of order (i.e. commitment)

Date of invoice

Date paid

- Total commitments, having adjusted for actual costs to date.

(c) Income

- Total budget for year

- Per month,

Total income received or invoiced

Budget for month

Variation for month

Cumulative variation

- Debtor Control

Time-Aged debtors

Follow-up status (reminder, final demand, etc.)

The precise format of such records shall be as determined by the Director of Finance

and Resources, in consultation with the Internal Auditors.

3. Budget holders shall, where practicable, have on-line access to the Symmetry accounting

system‟s commitment module which provides up to date data on expenditure against each

budget. Where such access is not provided the Finance Office shall, on a monthly basis,

issue budget holders with monitoring reports. Budget holders are required to provide the

Finance Office with any explanations which may be required regarding budget variances.

4. The Director of Finance and Resources shall be responsible for presenting at the normal

monthly meeting of the Senior Management, Deans and Directors‟ Group held on the first

Monday of the month, a statement showing the actual expenditure to the date of the

previous meeting and projected out-turn compared with the approved budget. A

statement of actual cash-flow compared with predictions should also be presented at least

twice each year.

January 2008

FPP3




FPP3 – GRANT INCOME AND PROPER USE OF FUNDS

(“FUNDS FOR THE PURPOSE”)

1. The University is responsible for ensuring that funds from the Higher Education Funding

Council for Wales (HEFCW) are used only in accordance with the Further and Higher

Education Act 1992, the Financial Memorandum and any other conditions which the

HEFCW may from time to time prescribe. The University must ensure that it has in place

appropriate financial and management controls sufficient to safeguard public funds and

ensure they are only used in accordance with the conditions under which they have been

made available.

2. As part of their opinion on the financial statements, the external auditors must report

whether funds from the HEFCW and other sources, administered by the University for

specific purposes, have been properly applied to those purposes and managed in

accordance with the Financial Memorandum, relevant legislation and any other terms and

considerations attached to them.

3. The overall responsibility for ensuring that funds from the HEFCW and other sources are

applied for the purposes for which they were provided rests with the University‟s Board

of Governors. On an annual basis, the Audit Committee should obtain a report from

management specifying the controls established to discharge the Board of Governors‟

responsibility for ensuring that funds received have been properly applied for the purpose.

As part of their work, the University‟s external auditors should review this management

report and comment on the consistency of the report with their audit findings and the

overall adequacy of the controls in place. This commentary should also indicate what

work has been carried out by the external auditors in support of their opinion on „funds

for the purpose‟.

4. Generally speaking funds provided for the provision of higher education should not be

used to fund provision of further education and vice-versa. In addition, the Funding

Councils allocate specific grants during the year in support of, for example, improved

academic infrastructure, Welsh language work, and defined socio-economic initiatives.

5. The University must ensure that it has adequate records to satisfy the external auditor that

funds have been applied for the purpose intended. In particular:-

a) The Finance Office shall ensure that its costing procedures are adequate to be able to

separately identify expenditure on higher education teaching, further education

teaching, research and other activities (N.B. this is currently the subject of a review by

the national Joint Costing and Pricing Strategy Group which will issue detailed

guidance.) In addition, expenditure from specific grants for defined purposes shall be

analysed in detail by use of discrete codes within the structure of the chart of accounts.

b) Budget Holders shall ensure that they keep detailed records of the use made of

specific grants allocated to them. Where expenditure is on procurement of goods and

services externally, budget holders must ensure that items are properly identified

before orders or invoices are passed to the Finance Office for processing. In those

circumstances budget holders may rely on the accounting records held in the Finance

Office and supplementary records do not need to be kept. Where expenditure includes

staff time then the budget holder shall ensure that detailed records are maintained for

example by means of diaries or time-sheets in order that the Finance Office may

calculate appropriate charges to the relevant accounting code.

January 2008

FPP4




FPP4 - PAYMENT OF SALARIES AND WAGES


1. General

1.1 Appointments of all employees shall be made in accordance with the conditions

determined by the Head of Personnel.

1.2 The calculation of all salaries, wages, overtime and other costs shall be made by the

Director of Finance and Resources or under arrangements approved and controlled by

him.

1.3 The calculation of tax, superannuation, national insurance and other deductions and

the payment of net pay shall be made by the Head of Finance or under arrangements

approved and controlled by him in consultation with the Director of Finance and

Resources and Internal Auditors.

2. Authorised Posts and Budgetary Control

2.1 Appointments, terminations, permanent amendments, overtime claims or any payroll

documents which will result in a financial charge to the University must be authorised

by the Head of Personnel, who shall ensure that adequate budget provision exists to

meet such expenditure.

2.2 All overtime shall be authorised in advance by the Head of Personnel or under

arrangements approved by him.

2.3 The Head of Personnel shall maintain a record of the authorised staffing establishment

detailing, per section or department, designations of post, grades, name of postholder,

relevant budget head/source of finance etc.

3. Authorisation Procedures

3.1 Payroll documents may only be authorised by designated officers and the number of

officers so designated shall be strictly limited and determined by the Head of

Personnel. A current list of approved signatories shall be held by the Heads of

Personnel and Finance.

3.2 Particular attention shall be paid to the authorisation of permanent changes to the

payroll such as appointments, terminations and rates of pay.

3.3 All documents and forms mentioned in this Procedure shall be properly secured at all

times.

4. Record of Attendance and Work Done

4.1 All time records or other pay documents shall be in a form prescribed or approved by

the Head of Personnel and shall be certified in manuscript (i.e. not initialled).

Timesheets shall be submitted in accordance with the time-table laid down by the

Head of Personnel.

4.2 Adequate systems shall be maintained to monitor staff attendances and confirm work

undertaken. Each Head of Department/Section shall maintain a record of absences

and submit a return to the Head of Personnel each week. A return shall be submitted

even if it is a “Nil” return.

5. Payment of Salaries and Wages

5.1 Remuneration in advance of the normal pay day shall not normally be authorised.

5.2 Following the calculation of net pay in the Payroll Office the BACS file is transferred

to the Finance Office for onward transmission to BACS who process the payment.

5.3 The method of payment will normally be by direct credit. Payment dates will be as

follows:

Full Time Academic and APT&C staff - Last working day of the

month

Part Time Academic staff - 22nd

of each month or earlier if

22nd

is weekend

Manual staff - Every other Friday.

6. Payment of Payroll Deductions

6.1 The payroll deductions from each payroll are summarised in the Finance Office and

shall be paid to the relevant body by the appropriate date.

6.2 Payments shall be made by either cheque or credit transfer signed in accordance with

the bank mandate.

7. Statutory Returns

The annual returns required by the Inland Revenue, P35, P11D, etc., shall be

completed by the Finance Office together with the Payroll Office. The relevant return

should be signed by the Director of Finance and Resources.

January 2008

FPP5




FPP5 - PAYMENT OF TRAVELLING AND SUBSISTENCE EXPENSES


As approved by Finance Planning and Monitoring Committee on 17th

October 2002.and by

the Inland Revenue for P11D Dispensation purposes in March 2003, backdated to August 1st

2002.

N.B. THIS POLICY SHOULD BE READ AS AN ENABLING

DOCUMENT RATHER THAN AS A SCHEDULE OF

ENTITLEMENTS.

EXPENSES WILL NORMALLY BE REIMBURSED ONLY

WHEN PRIOR APPROVAL HAS BEEN OBTAINED. THIS IS

PARTICULARLY RELEVANT IN THE CASE OF

RELOCATION EXPENSES

Swansea Metropolitan University

Expenses and Benefits Policy

Contents

Introduction

Expenses and Benefits provided by the University

Index

Appendix A: Engagement of:-

casual employees

construction industry subcontractors

other self employed individuals

agency workers

international assignees

Appendix B: Current rates and limits for expenses

Appendix C: Authority levels

Appendix D: Definition of business travel

Appendix E: Relocation/Removal allowance scheme

Introduction

1 This policy is to guide you as an employee or director of Swansea Metropolitan

University on the expenses and benefits which the University provides. The policy reflects the

need to run our business efficiently, keeping paperwork to a minimum, while complying with

tax and other legal obligations.

Benefits on which you pay tax

2 You will be liable to income tax on any of the following benefits which the University

provides to you:-

a) Accommodation and related benefits;

b) Medical insurance;

c) Redundancy payments, and/or benefits, which exceed £30,000;

d) University cars;

e) Fuel for private use in University cars;

3 The University will provide a statement after the end of each tax year showing the taxable

value of each benefit.

4 A return on "form P11D (substitute)" will then be made to the Inland Revenue by 6 July

following the end of the tax year so that they may amend your PAYE code or make other

arrangements to collect the tax. A copy of this return will be given to you by the same date for

the purposes of your tax return.

5 Provided that expenses and benefits have been claimed and/or provided only in

accordance with the terms of this policy, you will not need to report in your tax return

anything else provided by us.

Benefits and expenses on which you do not pay tax

6 Other expenses and benefits are, subject to a few exceptions dealt with in the policy,

covered either by:-

a) a "form P11D dispensation" issued by the tax office which confirms their agreement

that no additional tax arises in respect of them; or

b) a "PAYE settlement agreement" under which the University pays all income tax due

on your behalf, and any NIC liability arising.

7 Where the policy indicates that a dispensation applies, no tax or NIC liability will arise to

you and the tax office has agreed that you need not report details in your tax returns though

you are responsible for keeping your own records relating to the items concerned for tax

purposes. This is explained further below.

8 Similarly, where the policy indicates that a PAYE settlement agreement applies, no tax or

NIC liability will arise to you and no details need be reported in your tax returns.

9 If you incur any business expense or wish to receive any benefit which is not included in

this policy, or you have a query relating to the policy, refer in the first instance to your

manager who will if necessary refer to the Director of Finance and Resources or Deputy for

guidance. All contact with the Inland Revenue will be conducted by the Director of Finance

and Resources or Deputy.

Expense and benefits payment procedures

10 Expenses may be claimed only where they are incurred wholly, exclusively and necessarily

in carrying out the duties of employment with the University.

11 All expenses must be covered by a detailed standard expense claim form. The expense

claim form should be forwarded for approval by one of the certifying officers i.e. Vice-

Chancellor, Deputy Vice-Chancellor or Director of Finance and Resources. Claims should be

made promptly within one month of the expenditure being incurred and should be supported

by receipts, where appropriate, which should be attached to the claim form. If any expenses

are incurred and a receipt was not available then the items should be detailed on the expense

claim form with an explanation of why the cost was incurred. These occurrences should be of

a minor non-recurring nature. Claim forms are obtainable from Finance Office or

Faculty/Department Offices. Payment will be made monthly, by BACS, as part of the payroll

process.

12 Expense claims in respect of the Vice-Chancellor should be approved by the Chair of

the Board of Governors

Expenses reimbursed to you

13 Reimbursement will be made on production of receipts or invoices except in the

limited instances specified below in which expenses are reimbursed by way of round sum

allowances for which receipts are not required.

14 Expenses incurred on behalf of the University are to be recorded in detail on the

expenses claim form. These forms must be supported by receipts wherever the supplier can

reasonably be expected to provide a receipt, except where round sum allowances are claimed

in accordance with the instructions in this policy.

15 Where expenses are incurred in foreign currencies, the amounts should be shown, in

the currency in question, in the "details" column of the expenses claim form. The rate must be

indicated on the expenses claim form in the "Details" column.

16 You must sign the declaration on the expenses claim form and the form must be

authorised under the procedures.

17 The form should then be submitted within one month of the expense being incurred to

Finance Department for payment.

University credit cards

18 The University may arrange for an University credit card to be provided to certain

employees. Where a card is provided it is to be used only for:-

a) the business expenses set out in this policy,

b) fuel where applicable as set out in the “Fuel” section under “Travelling Expenses”;

and

c) in exceptional circumstances it is accepted that it may be necessary for you to use the

card privately. You are required to reimburse the University for the private costs so

incurred.

19 The procedures for completing the expenses claim form described above must be

followed in respect of all credit card expenses. Where the expenses were incurred in a foreign

currency you should convert them into Sterling at the exchange rate shown on the credit card

statement.

20 Those responsible for authorising expense claims must receive and authorise the

expenses claim form, together with supporting VAT invoices (see VAT below) before

authorising payment of the credit card account by the University.

21 Where the credit card account includes private expenses, you must reimburse the cost

of the private element either by means of a deduction from a separate claim for cash

reimbursement, or by means of a cash payment to the University. The person authorising

your expense claim will not be permitted to authorise payment of the credit card account until

such reimbursement has been made.

Petty cash

22 Petty cash vouchers are to be used only for small items of actual expenditure (not

round sum allowances). The maximum amount which may be claimed in respect of any item

through the petty cash system is indicated in Appendix B. All other expenses must be

claimed using the expenses claim form.

23 Any item claimed on a petty cash voucher must be fully described and a receipt

attached wherever the supplier can reasonably be expected to provide a receipt.

Payments direct to external suppliers

24 Certain expenses and benefits are provided by way of payments direct to external

suppliers of goods and services, for example, centrally organised conferences, and so on. The

conditions laid down in the relevant section of this policy must be satisfied before the

expenditure may be incurred. Any item not covered by this policy must be referred to the

Director of Finance and Resources or Deputy for guidance before any commitment is made to

meeting the expense.

25 If you are authorised to commit the University to making payments to external

suppliers you should also be aware that there are legal implications and special tax and NIC

rules relating to engagement of:-

a) casual employees;

b) construction industry sub-contractors;

c) self employed individuals;

d) agency workers;

e) individuals supplying their services through “personal service companies”; and

f) international assignees.

26 The procedures to be followed are described in Appendix A to this policy.

27 Where expenses and benefits are to be settled by direct payment by the University to

external suppliers, form must be completed and approved (see “Authorisation of expenses

and benefits" below) before the expenditure is incurred. Following approval, the expenses

claim form should be sent to Finance Department. Amounts in foreign currency should be

shown in the currency in question in columns 6 to 8.

Keeping records

28 Completed expenses claim forms, credit card statements and petty cash vouchers will

be submitted to the Finance Department together with all supporting documentation (receipts,

etc) no later than the end of the month following that in which the payment is made by the

University.

29 The supporting documentation will be retained centrally for at least six years.

However, you must retain your own records for tax purposes (see the Inland Revenue leaflet

"Guidance for employees about the employment records they may need to keep"), either by

copying the claim form and supporting documents, or by making a separate record which

provides details of the amount, nature and dates of the items incurred.

Authorisation of expenses and benefits

30 Expenses and benefits may be authorised by staff within the limits indicated in

Appendix C. Except where this policy specifically provides otherwise, authorisation

procedures will be as follows.

31 Expenses and benefits of staff must be authorised by the relevant line manager.

32 Any amendments made to forms should be initialled by the claimant and by the

individual authorising them. Under no circumstances will self authorised forms be submitted.

33 Authorised forms should not be returned to the claimant prior to payment or to

incurring the expenditure.

34 Any attempt to submit a false form will be treated as a serious disciplinary offence.

35 Except where otherwise provided in this policy in relation to specified items, no tax or

NIC liability arises in respect of expenses claimed in accordance with the above procedures

and no details need be reported in employees' tax returns.

VAT

36 It is important that VAT is correctly recorded on expenses forms and that VAT

invoices are provided wherever possible with claims, in order to ensure that the University

recovers the full amount of VAT to which it is entitled.

37 As a general rule, where goods and services are to be purchased for business purposes,

you should arrange, wherever possible, for the supply to be made to the University, and for

VAT invoices, made out to the University, to be provided.

38 In any event, VAT invoices must be obtained in respect of all expenses on which

VAT has been paid, except for the following, where under current Customs & Excise practice

VAT may be recovered by the University without VAT invoices:-

g) business telephone calls from public or private telephones (other than the employee's

own home telephone);

h) purchases through coin-operated machines;

i) car park charges (but not in respect of charges for on-street parking meters which are

not subject to VAT);

provided that the total expenditure for each supply is less than £25 (including VAT). The

VAT may only be recovered where the person incurring the expenditure is sure that the

supplier is actually registered for VAT. Where these conditions are met, 7/47ths of the

amount paid should be shown in the VAT column of the expense form, and the balance

shown in the relevant expense column.

39 There is no need to show separately the amount of VAT included in a claim for

business entertaining expenses (see "Entertainment") below). A receipt is nevertheless

required. For VAT purposes, business entertainment does not include staff entertainment,

except in those cases where staff entertainment is incidental to business entertainment. VAT

on staff entertainment should be included in the VAT column for recovery.

Advances

40 Advances against expenses may be claimed on the appropriate expenses advance form

subject to the following conditions:-

a) Advances will be limited to the amount of expected expenditure and authorised under

the normal procedure in "Authorisation of expenses and benefits" above.

b) An advance will be limited to a maximum of £300 and must be accounted for, in full,

by submission of expense claims on the expenses claim form, as soon as possible, and

in any event not later than two months after the date it was provided. Any unused

balance of the advance must be repaid within two months of the date it was provided

or when the claim is submitted. No further advances can be made while an advance is

outstanding if the total advances unaccounted for would exceed £300. The University

reserves the right to recover any uncleared advances from any moneys owed to you.

c) Advances may be made in foreign currencies where you are travelling overseas on

business. Application should be made to Finance Department. The amount of a

foreign currency advance will not exceed the Sterling equivalent in (b) above when it

is made and all of the remaining conditions set out in (a) and (b) above will apply.

Expenses incurred and the amount, if any, returned to the University, should be

accounted for in the currency advanced, in the details column of the expenses claim

form, and the sterling amounts extended into the remaining boxes.

41 No tax or NIC liability arises in respect of advances dealt with according to the above

rules and details need not be reported in tax returns.

Expenses and benefits provided by the University

Travelling Expenses

1 Generally the most economical method of travel must be used. Wherever practicable, staff

are encouraged to share cars.

2 You may claim the costs of necessary business travel. For guidance on which journeys

count as business journeys, see "Definition of business travel" in Appendix D.

3 Where overseas journeys are taken, VAT invoices should be obtained wherever possible,

but any overseas VAT included should not be shown separately in the VAT column of the

expenses claim form. Instead, the gross amount incurred should be shown in the relevant

expense column of the expenses claim form. Such VAT may be recoverable but Finance

Department will need to consider each relevant claim separately.

Car Mileage Allowance

4 A member of staff may use his/her own private motor car for business journeys which do

not exceed 100 miles in total.

5 The rates payable are those agreed with the Inland Revenue as tax-free under IRAMR.

Rail fares

6 All staff must travel standard class or saver. Tickets must be booked and obtained

through the Finance Office who will require at least three clear working days notice. Staff are

encouraged to book as far in advance as possible in order that discounts available on, for

example, APEX tickets may be obtained.

7 All staff should ensure that the most economical class of travel is used. In general this

will be a second class period return although employees are expected to investigate the

possibility that day return tickets or "savers" may be available at lower cost.

Coach Travel

8 This option is available to staff having regard to the circumstances of the journey.

Overseas Travel

9 Prior approval of the Vice-Chancellor is required for all overseas visits. All necessary

arrangements should then be made and details forwarded to the Finance Office to make the

final reservations and either make out an Official order or make payment using a Purchasing

Card.

Air fares

10 All staff who need to travel by air, should travel at tourist or economy class, taking

advantage wherever possible of any reduced rates.

11 Details of any rail and flight costs for which reimbursement is sought should be reported

on the expenses claim form, as for other public transport expenses.

12 No tax or NIC liability arises in respect of travel expenses claimed under the above rules

and details need not be reported in tax returns.

Air travel within UK

13 Prior authorisation must be obtained from the Director of Finance and Resources who will

consider having regard to the special circumstances.

Hotel Accommodation

14 When you are travelling on business you should obtain accommodation in a reasonable

quality hotel. Bookings of hotels should whenever possible be made through the Secretary of

the Clerk of Governors. The University will bear the cost of the room, evening meal and

breakfast. Where meals are not taken in the hotel separate restaurant receipts should be

obtained or alternatively you may charge only the room cost to the hotel bill and claim all

other meal and incidental costs by way of the overnight subsistence allowance under the rules

described in “Subsistence” below.

15 Contrary to the general rule, it is Customs & Excise‟s current practice that VAT may be

reclaimed on hotel bills even though they are not addressed to the University, though as this is

a concession only, central booking through the in-house travel agent should be used wherever

possible.

16 No tax or NIC liability arises in respect of hotel costs claimed under these rules and

details need not be reported in tax returns.

Personal incidental expenses

17 Whichever form of accommodation is used, items of a personal nature, such as mini-

bar drinks, newspapers or video hire will not be reimbursed by the University. Where these

items are included in a hotel bill, you should deduct the costs before submitting the bill for

reimbursement. Where the bill is to be paid by the University direct and includes such items,

the bill will be referred to you for attachment to the expenses claim form. The cost of the

personal items must either be deducted from a later expense claim or paid back to the

University.

Car parking

18 At Townhill, Mount Pleasant Campuses and Pen y bryn, car parks are available to

staff.

19 No tax or NIC liability will arise from the provision of this benefit and details need

not be reported in tax returns.

20 Parking costs incurred in the course of business travel (see Appendix D) may be

claimed via the expenses system. The costs of parking at the normal place of work may not be

so claimed.

21 Wherever VAT is charged on parking costs which may be claimed, a suitable VAT

invoice should be obtained and attached to the expenses claim form.

Fuel

22 Except as provided below, the cost of fuel used for business purposes in University

cars and vans should be claimed as follows:-

a) enter on the expenses claim form, the date of the journey;

b) enter the reason for the journey. More than one line should be used as necessary if

this will enable a more detailed description of the reason to be given. Also, enter details of

each journey stating the starting point, places visited en route and the point at which the

journey ended. Details must include the names and addresses of the persons visited and

addresses must be sufficiently precise to enable a check to be made on the mileage

calculation;

23 All charges for use of the card will be made direct to the University and payment will be

made direct by the University to the card company. Where this applies, the procedure

described above for claiming business mileage will not apply.

Pool Cars

24 The University has a number of pool cars that can be supplied for business use. It is the

responsibility of the Site Manager at the Townhill Campus to maintain a register and log of

all business mileage detailing the name of the employee taking charge of the vehicle and the

purpose of the journey. Private use of the official cars is strictly prohibited. These vehicles

are not allocated to any one individual. As these cars are not insured for regular private use

and since there may be substantial VAT costs if there is any private use, these cars may be

used only for business journeys.

To secure that the car scale charge will not apply in respect of vehicles designated as pool

cars, you must comply with the following rules:-

a) pool cars are provided for business journeys only and any private use is merely

incidental to its business use, (including office to home journeys after late working);

b) they must not be used by any one employee to the exclusion of others;

c) pool cars must be left overnight at the office location to which they are allocated and

not taken home by employees. Exceptionally it may be necessary to take a pool car home

when a long business journey on the following day is to be commenced early in the

morning. However, in such a case, specific permission must be sought in advance from

the Vice-Chancellor who will check whether such intended private use would be

incidental and exceptional.

d) It is the responsibility of the Site Manager to ensure the vehicle(s) are kept in a

roadworthy and presentable condition.

Private Transport (using your own car on business)

25 Staff must not use their own vehicles for authorised official duties unless their insurance

policy covers this use and also provides protection for the University in the event of any

accident occurring. Members of staff will be required to produce such policies upon

request.

26 In general, the approved mileage allowance will only be paid when no public transport is

available or when the extra cost of travel by private motor vehicle is outweighed by other

savings, e.g. staff time or through carrying passengers. Otherwise the lowest public transport

fare will be used in lieu of mileage allowance.

27 The approval of the appropriate Head of Department must be sought before the journey is

undertaken. In certain circumstances, it will be open for Heads of Department, subject to

prior negotiations with staff, to authorise payment of a reduced rate of mileage allowance.

28 The approved mileage allowance rates to be paid must be within the Inland Revenue‟s

Fixed Profit Car Scheme.

29 If you are authorised to use your own car on University business you should claim

following the procedure described below.

30 Full details of the journey, including date, reason for journey, starting points and

destinations, should be shown in the appropriate columns of the expenses claim form.

Business miles to be claimed must be entered and the amount claimed shown in the

appropriate columns. Business mileage for these purposes is defined in Appendix D.

31 The University is able to recover an amount in respect of VAT included in the fuel

element of the mileage charge. The amount is calculated by applying the percentage, set out

in Appendix B, to the total mileage claimed. VAT invoices are not required for these claims.

32 No tax or NIC liability arises in respect of mileage claimed for the use of the employee's

own car under the above rules and details need not be reported in tax returns.

Vehicle Hire

33 The University has arrangements with local and national agencies for vehicle hire.

The rates vary according to size of vehicle and duration of the period of hire. Request forms

can be obtained from the Site Clerk, Mount Pleasant and must be received at least 3 clear

working days before the date of the outward journey.

34 Staff are asked to use this facility when the business journey exceeds 100 miles for the

round trip. Staff who wish to use their own cars for such journeys instead of hired vehicle for

convenience, or other reason, may do so but their travel claims will be settled on the basis of

hire car costs plus an allowance for fuel.

35 When staff absence on business is for 3 days or more a hired vehicle should not be

used unless the University has made arrangements for the vehicle to be collected at the

business destination and replaced by a vehicle for the return journey. An exception can be

made when more than one member of staff is attending the same business venue, they should

travel together.

36 Daily hire vehicles must be collected either at Mount Pleasant or at Townhill at any

time by arrangement with the Site Clerk, Mount Pleasant and returned to the same site. If the

return journey ends after normal hours, the keys must be handed to the duty Security Officer;

any faults with the vehicle accidental damage caused to the vehicle must be reported when the

vehicle is handed over. In exceptional circumstances, e.g. serious delays or major disruptions

on motorways and highways, adverse weather conditions, etc, staff may retain hired vehicles

overnight provided they are returned to the collection site by 8.30am the next day. Failure to

meet this deadline will incur an extra day‟s hiring charge payable by the member of staff for

whom the vehicle was hired.

General Rules

37 Parking fees whilst on University business will be reimbursed provided they are

reasonable and the most economical available.

38 Any excess parking charges or fines will not be paid for by the University.

39 Standard toll charges will be refunded only upon production of receipts.

40 Any repairs for official cars must be arranged through the University where possible. If

for any reason this is not possible a full report and detailed claim must be provided.

41 All claims for reimbursement of business mileage should be made on a monthly basis, but

no later than termly, using the University‟s standard expenses claim form. A cumulative log

of business mileage must be maintained identifying the place visited and the purpose of the

journey.

Mobile telephones

42 Where the University is satisfied that a business need arises you may be provided with a

mobile telephone. Where this applies the University will pay all costs including those relating

to all calls. No taxable benefit arises and details need not be reported in your tax return.

43 The University will not reimburse you for hiring, leasing or purchasing such equipment

of your own, irrespective of whether the equipment is installed in a University vehicle or in

your private vehicle, or neither. The University will meet the costs of business calls made on

such equipment, provided detailed evidence of the costs is supplied with the claim form.

44 No tax or NIC liability arises in respect of use of mobile telephones in accordance with

the above and details need not be reported in tax returns.

Professional bodies' and trade association meetings

45 If you are a member of a professional body or trade association you may from time to time

attend meetings of that body as a representative of the University and in relation to the

University's business. Where you do so and incur travel costs or charges for entry to the

meetings, such costs may be claimed as business expenses. Where you hold office in the

body, any costs incurred in the capacity of office holder which are additional to costs which

you would have incurred in any event as a representative of the University, may not be

claimed from the University.

46 No tax or NIC liability arises in respect of the above, and details need not be reported in

tax returns.

Taxis for late working

47 Where you are obliged to work late, you may claim the cost of a taxi home, provided

the following conditions are satisfied:-

a) you are obliged to work until after 9.00 pm that is, your late working is

obligatory and not a matter of your choice but this does not follow any predictable

pattern and does not arise for you on more than 60 evenings in a tax year; and

b) when you leave, either public transport home has ceased operating or the

person responsible for authorising your expenses confirms on the expenses claim form

that it would not be reasonable to require you to use it.

c) when working behind the bar at Townhill Campus, should you work after

11.30pm you may be eligible to use „Yellow cabs‟ the local taxi firm, due to public

transport having ceased operating after 10pm and the lack of security in the area.

48 No tax or NIC liability arises provided the above conditions are satisfied. Details need not

be reported in tax returns.

Spouse travel

49 The University will not normally meet the travelling, subsistence and accommodation

costs of your spouse. In exceptional circumstances a spouse may accompany you on a

business trip, these being:-

a) your spouse has a skill which is relevant to your work, and which is exercised

regularly during the trip, for example your spouse is fluent in a foreign language and

serves as an interpreter when you meet business contacts; or

b) you are so ill that travelling alone would not be practicable; or

c) you have to arrange meetings, dinners, etc with business contacts and need your

spouse to attend as a host(ess) for those guests.

50 Where (a) or (b) above applies, the costs relating to your spouse are to be charged to

Travel on expenses claim forms. Where (c) above applies, the additional costs relating to your

spouse (that is, those costs which would not have been incurred had your spouse not

travelled) are to be charged to business entertaining. No tax or NIC liability arises to you in

respect of expenses claimed under the above rules and details need not be reported in tax

returns.

Conferences

51 You may be required to attend conferences and conventions in the course of your duties.

You will be notified individually of such events. Costs in respect of accommodation,

subsistence and travel will be paid centrally by the University. No tax or NIC liability arises

to you and details need not be reported in tax returns. You should note that any additional

costs, such as entertaining expenses, must be reclaimed using expenses claim forms.

Subsistence

52 If your duties require you to travel you are entitled to claim the additional cost of meals

taken en route. Only the costs of meals taken in the course of business journeys as defined

under "Definition of Business Travel" in Appendix D will be borne by the University in the

circumstances described below. You may claim either the actual, reasonable costs of food and

drink, supported by receipts, or, as an alternative, scale subsistence expenses as follows. The

payments should be claimed on expenses claim forms.

a) Day subsistence allowance (lunch) - £5.50

If you have a normal place of work you may claim this sum without the need for

receipts in respect of each day on which you purchase a meal while away from both

home and the normal place of work, and are:

i) more than 50 miles from each; and

ii) absent from each for more than 5 hours, spanning a normal meal time.

b) Day subsistence allowance (lunch and dinner) - £13.50

If you have a normal place of work you may claim this sum without the need for

receipts in respect of each day on which you purchase meals whilst away from

both home and the normal place of work and are:

i) more than 50 miles from each; and

ii) absent from each for more than 10 hours, spanning two normal meal times.

53 If you hold a travelling appointment you may qualify for the above allowances where you

are more than 50 miles from home for more than 5 hours, or 10 hours, as appropriate.

54 Staff in certain designated departments whose duties entail extensive travel may, at the

discretion of the manager, receive reimbursement of either of the following overnight

allowances as appropriate:-

c) Overnight subsistence allowance - £16

Where you are away from home and the normal workplace overnight you may claim

an overnight subsistence allowance of £16, in addition to accommodation costs (see

below), to cover lunch, evening meal, breakfast (if breakfast is not provided under a

composite charge for bed and breakfast in an hotel, etc) and all other incidental

business expenses. Where overnight allowance is claimed you may not claim the day

subsistence allowances referred to above, nor any actual meal or other incidental

costs. It should be noted that the allowance is payable in respect of nights spent away

from home, so that, for example, if you are away from home from Monday to

Wednesday and stay away from home on Monday night and Tuesday night, the

allowance claimable is 2 x £16 = £32; or

d) "Staying with friends" allowance

If you choose not to stay in hotel accommodation (see below) and instead stay

overnight with friends or relatives, an allowance of £25 per night may be claimed

by way of a contribution towards the costs incurred by the relatives in providing

board and lodging. This allowance is in lieu of the hotel costs which would

normally be claimed. Where this allowance is claimed, the only other scale

subsistence allowance for which you may claim, where appropriate, is the “day

subsistence allowance (lunch)” described above.

55 No tax or NIC liability arises in respect of any of the above expenses claimed in

accordance with these rules.

Entertainment

56 Necessary costs of entertaining business contacts will be reimbursed on production of

receipts. For this purpose, "business contacts" do not include other employees of the

University or of any other group University.

Entertainment and Hospitality

57 Hospitality may be extended to visitors to the University if it is in the interest of the

University to do so. Such hospitality should not be excessive of disproportionate to the

benefits of the visit to the University.

58 University facilities should be used wherever possible in entertaining visitors to the

University or a valid reason for non-use given. Where hospitality is offered in non-

University facilities prior approval of the Vice-Chancellor is required.

59 Where you entertain business contacts in the University's dining rooms or restaurant

facilities, you must enter details as at (a), (b) (c) below on the hospitality form.

60 In claiming the reimbursement of hospitality expenses, the appropriate from should be

completed and supporting receipts provided. The form should include the purpose of the visit

and the number of people entertained, with a split between University and non-University

participants.

61 The following information must be shown on expenses claim forms:-

a) the name(s) of attendees; and

b) the organisation which they represent./; and

the purpose of the entertainment (for example, "negotiation of contract," "business

acquisition").

62 Where meals are taken locally with other employees of the University, or with

employees visiting from other group companies other than in the University's dining rooms

which are available to all employees, the University will only meet the meal, etc costs in the

circumstances described in the "Subsistence" section above.

63 Costs which are incidental to business entertainment costs (for example, the cost of a

taxi to a restaurant where a customer is to be entertained), should be described as business

entertainment on the expense claim form (and not, for example, claimed under "Travel").

64 University funds will not be used to support the costs of social gatherings, except for

students (this also includes prospective students).

65 The receipt of hospitality from outside bodies, outside the normal course of the

University‟s activities is discouraged (see FPP 27). The receipt of hospitality which could

lead to financial gain for the providing outside body is strictly forbidden. This also includes

the giving of any incentives by outside bodies with a view to obtaining such gains.

Out of Pocket Expenses

66 You may claim the cost of reasonable out of pocket business expenses as described

under "Expense Reimbursement Procedure" above for which it is not normally possible to

obtain receipts. Examples of such expenses are parking meters (but not fines), taxis, tube and

bus fares and telephone calls from public call boxes. Claims must be limited to the actual

amount of expense incurred and not claimed as a round sum allowance. All items claimed

should be itemised and described as fully as possible on expenses claim forms. Provided that

the individual cost of telephone calls and/or car park charges (not parking meters) shown on

each claim does not exceed £25, the University may reclaim the VAT thereon without VAT

invoices being obtained (see "VAT" under "Introduction"). You should therefore report such

costs on expenses claim forms and calculate the recoverable VAT in accordance with the

instructions thereon.

67 No liability to tax or NIC arises to you in respect of expenses claimed in accordance

with these instructions and details need not be reported in tax returns.

Home Telephone Costs

68 If you are required to make business calls using your home telephone you should

claim reimbursement of such call costs by entering the amount to be claimed on expenses

claim forms and attaching the original telephone bill. Except as provided below the

University will not bear the cost of any part of the rental of a home telephone nor of any

private calls or private use of the internet, etc. Such costs must be deducted from the total

amount of each bill and only the net amount, representing only business calls (and the VAT

thereon), should be included on the expense claim form.

69 No liability to tax or NIC arises in respect of expenses claimed in accordance with these

rules and details need not be reported in tax returns.

Telephones

70 The University contracts directly with Service Providers to pay the telephone bills of the

Vice-Chancellor, if resident in College House, a few specified Wardens, and the Clerk to the

Governors, who use University telephones for business purposes e.g. Halls of Residence.

71 The relevant members of staff are expected to identify all business calls made and

reimburse or pay the University the costs relating to all private calls made and the VAT

element.

72 Members of staff should generally be discouraged from making private telephone calls.

Where national or international calls are made, however, the relevant cost should be

reimbursed to the University. It is the responsibility of each department to collect such

income due and receipts should be given as appropriate. Private international and other STD

calls should be connected via the University Switchboard, who should be advised that the

number requested is private. The member of staff concerned will receive an invoice from the

Director of Finance and Resources in due course which should be settled within fourteen

days.

Publications

73 The University will make available to you publications which are necessarily used in

the performance of your duties. Relevant staff are entitled to receive copies of the local

newspapers and appropriate trade journals. Other employees should seek authority to claim

trade journals appropriate to their duties.

74 No tax or NIC liability arises in respect of the above and details need not be reported

in tax returns.

Subscriptions

Professional subscriptions

75 The University will bear the cost of annual subscriptions to the following professional

bodies where the University considers that membership of the organisation in question will

enhance your effectiveness in performing your duties or it is a requirement of the profession

that you are a member in order to perform the duties of the employment:-

ILT

76 In such cases membership of the organisation is a condition of the employment. No tax

or NIC liability arises and details need not be reported in tax returns.

Club membership subscriptions

77 The University may meet the cost of subscriptions to members' clubs in the following

circumstances:-

a) the club offers cheap overnight accommodation to its members in a location

away from your home and normal place of work, which you frequently visit on

business, and you are a member only for this purpose in preference to staying in hotels

and paying higher charges in that location; and

b) the club has dining or social facilities, you are regularly required to entertain

external business contacts, and membership of the club is required, and the facilities

of the club are used, solely for the purpose of such entertaining. Where this applies,

the cost of the subscription should be claimed under "business entertaining" on the

expense form.

78 No tax or NIC liability arises in respect of the above and details need not be reported in

tax returns./Any income tax liabilities arising will be included in the PAYE settlement

agreement procedure described at paragraph 7 of the Introduction to this policy and details

need not be reported in tax returns.

Training courses

79 The University provides training courses to enable employees to improve their

effectiveness at work. The University organises training courses in-house and the costs of

these courses are borne by the University. Where it is necessary for you to travel to attend

these courses, any travel and subsistence expenses incurred may be claimed as business

expenses under the rules indicated in the "Travelling expenses" and "Subsistence" sections of

this policy.

80 Additionally, at its discretion, the University will bear the cost of external training

courses. The University Staff Development Committee may agree to meet the cost of courses

where the training leads to the acquisition or improvement of knowledge, skills or personal

qualities which are likely to prove useful to you in carrying out the duties of the employment,

or which better qualify you to undertake the duties of another employment with the University

in due course.

81 Where these conditions apply the University may agree to bear the cost of the course

fees and the cost of essential books. If you are in any doubt about whether a particular cost

can be treated as directly relating to the taking of the course, refer to the Finance department

for guidance.

82 No tax or NIC liability arises in respect of such payments and details need not be

reported in tax returns.

Training courses travel and subsistence expenses

83 Provided the period of training on an external course does not exceed 24 months and

you return to your normal place of work at the end of the period of training, any reasonable

travel and subsistence expenses incurred in attending the course may be claimed as business

expenses under the rules indicated in the "Travelling expenses" and "Subsistence" sections of

this manual.

84 No tax or NIC liability arises in respect of such costs and details need not be reported in

tax returns.

Training course incidental expenses

85 When you attend training courses arranged by the University and an overnight stay is

involved, you will generally be provided with overnight accommodation and meals at the

University's expense. In addition, you may claim the actual cost of incidental expenses such

as newspapers, laundry, drinks, video hire and so on provided that the total amount spent on

such items amounts to no more than £5 per night (where the night is spent wholly in the

United Kingdom) or £10 per night (where the night is spent wholly or partly outside the

United Kingdom). The average may be calculated only over the period during which you are

away from home on a training course or business trip. Any nights not spent away will break

the period. These limits must not be exceeded (since any excess will result in tax and possibly

NIC liabilities in respect of the full cost).

Uniforms

86 The University will provide uniforms for the following categories of employee. The

provision of clothing will be arranged by the University. Costs may not be claimed by way of

reimbursement in cash:-

Receptionist

1 Jacket & Skirt/trousers per annum;

3 shirts/blouses per annum.

Caretaking/security staff

Safety shoes (as required);

Protective clothing including overalls (as required).

87 The University's logo will be imprinted/stitched into or otherwise permanently attached

to all clothing provided other than safety helmets.

88 Any clothing (with the exception of protective clothing) which does not include the

University motif or logo or is used for private wear, will be regarded as a benefit-in-kind and

returned to the Inland Revenue authorities on form P11D.

89 Expenses of laundering the clothing referred to above may be claimed in accordance

with the procedures laid down in the "Expenses and benefits payment procedures" section of

this policy.

90 No tax or NIC liability arises in respect of clothing and laundry costs provided under

the terms described above and details need not be reported in tax returns.

91 If replacement clothing is purchased because of damage to an item of clothing referred

to above, this must be recorded on expenses claim forms.

Spectacles for VDU Operators

92 If you are required to operate VDU equipment in order to carry out your duties you will

receive training under the terms described in the Staff Handbook. Where for these purposes

you undergo an examination by an optician, the University will reimburse the cost of the

examination.

93 In addition, where an optician certifies that a new or alteration prescription for

spectacles is required solely for VDU usage, the University will bear (or make a contribution

towards) the costs of frames, lenses and any special prisms or tinting, subject to a maximum

as indicated in Appendix B, insofar as the cost relates only to the requirements for VDU

usage.

94 Where it is certified that existing bifocal lenses are unsuitable for VDU usage, the

University will pay the initial cost of replacement lenses on the same basis as above.

95 Any payment by the University towards the cost of spectacles will be limited to the

above amounts. Claims should be made using expenses claim forms. No tax or NIC liability

arises and details need not be reported in tax returns.

Pay & Allowances

96 Wherever entitlement to the following arises, all payments are made through the payroll

and are subjected to PAYE and NIC:-

a) Basic pay

b) Bonus

c) First aid allowance

d) Location allowance

e) Overtime

f) Shift allowance

Sick Pay

97 If you are absent from work for a reason other than annual or maternity leave or other

previously approved absence, your manager should be notified well before your normal start

time or as soon thereafter as is reasonably practicable. This notification may be given by

telephone or in writing and should give the reason, and on the third day notify Head of

Department or Personnel of continuing ill health so that relief can be arranged. Where the

absence is caused by sickness, upon return to work, you will be required to complete a `self

certificate' indicating the nature of the sickness.

98 If the absence continues beyond seven calendar days, you should write again before

the eighth day to the manager and, where the absence is as a result of sickness or injury,

enclosing a doctor's certificate. Further letters and certificates are required for each seven

calendar days of continuing absence unless the doctor certifies a longer period.

99 Where the absence is for more than 12 weeks the University may consider referring

the case to the University‟s medical advisors for medical opinion to be sought. In either case,

all reasonable travelling or similar necessary incidental fees or costs which may arise will be

reimbursed by the University. No tax or NIC liability will arise in respect of such costs./Such

costs are included in a PAYE settlement agreement. You need not report details in your tax

returns.

100 If you are absent through illness you will be paid the higher of University sick pay and

statutory sick pay, subject to the terms provided in the Staff Handbook. Such payments will

be subject to deduction of tax and NIC in the normal way.

Maternity pay

101 Subject to certain conditions, if you become pregnant you have a number of statutory

rights in relation to:-

a) paid time off for antenatal care;

b) a minimum period of maternity leave;

c) protection against dismissal by reason of pregnancy or childbirth;

d) protection from conditions which may be harmful to the health and safety of the

employee or the child;

e) the right to return to work; and

f) maternity pay.

102 Further details are given in the Staff Handbook.

103 It should be noted that in order that the requirements of the Statutory Maternity Pay

scheme may be met, you should notify Personnel Services in writing at least 21 days before

you intend to take maternity leave (or, if later, as soon as is reasonably practicable thereafter).

You should also arrange for medical evidence of the expected date of the birth on form

MATB1 to be signed by your doctor and supplied to Personnel Services. This form should

not be signed by the doctor more than 14 weeks before the week in which the baby is

expected.

Directors' and Officers' Liability Insurance

104 The University provides insurance cover to you against claims which may be made by

third parties for personal costs and financial losses arising from your actions. The policy

covers claims made against you for actual or alleged breach of trust, neglect, error and so on

in carrying out your work and extends to costs incurred in defending such claims. Losses and

costs arising from actions outside the scope of your employment duties, such as actions which

give rise to convictions for fraud, dishonesty or malicious conduct are not covered.

105 No tax or NIC liability arises in respect of the premium paid by the University in

providing this insurance. Similarly, no tax or NIC liability arises in respect of any payment

made to you by way of proceeds of a claim made under the policy. Exceptionally, the

University might make a payment to you in respect of liabilities of a kind which are covered

under the insurance policy, by way of direct reimbursement under the University's Articles.

These payments are also exempt from income tax and NIC. No details need be reported in tax

returns.

Redundancy

106 Where your contract of employment is terminated on grounds of redundancy prior to

attainment of normal retirement age, the University will, if you qualify, provide benefits in

excess of your statutory entitlement, if any. Any accrued salary, holiday pay and similar

remuneration accrued to the date of leaving will be paid and subject to PAYE/NIC in full.

Any payment in lieu of notice will be taxable in full and liable to NIC/eligible for the tax/NIC

reliefs described at (a) below. The main categories of additional redundancy benefits for

which you may be eligible are as follows:-

a) Redundancy payment

The amount of any redundancy payment will depend on your length of service and the

number of years remaining to normal retirement date. Provided you have been in service

for at least two years (from reaching the age of 18) prior to the termination of your

employment you will receive a payment equal to one month's salary for each year of

service, up to a maximum of 20 years. However, the payment will not exceed the

maximum amount of remuneration which you would have received, at rates current at the

date of termination, had you remained in employment up to normal retirement date.

Please refer to the Staff Handbook for further information.

Circumstances may arise where the University wishes to ensure that employees who are to

be made redundant remain in service for a period which serves the University's best

interests. Where this arises, the University may make an additional payment for

redundancy which compensates for the negative effect on the resulting prospects for the

employee to obtain another job.

If the aggregate amount of these payments is £30,000 or less, there will be no liability to

tax. If the aggregate exceeds £30,000 you will normally be liable to pay tax at your

marginal rate on the excess and the University will withhold such amounts of tax under

PAYE as are required by law. Details will be provided to the tax office by 6 July after the

end of the tax year and a copy of this report will be provided to you on request, in order to

assist with tax return preparation. No NIC liability arises.

b) Enhancement of pension benefits

The University may at its discretion arrange for enhancement of your benefits, if any,

under the University exempt approved pension scheme. No tax or NIC liability will arise

in respect of this enhancement but benefits resulting from the enhancement will be subject

to normal tax rules.

c) Outplacement counselling

If you qualify under the rules set out below, the University may arrange for you to receive

counselling from an external adviser to enable you to adjust to the termination of the

employment and/or to enable you to find other employment (or become self employed).

d) Retraining expenses

You qualify to receive this training if you have been employed full time for two years

when the course starts or, if earlier, when the employment is terminated, and you do not

become employed again by the University within two years of leaving.

All such training will be provided in the United Kingdom. The University will make the

necessary arrangements and will pay for the services direct.

You may claim travelling and subsistence expenses in attending such training on the basis

that such journeys represent business travel for the purposes of the "Travelling expenses"

and "Subsistence" sections of this policy.

No tax or NIC liability will arise to you and details need not be reported in tax returns.

Accommodation

Job related accommodation

107 In some instances, the duties of your employment require you to reside in University

provided accommodation. In other cases, the University will provide accommodation for the

better performance of your duties, where it is customary for employers to do so in the

circumstances. In such cases, the University will provide the accommodation for use by you

and your immediate family. This applies to the following job categories:-

Vice-Chancellor

Site Manager – Townhill Campus

Site Manager – Mount Pleasant Campus

108 In all cases, the accommodation will be provided in property in which the University

owns the freehold or leasehold interest. The University will not meet your liability for rent.

109 Where the above applies, the University will also meet the costs of the following in

relation to the accommodation:-

a) water rates;

b) Council tax;

c) electricity and gas supplies (see "contractual arrangements" below);

d) structural maintenance (see "contractual arrangements" below);

e) internal decoration (see "contractual arrangements" below);

f) furniture for use by your and your family. Where this applies, the furniture will be

purchased direct by the University and will remain the property of the University. It

must be returned to the University when you leave employment or take up a

different job with the University which does not require the provision of

accommodation.

Where the University meets the costs referred to at (c) to (e) above, all contracts for the

supply of the services in question must be in the name of the University and bills must be

paid direct by the University. None of these costs may be claimed through the expense

reimbursement system.

Taxation of job related accommodation benefits

110 No tax or NIC charge will arise in respect of the accommodation itself nor in respect of

payments of water rates or Council tax. However, if you receive salary and benefits at a rate

of £8,500 per annum or more, you will be liable to income tax (but not NIC) in respect of

payments by the University for electricity and gas supplies, internal decoration, and use of

furniture (the tax charge on furniture will normally be based on 20% of its cost, per annum).

The total value of these benefits which is charged to tax is limited to 10% of your total net

emoluments (excluding the value of accommodation and related benefits). The University

will therefore supply details to the Inland Revenue under the form P11D reporting procedure

(see “Introduction”). Alternatively, the University may make arrangements with the Inland

Revenue to pay any tax/NIC liabilities arising and the University will bear the cost of such

settlements, under a PAYE Settlement Agreement (see “Introduction”). You need not report

details of accommodation related benefits provided under the above rules, in your tax

returns.

111 Most University staff cannot qualify for the exemption on accommodation benefits

described above. Those concerned will be advised separately. They will then be dealt with in

accordance with the rules set out below for accommodation supplied to other employees.

Discount schemes

112 The University has arranged staff discount schemes as follows:-

a) used office furniture and machinery which is no longer needed by the University may

be offered to you at a price representing the estimated market value at the time, plus VAT;

b) local shops, etc will provide discounts on production of the University's security

passes as follows

See approved list held by the Health and Safety Officer

d) No tax or NIC liability arises from any of the schemes above and you need not report

details in your tax returns.

Loans

113 The University does not provide loans to employees.

Long Service Awards – APT & C only

114 When you complete 30 years continuous employment, and you were in post on 1 April

1992, you may, at the discretion of the University, be presented with a gift of a value of up to

£90 as a testimonial. A gift can take the form of cash or gift vouchers but otherwise you will

be invited to choose a gift from a range of articles offered by the University. No tax or NIC

liability will arise on any gifts or tangible assets and details need not be included in tax

returns. Although, tax and NIC will be liable on any cash payments.

Medical Examinations

115 Where the University requires you to undergo routine medical health checks or

medical screening, the University will make the necessary arrangements with the medical

practitioner and will pay direct the costs so incurred. You must not pay the practitioner and

reclaim the costs via the expense claim system. All medical reports will be supplied direct to

the University but copies will be made available to you on request. Medicals may be required

as follows:

a) pre-employment medicals for staff generally;

b) annual medical screening for certain senior staff selected by the University;

c) occasional special needs cases where the University requires a report on the

employee's fitness.

116 The University will not pay for medical treatment or diagnosis.

117 No tax or NIC liability arises in respect of the above and details need not be reported

in tax returns.

Medical Insurance

118 The University provides free medical insurance cover for certain Senior Staff and their

families under a scheme entered into with PPP Ltd. Full details are supplied separately as

soon as you become eligible. This cover represents a taxable benefit and the form P11D

reporting procedure (see Introduction) will apply. No NIC liability arises to you.

Staff restaurants

119 Subsidised staff restaurant facilities are provided at certain locations. The arrangements

for each location will be made known to employees individually.

120 Wherever staff restaurant facilities are used for entertaining business contacts from

outside the University, you must ensure that your own name, the name of each visitor, and the

organisation which he or she represents and the purpose of the entertainment are recorded in

the log books provided (see "Entertainment" below).

121 No tax or NIC liabilities arise to you in respect of the restaurant facilities.

Social events and social clubs

122 The University may organise a Christmas party for all staff in December each year. You

are permitted to invite one guest. The cost of the function is borne by the University.

However, the University does not bear any travel or accommodation costs associated with

attendance at the party and accordingly you must make your own arrangements. The cost of

the event is kept within limits laid down by the Inland Revenue (currently £75 per head

including VAT).

123 In addition, the University has established social club for the benefit of employees.

These are not open to the public and do not involve use of facilities which are open to the

public. All employees and members of their families or households, but, otherwise, not

friends, have access to the facilities of these clubs which include sports and other subsidised

social facilities. Information concerning the activities of the clubs is issued to staff from time

to time by the clubs' organisers.

124 No tax or NIC liability arises from the above and details need not be reported in tax

returns.

Pension Scheme

125 You will be notified separately as soon as you become eligible to participate in the

University's Inland Revenue exempt approved pension scheme. Under this scheme the

University makes contributions to provide pensions on retirement and death in service

benefits for its employees. The University's contributions are not benefits liable to income tax

or NIC and details need not be reported in tax returns. Any additional voluntary contributions

made by participating employees within prescribed limits are allowable as a deduction from

their remuneration for tax purposes (and adjustments to pay may be made for PAYE

purposes), but not for NIC purposes.

126 If you participate in the University scheme you will be contracted out of the earnings

related part of the State Earnings Related Pension Scheme and consequently pay a reduced

rate of NIC on part of your earnings. Otherwise you will not normally be contracted out and

will therefore pay the full rate of contributions.

127 Further details of the scheme are included in the Staff Handbook and in information

provided to you at the time when you become eligible to participate.

Suggestion scheme

128 The University encourages you to make suggestions on improvements in any aspect of

the business. Payments may be made, tax free, by way of reward for suggestions which satisfy

the criteria set out in the scheme below.

129 All employees may participate equally.

130 Awards may be made in respect of suggestions which are put into effect by the

University. In deciding the amount of the award the University will have regard to the

measurable improvement in financial performance resulting from the suggestion. In no

instance will an award be greater than one half of the anticipated overall financial

improvement in the first year, nor greater than one tenth of the overall financial improvement

in the first 5 years. Finally, no award will greater than £5,000.

131 No award will be made in respect of any suggestion which in the opinion of the

University represents part of your normal work, having regard to your length of time in

service, job description and so on. Nor will any award be given in respect of a suggestion

arising from a meeting of employees held specifically in order to generate suggestions.

132 Any award granted will be paid direct to the employee who put forward the suggestion.

Where a suggestion is put forward by a number of employees, any award granted will be

shared between them on whatever basis is considered reasonable by the University.

133 Where a suggestion is not put into effect but is nevertheless considered to have merit,

the University may grant an award of up to £25.

134 The University does not guarantee that any suggestion, whether implemented or not,

will lead to a reward under this scheme. Any awards made will be entirely at the University's

discretion, within the limits set out above.

135 If you wish to make a suggestion you should put it in writing and forward it to the

Finance Department.

136 No tax or NIC liability arises in respect of awards made under the scheme rules above

and details need not be reported in tax returns.

Index

Section Paragraph Introduction 1 Advances

40 Benefits and expenses on which you do not pay tax 6 Benefits on which you pay tax 2 Expense and benefit payment procedure 10 Expenses reimbursed to you

13 University credit cards

18 Petty cash

22 Payments direct to external suppliers

24 Keeping records

28 VAT

36 Expenses and benefits provided by the University

Accommodation

105 Accountancy fees - see "Personal financial planning and tax compliance"

Agency workers - see Appendix A, "Self employed individuals"

Basic pay – see "Pay and allowances"

Bonus - see "Pay and allowances"

Casual employees - see Appendix A

University cars - see "Travelling expenses"

Construction and maintenance contractors and subcontractors - see Appendix A

Detached duty - see "Travelling expenses - Definition of business travel” in Appendix D

Directors' and officers' liability insurance

102 Discount schemes

110 Entertainment

54 Examination awards

126 First aid allowance - see "Pay and allowances"

Home telephone costs

66 Home working expenses and office equipment

75 International assignments - see Appendix A

Employees from overseas assigned to work in the UK Employees assigned overseas from the UK Loans

111 Location allowance - see "Pay and allowances" Long Service awards

112 Maternity pay

99 Medical examinations

113 Medical insurance

116 Mobile telephones - see "Travelling expenses"

Out of pocket expenses

64 Overtime - see "Pay and allowances"

Pay and allowances

94 Pension scheme

123 Publications 71

Redundancy

104 Relocation expenses

1 Bridging loan expense

9 Duplicated expenses

10 Expenses of acquisition

5 Expenses of disposal

4 Expenses of transporting belongings

7 Sale of the old home

12

Paragraph

Tax treatment of relocation expenses

11 Travelling and subsistence expenses

8 Restaurants (staff)

117 Self-employed individuals and agency workers - see Appendix A

Shift allowance – see "Pay and allowances"

Sick pay

95 Social events and sports clubs

120 Spectacles for VDU operators

90 Subscriptions

73 Club membership subscriptions

75 Professional subscriptions

73 Subsistence

50 Hotel accommodation

16 Day subsistence allowance

50 Overnight allowance

52 Personal incidental expenses

19 Training course incidental expenses

83 Suggestion scheme

126 Training courses

77 Travelling expenses

1 Air fares

10 Air travel within UK

13 Car mileage allowance 4 Car parking

18 Coach travel

8 Fuel 22 Overseas travel

9 Pool cars

24

Conferences

49 Definition of business travel (post-5 April 1998 rules) see Appendix D

General rules 37 Hotel accommodation

14 Mobile telephones

40 Personal incidental expenses

17 Private transport (using your own car on business)

25 Professional bodies & trade association meetings

43 Rail fares

6 Spouse travel

47 Training course travel and subsistence 81 Taxis for late working

45 Vehicle hire 33 Uniforms

84

Appendix A

Engagement of casual employees, self employed individuals, agency workers, personal

service companies and international assignees

Introduction

1 This Appendix sets out guidance for all employees who are authorised to engage the

services of workers from outside the University. These procedures must be followed in order

to avoid exposing the University to claims for underpaid tax and NIC.

Casual employees

2 The term casual employee refers to any individual undertaking short term, irregular

employment with the University, including pensioners and those on maternity leave. It

includes anyone who is not engaged on a permanent basis. It does not include self employed

or agency workers, who are dealt with under Self Employed Individuals, Agency Workers and

Personal Service Companies, below.

3 Those members of staff with responsibility for engaging casual employees should

familiarise themselves with the requirements of the tax and NIC authorities before making

any payments to such persons. Where a casual employee:-

a) does not produce a form P45; and

b) is engaged for one week or less; and

c) is paid no more than the amount indicated in Appendix B; and

d) there is no intention for the employment to continue, or for further employment in the

future,

A record must be maintained of the name and address of the employee and the amount paid.

If the employment unexpectedly continues for more than one week, and in all other

circumstances, the procedures described in the Employer‟s Quick Guide to PAYE and NIC,

CWG1, cards 4 and 5, and CWG2 Chapter 4 must be followed and in most cases tax and NIC

will be due. The payroll department must therefore be notified. Guidance should be sought

from the payroll department in cases of doubt.

Construction and Maintenance Contractors and Sub-contractors (From 1 August 1999)

4 Staff who are responsible for engaging or paying persons, including companies, to

perform construction operations must be aware of the requirements of the Inland Revenue

construction industry tax deduction scheme and are responsible for ensuring that those

requirements are satisfied. Guidance is given in the Inland Revenue Booklet IR14/15(CIS)

which should be studied. A copy of the booklet may be obtained from the payroll office.

5 It is particularly important where individuals are engaged to perform construction

operations that the distinction between employment and self-employment is understood and

applied correctly (see the section on Self Employed Individuals, Agency Workers and

Personal Service Companies below). Only those who are genuinely self-employed or provide

their services through bona fide limited companies, partnerships or other agencies will be

subject to the rules set out below.

6 The activities to which the scheme applies fall under the following general headings.

Further details are given in Appendices A and B of the booklet:-

a) the construction, alteration, repair, extension, demolition or dismantling of buildings

and structures and certain works forming part of land;

b) the installation of heating, lighting, air-conditioning, ventilation, power or water

supplies, drainage, sanitation or fire protection systems;

c) the internal cleaning of buildings carried out in the course of their construction, repair,

alteration or extension;

d) site clearance, excavation, scaffold-erection, landscaping and the construction of

roadways; and

e) the painting or decorating of the internal or external surfaces of any building or

structure.

7 If there is doubt whether any activities are within the scope of the scheme, and the

Appendices A or B in the Inland Revenue Booklet IR 14/15(CIS) do not help, contact the tax

department immediately.

8 Once it has been established that the terms on which the sub-contractor has been engaged

do not amount to employment (see the section on Self Employed Individuals and Agency

Workers below) the individual engaging the sub-contractor must proceed as follows. If the

total of all payments to be made under the contract (excluding the direct cost of materials) is

less than £1,000 and the work is authorised by any of the following individuals, the payment

may be made gross and none of the following rules apply.

9 In all other circumstances, the following procedures must be applied :-

a) In the case of a sub-contractor who holds a Construction Tax Certificate “CIS 5” or a

Subcontractors Tax Certificate “CIS 6”, check the original certificate (not a

photocopy) and ensure that it is one which has been issued by the Inland Revenue.

Confirm that the person presenting the certificate or certifying document is the

subcontractor to whom it was issued or is authorised to present it. Confirm that the

certificate or document is in date. If a holder of a CIS5 certificate presents a

“certifying document” instead of the actual CIS5 further checks must be carried out

(see Chapter 5 of the booklet).

b) When a payment is made to a CIS5 holder you should complete and sign a Construction

Gross Payment Voucher “CIS23” showing the subcontractor‟s name, the certificate

number, the date and the amount of the payment. The top part should be forwarded to

the tax department who will pass it to the Inland Revenue, and the second part should

be retained for future reference.

c) When a payment is made to the holder of a valid CIS 6 the subcontractor should be

required to provide a completed and signed Subcontractors Gross Payment Voucher

“CIS24” showing the subcontractor‟s name, the certificate number, the date and the

amount of the payment. Insert our Contractor Tax Reference [xxxxx] on the voucher.

Forward the top copy to the tax department for onward transmission to the Inland

Revenue. Give the second copy to the subcontractor and retain the third copy for

future reference.

d) In the case of a sub-contractor holding a Registration Card CIS 4(P) or CIS 4(T),

payment must be made after deduction of tax. The registration card should be

inspected to confirm that the person presenting the certificate is the subcontractor to

whom it was issued and is authorised to present it. Confirm that the certificate is in

date by reference to the contract in respect of which payment is being made. Tax must

be deducted at the rate indicated in Appendix B. Tax is not to be deducted from any

part of the payment which covers the cost of materials, consumable stores, fuel

(except fuel for travelling), plant hire, VAT or CITB levy. You should ask for

evidence in support of any contentions by the subcontractor that any part of the

payment relates to these items before making payment.

e) Within 14 days after the tax month in which any payment is made to a subcontractor

holding a valid CIS 4(P) or CIS 4(T), you should complete and sign a Tax Payment

Voucher “CIS25”. This should show the total gross payments, costs of materials,

amounts liable to deduction, and deductions made in the tax month, the

subcontractor‟s name, CIS4 reference number, and in the case of a CIS4(P) the

national insurance number shown on it. Forward the top copy to the tax department

for onward transmission to the Inland Revenue. Give the second copy to the

subcontractor and retain the third copy for future reference.

10 No payment on account, in advance, or otherwise, should be made to a subcontractor or

his representative either directly or indirectly unless and until a valid certificate or registration

card has been presented to the University. All payments must be made by reference to the

subcontractors‟ certificates or registration cards and vouchers must be made out to the named

subcontractor even if the payment is to be made to a nominee or other representative of the

subcontractor.

11 All deductions withheld from payments to subcontractors should be paid to the Inland

Revenue monthly, within fourteen days of the end of the month. Arrangements for the

remittance of these sums should be made with the tax department.

12 At the end of each tax year a return must be made to the Inland Revenue of payments

made under the construction industry regulations. These will be made by the tax department

but you should retain annual records as evidence to support the returns made.

13 All contact with the Inland Revenue in relation to compliance with the construction

industry tax deduction scheme will be conducted by the tax department.

14 A VAT invoice or authenticated tax receipt is required to support the University‟s claim

to recover any VAT charged by the sub-contractor. Since such documents are only valid

when issued by a person who is registered or ought to be registered for VAT, the person

authorising payments should always satisfy himself that this is the case unless the sub-

contractor is of sufficient size and exceeds the VAT registration limits. In cases of doubt, the

sub-contractor‟s VAT registration should be checked with Customs & Excise. It should not

normally be necessary to check a registration more than once a year.

Self-Employed Individuals, Agency Workers and Personal Service Companies

15 The term “self-employed individual” is used to cover any individual who works for the

University under his or her own personal agreement (whether written or verbal) with the

University but does not have a contract of employment with the University and is not a casual

employee. This includes consultants, freelancers, sole trader businesses, and so on. The term

“agency workers and personal service companies” covers any individuals whose services are

supplied by a third party such as another limited liability Company, partnership or other

organisation independent of the individual concerned.

16 Before engaging any of the above to perform services for the University, full details of the

proposed terms of engagement, should be notified to the finance department in writing and

authority sought that the individual, agency or Company may be paid without deduction of

tax and NIC. The details to be supplied include the contract when there is one, the nature of

the duties to be performed and a description of all other terms of engagement including, in

particular, the degree of control exercised by the University over the work. No payment

should be made until such authority is received unless the finance department has already

given approval for other individuals to be engaged in circumstances which are in all material

respects identical. Where this is the case, the finance department should merely be informed

of the name and address of the individual, and, where appropriate, the agency or Company,

the proposed duration of the agreement, the amount to be paid, and the payments actually

made.

17 Where self-employed individuals are engaged, they should be paid only in money on

receipt of invoices and not in the form of benefits in kind, in order to avoid VAT

complications. All payments for the services of agency workers, including any business

expenses incurred, must be paid in money to the agency on receipt of invoices from the

agency.

18 Where agency workers are engaged, it is particularly important that the above procedure is

followed as we may be required to operate PAYE and NIC even if the individual is genuinely

self employed for all other legal purposes.

19 In agreeing terms for the engagement of an individual through his or her personal service

Company, bear in mind the Inland Revenue‟s current proposals to change the law from 6

April 2000 to require PAYE and NIC to be operated by that Company in respect of payments

made by us it, in a range of circumstances. Further details are available from the finance

department.

20 It should be noted that where a self employed individual or an employment agency is

registered for VAT, and VAT is chargeable on the services performed, VAT invoices must be

obtained in respect of payments made by the University.

International Assignments

Employees from overseas assigned to work in the United Kingdom

21 Where an individual employed by an overseas employer is sent, or is to be sent, to work

in the United Kingdom, the payroll department must be consulted at the earliest opportunity,

and wherever possible before the individual arrives, in order that the potential United

Kingdom tax and NIC position can be established and the tax costs of the assignment

managed. In many cases, the University is obliged to operate PAYE/NIC even though the

individual‟s remuneration is actually paid to him or her direct by the overseas employer.

Employees assigned overseas from the United Kingdom

22 Where an employee is assigned overseas for more than 60 days the payroll department

should be consulted at the earliest opportunity, and wherever possible before the individual

leaves, in order that the potential United Kingdom and overseas tax, social security and

pension implications can be established and the tax costs of the assignment managed. The

University may at its discretion make special arrangements for expenses and benefits while

the individual is overseas, home leave trips and family visits, and the tax, NIC and pensions

position must be established at the outset.

Current rates and limits for expenses Appendix B

2002/03 tax year 2003/04 tax year

Maximum amount claimable through petty cash

(Introduction, paragraph 25) £25.00 £25.00

Casual employees: maximum payment for one week

without PAYE/NIC liability (paragraph 3) £89.00 £89.00

Construction and maintenance contractors and

subcontractors: rate of deduction (Appendix A paragraph

9(d))

18% %

Spectacles for VDU operators: maximum contribution to

costs (paragraph 103) £50.00 £50.00

Mileage rates: Employees driving their own cars:

Mileage rate for first 10,000 business miles per

tax year (paragraph 37) (2002/03 onwards)

40p

Percentage to be applied thereto to calculate VAT* 3.25%

Mileage rate after the first 10,000 business miles

per tax year (paragraph 37) (2002/03 onwards)

25p

Percentage to be applied thereto to calculate VAT* 5.78%

Car sharing - additional allowance per business passenger

per mile.

5p

Mileage rate for business use of motor-cycles 24p

Mileage rate for business use of bicycles 20p

Day subsistence allowance (lunch) £5.50 £5.50

Day subsistence allowance (lunch and dinner) £13.50 £13.50

Overnight subsistence allowance £16.00 £16.00

Staying with friends allowance £25.00 £25.00

*These rates are for illustrative purposes only and are subject to individual agreement with

HM Customs & Excise

Authority Levels

Appendix C

The table below sets out the maximum amounts which may be authorised on an

expense form by individuals of particular grades. All amounts are exclusive of VAT.

Any claims amounting to £1,000 or more must be authorised by the Vice-Chancellor.

Grade Limit on amount which may be authorised on an expense

claim form

£

Deputy Vice-Chancellor or

Director of Finance and

Resources

1,000

Definition of business travel Appendix D

1 In this policy, in order to identify those journeys which may be regarded as

business journeys, employees‟ travel patterns will be categorised as follows.

You have a normal place of work (or “permanent workplace”) but you sometimes

travel elsewhere on business

2 Except as provided below, all journeys between home and the “permanent

workplace” (see below) are to be regarded as private. Also, all journeys between

other places visited for reasons other than carrying out this employment (for example

friends‟ and relatives‟ homes) and the permanent workplace are to be regarded as

private. The costs of these journeys are regarded as ordinary commuting expenses and

are not to be claimed. This applies even if the journey is in response to an emergency

call out or is for weekend working, or for any other purpose.

3 If a journey is, for all practical purposes, the same as ordinary commuting, the

expenses may not be claimed.

4 Where your duties require that journeys are undertaken between the permanent

workplace and other workplaces, those journeys may be regarded as business

journeys. Similarly, where the duties require journeys to be undertaken between your

permanent home and places other than your permanent workplace those journeys also

may be regarded as business journeys, provided that the journey is not, for all practical

purposes, the same as a private journey or an ordinary commuting journey, as

explained above.

In order to qualify, a journey does not have to be made by the shortest possible

route if an alternative may take less time. For example, a journey from home

on one side of London to a customer on the other side of London may be

quicker on the M25 than by going through the city, and would be allowable. A

journey whose purpose is private, cannot be converted, wholly or partly, into a

business journey, by making an incidental business call during the course of it.

5 If your duties require that you travel between your permanent home and another

workplace, as described above, the whole of your journey will still be a business

journey if you make a stop at your permanent workplace for a purpose which is

incidental to your business trip, for example, to pick up relevant papers. However, if

you perform substantive duties at your permanent workplace, only the onward journey

from there will be a business journey.

6 In most cases, it is clear where your permanent workplace is. In principle it is

possible for an employee to have more than one permanent workplace, though this is

rare in practice. In the following circumstances a place is likely to be regarded as a

“permanent workplace”:-

a) you attend the place regularly (i.e., following a pattern, for example once a

week, etc); and

b) your attendance there is not for a temporary purpose and the work which you do

there does not involve a task of limited duration. This will always be the case

if:

i) the place is your base; or

ii) you are normally allocated tasks there; or

iii) your visits are normally to attend to tasks which were left unfinished after

the preceding visit or the work there is ongoing and not self-contained; or

iv) you expect to work there wholly or mainly for a continuous period of more

than 24 months from the time when you began to work there, or you have

already done so, or for all or almost all of the remainder of the period of

your employment if that is shorter than 24 months (and the total duration

of your employment is less than five years).

7 If any doubt arises as to whether a place is a permanent workplace for you, the

matter should be discussed with the finance department, and you should always do so

if you think that the 24 month test or the “remainder of employment” test described

above could apply to you.

8 Where public transport is disrupted by strikes or other industrial action and you

are thereby obliged to incur extra costs of hotel or other accommodation, or in

travelling between your permanent home and your permanent workplace, such

journeys may be treated as business journeys for the purpose of applying the rules

under the “Subsistence” and “Travelling expenses” section of this policy.

You have a permanent workplace but are sent to work at a different location for up to

24 months (this is termed a “detached duty” assignment)

9 Where you are sent on a detached duty assignment, business travel will comprise:-

a) travelling on a daily basis between your permanent home and the detached duty

location. Travel costs will be based on:-

i) the actual cost of a weekly or monthly (or longer period if more cost

effective) season ticket where public transport is used; or

ii) the appropriate car mileage rate, where you use your own motor vehicle; or

iii) actual fuel costs where a University vehicle is provided to you (under the

rules set out in the “Fuel” section of this manual); or

iv) where you cannot travel daily to the new work location and are obliged to

stay in the area of the new location, travel to the new location at the

beginning of the assignment and travel home at the end, plus reasonable

return journeys home during the assignment.

If you are initially expected to be absent from the permanent workplace for up

to 24 months but circumstances change and it becomes known that the absence

will exceed 24 months, journeys undertaken after the date of the change of

circumstances may not be regarded as business journeys and you may not be

able to claim the cost.

10 If it becomes known, at any time during a detached duty posting which qualifies

for tax relief under these rules, that your employment will come to an end once the

current detached duty assignment is completed, the tax relief described above ceases

with effect from that time. You may also not be able to claim if you do not have a

permanent home but change where you live whenever there is a significant change in

the place where you work. In these cases, you should contact the tax department.

You have no normal place of work but travel is an integral part of your work and you

normally visit a number of locations each day

11 Except as provided below, all journeys on business (including journeys which

begin or end at home) will be regarded as business journeys. Therefore, travel and, if

you incur additional costs by reason of being away from home on business,

subsistence costs (See “Travelling expenses” and “Subsistence” sections of this

policy), incurred en route will be reimbursed and no tax or NIC liability arises.

Subsistence cannot be claimed if you do not have a permanent home.

12 The above rule is modified where your duties are defined by reference to a

geographical area and you live outside that area. Where this applies, the area in

question is to be treated as a “permanent workplace” and the rules relating to

permanent workplaces described above apply. Therefore, journeys between home (or

other places visited for reasons other than this employment) and the boundaries of that

area are to be regarded as private travel.

You have no normal place of work but you travel regularly to a series of locations

spending a few days, weeks or months at each

Except as provided below, all journeys on business (including journeys which

begin or end at your permanent home) will be regarded as business journeys,

providing that none of the places visited constitutes a permanent workplace as

defined above. In these circumstances, travel and subsistence costs (see

“Travelling expenses” and “Subsistence” sections of this policy) incurred en

route will be reimbursed and no tax or NIC liability arises. You may not be

able to claim if you do not have a permanent home but change where you live

whenever there is a significant change in the place where you work. You

should discuss your position with the tax department in this case.

13 The above rule is modified where your duties are defined by reference to a

geographical area and you live outside that area. Where this applies, the area in

question is to be treated as a “permanent workplace” and the rules relating to

permanent workplaces described above apply. Therefore, journeys between home (or

other places visited for reasons other than this employment) and the boundaries of that

area are to be regarded as private.

Your travel pattern does not correspond with any of the above

14 If your travel arrangements do not correspond with the categories above (for

example, you are based at home) you may be subject to different rules. You should

discuss the matter with the payroll department and agree the tax treatment before any

payments for travel, accommodation or subsistence are claimed. In particular, the

following are likely to require special consideration:-

a) travel between places visited for the purposes of different employments;

b) circumstances where there is doubt as to whether you have a permanent

workplace, or more than one permanent workplace;

c) modification of a permanent workplace so that the home to work journey

changes but doubt arises as to the significance of that change;

d) breaks in detached duty of site based assignments where the total period spent at

the location will exceed 24 months;

e) pooled cars used for any private journeys;

f) non-executive directors;

g) disabled people;

h) offshore oil and gas workers;

i) employees covered by Working Rule Agreement.

Relocation/Removal Allowance Scheme - Appendix E

Employees to whom the scheme applies

1 The removal allowances scheme will apply to employees newly appointed to

the University‟s service who take up their appointments on or after 1st April 1993 and

who satisfy the criteria laid down in 2 below.

Where an employee is required to change residence so as to comply with a direction

by the University to reside in a particular place or area, the conditions to apply will be

determined individually in consultation with the Vice-Chancellor.

Eligibility Criteria

2 To be eligible for reimbursement for expenses under this Scheme, an

employee must

have been employed outside the City and County of Swansea

immediately prior to taking up the appointment with the University

and have resided at a distance of at least 30 miles from the fixed

centre designated for the purpose of the appointment with the

University;

move his or her place of residence to a place within the University‟s

area or to an approved place within 30 miles from the fixed centre;

Under normal circumstances complete the resettlement and removal within 12 months

of taking up the appointment.

The distance between the employee‟s new home and former home must be at least 15

miles.

For the purpose of this paragraph, the word „miles‟ is taken to mean miles travelled by

the shortest reasonable route.

Approval

3 The application of this scheme is subject, in each and every individual case, to

the prior approval of the Director of Finance and Resources. Any dispute or matters

of anomaly arising shall be referred to the Vice-Chancellor whose decision shall be

final.

Relocation Expenses

4 Relocation costs as set out below will be borne by the University if you change

your only or main residence as a result of:-

a) becoming employed by the University; or

b) a change in the duties of your employment; or

c) a change in your normal place of work.

5 The reason for the change of residence must be in order to allow you to have

your only or main residence within a reasonable daily travelling distance of your new

normal place of work. This will not apply where your former residence is within a

reasonable daily travelling distance of that place of work. The University will only

bear expenses incurred, or provide benefits, during the period which ends twelve

months after 5 April following the date when you begin your new duties or the duties

at the new place of work. The University will either:-

a) make payments to you; or

b) make payments on your behalf; or

c) provide benefits to you or a member of your family or household.

6 The University is entitled to reclaim the VAT charged on certain expenses

paid or reimbursed by it under this section, provided the expenses are incurred under a

contract between the supplier and the University. Wherever possible, therefore, you

should seek approval in advance to act as the University's agent in arranging for the

supply to be made to the University and for VAT invoices accordingly to be issued to

the University.

Expenses of disposal

7 Where you dispose of your interest, or a member of your family or household

disposes of their interest, in your former residence or intends to do so because of a

change in your residence in the circumstances described above, the University will

meet all reasonable costs of the following:-

a) legal expenses connected with the disposal or intended disposal of the

interest in the former residence, including legal expenses connected with

the redemption of any loan used to acquire the interest or secured by it;

b) any penalty for redeeming, for the purpose of the disposal or intended

disposal, any such loan relating to the residence;

c) fees of any estate agent or auctioneer engaged in the disposal or

intended disposal;

d) expenses of advertising the disposal or intended disposal;

e) charges for disconnecting, for the purpose of the disposal or intended

disposal, public utilities serving the residence;

f) expenses of maintaining, insuring, or preserving the security of the

residence at any time when unoccupied pending the disposal or intended

disposal; and

g) any rent paid in respect of the residence at any such time.

Allowances payable

8(a) Removal of effects

The University will reimburse normal removal expenses and insurance actually

incurred in transporting the employee‟s household effects to his new home based on

the lowest of at least two written estimates to be submitted with the claim.

(b) Legal, Estate Agents and Advertising Costs

Where the employee sells his former house and purchases a new property, the

University will make a contribution towards legal and estate agents‟ fees and any

advertising costs necessarily incurred. An allowance will not normally be paid where

the employee changes his or her circumstances, e.g. moves from rented

accommodation and purchases a property.

(c) Resettlement and Lodging Allowances

A Settling-in-allowance will be made to cover essential items such as

disconnection/reconnection of services and appliances, replacement of curtains and

carpets where these cannot be moved, and losses of season tickets.

Subject to overall approval being given to the application of the Scheme (see 3

above), prior permission need not be sought to incur expenditure under this heading,

but the final decision as to whether any particular item or items will be reimbursed

rests with the Director of Finance and Resources.

A lodging allowance will be paid towards temporary living accommodation for a

maximum period of 6 months.

Amounts of Reimbursement

9

(a) the total amount reimbursable under paragraphs 8(a), 8(b) and 8(c)

combined shall not exceed £2,500.

(b) The total amount reimbursable under paragraph 8(c) above shall

not exceed £900 unless an exception is approved by the Vice-

Chancellor.

Expenses of acquisition

10 Where you acquire, or a member of your family or household acquires, an

interest in your new residence, the University will meet all reasonable costs of the

following:-

a) legal expenses connected with the acquisition of the interest (including

legal expenses connected with any loan raised to acquire the interest);

b) any procurement fees connected with any such loan;

c) the costs of any insurance effected to cover risks which are incurred by

the maker of any such loan and which arise because the amount of the loan

is equal to the whole, or a substantial part, of the value of the interest;

d) fees relating to any survey or inspection of the residence undertaken in

connection with the acquisition by you of the interest;

e) HM Land Registry (or their equivalent elsewhere in the United

Kingdom) fees payable in connection with the acquisition by you of the

interest;

f) stamp duty charged on the acquisition; and

g) charges for connecting any public utility for use by you, if the utility

serves the residence.

h) The University will meet such costs incurred on abortive acquisitions

where it is satisfied that the costs would have been allowed if the

acquisition had proceeded and that the acquisition did not proceed

owing to circumstances beyond your control or because you reasonably

declined to proceed.

Expenses of transporting belongings

11 The University will bear the cost of:-

a) transporting domestic belongings of yourself and your family or

household from the former residence to the new residence, including:-

i) packing and unpacking belongings;

ii) temporarily storing them if a direct move from the former to the new

residence is not made;

iii) detaching domestic fittings from the former residence if they are to be

taken to the new residence; and

iv) attaching domestic fittings to the new residence, and adapting them, if

they are brought from the former residence; and

b) any insurance covering such transportation.

Travelling and subsistence expenses

12 The University will meet the following travel and subsistence costs. For these

purposes, payments will be made, and accommodation provided as laid down in the

"Subsistence" and "Travelling Expenses" sections of this manual, on the basis that the

journeys described below are to be treated as if they were business journeys. The costs

must be reasonably incurred in connection with the change of your sole or main

residence:-

a) the costs of travelling and food, drink and temporary living accommodation, of

yourself and members of your family or household while making temporary visits

to the new area where your duties are to be performed, for purposes connected

with the change of residence;

b) your costs of travelling between the old residence and the new place where you

normally work;

c) except where the change of residence is made because you have become

employed by the University, your costs of travelling, before the change in

duties or your place of work, between your new home and either the place

where you normally worked at that time or any temporary living

accommodation of yours there;

d) costs of your food, drink and temporary living accommodation (other than as

at (a) above);

e) your costs of travelling between your old residence and any temporary living

accommodation at the new location;

f) the costs of travelling of yourself and members of your family or household

from the old residence to the new residence in connection with the change of

residence;

g) the costs of food, drink and temporary living accommodation, of any child or

dependant of yours while staying in the area of the former residence, for the

purpose of maintaining continuity of his or her education, after your change of

residence. The child or dependant must be under the age of 19 on 6 April

preceding the commencement of employment, or the effective date of the

change in your duties or your normal place of work, whichever is appropriate;

h) the costs of travel for such a child or dependant between the temporary

accommodation and your new sole or main residence;

i) the costs of food, drink and temporary living accommodation, of any such

child or dependant of yours while staying in the new area for the purposes of

maintaining continuity of his or her education, before your change of

residence; and

j) the costs of travel for such a child or dependant between the temporary

accommodation and your former sole or main residence.

Bridging loan expenses

13 Where you incur costs, or a member of your family or household incurs costs,

in acquiring an interest in the new sole or main residence before the proceeds of sale

of an interest in the former sole or main residence are available, a bridging loan may

be required. The University may contribute to the cost of interest payable on such a

loan, as follows:-

a) if the loan does not exceed the market value of the former residence (taken at

the time of acquisition of the new residence) the University will pay the interest

due on the loan in full. If the loan exceeds that value, the University's payment of

interest will be restricted accordingly; and

b) the loan must not be used for any purpose other than to pay off

a loan raised to purchase the former residence or for which the former

residence was security, or to purchase the new residence.

c) the University will not contribute to interest charged for periods

after the proceeds of the former residence become available.

Duplicated expenses

14 Where you dispose of, or a member of your family or household disposes of,

an interest in your old sole or main residence and you acquire, or a family member

acquires, an interest in your new sole or main residence, the University will meet the

cost of domestic goods such as carpets, curtains, and so on intended to replace goods

at the old residence which are not suitable for use at the new residence. The amount

which will be borne by the University will be the costs incurred, less any amount

received from the sale of the replaced goods. Note that VAT should not be shown

separately on expenses claim forms in respect of such costs since VAT is not

recoverable by the University in these circumstances.

Tax treatment of relocation expenses and benefits

15 Where the total of all of the above relocation costs met by the University (that

is, costs of disposal, acquisition, transportation, travel and subsistence, bridging loans

and duplicated expenses) exceeds £8,000, an income tax liability arises on the excess

over that figure. The University will bear any tax or NIC arising in consequence of the

relocation costs referred to above and will make arrangements for such tax/NIC to be

paid direct to the Inland Revenue. Otherwise, no tax or NIC liability arises in respect

of the relocation costs above and details need not be reported in tax returns.

Sale of the old home

16 If you are unable to sell your property at the old location within a reasonable

time of the assignment to the new location, the University may, at its sole discretion,

agree to compensate you for the loss arising from a forced sale. The University will

obtain two independent professional valuations of the market value of the property. If

the two valuations differ by more than 10%, a third will be obtained. The market value

will be taken to be the average of the valuations so obtained. The first offer which is

acceptable to the University for the purchase of the property will be accepted by you

and if this is lower than the market value as determined above, the University will pay

the difference to you.

17 This payment is not taxable and need not be reported in your tax return/treated

as taxable and will be paid via the payroll subject to PAYE/NIC. No NIC liability

arises.

18 If you are required by your employment to relocate your home the University

may agree, at its sole discretion, to assist by agreeing to purchase your old home from

you. In such cases, the price which the University will offer will be the market value

at the time of the purchase, which will be determined by reference to professional

valuations as described above. No income tax or NIC liability will arise in respect of

the payment of the sale proceeds to you and details need not be reported in tax returns.

19 In such cases, the University will bear all of the transaction costs. The costs

incurred by the University as purchaser of the property (the purchaser's legal fees,

valuation fees, and so on) will not represent taxable benefits to you. The

corresponding incidental costs which the University bears on your behalf as the

vendor of the property will be subject to the rules described under "Expenses of

disposal" above and aggregated with other relocation expenses for the purposes of the

£8,000 limit referred to under "Tax Treatment of relocation expenses and benefits"

above.

20 Relocation expenses will be subject to the normal expense claim and

authorisation procedures except as otherwise indicated by the above.

SUPPLEMENT TO EXPENSES POLICY

CLARIFICATION OF THE DEFINITION OF „APPROVED JOURNEYS‟ FOR

TRAVEL AND SUBSISTENCE CLAIMS.

THE UNIVERSITY WILL REIMBURSE TRAVEL AND/OR SUBSISTENCE

EXPENSES:-

between University sites.

for visits to students on teaching practice, work placement or at exhibitions.

on official University business, for example to Funding Council meetings or to

other educational establishments.

to meetings of HE representative bodies.

subject to prior approval, to meetings associated with the member of staff‟s

membership of professional bodies1 (unless in a capacity as an officer of such

body).

to courses or conferences approved through the University‟s Staff

Development scheme.

in association with unpaid bona fide research or scholarly activity which forms

part of the member of staff‟s approved balanced programme of activities

where the University can be expected to benefit from an increased research

profile or improved teaching quality.

for approved unpaid work for government agencies.

in association with commercial projects, organised through the Commercial

Services Unit, where the client pays a fee to the University (such fees being

subject to the University‟s costing and pricing policy).

THE UNIVERSITY WILL NOT NORMALLY REIMBURSE TRAVEL OR

SUBSISTENCE COSTS:-

for duties associated with the federal functions of the University of Wales

where reimbursement should be claimed directly from the University‟s

Registry.

on business in connection with the holding of a formal office in a professional

body (whether paid or unpaid) where such body should be responsible for

reimbursement of expenses.

for activities where the member of staff receives more than token payment

from a third party.

THE UNIVERSITY WILL NEVER REIMBURSE TRAVEL OR SUBSISTENCE

COSTS FOR TRAVEL ON PERSONAL BUSINESS

In order that this policy may be properly monitored all staff should ensure that

full details are entered in the „purpose of journey‟ column of expenses claims.

Issued as clarification 2nd

March 2005 – not retrospective.

1 i.e. such professional bodies as are accepted as tax deductible by the Inland Revenue.

FPP6




FPP6 - ORDERS FOR WORK, GOODS AND SERVICES


1. General

(See Annex B of Financial Regulations for current authorisation limits)

1.1 All purchasing shall be in accordance with the “Conditions of Contract for

Purchase of Goods or Services” see Annexes C and D.

1.2 Budget holders shall ensure that the reasons for choosing a supplier are

properly documented in every instance. These records must be kept up to date

and be available for inspection at all times.

1.3 Each budget holder shall pay due attention to obtaining value for money in the

procurement of goods and services. (Refer to FPP24, Value for Money

Strategy)

1.4 Official orders shall be in a form approved by the Director of Finance and

Resources and shall be signed only by officers authorised by the appropriate

budget holders, electronically or otherwise, who shall be responsible for

official orders issued from their department/section. (see Appendix A re

special arrangements for the Libraries)

1.5 Before issuing any order for works, goods, or services, the officer authorising

the order shall ensure that there is sufficient budget provision to cover the

resulting expenditure.

1.6 Official orders shall be issued for all work, goods, or services to be supplied to

budget holders except for:

a) Public utilities

c) Periodical payments, or

d) Purchases made using an University Purchasing Card, or

e) Subscriptions to trade associations etc. or

c) Petty Cash purchases, or

d) Such other exceptions as the Director of Finance and Resources may

approve.

2. Selection of Supplier

2.1 Budget holders using the services provided by The Higher Education

Purchasing Consortium for Wales (HEPCW) or County Supplies shall follow

the procedures described in the relevant guidance prepared by the agency.

2.2 Budget Holders utilising the service provided by the Higher Education

Purchasing Consortium Wales (HEPCW) or County Supplies need not

maintain any further records or documentation supporting a choice of supplier

as described in paragraph 1.2. (see also Financial Regulation 6)

2.3 Second hand goods may be purchased only in exceptional circumstances. See

Appendix B.

3. Issue of Official Orders

3.1 Officers approving orders or incurring commitments shall ensure that adequate

budget provision is available before issuing any order requisition for goods or

services.

3.2 All orders for repairs and adaptations to University premises shall be placed

through the Director of Estates unless alternative arrangements are specifically

approved.

3.3 Official orders shall not be raised for any personal or private purchases.

Personal or private use should not be made of University Contracts, unless

specifically detailed on the Staff Benefits list

3.4 All deliveries of goods and services shall be made to University premises only.

The precise delivery location must be specified on the order.

3.5 Telephone or other oral orders are not permitted.

3.6 If an oral request to amend an official order is made to a supplier after issue of

such official order, then both a replacement order and the original order

number must be stated.

3.7 The cost of the order shall be entered on all relevant budgetary control records

prior to the order being despatched.

3.8 All orders must be processed in the Finance Office, entered into the

commitment ledger, a check being made that sufficient funds are available to

process the order; it should then be electronically authorised by an approved

certifying officer in the Finance Office prior to despatch. The Director of

Finance and Resources may, in urgent circumstances, authorise despatch of an

order before it is processed, however the assumption underlying the

University‟s procedures is that budget holders plan their purchasing to ensure

that such problems do not arise.

3.9 Orders for books for the University‟s libraries are processed through the

TALIS system which is covered by separate procedure notes. See Appendix A

or please refer to the Head of Library and Learning Resources for details.

4. Receipt of Goods and Services

4.1 All goods and/or services shall be checked on receipt. The goods and/or

services shall be compared to the details on the delivery notes, and to the

details contained in the official order. Defects shall be immediately reported

to the supplier and the budget holder. Delivery notes shall only be signed if

checks have been undertaken and the goods and/or services are satisfactory.

Where, for whatever reason, full checks have not been carried out the delivery

note should be endorsed to that effect.

4.2 If the checks described in paragraph 4.1 were not made or if no delivery notes

are received at the time of delivery, then a goods received book should be

maintained at the location where goods and/or services are delivered. The

goods received book shall record full details of deliveries. The budget holder

officer responsible for authorising paying invoices subsequently received

should compare this record (or a copy thereof) with such invoices prior to

approving payment.

5. Checking of Invoices

5.1 Full details of procedures to be followed are contained in Financial Procedure

FPP8.

5.2 All invoices must be agreed with:

Order forms and

Delivery notes and/or

Goods received books/sheet and/or

Record of work done.

5.3 Prices shall be checked against order.

5.4 No payment can be made unless an order has been set up in the budgetary

control system other than as outlined in 1.7 above.

October 2006

FPP 6 APPENDIX A

Swansea Metropolitan University Library and Learning Resources

Item Purchase Procedures

1. The Library and Learning Resources Service receives an annual allocation of

funds for all non-staffing expenditure from the University Resources Group.

The Head of Library and Learning Resources is able to meet the Group in

March or April and the allocation for the financial year (August-July) is made

in June.

2. The Library top-slices the fund to provide funds for computing provision

(hardware and networking) in the library open-access computer rooms, and for

general stationery and furniture requirements.

3. The majority of the fund is then allocated to the

Faculties/Departments/Schools for purchase of material for the Library. The

funds are allocated on an historical basis and adjusted according to a formula

that takes into account the number of students studying in the subject area and

the average cost of books in the subject area.

4. Three spending heads for each fund are identified as “Books” “Periodicals”

and “Electronic Databases/Services”.

5. The Periodical and Electronic fund sums are determined according to the

historical total spent in the previous financial year plus a notional sum to allow

for inflation. This is because these services have to be paid for in advance in

the majority of cases. The Periodical budget in particular varies considerably

in size according to the subject studied and the amount of reliance on journals.

Each year, in March/April the Library circulates to the Deans a listing of titles

currently taken by the Faculty indicating the total cost, cost per issue, and

predicted cost for the forthcoming financial year. (This predicted cost is

assumed to be 10% higher each year as periodicals normally increase in cost at

about this level.) The Deans and academic staff are invited to review their

periodical subscriptions and to cancel any titles no longer required and to

indicate any new titles they may wish to order. (Periodical subscriptions

normally run from January – December and so any cancellations only take

effect in the new calendar year.) The wishes of the Faculties are then

instituted before the total periodical budget is calculated.

6. Once the periodical and electronic budgets have been determined, the

remainder is available for the purchase of books. (Complete virement

between funds is allowed during the year if periodicals cease and refunds are

allowed, or if new periodical and or electronic services are needed during the

year.)

7. Individual lecturers make book purchase suggestions to the Library on book

purchase forms. (The ability to make suggestions for purchase varies from

Faculty to Faculty, but the Library asks that the Dean or their nominated

representative to authorise the expenditure countersign the form.) The forms

ask for details of title, author, publisher, date of publication, edition, number

of copies required, whether the copy is for reference, overnight, weekly,

ordinary, part-time-students, or teaching practice loan periods, the ISBN, the

price, and in which library the item is to be placed. The forms are checked by

the relevant Subject Librarians for accuracy, especially of the ISBN and the

price. The title is also checked against our current stock to ensure that

unnecessary duplication does not occur. The ISBNs are checked using the

EnterBooks service of our HEFCW approved library book suppliers, Dawson.

Once the details are verified and it is shown that the item is in print, it is

ordered using EDI via Talis (our library management system). When the item

is received, catalogued and classified, the top part of the purchase form is

returned to the originating lecturer indicating that the book is in stock and

where it may be found on the shelves.

8. During the financial year, as funds build up in the library from overdue fines,

further allocations are made to the budgets depending on need and special

requirements.

FPP6 APPENDIX B

PURCHASE OF SECOND HAND EQUIPMENT

In general the purchase of second hand equipment should be avoided due to the

potential difficulties arising from the lack of warranties and after sales service.

In exceptional circumstances, and subject to the prior approval of the Director of

Finance and Resources, second hand equipment may be acquired where there are clear

benefits to the University. The budget holder purchasing the items is required:-

to provide written justification in support of the order;

to obtain evidence that the vendor has title to the goods;

to provide independent evidence of value (e.g. a statement from an approved

supplier).

If the vendor is a member of University staff or a close relative of a member of staff

and the proposed price exceeds £500, the Vice-Chancellor‟s approval is required;

where the proposed price is £5,000 or more, the approval of the Finance, Planning and

Monitoring Committee is required.

FPP7




N.B. THIS POLICY IS CURRENTLY BEING REVIEWED BY THE SOUTH

WEST WALES HE PROCUREMENT PARTNERSHIP AND MAY

CHANGE – CONTACT FINANCE OFFICE FOR ADVICE

FPP7 – TENDERING PROCEDURES

(refer also to Financial Regulation 6.

And Code of Tendering Practice)

1. These tendering procedures are intended to ensure fairness of competition. All

members of staff are required to comply with the procedures.

2. Staff should at all times have due regard to European Union Directives on

procurement, in particular the requirements for tenders with expected values

above defined threshold values to be advertised in the European Journal. The

threshold limits at 31 January 2006 are as follows:

EC PUBLIC SECTOR CONTRACT THRESHOLD VALUES

Details of the thresholds from 31 January 2006 are given below. Thresholds are net of

VAT.

SUPPLIES SERVICES WORKS

Entities listed in

Schedule 1 1

£93,738

(€ 137,000)

£93,738 2

(€ 137,000)

£3,611,319 3

(€ 5,278,00)

Other public sector

contracting authorities

£144,371

(€ 211,000)

£144,371

(€ 211,000)

£3,611,319 3

(€ 5,278,00)

Indicative Notices £513,166

(€ 750,000)

£513,166

(€ 750,000)

£3,611,319

(€ 5,278,00)

Small Lots £54,738

(€ 80,000)

£54,738

(€ 80,000)

£684,221

(€ 1,000,000)

1 Schedule 1 of the Public Contracts Regulations 2006 lists central government bodies

subject to the WTO GPA. These thresholds will also apply to any successor bodies.

2 With the exception of the following services, which have a threshold of £144,371

(€211,000)

Part B (residual) services

Research & Development Services (Category 8)

The following Telecommunications services in Category 5

CPC 7524 - Television and Radio Broadcast services

CPC 7525 - Interconnection services

CPC 7526 - Integrated telecommunications services

Subsidised services contracts under regulation 34.

3 Including subsidised works contracts under regulation 34.



The Following Telecommunications services in Category 5




UTILITIES CONTRACTS REGULATIONS 2006 - FROM 31 JANUARY 2006


All Sectors £288,741

(€ 422,000)

£288,741

(€ 422,000)

£3,611,319

(€ 5,278,000)


(€750,000)

£513,166

(€750,000)

£3,611,319

(€ 5,278,000)

Small lots £54,738)

(€80,000)

£54,738)

(€80,000)

£684,221

(€1,000,000)

Please contact Finance Office for confirmation of current Sterling values

3. Procurement of goods and services with a value in excess of such sums as shall be

periodically determined by the Board of Governors shall be subject to formal

tender arrangements (see Annex B for current limits). The value shall be

determined on the basis of the total cost including irrecoverable Value Added Tax.

In the case of procurement of services the value for determining whether tenders

are required shall be the cost of the contract over its entire life, not the cost in one

budget year in isolation.

4. Budget holders shall ensure that they carry out adequate pre-tender investigations

to satisfy themselves that the companies invited to tender are financially and

technically able to meet the University‟s requirements.

5. Budget holders shall ensure that the Invitation to Tender includes a detailed and

unambiguous specification of requirements.

6. All invitations to tender shall include the following statement:- “The University

does not bind itself to accept the lowest or any tender and reserves the right to

enter into post tender negotiations.”

7. The invitation to tender shall state that the contract is to be issued according to the

University‟s standard terms and conditions of contract. Successful tenderers shall

be required to comply with all relevant British and/or international standards.

8. Firms invited to tender must be supplied with return envelopes, addressed to the

Director of Finance and Resources, and clearly marked “Tender Documents – Do

Not Open”. The tender documents must be returned by the due date and the return

envelope must not show any marks or logos identifying the sender.

9. Tenders shall be opened by a panel comprising the Director of Finance and

Resources (or, in his absence, the Deputy), the relevant budget holder and one

other senior member of staff. A formal minute of the meeting shall be kept and

include, as a minimum, details of the firms tendering, the value of each tender and

a detailed explanation of the reasons if the tender accepted was not the lowest. All

tender documents, including unsuccessful bids, shall be retained.

10. Tenders received after the stated deadline shall not normally be accepted. Where

the tender panel decides to make an exception to this rule the details of the late

tender and the reason for accepting it shall be recorded in the minutes of the

meeting.

11. Where a decision is taken to accept a tender which is not the lowest price a full

report outlining the reasons for the decision must be prepared by the budget

holder. A copy of the report shall be included with the official order when

presented to the Vice-Chancellor for final approval.

12. Successful tenders shall be accepted by the issue of an official University purchase

order.

13. Where the value of the tender exceeds limits requiring the approval of the Board

of Governors (see Annex B for current limits) no commitment shall be entered

into without the express approval of the Finance, Planning and Monitoring

Committee.

14. Budget holders need to recognise that the full formal tender process takes some

time to complete, particularly where Board of Governors approval is required, and

should plan accordingly to ensure that adequate time is available between the start

date and the date the goods or services are required. The meetings of the Board of

Governors and its Committees are scheduled well in advance and dates are

available from the Clerk to the Governors.

15. Staff involved in the tendering process must maintain full confidentiality at all

times.

16. Staff involved in the tendering process should exercise caution with regard to the

acceptance of hospitality. (see FPP28 – Gifts and Hospitality).

January 2008

CODE OF TENDERING PRACTICE

INTRODUCTION

The purpose of this Code of Practice is to ensure that the University benefits from the

use of sound procurement practices and avoids the risk of accusations of malpractice.

DUTY TO COMPLY

All staff are required to comply with this Code of Practice. Failure to comply will be

subject to disciplinary action.

EUROPEAN UNION DIRECTIVES

The European Commission lays down certain rules regarding competition. The key

requirement is to advertise tenders above a certain limit in the European Journal. The

current limits are as follows:-

EC PUBLIC SECTOR CONTRACT THRESHOLD VALUES

Details of the thresholds from 31 January 2006 are given below. Thresholds are net of

VAT.


Entities listed in

Schedule 1 1

£93,738

(€ 137,000)

£93,738 2

(€ 137,000)

£3,611,319 3

(€ 5,278,00)

Other public sector

contracting authorities

£144,371

(€ 211,000)

£144,371

(€ 211,000)

£3,611,319 3

(€ 5,278,00)


(€ 750,000)

£513,166

(€ 750,000)

£3,611,319

(€ 5,278,00)

Small Lots £54,738

(€ 80,000)

£54,738

(€ 80,000)

£684,221

(€ 1,000,000)

1 Schedule 1 of the Public Contracts Regulations 2006 lists central government bodies

subject to the WTO GPA. These thresholds will also apply to any successor bodies.

2 With the exception of the following services, which have a threshold of £144,371

(€211,000)



The following Telecommunications services in Category 5




Subsidised services contracts under regulation 34.

3 Including subsidised works contracts under regulation 34.



The Following Telecommunications services in Category 5




UTILITIES CONTRACTS REGULATIONS 2006 - FROM 31 JANUARY 2006


All Sectors £288,741

(€ 422,000)

£288,741

(€ 422,000)

£3,611,319

(€ 5,278,000)


(€750,000)

£513,166

(€750,000)

£3,611,319

(€ 5,278,000)

Small lots £54,738)

(€80,000)

£54,738)

(€80,000)

£684,221

(€1,000,000)

Please contact Finance Office for confirmation of current Sterling values

The Finance Office should be consulted for guidance on the Sterling equivalents of

the above limits.

COMPETITIVE TENDERING PROCEDURE

All competitive tenders must be sent out by and returned to the Director of Finance

and Resources. Budget holders should provide the Director of Finance and Resources

with details of their selected suppliers or contractors (a minimum of three) and a

specification regarding the goods or services to be purchased. Budget holders should

ensure that suppliers or contractors selected are capable of meeting the University‟s

requirements.

The covering letter inviting tenders shall clearly state the closing return date and time

and shall include a statement that the University does not bind itself to accept the

lowest or any tender and reserves the right to enter into post-tender negotiations.

QUOTATION PROCEDURE

Firms invited to tender shall be given a reasonable period to respond, this should not

normally be less than ten working days from the date of posting of the invitation to

tender. If the pricing of the purchase is likely to be complex then the budget holder

should provide the Director of Finance and Resources with a standardised quotation

template for inclusion with the invitation to tender.

SUBMISSION OF TENDERS

Tenders must be submitted by the due date and time in plain envelopes provided by

the University and addressed to:

Director of Finance and Resources

Swansea Metropolitan University

Mount Pleasant Campus

Swansea SA1 6ED

The official envelope when returned must not bear any name or work identifying or

otherwise indicating the name of the sender. Tenders which are not submitted in

accordance with these instructions, or which are delivered after the specified time and

date, will not normally be considered.

RECEIPT AND OPENING OF TENDERS AND SAFE CUSTODY OF

TENDERS AND RECORDS

Returned tenders shall be retained securely and unopened by the Director of Finance

and Resources. Within five working days following the closing date a Tender

Committee shall be convened to open the tenders. The Committee shall comprise the

Director of Finance and Resources (or, in his absence, the Head of Finance), the

relevant budget holder and one other senior member of staff.2.

All tenders shall be opened in the presence of the full Committee, date-stamped and

signed by those present.

Under normal circumstances a decision shall be taken immediately to accept the

lowest tender. Where this is not possible, for example in the case of complex building

works contracts, a formal evaluation of the tenders shall be undertaken by the budget

holder or one of his/her staff or by a nominated independent professional adviser.

A formal minute of the meeting shall be kept, detailing, as a minimum:-

The date, time and location of the meeting;

The names of those present;

The companies invited to tender;

Those companies which responded and the value of tenders received;

Any decision taken.

Where an evaluation is required, the person carrying out the evaluation shall maintain

full confidentiality at all times and shall not discuss the contents of tenders with any

2 The Vice-Chancellor, Deputy Vice-Chancellor, Deans of Faculties, Dean of Quality, Director of

Estates, Head of Personnel, Academic Registrar, Academic Secretary, Head of Computing, or Head of

Library and Learning Resources.

third parties. Contact with tenderers must be limited to questions necessary to clarify

the content of the tenders.

When the evaluation is complete a formal report detailing the outcome and making a

recommendation shall be submitted to the members of the original committee who

shall either formally accept the recommendation by signing the report or request that

the committee be reconvened to discuss the matter. If the meeting is reconvened full

minutes shall be kept.

ADMISSIBILITY OF TENDERS

Tenders received after the closing deadline shall be clearly marked as having been

received late. The Tender Committee may open and consider such tenders but

acceptance must be authorised by the Vice-Chancellor and the Chairman or Vice-

Chairman of the Finance, Planning and Monitoring Committee.

ACCEPTANCE OF TENDERS AND QUOTATIONS

The Tender Committee has authority only to recommend the acceptance of tenders.

All tenders must be formally approved by the Vice-Chancellor. In addition, approval

of the Finance, Planning and Monitoring Committee is required for purchases of items

of plant or equipment costing in excess of £50,000 or for building works or service

contracts costing in excess of £100,000 (inclusive of VAT).

In the case of building contracts a financial appraisal of the prospective contractor

may be required before the tender is finally accepted.

Acceptance of a tender shall be formally confirmed by the issue of an official

University purchase order.

JUSTIFICATION OF ACCEPTANCE OF TENDERS NOT AT THE LOWEST

PRICE

Tenders not at the lowest price may be accepted under the following circumstances:-

Where a whole life costing exercise indicates that the cost of a purchase over its

working life will be less than an alternative which has a lower original acquisition

cost.

Where the difference between the purchase cost of two or more alternatives is

10% or less but the after sales service offered by one supplier is considered to be

superior to that offered by a lower cost alternative.

Where the difference between the cost of two or more alternatives is 10% or less

but the compatibility with existing equipment of one alternative is considered to

be superior to that offered by a lower cost alternative.

Where the difference between the cost of two or more alternatives is 2.5% or less

but a decision is taken by the Finance, Planning and Monitoring Committee to

favour a local SME (N.B. this does not apply to the local offices of national or

international companies).

Where time is of the essence.

Other circumstances where the Finance, Planning and Monitoring Committee

considers it to be in the best interests of the University to accept a tender which is

not at the lowest price.

January 2008

FPP8




FPP8 – PAYMENT OF CREDITORS


1. General

a) All budget holders must utilise the University‟s central creditor payment systems.

The main features of the creditor payments system are as follows:

Invoices are to be sent to the Finance Office, as stated on orders. The Invoice

is then registered, checked for an order number and sent to the budget holder

for approval (this may be by electronic transmission). If there is no order

number on the invoice it is returned to the supplier with a standard letter of

explanation.

Copy orders for works, goods or services are retained by the originating budget

holder.

Invoices are compared with the copy orders, and delivery note or goods

received book, certified for payment, and sent to the Finance Office for

payment. Delivery notes and goods received books must be retained by budget

holders. In the Finance Office the invoices are matched to the relevant order

and then selected for payment.

The paid invoices are filed in the Finance Office.

The Finance Office shall only pay properly authorised invoices. Each budget

holder shall submit to the Director of Finance and Resources the names and

specimen signature of designated officers. The number and status of

authorising officers shall be strictly limited by the budget holder.

b) Before authorising an invoice the authorising officer shall have satisfied

him/herself that:-

The work, goods, or services to which the invoice relates have been received,

carried out, examined and approved as may be appropriate.

The prices, extensions, calculations, trade discounts, other allowances, credit,

and tax are correct;

The relevant expenditure has been properly incurred, and is within the relevant

estimate provision;

Appropriate entries have been made in inventories, stores records or stock

books as required;

The account has not been previously passed for payment and is a proper

liability of the University.

The coding/certification slip is completed correctly.

c) Duly certified invoices shall be passed without delay to the Finance Office who

shall examine them for which purpose it shall be entitled to make such enquiries and

to receive such information and explanation as it may require. Errors may result in

payment being delayed.

d) Apart from imprest accounts, the normal method of payment of money due shall be

by cheque or other instrument drawn on the banking account by the Director of

Finance and Resources or by BACS (Bankers Automated Clearing Service).

e) Cheque signatories must be in accordance with the bank mandate.

2. Authorised Ordering and Certification Signatories

The budget holder issuing an order is responsible for examining, verifying and

certifying the related invoice(s) and similarly for any other payment vouchers or

accounts arising from sources in his department. Such certification shall be in

manuscript by or on behalf of the budget holder. The names of officers authorised to

sign such records shall be sent to the Director of Finance and Resources by each

budget holder and shall be amended on the occasion of any change therein. The list

will be updated annually, on or before 1st October.

3. Frequency of Processing Payments by the Finance Office

Cheque runs or BACS transmissions will be on a weekly basis. Although invoices

will normally be paid within 28 days of the invoice date, the official order commits

the University only to paying by the end of the month following the month in which

the invoice was raised.

4. Originating Payment

a) Budget Holders should ensure that a completed certificate/financial coding “yellow

sticker” is attached to each individual invoice. Provided that invoices are addressed to

the Finance Office then normally stickers will be attached and coded before being

sent, where appropriate, to budget holders for certification.

b) Following processing of the invoice payment will normally be made by means of

Symmetry Autopay according to the University‟s standard terms of settlement.

c) All paid invoices shall be retained in the Finance Office.

January 2008

FPP9




FPP9 – CORPORATE VISA PURCHASING CARDS


The Pilot Scheme rules are as follows:-

1. PARTICIPANTS

Card Holder Transaction

Limit

Monthly

Limit

Julie O‟Byrne O‟Keefe, Finance, (stationery system) £500 £7,000

Nicola Evans, Finance, (overseas travel, misc.) £1,000 £8,000

Julie Reed, Senior Management Support (UK travel) £500 £7,000

Julie Jones, Secretary, Business School £500 £5,000

Bob Lewis, Estates Manager, Mount Pleasant £500 £5,000

John Davies, Estates Manager, Townhill £500 £5,000

Brian Kelleher, Catering and Residences Manager £600 £30,000

Brian Griffiths, Head of International Office

Anne Harvey*, Senior Librarian, Mount Pleasant £2,000 £20,000

Allan Nantel, Admin Officer, FADE £500 £5,000

Alan Bower, Technician Art and Design £500 £5,000

Helen Morris, Senior Admin Officer, Education £500 £5,000

* This will be automated through the Library Purchasing System*

2. AUTHORISATION REQUIRED

Engineering Supplies Dean's certification of monthly statements.

Library

Books/Periodicals

Book ordering is automated in the BLCMP Library System. It is

proposed that the system will hold the card numbers and the Head

of Library and Learning Resources will certify the monthly Visa

statements.

UK Hotels Certification of monthly statements by Secretary to Clerk.

Car Hire Internal requisition signed by Dean/Head of Department.

Stationery Certification of monthly statements by Director of Estates.

Overseas Travel Prior written approval of Vice-Chancellor. Certification of

monthly statements by Director of Finance and Resources.

Building Supplies Certification of monthly statements by Director of Estates.

3. LIMITS

PER TRANSACTION PER MONTH

Engineering Supplies £ 300 £5,000

Books/Periodicals £2,000 £20,000

UK Hotels £ 500 £ 7,000

Car Hire £ 500

£ 7,000

Stationery

Overseas Travel £1,000 £ 8,000

Building Supplies £ 250 £ 4,000

4. VERIFICATION AND CHECKING

- The Corporate and individual Statements are to be addressed to the Finance

Office. The cardholder will also receive a copy of the statement.

- There will be a preliminary scrutiny of statements by the Finance Office for

unusual items.

- The spending department must check statements against its record of card use

and certify the statement. Certification must be independent of the cardholder.

- Certified statements together with the transaction log and any other supporting

vouchers are to be returned to the Finance Office for inputting into the

accounting system. The documentation will be retained in the Finance Office

as with any other invoice.

- Direct debit payments must be certified by the Director of Finance and

Resources or the Head of Finance, plus one other, in accordance with the bank

mandate.

- Any queries/disputes etc. are to be handled by the Finance Office in discussion

with Visa, not by the cardholder or certifying officer.

- There will be a periodic review of the scheme by internal audit.

January 2008

FPP10




N.B. THIS POLICY IS CURRENTLY BEING REVIEWED BY THE SOUTH

WEST WALES HE PROCUREMENT PARTNERSHIP AND MAY

CHANGE – CONTACT FINANCE OFFICE FOR ADVICE

FPP10 – CENTRALISED PURCHASING ARRANGEMENTS

1. Prices paid for goods and services can be reduced if bulk purchasing

arrangements are introduced. Such arrangements need proper planning if they

are to succeed and adequate time is required to prepare tender documentation

and arrange the necessary Board of Governors approval. Opportunities for

significant price reductions can be lost due to poor planning by budget holders

over the Summer vacation period resulting in the fragmented issuing of urgent

orders at the start of the Christmas Term. This is particularly true in the case of

computer equipment.

2. The following items are to be purchased through centralised arrangements and

budget holders should not place orders directly with suppliers:-

Library books must be purchased through procedures managed by the Head

of Library and Learning Support Services. Faculties should provide details of

books required for courses starting in the Christmas Term by the end of July at

the latest.

Computers (PCs and MACs) must be purchased through procedures

managed by the Director of Finance and Resources. There will normally be

one major purchasing exercise each academic year, arrangements for which

will commence in April in order that the tendering process may be completed

in time to obtain Board of Governors‟ approval during the July cycle of

committee meetings. Orders must be placed in sufficient time to ensure that all

required equipment can be delivered and installed in time for the start of the

Christmas Term. Major purchases outside this process must be approved by

the Vice-Chancellor and will normally only be authorised in exceptional

circumstances such as the late validation of a new course. Faculties‟ planning

for the purchase of computers must also take into account associated furniture

needs and the possibility that building adaptations, particularly regarding

electrical works, air conditioning or security may be necessary. As stated in

FPP6, clause 3.2, such adaptations require the approval of the Director of

Estates.

Furniture must be purchased through procedures managed by the Director of

Estates. There will normally be one major purchasing exercise each academic

year, arrangements for which will commence in April in order that the

tendering process may be completed in time to obtain Board of Governors‟

approval during the July cycle of committee meetings. Orders must be placed

in sufficient time to ensure that all required equipment can be delivered and

installed in time for the start of the Christmas Term.

Wherever practicable consideration should be given to entering into collaborative

purchasing arrangements with the University of Wales Swansea in order to increase

the discounts available.

January 2008

FPP11




FPP11 - CREDIT INCOME


1. General

1.1 Budget Holders issuing requests for invoices shall ensure that there is

sufficient documentary evidence to support a claim for payment. The

minimum evidential requirement shall be:-

a) Evidence that the goods and/or services were ordered by the person or

organisation to whom the invoice is issued. This evidence should take

the form of an official order, enrolment form, letter or other written

request received from the person or organisation and

b) Acknowledgement from the person or organisation to whom the

invoice is issued that the goods or services have been received.

Budget Holders issuing requests for invoices shall provide the evidence details

in (a) and (b) to the University‟s solicitors on request together with any

information regarding any dispute in respect of the supply.

1.2 In order to ensure that an adequate division of duties is achieved, the duties of

providing information regarding sums due to or from the University and of

calculating, checking and recording these sums, shall be separated as

completely as possible from the duty of collecting or disbursing them.

1.3 All fees, charges and rents shall be reviewed annually in consultation with the

Director of Finance and Resources and recommendations shall be made by the

Vice-Chancellor and the Director of Finance and Resources to the Board of

Governors for approval.

2. Issue of Invoices

2.1 The Finance Office shall be notified in writing as early as possible of all

monies due to the University. This notification should be submitted on the

standard sales invoice request form.

2.2 All accounts for money due shall be promptly made out by the Finance Office.

2.3 A record shall be kept of invoice request pads and credit note pads printed. A

record shall be kept of departments that invoice request pads are issued to.

These documents shall be kept in a secure place when not in use.

2.4 Only official invoices shall be used for income due to the University.

2.5 The pre-printed instructions on the document shall not be amended in any way.

2.6 All persons paying bills shall be instructed to send payments directly to the

Finance Office unless an alternative arrangement has been previously agreed

in writing by the Director of Finance and Resources. Management shall

ensure an adequate division of duties between the setting up of the invoice and

the receipt of cash.

3. Credit Notes and Write Offs

3.1 The Director of Finance and Resources shall refer all unpaid debts to the

University‟s debt collection agent after they have been outstanding for more

than the period specified in Financial Policies and Procedures FPP13.

Exceptions may be made where the Director of Finance and Resources deems

it not to be in the University‟s best interests to refer debts for legal action.

3.2 No debt in respect of any amount due to the University shall be discharged

otherwise than by payment in full or by resolution of the Governing Body

authorising the writing-off of any non-collected debts after considering a

report from the budget holder with the exception of:-

a) Debts as specified in Financial Policies and Procedures FPP13 which

may be written-off on the authority of the Vice-Chancellor. Such

write-offs to be reported periodically to the Governing Body.

b) The issue of a properly certified credit note by the Finance Office for

the purpose of correcting the amount of an erroneous debit, this being

the requirement of Value Added Tax regulations.

3.2 Credit notes shall only be used to cancel invoices raised in error. Credit notes

shall not be used for the purpose of writing-off a debt. Credit notes can only

be issued by the Finance Office.

4. Invoices and Credit Note Preparation

4.1 General

All documents shall be completed as clearly and accurately as possible. It is

recommended that PRINTING rather than longhand manuscript is used.

The name and address and financial coding details are required for computer

input.

4.2 Processing

The invoice will consist of 2 parts coloured white, and yellow for ease of

identification.

The top copy shall be despatched to the debtor.

The second copy shall be retained in the Finance Office.

The details are entered into the QL accounting system from the invoice request

form and the invoice number is automatically generated sequentially by the

system. The invoice is automatically posted to the supplier account. (This may

be supplemented by a manual system where necessary)

Normally invoices are printed every week, unless an urgent invoice is required.

Credit Notes will consist of 2 parts coloured white and pink for ease of

identification.

The top copy shall be despatched to the debtor.

The second copy shall be retained in the Finance Office.

January 2008

FPP12




FPP12 - TUITION FEE REFUND POLICY

1. INTRODUCTION

Full Time Tuition Fees

In accordance with DfEE regulations tuition fees are payable for all students in

attendance at the University on the 1st December. Where a student transfers

institution, the fee is payable to the institution that the student was attending

on 1st December.

Part Time Tuition Fees

The University has a “try before you buy” policy which means that students

can attend a course up to 31st October; if the student withdraws before that

date no fees are payable.

2. FULL TIME TUITION FEES

Standard

Students who withdraw before the 1st December cut off date will be refunded

in full any fee paid prior to their withdrawal, with the exception of

international (non EU) students where a minimum fee of £1,000 will remain

payable (Under Review).

Students who withdraw between the 1st December and end of the first semester

will only have to pay half of their contribution. Students will be refunded any

money over 50% of their contribution paid prior to withdrawal.

Students who withdraw after the start of the second semester will have no

refund and have to pay full fees.

Exceptional

The University may in exceptional circumstances vary its standard policy.

Such decision is at the discretion of the Director of Finance and Resources

following a written request from the student which is supported by the

student‟s Course Director. Where a student who has paid his/her fees is

suspending studies the fees may be carried forward to the next academic year.

3. PART TIME STUDENTS

If a student is in attendance at 1st November fees are payable in full and no

refund is due.

Any refunds for withdrawals after 1st November are at the discretion of the

Director of Finance and Resources. Refund requests must be made in writing

and supported by the Course Director. Refunds will only normally be

considered if the student is withdrawing for the following reasons:- ill health,

job moves, redundancy. January 2008

FPP13




FPP13 - DEBT RECOVERY AND WRITE-OFF POLICY

1. INTRODUCTION

The University has two main types of invoiced income, tuition fees and

miscellaneous. In addition the University collects accommodation income for the halls

of residences

2. RECOVERY OF TUITION FEES

Full Time Tuition Fees

Full-time students are required to pay their tuition fees in two equal instalments, the

first in October and the second in January of each academic year. Where students fail

to comply with these deadlines recovery procedures shall be instigated according to

the following rules:-

– Recovery procedures will not commence until the final tuition fee

assessment is received from the Student Loans Company.

– Debtors who are still registered as full-time students shall not normally be

referred to the University‟s debt collection agency until such time as shall,

from time to time, be determined by the Finance, Planning and Monitoring

Committee.

– Various sanctions will be applied against full-time students who are in debt.

These sanctions will include withdrawal of library and computing facilities,

the with-holding of examination certificates and, in extreme cases,

exclusion.

Part Time Tuition Fees

Payment is due on receipt of invoice. If no payment has been received within 28 days

of the invoice date the following action will be taken:

– A letter shall be sent requesting payment in full within 10 working days and

advising the student that, if payment is not received, library and computer

facilities will be withdrawn and that the debt will be referred to the

University‟s debt collection agency.

– After the 10 days have elapsed a list will be prepared of all students who

have not responded and after further checking the status of these students to

ensure that they have not withdrawn, the list will be sent to the University‟s

debt collection agency for them to commence their recovery process.

– If the agency fail to collect the debt it will be referred back to the University

for a decision to be made on its recoverability. The Director of Finance and

Resources shall be responsible for deciding whether to refer the debt to the

University‟s approved debt collection agents for court action.

3. RECOVERY OF MISCELLANEOUS INCOME

Payment is due on receipt of invoice, if no payment has been received within 28 days

of the invoice date the following action will be taken:

– A letter shall be sent requesting payment in full within 10 working days and

advising that if payment is not received the debt will be referred to the

University‟s debt collection agency.

– After the 10 days have elapsed a list will be prepared of all unpaid invoices,

the list will be sent to the debt collection agency for them to commence their

process.

– If the agency fails to collect the debt it will be referred back to the University

for a decision to be made on its recoverability. The Director of Finance and

Resources shall be responsible for deciding whether to refer the debt to the

University‟s solicitors for court action.

4. WRITE OFF OF BAD DEBTS

Unless the debtor is insolvent or bankrupt the initial assumption shall be that all debts

are, ultimately, recoverable in full. It shall be the responsibility of the Director of

Finance and Resources to recommend the write-off of debts after giving due

consideration to the potential cost of recovery and the likelihood that any recovery

may be protracted. Debts may only be written off on the authority of the Vice-

Chancellor for debts of less than £1,500 and the Finance, Planning and Monitoring

Committee for all other debts.

Individual bad debts exceeding £10,000 must be reported to the Higher Education

Funding Council for Wales on the Annual Certificate of Losses.

January 2008

FPP14




FPP14 - COLLECTION AND DEPOSIT PROCEDURES AND BANK

RECONCILIATION


1. General

1.1 In order to ensure an adequate division of duties, the duties of providing

information regarding sums due to the University and of calculating, checking

and recording these sums, shall be separated as completely as possible from

the duty of collecting them.

1.2 In particular, there shall be adequate division of duties between:

a) Receipting of income.

b) Writing up of collection details in the daily cash posting summary.

c) Depositing of monies at bank and making appropriate entries in the

deposits column of the cash book.

It is essential that different persons should perform tasks (b) and (c).

2. Official Records and Documents

2.1 All official forms, bank paying-in slips, tickets (of value) and all documents

representing money or moneys worth (including on-line payment over the

internet3) shall be ordered and controlled by the Director of Finance and

Resources (see Financial Policies and Procedures FPP31).

2.2 The Vice-Chancellor records and books to be maintained are:-

- Receipt books for cash payments.

- Daily Cash Posting Summary.

- Paying-in Books.

2.3 When not in use all official records shall be securely held in a locked

receptacle, e.g. locked cupboard.

3 Consult Head of Finance for advice

3. Collection of Monies

Cheque Receipt

3.1 All cheques shall be made payable to Swansea Metropolitan University. The

notice “Cheque Payments” should be displayed prominently at the collection

point.

3.2 All cheque payments under £100 should be accompanied by a Cheque

Guarantee Card, unless the guarantee card is for £50, in which case the lower

limit shall apply.

The card number should be written on the reverse of the cheque by the person

issuing the receipt, even if the drawer has already done so.

3.3 In order that the payment details are easily identifiable in the event of a cheque

being dishonoured, the following details are required on the reverse of each

cheque:-

a) Cheque Guarantee Card number.

b) Receipt number.

c) Invoice number (if applicable).

d) Name of officer accepting cheque.

e) The drawer‟s full address on the reverse of the cheque if the amount

exceeds £100.

Issue of Receipts

3.4 A receipt or ticket issued from official books or tills shall always be issued for

monies received in person.

3.5 Separate receipt books shall be maintained for any unofficial funds approved

by the Director of Finance and Resources.

3.6 Monies collected from machines (e.g. vending machines etc) shall be collected

by two officers and a record of such collections shall be maintained and signed

by both officers.

3.7 All transfers of monies between officers shall be evidenced by the signature of

both officers or the issue of a receipt.

4. Collection Records

4.1 All monies collected shall be entered daily in the collection column of the

daily cash posting summary by a person other than the one responsible for

entering deposits and banking monies.

4.2 Entries shall be clearly referenced to receipt books or sales books or other

collection record.

4.3 Collections should be analysed over type of income in order to facilitate the

financial coding of such income.

5. Cash Holdings

5.1 Safekeeping

All cash shall be kept permanently under lock and key in a secure and lockable

cabinet, safe, desk or cupboard in a lockable room with restricted access.

Every effort shall be made to ensure that the room is only left open when

access is essential. Cash is only to be kept overnight if deposited in a safe

approved by the Director of Finance and Resources. N.B. The University’s

insurers require that all safe keys are taken away from the University at

night.

5.2 Key Security

The number of keys in circulation shall be strictly limited. It is recommended

that there should be 2 keys for each lock - the budget holder to have one set of

keys, the person in charge at any other time to have the other set of keys.

When not in use, the keys shall be locked away by the budget holder.

5.3 Holding Limits

There is a general limit of “cash holdings” including cheques, giro cheques,

postal orders etc. These are laid down in the University‟s insurance policies.

The approved limits include all sources of cash, such as collections, petty cash,

wage packets, pocket money etc.

5.4 Frequency of Banking

All collections shall be banked promptly and intact. No deduction shall be

made from income collected. Officers shall not cash cheques out of cash in

hand (including petty cash, pays etc.). It is essential that collecting officers

should at all times comply with this instruction as they may be held liable for

any loss arising through failure to bank monies promptly. Unbanked monies

shall be locked away in a secure place.

6. Deposit Procedures

6.1 All income arising from the conduct of the official business of the University

shall be paid into official bank accounts approved by the Director of Finance

and Resources.

Deposit of Monies at Bank

6.2 The University‟s main bankers are Lloyds TSB plc.

6.3 The paying in book should be used to deposit monies at the nominated branch

of the bank or at a branch of an agent approved by the bank.

6.4 Under normal circumstances, monies shall be taken to the bank by an

approved security company.

6.5 Directions regarding the completion of the credit-slips are printed on the

covers of the paying-in books and these should be strictly adhered to.

6.6 It is very important that no form or slip other than those in official paying-in

books should, in any circumstances, be used.

6.7 Where any sum received is in the form of a cheque, the amount should be

entered in the portion of the slip headed “Cheques, P.O.‟s etc” and the name of

the period from whom the cheque was received or the number of the receipt

issued shall be entered against the amount.

6.8 Details (i.e. date, amount and paying-in slip number) of the banking shall be

entered in the deposits column of the daily cash posting summary.

7. Bank Reconciliation

A bank reconciliation shall be prepared within seven working days of the end of

each month.

January 2008

Appendix to FPP14



ACCEPTANCE OF DEBIT/CREDIT CARD PAYMENTS

1. Introduction

The University has recently installed an on-line credit card machine. This facility

means that we are no longer required to bank credit card slips in the traditional way,

our nominated bank current account is automatically credited with the days

transaction at the end of each trading day. A monthly summary sheet is then received

from the service provider to enable a reconciliation to be undertaken.

2. Methods of Payment

There are three main methods of processing a payment -

a) With the cardholder present.

b) Over the telephone, cardholder not present.

c) Mail order, through the post.

The service provider recommends various checks are undertaken to ensure that the

card is not being used fraudulently.

Cardholder present

Check the card to ensure:

a) the dates are valid.

b) cardholder number is same on the front and the back of the card

c) cardholder‟s title and name, make sure no discrepancy between card

and person present.

d) cardholder‟ signature.

e) Mastercard and Visa cards have the first four digits repeated in small

characters above or below embossed number.

f) hologram is present.

g) Chip (if present) and magnetic strip have not been mutilated in any

way.

Cardholder not present

Obtain the following details:

a) Card Number

b) Cardholder name and title

c) Expiry date.

d) Address and postcode (must include flat number, if applicable, and

street number)

e) Security number off the back of the card, (last three numbers).

f) Amount

Send copy of credit card slip to customer.

Mail order

Obtain the following details:

a) Card Number

b) Cardholder name and title

c) Expiry date.

d) Address and postcode.(Must include flat number, if applicable, and

street number)

e) Amount

3. End of Day Procedures

At the end of each day the following reports need to be run from the terminal,

an end of day report and an X reading. In addition to these reports on a

Tuesday, Thursday and Friday evenings a Z reading should also be obtained.

The daily readings are to be summarised onto a spreadsheet to enable easy

reconciliation to the service provider‟s monthly statement and to the

University‟s bank statements.

FPP15




FPP15 - PETTY CASH


1. Petty Cash is intended for making urgent small purchases and is not a source of

money additional to approved estimates.

2. The limit for the issue of petty cash is £25 unless otherwise authorised by the

Director of Finance and Resources. The issue must be supported by receipts or

vouchers where available. Petty cash must not be used as a substitute for travel or

subsistence claims (except for fuel for hire cars) or used for payment for staff

time.

3. The Director of Finance and Resources shall make available such imprests as are

considered necessary for the disbursement of petty cash expenses. Floats shall not

normally exceed £500 in value; floats in departments, outside the Finance Office

will not exceed £200. Floats shall only be issued on the authority of the Director

of Finance and Resources.

4. The member of staff granted a float is personally responsible for its safe keeping.

The petty cash box must be kept locked in a secure place in compliance with the

requirements of the University‟s insurers when not in use, and will be subject to

periodic checks by the head of department or another person nominated by him or

her.

5. The basis of accounting shall be on an imprest system, with reimbursements made

as and when required. The request for reimbursement from the departments should

be returned to the Finance Office, signed by the budget holder, together with

supporting vouchers.

6. Standard University petty cash sheets are supplied by the Director of Finance and

Resources and must be used for recording all imprest accounts. Petty cash will

only be issued following the completion of a petty cash voucher signed by the

relevant budget holder and supported by valid receipts. The voucher shall be

counter-signed by the recipient as confirmation of receipt.

7. Requisitions for reimbursement must be sent to the Director of Finance and

Resources, together with appropriate receipts or vouchers, before the total amount

held has been expended, in order to retain a working balance pending receipt of

the amount claimed.

8. Imprest sheets shall be summarised on a monthly basis and posted onto the

accounting system.

9. At the end of the financial year a certificate of the balances held should be

completed by the member of staff responsible for the float and counter signed by

the head of department.

January 2008

FPP16




FPP16 - TREASURY MANAGEMENT

(refer also to Financial Regulations 4. and 8.)

1. All monies in the hands of the University and its subsidiaries shall be aggregated

for the purposes of Treasury Management and shall be under the control of the

Director of Finance and Resources.

2. The objective of the policy is to maximise earnings from investments

commensurate with the avoidance of risk and the maintenance of security.

3. A balanced portfolio shall be maintained with invested funds spread over a

number of financial institutions and a limit set on the lending to any one

institution of £2m (plus accumulated interest) except that there be a limit of £5

million (plus accumulated interest) for the following named clearing banks: Bank

of Scotland, HSBC, Barclays, Lloyds TSB and Royal Bank of Scotland. There will

be no limit on the sum which may be invested in the University‟s main bank or its

parent company.

4. All fixed term lending is restricted to a maximum period of six months.

5. Investments shall only be made with clearing banks incorporated in the United

Kingdom and their subsidiaries, A1 rated financial institutions and building

societies and non-capped local authorities. A list of institutions currently approved

is maintained by the Director of Finance and Resources. The Director of Finance

and Resources may delete names from this list but may only add to the list subject

to obtaining credit ratings from an approved credit rating agency and with the

agreement of the Board of Governors.

6. All executive decisions on investment shall be delegated to the Director of

Finance and Resources or through him to his staff, who shall be required to act in

accordance with the prescribed guidelines. Transfers of funds from the

University‟s bankers to other borrowers shall be subject to dual authorisation by

the Director of Finance and Resources and the Vice-Chancellor or Deputy Vice-

Chancellor.

7. The Director of Finance and Resources shall report to the Finance, Planning and

Monitoring Committee on a termly basis with details of current investments. The

report shall include a summary of interest earned and the amount invested.

October 2008

Footnote The above remains as the official policy on Treasury Management and the flexibility it offers

is helpful. However, in practice, the Board of Governors has expressed a preference for investing only

with the University‟s main banker, provided the interest rate offered remains competitive. It is

considered that the effort involved in switching funds is not justified given the small financial benefit

likely to accrue.

FPP17




FPP17 - INVENTORIES, STOCK, SECURITY

(refer also to Financial Regulations 4., 8. and 9.)

1. Inventories

Each member of staff is responsible for maintaining adequate security of

property at all times in respect of all buildings, stocks, stores, furniture,

equipment, cash, etc. under his/her control.

Budget holders are required to keep inventory books in which all items of

apparatus, equipment, furniture and plant are accurately recorded.

Separate Inventory Books must be maintained as follows:

a) Plant, equipment and apparatus.

b) Furniture.

With regards to (a) items individually costing less that £1000 need not be

recorded if such items are not singularly identifiable by means of a serial

number.

Inventory books shall be maintained by the officer responsible for authorising

invoices, who shall make the necessary entry in the inventory book at the time

of payment. Disposals shall also be recorded immediately. (See 1.1).

It is essential that a full description of each item including purchase cost is

recorded in the inventory book including serial numbers wherever possible.

Equipment, apparatus and furniture recorded in inventory books shall be

physically verified periodically and at least once a year. Inventory books

should be maintained by the person authorising payments. It is desirable that

this same person performs the physical check. The performance of this check

shall be evidenced in the inventory book. Any surpluses or deficiencies

revealed shall be reported to the Director of Finance and Resources.

A computer based inventory may be kept if the following additional conditions

are observed:

a) access to the inventory shall be restricted to officers nominated by the

budget holder by means of a secure password(s).

b) additions shall be entered centrally by the person responsible for

authorising invoices.

c) deletions/transfers shall be supported in writing on an appropriate form

by an officer nominated by the budget holder.

d) the inventory shall be printed and certified annually and retained for

audit inspection.

N.B. The Finance Office is currently developing a central fixed assets

register as part of the Symmetry accounting package. Contact

Head of Finance for advice.

Subject to the approval of the Finance, Planning and Monitoring Committee

certain items may be recorded in a centrally controlled inventory. Where this is

the case budget holders need not duplicate these records in departmental

inventories. At present such central inventories are restricted to networked

PCs. Budget holders should consult the Finance Office if in doubt.

Donations of equipment shall be entered on the inventory book.

If any equipment is marked for security purposes an appropriate note shall be

made in the inventory book.

The inventory book shall be kept in a safe place and if possible in a fireproof

receptacle.

The fire insurance policy does not cover personal property that is left at

establishments. However, any articles belonging to individual staff members,

which are kept on the premises for the benefit of the establishment, should be

entered in the inventory book.

University property shall not be removed from the University premises unless

otherwise authorised by the Director of Finance and Resources. Such

authorisation shall be recorded on the appropriate form of authorisation clearly

stating the reason for the removal, its duration and the items removed.

1.1 Disposal of surplus goods and equipment

All Deans or Heads of Department are to review goods and equipment on a

regular basis to identify any surplus items, thus ensuring that the University

maximises its return on the disposal of the goods or equipment.

Disposal of all equipment is to be approved by the Director of Finance and

Resources and the best possible price obtained.

Details of disposals must be sent to Director of Finance and Resources as soon

as disposal takes place giving details of :

a) Date of purchase.

b) Description of equipment disposed of.

c) Original cost.

d) Sale proceeds.

2. Stocks

2.1 General

Each budget holder shall be responsible for the care and custody of the stocks

and stores in his/her department.

Stock records should be maintained of goods, materials or liquids if either:

a) the items are of high value, or

b) it is desirable to maintain an independent record of stocks to be

checked against physical stocks from time to time, or

c) a record of issues is required for other purposes.

2.2 Records

Stock records may be maintained in loose leaf or book format or on a

computer system.

Stock record sheets shall be maintained for individual items.

Receipts and issues shall be entered on the stock records immediately i.e. at

the time of the physical movement of the items.

2.3 Physical Verification

The frequency of checks between stock records and physical stocks will be

determined by the value of the items involved and the number of transactions.

In any event, checks shall be undertaken at least once a year.

2.4 Security

Valuable items shall be kept under lock and key at all times. The number of

keys in circulation shall be limited as far as possible. Keys shall not be kept in

unsecured locations.

3. Security of Cash, Official Documents and Data

3.1 General Principles

Adequate systems shall be installed to establish and strictly control the

accountability of each officer handling cash, cheques or other monies.

Systems should be fully documented and covered by written instructions or

regulations. All accountable officers shall be fully conversant with their

responsibilities.

The following advice covers basic principles. Advice on specific problems

should be requested from the local Crime Prevention Officer.

3.2 Physical Protection

Adequate facilities shall be provided for the safekeeping of cash whilst on the

University‟s premises. The facilities shall extend to the protection of staff

who may be injured in any attack. Cash holdings should be concentrated into

as few places as possible to enable a concentration of protective security

measures.

All cash, cheque books Corporate Visa cards and cheque cards shall be kept

permanently under lock and key in a secure lockable receptacle, if no safe is

available.

On no account shall official monies be mixed with staff‟s personal monies.

Official cheques shall never be processed through an Officer‟s personal bank

account. Such cheques shall be paid into the appropriate University account or

encashed where the University‟s normal banking facilities are available.

Where money is held on behalf of lecturers, students etc., a record sheet shall

be used to detail the payments received in this way.

There is a cash holding limit in existence for insurance purposes and this limit

must not be exceeded (contact Finance Office for details). Stolen cash is

normally recoverable via the University‟s insurers, but only up to the cash

holding limit and subject to a policy excess. Any amount in excess of this

limit will not be recoverable. A budget holder may be held accountable for

this excess.

3.3 Safes

The quality of safes and their locking mechanisms shall be commensurate with

the maximum level of risk. The use of more than one safe may have to be

considered if the level of risk is high. If the safe is less than, say 1/2 ton in

weight, it should be bolted to the floor or bricked into the fabric of the

building.

Key and/or combination holders shall be restricted in number and their names,

addresses and telephone numbers notified to the police to facilitate contact

outside business hours. Written instructions should be give to

key/combination holders, setting out the procedure on call out by the police.

Duplicate keys and the only written note of a combination number shall be

held securely. Keys in daily use shall be kept on the responsible officer‟s

person at all times. Copies of keys should only be obtainable from the safe

manufacturers at the written request of a designated senior officer. In the

event of a change in the key/combination holder, the combination shall be

changed.

3.4 Cash Collection/Payment Counters

Any point at which the public congregate either to pay in or receive money

from the University should be provided with adequate security facilities.

3.5 Alarm Systems

Appropriate alarms must be installed to supplement security measures but they

are not an alternative to good quality safes, locks, doors, walls, etc.

3.6 Keys, Locks and Other Locking devices

3.6.1. General

Where it is necessary to ensure that unauthorised entrance is not easily gained

through external doors, a good quality lock, and sometimes other devices,

should be provided.

3.6.2 Keys

If a room/office needs to be left unlocked, every effort must be made to ensure

that the room/office is only left open when access is essential.

Duplication of types of keys shall be kept to a strict minimum. Ideally there

should only be two keys for each lock - the budget holder or his designated

assistant to have one set of keys; the person in charge at any given time to be

in possession of the other set. A record shall be kept of persons issued with

keys.

The budget holder‟s set of keys must be kept on the person whilst on duty and

taken home when not. Similarly the second set must always be kept on the

personage of the person in charge and locked away by the Budget Holder when

not in use.

Pass keys and master keys shall be issued only on the authority of the Director

of Estates who shall maintain a register of all holders.

3.7 Irregularities

Any officer shall immediately notify their Head of Department and the

Director of Finance and Resources if any discrepancy or suspected

irregularities come to light.

4. University Vehicles

4.1 Vehicles must be kept secure at all times.

4.2 Log sheets must be maintained for each vehicle.

4.3 Each vehicle is assigned a Shell petrol purchasing card which can be used at

any Shell garage.

4.4 Authorisation of petrol and derv. requisitions must be by properly authorised

certifying officers.

January 2008

FPP18




FPP18 - INSURANCE

1. The University‟s Director of Finance and Resources shall be responsible for

arranging adequate insurance in respect of all the activities of the University and

its subsidiaries.

2. The provider of insurance cover shall be selected by competitive tender. The

University may appoint brokers to undertake this exercise provided the brokerage

service is itself periodically tested by tender.

3. As a minimum, the following policies shall be maintained:-

Material damage to buildings and contents.

Business interruption.

Employers‟ liability.

Public / Products liability.

Professional indemnity.

Governors, directors and officers liability.

Group personal accident / travel.

Motor fleet.

Terrorism.

4. The level of cover should be based on advice provided by the University‟s

approved brokers, subject to the valuation of buildings being periodically

reviewed by an independent qualified surveyor. The period of review should not

normally exceed five years with the insurers applying relevant indexation during

the period between formal revaluations.

5. Any serious loss must be reported to the Director of Finance and Resources or an

officer nominated by the Director of Finance and Resources. The University‟s

nominated brokers must, without delay, be notified of the loss. The brokers shall

provide telephone numbers to enable contact to be made outside business hours if

necessary.

6. Claims may only be made by the Director of Finance and Resources or another

nominated officer. University staff must not deal directly with the brokers or the

insurers.

7. All claims shall be submitted on the relevant approved stationery.

8. A register of losses and claims shall be maintained.

9. Where a policy excess applies and a loss is suffered by a member of staff or a

student, reimbursement of the excess must be subject to authorisation by the

Director of Finance and Resources who should take into account factors such as

contributory negligence.

10. The Internal Auditor‟s strategic plan should include provision for a periodic

review of insurance and risk management.

11. An annual report on the University‟s insurance shall be presented to the Finance

Planning and Monitoring Committee of the Board of Governors in the Autumn

term.

January 2008

FPP19




FPP19 - UNOFFICIAL FUNDS

Under normal circumstances unofficial funds should not be maintained –

all financial transactions should be processed through the University‟s

normal bank accounts. However, where, in exceptional circumstances, the

Director of Finance and Resources authorises staff to operate an

unofficial fund the following procedures shall be applied.

1. General

1.1 The Director of Finance and Resources shall be responsible for the oversight and

audit of unofficial funds controlled by an employee of the University in the course

of his/her official duties which is not a fund belonging to the University. The

Director of Finance and Resources shall maintain a central register of all such

unofficial funds.

1.2 Officers of the University shall consult with the Director of Finance and

Resources before formulating regulations that will apply to such funds.

1.3 The objectives of the fund shall be clearly defined in the constitution.

1.4 A Secretary, a Treasurer and Auditor(s) shall be appointed for each unofficial

fund.

1.5 The financial records of all funds shall be maintained by the Treasurer of the

fund.

1.6 Annual accounts, signed by the Treasurer and certified by the Auditor(s), shall be

submitted to the management body of the fund for approval within a reasonable

period after the end of the financial year (as specified by the management body).

Copies of final accounts, auditor‟s certificate and management body approval

shall be reported to the University‟s Finance, Planning and Monitoring

Committee.

2. Financial Administration

2.1 Banking Arrangements

2.1.1. The management body shall approve all banking arrangements.

2.1.2. The Fund Treasurer should be authorised to operate approved banking accounts.

2.1.3. Cheques shall be signed by two authorised persons.

2.2 Income

2.2.1. All monies received shall be promptly banked.

2.2.2. All receipts shall be recorded by use of a duplicate receipt book.

2.2.3. Fund monies shall not be mixed with official University monies.

2.2.4. All receipts shall be retained for audit purposes.

2.3 Expenditure

2.3.1. All expenditure shall be consistent with the objectives of the Fund.

2.3.2. All expenditure shall be authorised by the management body of the Fund. Such

authorisation shall be formally recorded.

2.3.3. Before paying an invoice the authorised persons shall ensure that a certification

has been made indicating that:

a) all goods or services have been satisfactorily received;

b) the invoice is arithmetically correct;

c) the expenditure has been authorised by the management body;

d) appropriate entries have been made in inventories and stock records as

required.

e) the account has not been previously paid and is a proper liability of the

Fund.

2.3.4. All paid invoices shall be retained for audit purposes.

2.4 Accounts

2.4.1. An appropriate form of cash book shall be maintained by the Fund Treasurer.

2.4.2. The cash book shall be periodically reconciled with statements of account

produced by the Fund‟s bankers.

January 2008

FPP20




FPP20 - CATERING

1. The University‟s Catering Service is the responsibility of the Catering and

Accommodation Manager.

2. The University‟s Financial Regulations and Accounting Instructions apply to all

financial aspects of the operation of the Catering Service. Particular attention is

drawn to the approved procedures in respect of:-

Collection of income and banking.

Petty cash.

Purchasing.

Appointment of staff.

Inventories.

Security.

Internal audit.

3. The Catering and Accommodation Manager has delegated responsibility for

determining pricing structures.

4. The Catering and Accommodation Manager, in consultation, where appropriate,

with the University‟s Health and Safety Officer, is responsible for ensuring

compliance with all relevant hygiene and food safety legislation and for ensuring

compliance with the Licensing Acts in relation to those parts of the University

licensed to serve alcohol.

5. The normal expectation is that the Catering Service should operate on a break

even basis, or better, when all costs, including a fair apportionment of overheads,

are taken into account.

6. Funding Council income shall not be used to subsidise the Catering Service.

7. The Catering and Accommodation Manager, in consultation with the Finance

Office, shall prepare monthly trading statements providing details of gross and net

profit and a comparison with the same period for the previous year. The

statements shall include an explanation of significant variances. The statements

shall be submitted to the Vice-Chancellor and to the Finance Office within 10

working days of the month end.

8. Meals provided for members of staff are subject to Value added Tax.

9. Hospitality provided in respect of internal meetings of staff or Governors or

provided for guests must be authorised and recorded and the relevant transfer of

charges between accounts will be actioned by the Finance Office on a monthly

basis.

January 2008

FPP21




FPP21 - HALLS OF RESIDENCE

1. The University‟s Halls of Residence are the responsibility of the Accommodation

Officer, reporting to the Catering and Accommodation Manager.

2. The University‟s Financial Regulations and Accounting Instructions apply to all

financial aspects of the operation of the Halls of Residence. Particular attention is

drawn to the approved procedures in respect of:-

Collection of income and banking.

Petty cash.

Purchasing.

Appointment of staff.

Inventories.

Security.

Internal audit.

3. The approval of rents shall be the responsibility of the Board of Governors.

4. The Halls of Residence shall be operated to ensure that they generate a profit when

all costs, including a fair apportionment of overheads, are taken into account.

Under normal circumstances the profit shall be set aside to create a fund which

shall be used to maintain, refurbish or improve the Halls.

5. Funding Council income shall not be used to subsidise the Halls of Residence.

6. A computerised database shall be maintained and kept up to date to provide the

following information:-

a record for each room.

the rent due for each room.

the current occupants.

any debts outstanding.

deposits paid.

deposits forfeited (with reasons).

Access to the database, which shall be maintained on a real-time basis, shall be

available to the Accommodation Officer and the Finance Office concurrently.

7. Students shall not be issued with room keys unless they have paid the relevant

deposit and presented payment for the first term‟s rent. Rents in respect of

subsequent terms shall be payable two weeks after the start of term.

8. All rent payments should be submitted to the Finance Office.

9. The Accommodation Officer shall provide monthly statements providing details

of:-

– income to date in comparison with budgets.

– current level of voids.

– deposits forfeited.

The statements shall be submitted to the Vice-Chancellor and to the Finance

Office within 10 working days of the month end.

10. The Accommodation Officer shall be responsible for initial attempts to recover

hall fee debts. Where, after one month, such action has been unsuccessful, details

of outstanding debts shall be referred to the Finance Office on a monthly basis.

The Finance Office shall be responsible for initiating follow-up action in

accordance with the University‟s agreed debt recovery procedures.

11. A handbook containing all relevant rules and regulations in respect of Residence

in Halls shall be prepared and a copy shall be handed to every student when he or

she takes up residence. Students must sign to confirm that they have received the

handbook.

12. The Catering and Accommodation Manager shall be responsible for overseeing

the maintenance of discipline in Halls. Where disciplinary action is considered to

be necessary the matter must be referred to the Deputy Vice-Chancellor who shall

act in accordance with the approved Student Disciplinary Procedures.

January 2008

FPP22




FPP22 - GENERAL LEDGER AND CHART OF ACCOUNTS


INTRODUCTION

The accounting operation of the University forms part of the University‟s

Management Information Systems and uses Symmetry Financials which runs using an

Oracle database.

GENERAL LEDGER

The central feature of the system shall be the general ledger which comprises a

comprehensive and detailed recording system with associated ledger maintenance and

financial reporting capabilities. Integrated within the general ledger are the transaction

processing modules. These are:

Payment of accounts - Purchase ledger module

Budget and Order processing - Commitment module

Journal processing - General ledger module

The following systems have interfaces with the accounting system:

„Agresso‟ Student fees system

Payroll system

The main function of the University‟s ledger shall be to record in a central place the

great volume of financial transactions taking place within the University. Within the

purchase and sales modules there are self balancing ledgers for creditors/accounts

payable and debtors/accounts receivable. Each of these subsidiary ledgers has a

control account in the general ledger and at any given time the amount shown in the

control account should equal the sum of the account balances in the subsidiary ledger.

CHART OF ACCOUNTS

ACCOUNTING STRUCTURE

The accounting structure is divided into three distinct sections

– The Subjective/General ledger code, a five digit number, this defines the

expenditure or income heading under which a transaction is grouped.

– The Cost centre code, a four digit number, this defines which department

the income and expenditure has been assigned to.

– The Project code, a four digit number, is used if there is a specific project or

grant against which income and expenditure are required to be allocated.

This shall be achieved by setting up a separate project code within the cost

centre.

The three individual codes are combined with each other to create a unique coding

combination:-

XXXXX XXXX XXXX

Subjective/General Cost Project

Ledger Code Centre Code

This unique coding combination shall reduce the chances of miscoding and each

coding combination is linked to a budget control rule which enables control to be

exercised over the delegated budget preventing orders being posted when the relevant

budget would be exceeded.

The setting up of the general ledger codes, cost centre codes and project codes are

under the control of the Head of Finance, who is also responsible for setting up the

coding combinations and budget control rules.

January 2008

FPP23




FPP23 - COSTING AND PRICING

(refer also to Financial Regulations 4. and 9.)

1. The Director of Finance and Resources shall be responsible for ensuring that the

University‟s Costing and Pricing Strategy, as approved by the Board of Governors,

is adhered to and kept under review. The strategy shall have due regard to the

recommendations of the Funding Councils‟ Joint Costing and Pricing Strategy

Group (JCPSG) and the Transparency Review of Research.

N.B. National requirements on costing and pricing are now complex and the

guidance is voluminous - see JCPSG web-site at www.jcpsg.ac.uk .

2. Pricing of Commercial Activities

a) Commercial activities are such courses, consultancy work or research which are

additional to the mainstream HEFCW or FEFCW funded provision of the

University.

b) Staff involved in the development and delivery of commercial activities must

obtain the approval of the Head of Finance before any prices are quoted to clients.

c) In pricing commercial activities, the Head of Finance shall have due regard to the

requirement, under normal circumstances, to recover full costs including a fair

apportionment of overheads which should, wherever possible, equate to the

approved JCPSG default rates..

d) Where a decision is taken to price an activity at less than full cost, the price must,

as a minimum, recover the marginal cost of the activity. Where such a decision is

taken, the Head of Commercial Services must authorise the agreement.

e) Funding Council income shall not be used to subsidise commercial activities.

f) The Head of Finance shall produce, twice yearly, a summary statement detailing,

for each commercial activity, the price charged, the estimated total cost at

completion, the estimated profit and the actual full cost to date.

g) The Director of Finance and Resources shall annually submit a report to the

Finance, Planning and Monitoring Committee summarising the financial position

in respect of all commercial activities.

January 2008

http://www.jcpsg.ac.uk/

FPP24




FPP24 - VALUE FOR MONEY

The attached strategy regarding obtaining value for money was approved by the Audit

Committee in April 2005.

VFM STRATEGY

Introduction

Swansea Metropolitan University (“the University”) recognises its

responsibility to achieve value for money from all its activities,

however they may be funded.

The University is committed to the pursuit of economy, efficiency

and effectiveness as part of its corporate and academic strategy and

will seek to adopt good practice and incorporate VFM principles in

all its activities.

Objectives

To achieve good VFM, the University has set itself these

objectives:

to integrate VFM principles within existing management,

planning and review processes

to adopt recognised good practice where this makes sense

to undertake VFM studies on areas of activity identified as

worthy of review

to benchmark the institution‟s activities against other

similar activities and organisations where this is considered

useful

to respond to opportunities to enhance the economy,

efficiency and effectiveness of activities

to promote a culture of continuous improvement

to demonstrate actively to both internal and external

observers that the achievement of VFM is sought in all

activities undertaken

to ensure that all staff recognise their continuing obligation

to seek VFM for the institution as part of their routine

activities.

Responsibility

„The responsibility for VFM lies with all members and staff of the

University and is not restricted to those with resource or financial

responsibilities.‟ (Dr G. Lewis, Chair of Audit Committee,

September 2002.)

The governing body is required to satisfy itself that VFM is being

sought and achieved from the use of public funds. The governing

body has determined that this institution should extend this

principle to all its funds.

The Audit Committee is required, under the HEFCW Audit Code

of Practice, to satisfy itself that satisfactory arrangements are in

place to promote economy, efficiency and effectiveness. The

committee is required to relay its view on the arrangements to the

governing body in its annual report.

The Senior Management, Deans and Directors Committee (SMDD)

has the executive responsibility to put in place arrangements that

will ensure VFM is being sought. SMDD (and the Clerk to the

Governors/Audit Committee) have a responsibility to keep the

governing body and Audit Committee advised of VFM issues (for

example, the publication of relevant advice or reports). To help

discharge this responsibility, the University has established

procedures for the Resources Group to monitor VFM and provide

advice to SMDD on VFM matters.

Managers have the executive responsibility to maintain an

awareness of good practices in their own area of operation and to

ensure that these are followed appropriately. All staff should

endeavour to seek and achieve VFM in all activities and to bring to

management‟s attention any opportunities for improvement. In so

doing they should be aware that:-

Budget holders should ensure that they follow the

University‟s approved procurement procedures. However,

obtaining value for money is not simply about „buying

cheap‟. Fitness for purpose, anticipated annual maintenance

costs and the expected useful life of a purchase also need to

be taken into account. In the case of large items it may be

necessary to carry out an exercise in “Whole Life Costing”,

guidance on which is available from the Finance Office.

Budget holders need to be aware that the Higher Education

Funding Council for Wales and the National Audit Office

have a keen interest in value for money issues and periodic

guidance on best practice is issued.

In accordance with the need to demonstrate proper use of

public money the Vice-Chancellor and the Director of

Finance and Resources shall be responsible for carrying out

periodic value for money reviews of aspects of the

University‟s activities; the findings of these reviews shall be

reported to the Audit Committee. In addition, a small panel,

chaired by the Vice-Chancellor, shall, on at least a termly

basis, meet to carry out a retrospective review of selected

items of expenditure in order to determine whether proper

procedures have been followed and adequate efforts made

to secure value for money. Budget holders may be required

to explain their actions to the panel.

VFM Strategy.doc/BRL

October 2002

FPP25




FPP25 - SUBSIDIARY COMPANIES

(see also Financial Regulation 9.)

1. The University is permitted within the law to form subsidiary companies to

undertake defined activities.

2. No company shall be formed without the express approval of the Finance,

Planning and Monitoring Committee. Where such approval is sought the Vice-

Chancellor and the Director of Finance and Resources shall submit a report to the

Committee providing, as a minimum, the following information:-

The purpose of the company.

The names of proposed directors.

An outline business plan.

Details of any University investment required.

A detailed justification for the proposal, including an explanation outlining

why the existing organisational structure cannot be utilised.

A risk assessment.

The University shall nominate a member of staff who holds no office within any

subsidiary (currently the Head of Finance) to monitor on its behalf all activities of

the subsidiary companies. The nominated officer shall report annually to the

Finance, Planning and Monitoring Committee.

3. If the formation is agreed a Board shall be set up comprising five members, two of

whom shall be independent members of the Board of Governors.

4. An approved member of the University‟s Senior Management, Deans and

Directors Committee or another member of staff holding a professional

qualification awarded by a CCAB body or the Institute of Chartered Secretaries

shall act as Company Secretary to all the University‟s subsidiary companies.

5. The financial administration of all subsidiary companies shall be the responsibility

of the University‟s Director of Finance and Resources.

6. The University shall appoint a „nominated officer‟ to monitor the activities of all

subsidiaries on its behalf. The nominated officer shall not act as a director or

company secretary of any subsidiary.

7. The University‟s Financial Regulations and other approved policies and

procedures shall apply to all subsidiaries unless exceptions have been expressly

approved by the Finance, Planning and Monitoring Committee.

8. The accounting period for all subsidiary companies shall be concurrent with that

of the University.

9. The Company Secretary shall ensure that copies of all minutes of all board

meetings of subsidiary companies shall be given to the Clerk to the University‟s

Board of Governors who shall submit them to the subsequent meeting of the

Finance Planning and Monitoring Committee.

10. All subsidiary companies shall be audited by the same firms and under the same

arrangements as apply to the University.

11. Staff and governors may find the following advice useful:-

“Institutions may decide to form limited liability companies for trading purposes

to take advantage of favourable taxation and grant schemes, to avoid possible

challenges to charitable status and to allow decision-making to take place in a

more commercial atmosphere. The extent to which institutions are able to invest

public funds in such activities is dependent upon the terms of the Financial

Memorandum, and all such investments must be shown in the institution‟s

accounts.

In principle, formation of companies is very straightforward. However, it should

not be assumed that separate legal personality and limited liability provide total

protection for an institution which has formed a company. The courts have

developed a doctrine known as „lifting the veil of incorporation‟ by which the

form of a company can be cast aside to reveal the substance, behind the veil of

incorporation, of directors or shareholders manipulating the company in order to

avoid responsibilities to third parties. The institution‟s governing body may find

itself regarded as a „shadow director‟ for actions following from advice or

direction given by it to the directors who are members of staff. It is therefore

essential that potential investments should be thoroughly examined by properly

qualified officers and the extent of potential liability identified.

Directors of companies are responsible, under the Articles of Association of the

company, for the general management and administration of the company between

general meetings. Their potential liabilities are considerable as they occupy

personal offices of trust and should be fully indemnified by the institution in so far

as the companies legislation permits and insurance cover taken out to cover both

them and the institution.” (from The Law of Higher Education, D.J. Farrington, 1994:450)

January 2008

FPP26




FPP26 – STAFF COMPANIES

In general terms staff employed by the University are subject to exclusivity of service.

This is an explicit term in academic contracts of employment1 and is implicit in other

contracts. However, there are certain circumstances (e.g. under the „Spin-Out‟

Scheme) where the University may agree to a member of staff forming an independent

company which is entirely separate from the University even though it carries out

activities which are similar to activities carried out by the University itself.

The legal position in these cases can be extremely complex and it is important to

ensure that the University is not exposed to any risk, particularly risks which may

arise due to the doctrine known as „lifting the veil of incorporation‟ “by which the

form of a company can be cast aside to reveal the substance, behind the veil of

incorporation, of directors or shareholders manipulating the company in order to

avoid responsibilities to third parties. The institution‟s governing body may find itself

regarded as a „shadow director‟ for actions following from advice or direction given

by it to the directors who are members of staff. It is therefore essential that potential

investments should be thoroughly examined by properly qualified officers and the

extent of potential liability identified”2

Consequently all staff are required to obtain the approval of the Vice-Chancellor

before any company is set up.

1 Clauses 13.1 to 13.4 of the standard contract.

2 D.J Farrington, The Law of Higher Education, Butterworth‟s 1994, page 450.

FPP27




FPP27 - GIFTS AND HOSPITALITY


1. The University‟s Financial Regulations state that:

“Staff may accept modest hospitality4 from third parties subject to the

approval of their line manager.

The acceptance of gifts, other than promotional items, is strictly prohibited”

2. For the avoidance of doubt, staff should be aware of the following guidance

agreed by the Governing Body:-

a) When accepting hospitality, staff should always be aware that employees of

publicly funded bodies are under close scrutiny and must ensure the strictest

probity at all times. Practices which are widely accepted as normal in the

private sector may well be regarded as corrupt when applied to public bodies.

b) The University considers the acceptance of hospitality from other bodies,

especially private sector bodies which have or expect to have contracts with

the University, to be a matter for extreme caution. Staff may accept modest

hospitality only with the approval of their line manager and must not accept

hospitality of a standard or frequency higher than that which the University

itself offers to its guests without the prior approval of the Vice-Chancellor.

Hospitality should not be accepted from organisations involved in tendering or

negotiations for a new University contract.

c) The acceptance of gifts is prohibited unless the gifts are promotional items

such as diaries, pens and calendars which carry the logo of suppliers. It is

understood that it can appear discourteous to refuse a modest gift such as a

bottle of whisky at Christmas; where this occurs, the member of staff may

accept the gift as a prize for an annual raffle to be organised in aid of the

Students‟ Emergency Fund.

3. Hospitality may be extended to visitors of the University if it is in the interest

of the University to do so. Such hospitality should not be excessive or

4 „Modest hospitality‟ shall be defined as hospitality of a standard similar to that offered by the

University to its guests. On that basis, acceptance of an occasional working lunch or evening meal paid

for by a third party is acceptable if the member of staff feels he/she would be able to reciprocate on

another occasion. Staff should not accept any form of hospitality which is purely social in nature and

which is not associated with a meeting arranged to discuss specific official business; this particularly

applies to the acceptance of invitations to sporting or entertainment events.

disproportionate to the benefits of the visit to the University and must be

approved in advance by the Vice-Chancellor or the Director of Finance and

Resources. Staff entertaining guests from outside bodies should normally use

the University‟s catering facilities. Where it is necessary to entertain visitors

outside the University, then only restaurants approved in advance may be used.

Application forms are obtainable from the Vice-Chancellor‟s Secretary.

The cost of cigars and cigarettes will not be met by the University. The

amount claimed for alcoholic drinks should be itemised and kept to a

minimum and will only be reimbursed where business contacts are being

entertained.

No more than one member of staff per guest will be reimbursed.

University funds will not be used to support the cost of social gatherings,

except for students (this also includes prospective students).

The University will not normally pay for gifts for staff or visitors. The Vice-

Chancellor may approve exceptions in the case of, for example, visiting

dignitaries or retiring governors or members of staff. Where gifts are approved

these shall be modest, (for example a bouquet of flowers) or items such as

works of art which have been produced by University staff or students.

January 2008

FPP28




FPP28 - FRAUD AND CORRUPTION

ANTI-FRAUD STRATEGY

1. Introduction

1.1 Swansea Metropolitan University requires all staff to act honestly and with

integrity and to safeguard the resources for which they are responsible. Fraud

is an ever-present threat to those resources and therefore must be a concern to

staff. The purpose of this document is to set out the Board‟s responsibilities

regarding the prevention of fraud and the procedures to be followed where a

fraud is discovered or suspected.

2. What is Fraud?

2.1 Fraud is the term used to describe such acts as deception, corruption, bribery,

forgery, concealment of facts, embezzlement, misappropriation, false

representation and collusion. In law however, there is no specific offence of

fraud; most of the offences that we regard as fraud are covered by a number of

offences contained within the Theft Acts of 1968 & 1978. For practical

purposes fraud may be described as the use of deception with the intention of

obtaining an advantage, avoiding an obligation or causing loss to another

party.

3. The Board‟s Responsibilities

3.1 In administering its responsibilities, Swansea University is committed to

preventing fraud and corruption from occurring and to developing an effective

anti-fraud culture throughout the organisation. To achieve this:

“Departments must develop and maintain effective controls to prevent fraud

and to ensure that if it does occur departments carry out a vigorous and prompt

investigation. They should take the appropriate legal and/or disciplinary

action in all cases where that would be justified; and they should make any

necessary changes to systems and procedures to ensure that similar frauds will

not happen again. Investigations should consider as a matter of course

whether there has been a failure of supervision; and appropriate disciplinary

action should be taken where supervisory failures have occurred. Departments

must also establish systems for recording and subsequently monitoring all

discovered cases of fraud” Chapter 37 Government Accounting.

3.2 While overall responsibility for preventing fraud rests with the University‟s

Vice-Chancellor and Director of Finance and Resources, line management

bears significant responsibility for specific failures within their areas of

individual responsibility.

4. Line Management Responsibility

4.1 Line managers are responsible for ensuring that an adequate system of internal

control exists within their areas of responsibility and that those controls are

effective. The responsibility for the prevention and detection of fraud

therefore, rests primarily with the managers. There is a need for all managers

to review and to test those control systems regularly, to ensure that controls are

being complied with; and to satisfy themselves that their systems continue to

operate effectively.

4.2 In terms of establishing and maintaining effective controls it is generally

desirable that:

a) There is rotation of staff, where possible;

b) There is separation of duties so that control of a key function does not rest

with one staff member; and

c) When new systems are being designed, safeguards against fraud are

considered at an early stage.

4.3 The level of controls should, however, be appropriate to the risk involved.

While the controls outlined at 4.2 are essential in situations where money is

being handled, they will not be needed in many situations. Line managers

need to have in their sights the areas of risk in the work they are responsible

for – the adequate control of invoice handling, for example; payment to service

providers, for another – and ensure controls in place are effective to manage

the level of risk to which the organisation is exposed.

5. Fraud Response Plan

5.1 The Board has prepared a fraud response plan, which can act as a guide to

follow in the event of a fraud being detected or suspected. It covers:

a) Initial actions

b) Reporting procedures

c) Securing evidence

d) Informing the Police

e) Prevention of losses

f) Financial recovery

g) Handling the Media

6. Creating an Anti-Fraud Culture

6.1 The creation of an anti-fraud culture underpins all other work to counter fraud.

Staff and the Board must understand the risk to fraud faced by the

organisation, that fraud is serious and that it diverts valuable resources from

the Board‟s primary objective.

7. Fraud Detection

7.1 Line managers must be alert to the possibility that unusual events or

transactions could be symptoms of fraud or attempted fraud. Fraud may also

be highlighted as a result of specific management checks or be brought to

management‟s attention by a third party.

8. Staff Responsibilities

8.1 It is the responsibility of all members of staff to ensure that funds controlled by

the Board are safeguarded against fraud. Staff must alert their line manager if

they believe an opportunity for fraud exists because of poor procedures or

controls. Staff must report any suspicion of fraud immediately to their line

manager, Head of Personnel or the Accounting Officer. For further

information refer to the Annex to this Strategy and the Board‟s Whistle-

blowing policy.

8.2 The Board subscribes to the seven principles of public life set out in the Nolan

Committee‟s first report, Standards in Public Life.

The Seven Principles of Public Life are:

Selflessness - Holders of public office should take decisions solely in terms of

the public interest. They should not do so in order to gain financial or other

material benefits for themselves, their family, or their friends.

Integrity - Holders of public office should not place themselves under any

financial or other obligation to outside individuals or organisations that might

influence them in the performance of their official duties.

Objectivity - In carrying out public business, including making public

appointments, awarding contracts, or recommending individuals for rewards

and benefits, holders of public office should make choices on merit.

Accountability - Holders of public office are accountable for their decisions

and actions to the public and must submit themselves to whatever scrutiny is

appropriate to their office.

Openness - Holders of public office should be as open as possible about all

the decisions and actions that they take. They should give reasons for their

decisions and restrict information only when the wider public interest clearly

demands.

Honesty - Holders of public office have a duty to declare any private interests

relating to their public duties and to take steps to resolve any conflicts arising

in a way that protects the public interest.

Leadership - Holders of public office should promote and support these

principles by leadership and example.

9. Sanction & Redress

9.1 In all cases where fraud is proven the Board will consider initiating criminal

proceedings against those responsible whether perpetrated by a member of

staff or a source external to the organisation. Decisions regarding the

appropriate form of any investigation must only be taken by the Vice-

Chancellor or Director of Finance and Resources in consultation with the

Chairman of the Audit Committee. Any investigation should only be carried

out by competent persons. Only the Vice-Chancellor, the Chairman of the

Board of Governors and the Chairman of the Audit Committee have authority

to involve the Police. The Board will co-operate fully with the investigating

body and will always seek to recover funds lost through fraud. It may be

necessary for the Board to initiate a Civil Action against the fraudsters. If,

during the course of the investigation any failure of supervision is identified

the Board must consider whether disciplinary action is appropriate for those

involved.

10. Learning from the Experience

10.1 Where fraud has occurred it is vital that management recognises the need to

examine systems and procedures and make necessary changes to ensure that

similar fraud will not occur.

11. Conclusion

11.1 Whilst the circumstances of fraud will undoubtedly vary it is important that

each individual case is subjected to the same rigorous process of investigation

and redress. The Board values its dedicated and loyal staff but it wishes to

reiterate, however, that it views fraud very seriously and will not hesitate to

take the appropriate action in every case.

APPENDIX TO FPP28



FRAUD RESPONSE PROCEDURE

In the event that allegations of fraud are made under the terms of the University‟s

Fraud Policy or Whistleblowing Policy the following actions must be taken.

1. The Director of Finance and Resources must be informed and shall be responsible

for involving the Internal Audit Service. The Director of Finance and Resources

shall also inform the Vice-Chancellor and the Chair of the Audit Committee, in

writing, of the allegations.

2. The Director of Finance and Resources shall take protective action to minimise the

risk of further loss. This action shall include securing all relevant documents and

potential evidence and correcting any weaknesses in control or supervision.

3. If a member of staff is the subject of allegations the Director of Finance and

Resources must inform the Head of Personnel.

4. Where the allegations involve a member of staff an internal investigation shall be

carried out by the Internal Audit Service, assisted by relevant University staff, to

determine if there is a case to answer. The investigation shall determine one of

three outcomes:-

a) That there is no case to answer.

b) That there is prima facie evidence of error arising from negligence or poor

judgement.

c) That there is prima facie evidence of gross misconduct or dishonesty.

In the case of outcomes (b) and (c) the Head of Personnel shall consider

instigating disciplinary or dismissal proceedings.

5. Where the allegations involve a contractor or other third party an internal

investigation shall be carried out by the Internal Audit Service, assisted by relevant

University staff, to determine if there is a case to answer. The investigation shall

determine one of three outcomes:-

a) That there is no case to answer.

b) That there is prima facie evidence of error arising from negligence or poor

judgement.

c) That there is prima facie evidence of gross misconduct or dishonesty.

In the case of outcomes (ii) or (iii) the Vice-Chancellor shall consider

instigating civil proceedings, refer the matter to the police and/or cancel the

contract.

6. Where there is prima facie evidence of a criminal act no further investigations

shall be carried out without consulting the police who shall be requested to carry

out investigations or advise on the relevant procedures and any implications of the

Police and Criminal Evidence Act (1984). In addition, the Director of Finance and

Resources must inform the external auditor and the Welsh Funding Councils‟

Audit service.

January 2008

FPP29




FPP29 - RETENTION OF DOCUMENTS

N.B. THIS POLICY IS CURRENTLY UNDER REVIEW AS PART OF THE

DEVELOPMENT OF A UNIVERSITY WIDE ARCHIVING POLICY

Staff must be aware that financial documents must be retained in a secure place in

case they are needed for audit, taxation, legal or other enquiries.

Retention periods run from the date of completion of the final audit for the year to

which the documents relate.

Documents marked * are to be shredded at the end of the retention period.

Retention periods are as follows:-

Document Retention Period

Sales Invoice Request Forms and other documentation

supporting invoices raised.

6 years

Sales Invoices. 6 years

Receipts. 6 years

Till „z‟ readings. 2 years

Reviewed aged debtor lists. 1 year

Purchase orders. 6 years

Purchase invoices. 6 years

Remittance Advices 6 years

Quotes for purchases over £1,000. 6 years

Tenders. 6 years

Date stamped sealed tender envelopes. 2 years

Petty cash imprest returns and supporting vouchers 6 years

Journals 6 years

Bank Statements 6 years

Paid cheques (in practice, held by bank) 6 years

Cancelled cheques 2 years

Staff travelling expenses claims 6 years*

Part time lecturing contracts 6 years*

Staff time sheets and other input documents 6 years*

Staff personal record cards Retain permanently

Printouts of pay rates Retain permanently

Appointment/Termination of Employment forms Retain permanently

Inventories. Retain permanently

(on an updated basis)

Internal audit reports. Retain permanently

Budget working papers. 2 years

Formal budget reports. Retain permanently

Monthly budget monitoring reports. 2 years

Summary budget monitoring reports submitted to SMDD. 2 years

Revised estimates working papers. 2 years

Virement approvals. 2 years

Board of Governors committee reports. Retain permanently

Final Accounts working papers file 6 years

Final Accounts. Retain permanently

Year end Symmetry print-outs Retain permanently

External auditor‟s management letter. Retain permanently

Final accounts/forecasts variance analysis. 2 years

Mid term forecasts and working papers. 2 years

5 year financial forecasts and working papers. 6 years

Policies and procedures developed by the University. Retain permanently

Hardship Awards 3 years*

Student Loans Documentation 3 years*

January 2008

FPP30




FPP30 - AUDIT REQUIREMENTS AND RESPONSIBILITIES

The University‟s auditors shall be allowed access to all records and documentation

whether held on paper or on electronic or other media. All staff are required to

respond to requests from auditors for information. The detailed audit requirements are

contained in the Funding Council‟s Audit Code of Practice, copies of which are

available from the Finance Office.

Role and Scope of Internal Audit

1. The University is required to ensure that it has sound systems of financial and

other management controls. These are the systems of controls which help to

ensure:

the University‟s objectives are achieved;

adherence to management‟s policies and directives and compliance with other

relevant procedures, legislation and regulations;

the economical, efficient and effective use of resources;

the safeguarding of the University‟s assets and interests from losses of all

kinds, including those arising from fraud, irregularity or corruption; and

the integrity and reliability of accounting records, other information and data.

2. The scope of the internal audit service embraces the whole internal control system

of the institution.

3. The primary responsibility of internal audit is to provide assurance to the Vice-

Chancellor and to the Governing Body on the adequacy, reliability and

effectiveness of the internal control system.

4. As an integral part of its responsibility to evaluate the internal control system,

internal audit will examine the controls established by management to secure

value for money. In addition to this, the Audit Committee may consider it

appropriate to use the services of the internal auditors to undertake specific value

for money studies. The use of internal audit resources in this way should be

included in the assessment of the University‟s audit needs and in the plans derived

therefrom, to ensure that an adequate basis exists for the provision of assurance on

the internal control system.

5. When planning value for money studies, care must be taken to ensure that the

independence of internal audit is not compromised.

6. Internal audit should also assess the adequacy of the arrangements in place to

prevent and detect irregularities, fraud and corruption, although the primary

responsibility for prevention and detection rests with management.

7. The work of Internal Audit shall not lessen the responsibilities of managers for the

development, implementation, maintenance and review of management control

systems in their work area. University managers should not rely solely on the

results of periodic Internal Audit reviews in order to monitor adherence to

established controls and the achievement of University objectives.

8. The University‟s internal audit service is contracted out. The contract is currently

held by Bentley Jennison. The partner or manager of the firm appointed as Internal

Auditor shall under normal circumstances liaise with the University‟s Director of

Finance and Resources but shall have the discretion to present audit findings

directly to the Vice-Chancellor. The partner or manager of the firm appointed shall

also have direct access, where necessary, to the Chairman of the University‟s

Audit Committee.

Role of External Audit

The University‟s external auditors are the Audit Commission in Wales.

The primary role of external audit is to report on the financial statements of the

University and to carry out such an examination of the financial statements and

underlying records and control systems as is necessary to form an opinion on the

statements. However, the audit of public funds is different from audit in the

commercial sector, since auditors must also be concerned with the requirements of

HEFCW. In particular, their report must state whether funding received from the

HEFCW (and other bodies and restricted funds where appropriate) has been properly

applied for the purpose provided and in accordance with the Financial Memorandum.

Other Audit Agencies

The following agencies also have audit rights in respect of all or part of the

University‟s activities:-

The Welsh Funding Councils‟ Audit Service.

The Auditor-General of the National Assembly for Wales.

The National Audit Office.

H.M. Revenue and Customs

The Verification and Audit Section of the European Social Fund Unit within the

Department for Education and Employment.

Directorates General V and XX of the European Commission.

UCLAF (Unite de la Co-ordination pour la Lutte Anti-Fraude.)

The European Court of Auditors.

January 2008

FPP31




FPP31 – CONTROLLED STATIONERY

1. The following items of the University‟s financial stationery are classified as

controlled stationery and must be serially numbered (either when printed or

automatically when processed by the accounting system), kept in secure conditions

and proper stock control records maintained.

Official orders (computer template).

Sales invoice request pads.

Sales invoices (computer template).

Credit notes (computer template).

Receipt books.

Blank cheques.

2. Bulk stocks of these items must at all times be kept in the Finance Office.

3. Sales invoices and blank cheques must not be issued to budget holders.

4. Issues to budget holders of sales invoice request pads and receipt books (see also

FPP14) shall be sufficient only to cover short term needs and bulk stocks of

controlled stationery must not be held outside the Finance Office.

5. The Finance Office shall maintain records which detail approved issues of

controlled stationery to budget holders. These records must be adequate to ensure

that the serial numbers of items of controlled stationery can easily be linked to the

budget holder to whom they were issued.

6. Budget holders shall keep controlled stationery securely.

7. The Finance Office shall, throughout the year, carry out random checks on

controlled stationery issued in order to identify breaks in the serial numbering.

Where breaks occur the Budget Holder must provide an explanation if requested;

to that end all spoiled and unused items of controlled stationery should be retained

by budget holders in order to identify gaps in the numbering sequence.

January 2008

FPP32




FPP32 – REPORTING OF LOSSES

1. The Director of Finance and Resources is responsible for completing an annual

Certificate of Losses for submission to the Funding Council. The Certificate shall

be signed by the Vice-Chancellor and shall be reported to the Audit Committee.

2. All budget holders are required to report losses to the Director of Finance and

Resources as soon as they are discovered.

3. The Funding Council rules are as follows:-

“In deciding what constitutes a reportable loss the following minimum criteria

represent those incidents which should be considered reportable:

Thefts of monies, material, data, research, computer or other equipment,

other assets;

Unauthorised allocation of work or contracts, disposal of assets, private

work, alteration of input data, alteration of other data;

Individual debts in excess of £10,000 that are written off;

Payment for goods or services not received in part or in full;

Sabotage of equipment (including computer data);

Destruction or suppression of computer data;

Expenditure on projects that are subsequently cancelled;

Premature cancellation of a contract where the full contract price is still

payable; and

Corruption and other conflicts of interest.

Incidents should be reported even where there has been a subsequent full or partial

recovery of the item or money, whether via the perpetrator or insurance.

Losses or potential losses which an institution is currently aware of should be

reported even where information concerning the full nature and/or extent of the

loss is unknown or incomplete. If an investigation is likely or is currently being

undertaken then this should be noted on the certificate. Follow-up information

should be provided where appropriate.

Incidents affecting subsidiary companies, associated companies where there are

any implications for the institution and other related organisations should be

reported in line with the criteria described.

A loss should not be omitted just because it cannot be quantified in money terms

or because the perpetrator is not known. Additionally, a loss involving „non-public

funds‟ should be reported in order that consideration can be given to disseminating

relevant information throughout the sector in accordance with the Audit Code of

Practice.

A reportable loss should be included if it belongs to a prior year, but not preceding

1 April 1993, and has not previously been notified to the Funding Council for

whatever reason.

Trivial losses1 need not be included unless they relate to a senior member of staff,

a governor/council member (or other relevant non-executives), a fundamental

breakdown in control, fraud or corruption. A trivial loss should also be reported if

it is likely to be shown in the annual financial statements. If, however, there is any

doubt as to whether or not a loss is „trivial‟, the incident should be fully reported.”

January 2008

1 The Funding Council does not define „trivial‟. Staff are required to report all losses, no matter how

small, to the Director of Finance and Resources. Ultimately, the financial limit for the exclusion of

trivial losses from the annual certificate will depend on the circumstances of the individual loss and is

therefore left to the discretion of the Vice-Chancellor.

FPP33

RISK MANAGEMENT POLICY

August 2001

Purpose of this document

1. This risk management policy (the policy) forms part of the University‟s internal

control and corporate governance arrangements.

2. The policy explains the University‟s underlying approach to risk management,

and documents the roles and responsibilities of the Board of Governors, the Senior

Management, Deans and Directors Committee (SMDD), and other key parties. It also

outlines key aspects of the risk management process, and identifies the main reporting

procedures.

3. In addition, it describes the process the Board of Governors will use to evaluate

the effectiveness of the University‟s internal control procedures.

Underlying approach to risk management

4. The following key principles outline the University‟s approach to risk

management and internal control:

the Board of Governors has responsibility for overseeing risk management

within the University as a whole

an open and receptive approach to solving risk problems is adopted by the

Board of Governors

the Vice-Chancellor and SMDD support, advise and implement policies

approved by the Board of Governors

the University makes conservative and prudent recognition and disclosure of

the financial and non-financial implications of risks

all Deans and Directors are responsible for encouraging good risk management

practice within their areas of responsibility.

key risk indicators will be identified and closely monitored on a regular basis.

Role of the Board of Governors

5. The Board of Governors has a fundamental role to play in the management of

risk. Its role is to:

a. Set the tone and influence the culture of risk management within the

University. This includes:

determining whether the University is „risk taking‟ or „risk averse‟ as a

whole or on any relevant individual issue

determining what types of risk are acceptable and which are not

setting the standards and expectations of staff with respect to conduct

and probity.

b. determining the appropriate risk appetite or level of exposure for the

University.

c. approving major decisions affecting the University‟s risk profile or

exposure.

d. monitoring the management of significant risks to reduce the likelihood of

unwelcome surprises.

e. satisfying itself that the less significant risks are being actively managed,

with the appropriate controls in place and working effectively.

f. annually reviewing the University‟s approach to risk management and

approving changes or improvements to key elements of its processes and

procedures.

Role of the Senior Management, Deans and Directors Committee (SMDD)

6. Key roles of SMDD are to:

a. Implement policies on risk management and internal control.

b. Identify and evaluate the significant risks faced by the University for

consideration by the Board of Governors.

c. Provide adequate information in a timely manner to the Board of

Governors and its committees on the status of risks and controls.

d. Undertake an annual review of effectiveness of the system of internal

control and provide a report to the Board of Governors.

In practice, SMDD delegates these roles to the Risk Management Group.

Risk management as part of the system of internal control

7. The system of internal control incorporates risk management. This system

encompasses a number of elements that together facilitate an effective and efficient

operation, enabling the University to respond to a variety of operational, financial, and

commercial risks. These elements include:

a. Policies and procedures.

Attached to significant risks are a series of policies that underpin the internal control

process. The policies are set by the Board of Governors and implemented and

communicated by SMDD to staff. Written procedures support the policies where

appropriate.

b. Termly reporting.

Comprehensive termly reporting is designed to monitor key risks and their controls.

Decisions to rectify problems are made at regular meetings of SMDD and the Board

of Governors if appropriate.

c. Business planning and budgeting.

The business planning and budgeting process is used to set objectives, agree action

plans, and allocate resources. Progress towards meeting business plan objectives is

monitored regularly.

d. High level risk framework (significant risks only).

This framework is compiled by the Risk Management Group and helps to facilitate the

identification, assessment and ongoing monitoring of risks significant to the

University. The document is formally appraised annually but emerging risks are

added as required, and improvement actions and risk indicators are monitored

regularly.

e. Faculty risk frameworks.

Deans and Directors develop and use this framework to ensure that significant risks in

their areas of responsibility are identified, assessed and monitored. The document is

formally appraised annually but emerging risks are added as required, and

improvement actions and risk indicators are monitored regularly by business units.

f. Audit Committee.

The Audit Committee is required to report to the Board of Governors on an annual

basis on internal controls and alert governors to any emerging issues. In addition, the

Committee oversees internal audit, external audit and management as required in its

review of internal controls. The Committee is therefore well-placed to provide advice

to the board on the effectiveness of the internal control system, including the

University‟s system for the management of risk.

g. Internal audit programme.

Internal audit is an important element of the internal control process. Apart from its

normal programme of work, internal audit is responsible for aspects of the annual

review of the effectiveness of the internal control system within the organisation.

h. External audit.

External audit provides feedback to the Audit Committee on the operation of the

internal financial controls reviewed as part of the annual audit.

i. Third party reports.

From time to time, the use of external consultants will be necessary in areas such as

health and safety, and human resources. The use of specialist third parties for

consulting and reporting can increase the reliability of the internal control system.

Annual review of effectiveness

8. The Board of Governors is responsible for reviewing the effectiveness of

internal control of the University, based on information provided by SMDD. Its

approach is outlined below.

9. For each significant risk identified, the board will:

review the previous year and examine the University‟s track record on risk

management and internal control

consider the internal and external risk profile of the coming year and consider

if current internal control arrangements are likely to be effective.

10. In making its decision the board will consider the following aspects.

a. Control environment:

the University‟s objectives and its financial and non-financial targets

organisational structure and calibre of the senior management team

culture, approach, and resources with respect to the management of risk

delegation of authority

public reporting.

b. On-going identification and evaluation of significant risks:

timely identification and assessment of significant risks

prioritisation of risks and the allocation of resources to address areas of high

exposure.

c. Information and communication:

quality and timeliness of information on significant risks

time it takes for control breakdowns to be recognised or new risks to be

identified.

d. Monitoring and corrective action:

ability of the University to learn from its problems

commitment and speed with which corrective actions are implemented.

11. SMDD will prepare a report of its review of the effectiveness of the internal

control system annually for consideration by the Board of Governors.

c:Risk Policy.doc/BRL

22/09/2009

FPP34




FPP34 – USE OF THE UNIVERSITY‟S SEAL

1. Where a deed or document requires the University‟s seal, it must be sealed by

the Clerk to the Governors or, in his absence, by the Director of Finance and

Resources.

2. The seal must then be authenticated by:

(a) A member of the Board of Governors – the Chair or, in his/her

absence, the Vice-Chair or, in the absence of both of them a

member of the Board nominated by one of them; and

(b) The Vice-Chancellor or, in his absence, the Deputy Vice-

Chancellor or, in the absence of both of them, a member of the

Senior Management, Deans and Directors Committee nominated by

one of them.

3. A seal book shall be kept in which shall be recorded particulars of all deeds

and documents to which the University seal is affixed.

4. A report shall be submitted to each meeting of the Finance, Planning and

Monitoring Sub-Committee recording the deeds and documents to which the

University seal has been affixed since the last meeting of the Committee.

January 2008

ANNEX A

FINANCIAL REGULATIONS

JANUARY 2008

CONTENTS

PAGE

1. BACKGROUND 5

2. STATUS OF FINANCIAL REGULATIONS 6

3. FINANCIAL CONTROL 7

THE GOVERNING BODY

COMMITTEE STRUCTURE

Finance, Planning and Monitoring Committee


Audit Committee

AUDIT REQUIREMENTS 8

External audit 9

Internal audit

Other auditors

RESPONSIBILITIES 10

The Vice-Chancellor

The Director of Finance and Resources

Heads of department

BUDGETING 11

Resource allocation

Budget preparation

Capital programmes

Financial planning 12

Budgetary control

Virement 13

Treatment of year end balances

ACCOUNTING POLICIES 14

Basis of accounting

Format of the accounts

Basis of consolidation

ACCOUNTING RETURNS

ACCOUNTING RECORDS 15

4. INCOME AND BANKING 16

GENERAL

APPOINTMENT OF BANKERS

BANKING ARRANGEMENTS

CASH RECEIPTS 17

THE COLLECTION OF DEBTS

STUDENT FEES 18

GIFTS, BENEFACTIONS AND DONATIONS

SECURITY OF DOCUMENTS

STOCKS AND STORES

5. RESEARCH GRANTS AND CONTRACTS 19

GENERAL

ADDITIONAL PAYMENTS TO STAFF 20

PRIVATE CONSULTANCIES AND OTHER PAID WORK

INTELLECTUAL PROPERTY RIGHTS AND PATENTS 21

General

Patents

Intellectual property rights

6. EXPENDITURE 22

GENERAL

ADDITIONAL PAYMENTS TO STAFF

AUTHORITIES

PETTY CASH 23

PURCHASE ORDERS

TENDERING 24

CONTRACTS

EU REGULATIONS

PAYMENT OF INVOICES 25/26

7. SALARIES AND WAGES 27

GENERAL

SUPERANNUATION

TRAVEL, SUBSISTENCE AND OTHER ALLOWANCES 28

8. ASSETS 29

LAND, BUILDINGS, FIXED PLANT AND MACHINERY

INVENTORIES

ASSET DISPOSAL

TREASURY MANAGEMENT (Investments and Borrowings) 30

9. OTHER 31

COMPANIES

RISK MANAGEMENT

TAXATION 32

SECURITY

SHORT COURSES AND SERVICES RENDERED 33

CODE OF CONDUCT FOR STAFF

HOSPITALITY 34

STUDENTS‟ UNION

USE OF THE UNIVERSITY‟S SEAL

TRUST FUNDS 35

10. APPENDICES

Appendix A - Committee Structure

Appendix B - Responsibilities of Finance, Planning and Monitoring Committee

Appendix C - Audit Committee: Duties

Appendix D - Internal Audit: Responsibilities

Appendix E - Structure of the Finance Function

Appendix F - Main Points Included in the University‟s Code of Tendering

Practice

Appendix G - Contents of „Conditions of Contract for the Purchase of Goods‟

Appendix H - Budget Holders

FINANCIAL REGULATIONS FOR SWANSEA

METROPOLITAN UNIVERSITY

1. BACKGROUND

The University is a statutory Higher Education Corporation. Its structure of

governance is laid down in the instruments of its incorporation (Instrument and

Articles of Government). The Instrument and Articles of Government can only be

amended by the Privy Council. The University is accountable through its Governing

Body which has ultimate responsibility for the University‟s management and

administration.

The University has charitable status for tax purposes.

The financial memorandum between the Funding Council and the University sets out

the terms and conditions on which grant is made. The Governing Body is responsible

for ensuring that conditions of grant are met. As part of this process the University

must adhere to the Funding Council‟s audit code of practice which requires it to have

sound systems of financial and management control. The financial regulations of the

University form part of this overall system of accountability.

2. STATUS OF FINANCIAL

REGULATIONS

This document sets out the University‟s financial regulations. It translates into

practical guidance the University‟s broad policies relating to financial control. This

document was approved by the Governing Body. It applies to the University and all its

subsidiary undertakings.

These financial regulations are subordinate to the University‟s Instrument and Articles

of Government and to any restrictions contained within the University‟s financial

memorandum with the Funding Council and the Funding Council‟s audit code of

practice.

Compliance with the financial regulations is compulsory for all staff connected with

the University. A member of staff who fails to comply with the financial regulations

may be subject to disciplinary action under the University‟s disciplinary policy. Any

such breach will be notified to the Governing Body through the Audit Committee. It is

the responsibility of heads of departments to ensure that their staff are made aware of

the existence and content of the University‟s financial regulations and that an adequate

number of copies are available for reference within their department.

The Finance, Planning and Monitoring Committee is responsible for maintaining a

continuous review of the financial regulations and advising the Governing Body of

any additions or changes necessary.

The University‟s detailed financial procedures set out precisely how the regulations

will be implemented and are contained in a separate manual which is available in all

departments.

3. FINANCIAL CONTROL

THE GOVERNING BODY The Governing Body is responsible for the strategy and solvency of the University. Its

financial responsibilities are to:

ensure the solvency of the University

safeguard the University‟s assets

ensure the effective and efficient use of resources

ensure that the funds provided by the Funding Council are used in accordance

with the terms and conditions specified in the University‟s financial memorandum

with the Funding Council

ensure that financial control systems are in place and are working effectively

ensure that the University complies with the Funding Council‟s audit code of

practice

approve the University‟s strategic plan

approve annual estimates of income and expenditure and to approve the annual

accounts

appoint the University‟s internal and external auditors.

COMMITTEE STRUCTURE

The Governing Body has ultimate responsibility for the University‟s finances, but

delegates this to the committees detailed below. These committees are accountable to

the Governing Body. (A schedule outlining the committee structure is included at

Appendix A).


Monitoring of the University‟s financial position and financial control systems is

undertaken by Finance, Planning and Monitoring Committee. The committee will

examine annual estimates and accounts and recommend their approval to the

Governing Body. It will ensure that short term budgets are in line with agreed longer

term plans and that they are followed. It will consider any other matters relevant to

the financial duties of the Governing Body and make recommendations accordingly.

The committee will also ensure that the Governing Body has adequate information to

enable it to discharge its financial responsibilities. A more detailed list of the

responsibilities of Finance, Planning and Monitoring Committee is shown at

Appendix B.

Audit Committee

Institutions are required by their financial memorandum with the Funding Council and

by the Funding Council‟s audit code of practice to appoint an Audit Committee. The

committee is independent, advisory and reports to the Governing Body. It has the

right of access to obtain all the information it considers necessary and to consult

directly with the internal and external auditors. The committee is responsible for

identifying and approving appropriate performance measures for internal and external

audit and for monitoring their performance. It must also satisfy itself that satisfactory

arrangements are in place to promote economy, efficiency and effectiveness.

The duties of the Audit Committee are set out at Appendix C.

The audit requirements of the University are set out in the Funding Council‟s audit

code of practice.

AUDIT REQUIREMENTS External auditors and internal auditors shall have authority to:

access University premises at reasonable times

access all assets, records, documents and correspondence relating to any financial

and other transactions of the University

require and receive such explanations as are necessary concerning any matter

under examination

require any employee of the University to account for cash, stores or any other

University property under his/her control.

access records belonging to third parties, such as contractors when required.

Whenever any matter arises which involves, or is thought to involve, irregularities or

fraud concerning cash, stores or other property of the University or any other

suspected irregularity in the exercise of the activities of the University, the head of

department concerned shall notify the Director of Finance and Resources who will

take such steps as he/she considers necessary by way of investigation and involvement

of internal audit. Where necessary the Funding Council shall be advised of the matter

and early consideration should be given to the need to involve the police in the

inquiry.

The Director of Finance and Resources is responsible for drawing up a timetable for

final accounts purposes and will advise staff and the external auditors accordingly.

Following consideration by Finance, Planning and Monitoring Committee, the

accounts should be reviewed by Audit Committee. On the recommendation of

Finance and Audit Committees they will be submitted to the Governing Body for

approval.

External Audit

The appointment of external auditors will take place annually and is the responsibility

of the Governing Body. Consideration shall be given to subjecting the contract to

competitive tendering every five years. The Governing Body will be advised by Audit

Committee.

The primary role of external audit is to report on the University‟s financial statements

and to carry out such examination of the statements and underlying records and

control systems as are necessary to reach their opinion on the statements and to report

on the appropriate use of funds. Their duties will be in accordance with advice set out

in the Funding Council‟s audit code of practice and the Auditing Practices Board‟s

auditing standards.

Internal Audit

The internal auditor is appointed by the Governing Body on the recommendation of

the Audit Committee.

The University‟s financial memorandum with the Funding Council requires that it has

an effective internal audit function. The main responsibility of internal audit is to

provide the Governing Body, the Vice-Chancellor and senior management with

assurances on the adequacy of the internal control system.

The internal audit service remains independent in its planning and operation and has

direct access to the Governing Body, Vice-Chancellor and chairman of Audit

Committee.

The formal responsibilities of internal audit are detailed at Appendix D. The internal

auditor will also comply with the Auditing Practices Board‟s Auditing Guideline

Guidance for Internal Auditors.

Other Auditors

The University may, from time to time, be subject to audit or investigation by external

bodies such as the Funding Council, National Audit Office, European Court of

Auditors, HM Customs and Excise and the Inland Revenue. They have the same

rights of access as external and internal auditors.

RESPONSIBILITIES The Vice-Chancellor

The Vice-Chancellor is the University‟s designated accounting officer and is

responsible for the financial administration of the University‟s affairs. As the

designated officer the Vice-Chancellor may be required to justify any of the

University‟s financial matters to the Public Accounts Committee at the House of

Commons.

The Director of Finance and Resources

Day to day financial administration is controlled by the Director of Finance and

Resources. The Director of Finance and Resources is responsible to the Vice-

Chancellor for:

preparing annual capital and revenue budgets and financial plans

preparing accounts, management information, monitoring and control of

expenditure against budgets and all financial operations

preparing the University‟s annual accounts and other financial statements and

accounts which the University is required to submit to other authorities

ensuring that the University maintains satisfactory financial systems

providing professional advice on all matters relating to financial policies and

procedures.

A diagram indicating the structure of the finance department including all sections,

staff and lines of responsibility is shown at Appendix E.

Budget Holders

A list of approved budget holders is provided as Appendix H. The Director of Finance

and Resources has authority to add to or delete from this list.

Budget Holders are responsible to the Vice-Chancellor for financial management in

their own areas. They are advised by the Director of Finance and Resources in

executing their financial duties. The Director of Finance and Resources will also

supervise and approve the financial systems operating within their departments

including the form in which accounts and financial records are kept.

Budget Holders are responsible for establishing and maintaining clear lines of

responsibility within their department for all financial matters.

Where resources are devolved to budget holders, they are accountable to their head of

department for their own budget.

BUDGETING Resource Allocation

Resources are allocated annually by the Governing Body on the recommendation of

the Vice-Chancellor, as advised by the Resources Group.

Budget holders are responsible for the economic, effective and efficient use of

resources allocated to them.

Budget Preparation

The Director of Finance and Resources is responsible for preparing annually a revenue

budget and capital programme for consideration by the Vice-Chancellor and by

Finance, Planning and Monitoring Committee before submission to the Governing

Body. The budget should also include monthly cash flow forecasts for the year end

and a projected year end balance sheet. The Director of Finance and Resources must

ensure that detailed budgets are prepared in order to support the resource allocation

process and that these are communicated to budget holders as soon as possible

following their approval by the Governing Body.

During the year, the Director of Finance and Resources is responsible for submitting

revised budgets to the Vice-Chancellor for consideration before submission to the

Finance, Planning and Monitoring Committee for approval.

Capital Programmes

For accounting purposes, capital expenditure is defined as expenditure on an asset

costing more than £5,000 and having a useful life of more than one year.

Capital expenditure on land, buildings, furniture and associated costs can only be

considered as part of the capital programme approved by the Governing Body.

The Director of Finance and Resources is responsible for providing regular statements

concerning all capital expenditure to Finance, Planning and Monitoring Committee

for monitoring purposes.

Proposed capital projects should be supported by:

a statement which demonstrates the project‟s consistency with the strategic plans

and estates strategy approved by the Governing Body

an initial budget for the project for submission to Finance, Planning and

Monitoring Committee. The budget should include a breakdown of costs

including professional fees, VAT and funding sources

a financial evaluation of the plans together with their impact on revenue plus

advice on the impact of alternative plans

an investment appraisal in an approved format which complies with Funding

Council guidance on option and investment appraisal

a demonstration of compliance with normal tendering procedures and Funding

Council regulations

a cash-flow forecast.

Following completion of a capital project, a final report should be submitted to

Finance, Planning and Monitoring Committee and/or Estates Committee recording

actual expenditure against budget and reconciling funding arrangements where a

variance has occurred.

Financial Planning

The Director of Finance and Resources is responsible for preparing annually a rolling

three five year financial plan for approval by the Governing Body on the

recommendation of the Vice-Chancellor and for preparing financial forecasts for

submission to the Funding Council. Financial plans should be consistent with the

strategic plans and estates strategy approved by the Governing Body.

Budgetary Control

The control of income and expenditure within an agreed budget is the responsibility of

the designated budget holder who must ensure that day to day monitoring is

undertaken effectively. Budget holders are responsible to their head of department for

the income and expenditure appropriate to their budget. The budget holder will be

assisted in this duty by management information provided by the Director of Finance

and Resources. The types of management information available to different levels of

management are described in the University‟s detailed financial procedures together

with the timing at which they can be expected.

Significant departures from agreed budgetary targets must be reported immediately to

the Director of Finance and Resources by the budget holder concerned and, if

necessary, corrective action taken.

The Director of Finance and Resources is responsible for supplying budget monitoring

and management accounting information to Finance, Planning and Monitoring

Committee on a regular basis.

Virement

Where a budget holder is responsible for more than one budget, virement is permitted

up to 10% of the budget from which virement is sought, except that virement of

staffing budgets requires the additional approval of the Vice-Chancellor.

Virement between budgets held by different budget holders is permitted up to 10% of

the budget from which virement is sought, with the written approval of the

transferring budget holder (again, subject the the Vice-Chancellor‟s approval in the

case of staffing budgets).

The Director of Finance and Resources is responsible for submitting requests for

virement of resources above 10% to the Vice-Chancellor for consideration. Virement,

where approved, shall be noted in revised budgets before submission to the Finance,

Planning and Monitoring Committee for approval.

Treatment of Year End Balances

At year end, budget holders will not automatically have the authority to carry forward

a balance on their budget to the following year. Specific departmental consumables

and equipment account balances may be carried forward with the approval of the

Vice-Chancellor.

ACCOUNTING POLICIES

Basis of Accounting

The consolidated financial statements are prepared on the historical cost basis of

accounting and in accordance with applicable accounting standards.

Format of the Accounts

The accounts are prepared for the financial year ending 31 July, in accordance with

the Statement of Recommended Practice for Accounting in Higher Education

Institutions as required by the Funding Council (and in accordance with the provisions

of the Companies Act 1985, as amended by the Companies Act 1989, where relevant)

Basis of Consolidation

The consolidated financial statements consolidate the financial statements of the

University and all its subsidiary undertakings for the financial year.

ACCOUNTING RETURNS The Director of Finance and Resources is responsible for consolidating and

despatching financial returns and other periodic financial reports to the Funding

Council and other agencies as required. The Director of Finance and Resources is

also responsible for ensuring that all grants notified by the Funding Council and other

bodies are received.

ACCOUNTING RECORDS The Director of Finance and Resources is responsible for the retention of financial

documents. These should be kept in a form acceptable to the relevant authorities.

The University is required by law to retain prime documents for six years. These

include:

official orders

paid invoices

accounts raised

bank statements

copies of receipts

paid cheques (in practice held by bank)

part time lecturer contracts

complete paper record transactions for each year from the computerised

accounting system.

Additionally, for auditing and other purposes, other financial documents should be

retained for three years.

4. INCOME AND BANKING

GENERAL The Director of Finance and Resources is responsible for ensuring that appropriate

procedures are in operation to enable the University to receive all income to which it

is entitled. All receipt forms, invoices, tickets or other official documents in use must

have the approval of the Director of Finance and Resources.

Levels of charges for contract research, services rendered, goods supplied and rents

and lettings are determined by procedures approved by the Vice-Chancellor and are

approved by the Governing Body.

The Director of Finance and Resources is responsible for the prompt collection,

security and banking of all income received.

The Director of Finance and Resources is responsible for ensuring that all grants

notified by the Funding Council and other bodies are received and appropriately

recorded in the University‟s accounts.

The Director of Finance and Resources is responsible for ensuring that all claims for

funds, including research grants and contracts, are made by the due date.

APPOINTMENT OF BANKERS The Governing Body is responsible for the appointment of the University‟s bankers on

the recommendation of Finance, Planning and Monitoring Committee. The

appointment shall normally be for a period of five years after which consideration

shall be given by Finance, Planning and Monitoring Committee to competitively

tendering the service.

BANKING ARRANGEMENTS The Director of Finance and Resources is responsible for, on behalf of Finance,

Planning and Monitoring Committee, liaising with the University‟s bankers in relation

to the University‟s bank accounts and the issue of cheques. All cheques shall be

ordered on the authority of the Director of Finance and Resources who shall make

proper arrangements for their safe custody.

Only the Director of Finance and Resources may open or close a bank account for

dealing with the University‟s funds. All bank accounts shall be in the name of the

University or one of its subsidiary companies.

All cheques drawn on behalf of the University must be signed in the form approved by

Finance, Planning and Monitoring Committee.

The Director of Finance and Resources is responsible for ensuring that all bank

accounts are subject to regular reconciliation and that large or unusual items are

investigated as appropriate.

CASH RECEIPTS All monies received within departments from whatever source must be recorded by

the department on a daily basis together with the form in which they were received.

Money must be paid to the cashier and custody of all cash holdings must comply with

the requirements of the University‟s insurers.

No deductions may be made from any cash collected on behalf of the University prior

to paying into the cashier.

Personal or other cheques must not be cashed out of money received on behalf of the

University.

THE COLLECTION OF DEBTS

The Director of Finance and Resources should ensure that:

debtors invoices are raised promptly in respect of income due to the University

debtors are raised on official University invoices

swift and effective action is taken to collect overdue debts in accordance with

procedures (detailed in the financial procedures)

outstanding debts are monitored and reports are prepared for managers.

The Director of Finance and Resources is responsible for implementing credit

arrangements and indicating a period in which different types of invoice must be paid.

These were approved by Finance, Planning and Monitoring Committee. Any

subsequent changes must be submitted to Finance, Planning and Monitoring

Committee for approval.

Requests to write-off single debts in excess of £1,500 must be referred in writing to

the Director of Finance and Resources for submission to Finance, Planning and

Monitoring Committee for consideration. Debts below this level may be written off

with the permission of the Vice-Chancellor.

STUDENT FEES The procedures for collecting tuition and residence fees must be approved by the

Director of Finance and Resources. He/she is responsible for ensuring that all student

fees due to the University are received.

Any student who has not paid an account for fees or any other item owing to the

University shall not be awarded a degree or any diploma, certificate and qualification

from the University until all outstanding debts have been cleared. Such students may

be prevented from re-enrolling at the University and from using any of the

University‟s facilities.

GIFTS, BENEFACTIONS AND DONATIONS The Director of Finance and Resources is responsible for maintaining financial

records in respect of gifts, benefactions and donations made to the University and

initiating claims for recovery of tax where appropriate.

SECURITY OF DOCUMENTS The Vice-Chancellor is responsible for the safekeeping of official and legal

documents relating to the University. Signed copies of deeds, leases, agreements and

contracts must, therefore, be forwarded to the Vice-Chancellor. All such documents

shall be held in an appropriately secure, fireproof location and copies held at a

separate location.

STOCKS AND STORES

Budget holders are responsible for establishing adequate arrangements for the custody

and control of stocks and stores within their departments. The systems used for stores

accounting in departments must have the approval of the Director of Finance and

Resources.

Heads of departments are responsible for ensuring that regular inspections and stock

checks are carried out. Stocks and stores of a hazardous nature should be subject to

appropriate security checks.

Those budget holders whose stocks require valuation in the balance sheet must ensure

that the stock-taking procedures in place have the approval of the Director of Finance

and Resources and that instructions to appropriate staff within their departments are

issued in accordance with advice contained in the University‟s detailed financial

procedures.

5. RESEARCH GRANTS AND

CONTRACTS

GENERAL

Research can be defined as original investigation, undertaken to gain new knowledge

and understanding, which may be directed towards a specific aim or objective.

The term „research grant‟ is restricted to research projects funded by the UK research

councils, charities and the higher education Funding Councils.

All other externally financed research projects are classified as „research contracts‟.

Where approaches are to be made to outside bodies for support for research projects

or where contracts are to be undertaken on behalf of such bodies, it is the

responsibility of the budget holder to ensure that the financial implications have been

appraised by the Director of Finance and Resources.

The Director of Finance and Resources is responsible for examining every formal

application for grant and shall ensure that there is adequate provision of resources to

meet all commitments. The Director of Finance and Resources should ensure that the

full cost of research contracts is established. The research agreement must be in line

with the University‟s policy with regard to indirect costs and other expenses and take

account of different procedures for the pricing of research projects depending on the

nature of the funding body.

Research grants and contracts shall be accepted on behalf of the University by the

Vice-Chancellor.

The Director of Finance and Resources shall maintain all financial records relating to

research grants and contracts and shall initiate all claims for reimbursement from

sponsoring bodies by the due date.

Each grant or contract will have a named supervisor or grant holder and will be

assigned to a specific budget centre.

Control of pay and non-pay expenditure will be contained within the budget centre.

The head of the budget centre may delegate day to day control of the account to a

supervisor or grant holder, but any overspend or under recovery of overheads is to be

the clear responsibility of the budget centre with any loss being a charge on

departmental funds.

ADDITIONAL PAYMENTS TO STAFF Any proposal which involves additional payments to members of staff should be

supported by a schedule of names and values and must be approved by the head of

department, and in the case of a head of department, the Vice-Chancellor. Such

additional payments must be processed through the University‟s payroll system.

PRIVATE CONSULTANCIES AND OTHER PAID WORK

Unless otherwise stated in a member of staff‟s contract:

outside consultancies or other paid work must not be accepted without the consent

of the Vice-Chancellor.

applications for permission to undertake work as a purely private activity must be

submitted to the Vice-Chancellor, and include the following information:

– the name of the member(s) of staff concerned

– title of the project and a brief description of the work involved

– the proposed start date and duration of the work

– full details of any University resources required (for the calculation of the

full economic cost)

– an undertaking that the work will not interfere with the teaching and normal

University duties of the member(s) of staff concerned.

INTELLECTUAL PROPERTY RIGHTS AND PATENTS

General

Certain activities undertaken within the University including research and consultancy

may give rise to ideas, designs and inventions which may be patentable. These are

collectively known as intellectual property.

Patents

Finance, Planning and Monitoring Committee is responsible for establishing

procedures to deal with any patents accruing to the University from inventions and

discoveries made by staff and students in the course of their research.

Intellectual Property Rights

In the event of the University deciding to become involved in the commercial

exploitation of inventions and research, the matter should then proceed in accordance

with the intellectual property procedures issued by the University and contained in the

University‟s detailed financial procedures.

6. EXPENDITURE

GENERAL

The Director of Finance and Resources is responsible for making payments to

suppliers of goods and services to the University.

AUTHORITIES

The budget holder is responsible for purchases within his/her department. Purchasing

authority may be delegated to named individuals (or budget holders) within the

department.

The Director of Finance and Resources shall maintain a register of authorised

signatories. Any changes to the authorities to sign must be notified to the Director of

Finance and Resources immediately. Budget holders must supply the Director of

Finance and Resources with specimen signatures of those authorised to certify

invoices for payment.

Budget holders are not authorised to commit the University to expenditure without

first reserving sufficient funds to meet the purchase cost.

Budget holders may be required to provide explanations regarding the need for and

purpose of expenditure before an order is released by the Finance Department.

Expenditure on a single item in excess of £1,000 must be supported by three

competitive quotes.(Except for building works where the limit shall be £5,000 subject

to the work being carried out by an University approved contractor.) Where supply

contracts arranged by the various higher education purchasing consortia are utilised

this requirement may be waived.

Expenditure on any single item in excess of £10,000 shall require the approval of the

Vice-Chancellor.

Expenditure on a single item of plant or equipment in excess of £50,000, or on

building works or service contracts in excess of £100,000 shall require the approval of

the Finance, Planning and Monitoring Committee.

PETTY CASH

Where a single item is for less than £25 it may be paid from petty cash if necessary. It

must be supported by receipts or vouchers where available. Petty cash must not be

used as a substitute for travel or subsistence claims or used for payment for staff time.

The Director of Finance and Resources shall make available such imprests as are

considered necessary for the disbursement of petty cash expenses.

Requisitions for reimbursement must be sent to the Director of Finance and

Resources, together with appropriate receipts or vouchers, before the total amount

held has been expended, in order to retain a working balance pending receipt of the

amount claimed.

The member of staff granted a float is personally responsible for its safe keeping. The

petty cash box must be kept locked in a secure place in compliance with the

requirements of the University‟s insurers when not in use, and will be subject to

periodic checks by the head of department or another person nominated by him or her.

Standard University petty cash sheets are supplied by the Director of Finance and

Resources and must be used for recording all imprest accounts.

At the end of the financial year a certificate of the balances held should be completed

by the member of staff responsible for the float and counter signed by the head of

department.

PURCHASE ORDERS The ordering of goods and services shall be in accordance with the University‟s

detailed financial procedures/purchasing policies.

Official University orders must be used for the purchase of all goods or services,

except those made using petty cash.

Verbal orders by telephone or other unofficial methods are not permitted.

It is the responsibility of the Director of Finance and Resources to ensure that all

purchase orders refer to the University‟s conditions of contract (see Appendix G).

TENDERING

Subject to special rules imposed by funding bodies, the University‟s tendering

procedures, contained in the University‟s code of tendering practice, are applicable to:

procurement of services and buildings in excess of £20,000

purchases where the estimated cost is in excess of £20,000

The main points covered by this code are described at Appendix F.

CONTRACTS Building contracts are the responsibility of the Vice-Chancellor and the Finance,

Planning and Monitoring Committee and are administered by the University‟s

Director of Estates and Buildings.

Proposals will normally be initiated by the Director of Estates and Buildings in respect

of planned replacements, general improvement schemes, space planning or in

response to requests from departments.

Consultants may be appointed if the project, as determined by the Vice-Chancellor, is

too large or too specialised for Estates Department resources. Appointments shall be

subject to tendering and other procedures where appropriate.

Proposals shall be presented in the form of costings or investment appraisals as

appropriate. Investment appraisals should comply with appropriate Funding Council

guidance.

Following consideration by the Vice-Chancellor and Finance, Planning and

Monitoring Committee and approval by the Governing Body, submissions should be

forwarded to the Funding Council where appropriate. If the required agreement is

secured by the Funding Council, Funding Council procedural rules should be

followed. Funding Council guidance on best practice should be followed even when

Funding Council approval is not required.

All contracts will attempt to ensure best value for money.

Conditions of contract for the purchase of goods will be followed as described in the

University‟s detailed financial procedures. The main points are described at

Appendix G.

EU REGULATIONS

The Director of Finance and Resources is responsible for ensuring that the University

complies with its legal obligations concerning European procurement legislation. EU

procurement regulations apply to written contracts for all forms of procurement or hire

(whether or not hire purchase) with a total value exceeding a threshold value.

(The thresholds are updated annually see procedure FPP7 for details.)

A breach of these regulations is actionable by a supplier or potential supplier.

It is the responsibility of the budget holder to ensure that their members of staff

comply by notifying the Director of Finance and Resources of any purchases likely to

exceed the thresholds noted above. This will need to be done well in advance in order

to permit advertisements in official journals, etc.

PAYMENT OF INVOICES The procedures for making all payments shall be in a form specified by the Director of

Finance and Resources.

The Director of Finance and Resources is responsible for deciding the most

appropriate method of payment for categories of invoice. Payments to UK suppliers

will normally be made by computer cheques produced weekly. In exceptional

circumstances the Director of Finance and Resources will prepare cheques manually

for urgent payments.

Suppliers should be instructed by the budget holder to submit invoices for goods or

services to the finance office.

Payment will normally be made by the end of the month following the month in which

the invoice is received, but normally within 28 days.

Budget holders are responsible for ensuring that expenditure within their department

does not exceed funds available.

Payments will only be made by the Director of Finance and Resources against

invoices which have been certified for payment by the appropriate budget holder.

Certification of an invoice will ensure that:

the goods have been received, examined and approved with regard to quality and

quantity, or that services rendered or work done is satisfactory

where appropriate, it is matched to the order

invoice details (quantity, price, discount) are correct

the invoice is arithmetically correct

the invoice has not previously been passed for payment

where appropriate, an entry has been made on a stores record or departmental

inventory

an appropriate cost centre is quoted. This must be one of the cost centre codes

included in the budget holder‟s areas of responsibility and must correspond with

the types of goods or service described on the invoice.

Invoices must be passed to the finance department as soon as they have been certified.

Care must be taken by the budget holder to ensure that discounts receivable are

obtained.

7. SALARIES AND WAGES

GENERAL

The Head of Personnel and the Director of Finance and Resources are jointly

responsible for all payments of salaries and wages to all staff including payments for

overtime or services rendered. All time sheets and other pay documents, including

those relating to fees payable to external examiners, visiting lecturers or researchers,

will be in a form prescribed or approved by the Head of Personnel and the Director of


All University staff will be appointed to the salary scales approved by the Governing

Body and in accordance with appropriate conditions of service. All letters of

appointment must be issued by the personnel office. The Head of Personnel will be

responsible for keeping the Director of Finance and Resources informed of all matters

relating to personnel for financial control and budgetary purposes.

In particular these include:

appointments, resignations, dismissals, supervisions, secondments and transfers

changes in remuneration other than normal increments and pay awards

All casual and part-time employees will be included on the payroll.

The Head of Personnel and the Director of Finance and Resources shall be responsible

for keeping all records relating to payroll including those of a statutory nature.

All payments must be made in accordance with the University‟s detailed payroll

financial procedures and comply with Inland Revenue regulations.

SUPERANNUATION

The Governing Body is responsible for undertaking the role of employer in relation to

appropriate pension arrangements for employees.

The Head of Personnel and the Director of Finance and Resources are responsible for

day to day superannuation matters including:

paying of contributions to various authorised superannuation schemes

preparing the annual return to various superannuation schemes

liaising with the University‟s pension fund managers.

TRAVEL, SUBSISTENCE AND OTHER ALLOWANCES

All claims for payment of subsistence allowances, travelling and incidental expenses

shall be completed in a form approved by the Director of Finance and Resources.

Claims by members of staff must be certified by their head of department and the

Deputy Vice-Chancellor. The certification by the head of department shall be taken to

mean that the journeys were authorised, the expenses properly and necessarily

incurred and that the allowances are properly payable by the University.

8. ASSETS

LAND, BUILDINGS, FIXED PLANT AND MACHINERY The purchase, lease or rent of land or buildings or fixed plant can only be undertaken

with authority from the Governing Body and with reference to Funding Council

requirements where exchequer funded assets or exchequer funds are involved.

The Director of Finance and Resources is responsible for maintaining the University‟s

register of land, buildings, fixed plant and machinery and for ensuring that these are

updated on an annual basis in line with the approved accounting policies.

INVENTORIES

In addition to the asset register, heads of departments are responsible for maintaining

inventories for all plant, equipment and furniture and stores in their departments with

a value in excess of £350.

The inventory must include items donated or held on trust.

Where approved by the Finance, Planning and Monitoring Committee, centralised

automated inventories may be introduced.

Inventories must be checked at least annually and retained in the form prescribed by

the Director of Finance and Resources as described in the University‟s detailed

financial procedures.

ASSET DISPOSAL

Disposal of equipment and furniture must be in accordance with procedures agreed by

Finance, Planning and Monitoring Committee and contained in the University‟s

detailed financial procedures.

Disposal of land and buildings must only take place with the authorisation of the

Governing Body. Funding Council consent may also be required if exchequer funds

were involved in the acquisition of the asset.

TREASURY MANAGEMENT (Investments and

Borrowings)

Finance, Planning and Monitoring Committee is responsible for approving a treasury

management policy statement (based on CIPFA‟s Treasury Management in Higher

Education: A Statement of Best Practice) setting out a strategy and policies for cash

management, long term investments and borrowings. Finance, Planning and

Monitoring Committee has a responsibility to ensure implementation, monitoring and

review of such policies.

All executive decisions concerning borrowing, investment or financing (within policy

parameters) shall be delegated to the Director of Finance and Resources and an

appropriate reporting system set up. All borrowing shall be undertaken in the name of

the University and shall conform to any relevant Funding Council requirements. The

Director of Finance and Resources and his/her staff are required to act in accordance

with CIPFA‟s statement of best practice.

The Director of Finance and Resources will report to Finance, Planning and

Monitoring Committee termly in each financial year on the activities of the treasury

management operation and on the exercise of treasury management powers delegated

to him/her.

CIPFA = The Chartered University of Public Finance and Accountancy

9. OTHER

COMPANIES

In certain circumstances it may be advantageous to the University to establish a

company to undertake services on its behalf.

The Governing Body is responsible for approving the establishment of companies and

the procedure to be followed in order to do so. The process involved in forming a

company and arrangements for monitoring and reporting on the activities of subsidiary

undertakings are documented in the University‟s financial procedures.

It is the responsibility of the Governing Body to establish the shareholding

arrangements and appoint directors of companies wholly or partly owned by the

University.

The nominated officer of companies where the University is the majority shareholder

must submit, via Finance, Planning and Monitoring Committee, an annual report to

the Governing Body.

RISK MANAGEMENT The Vice-Chancellor and the Director of Finance and Resources are responsible for

developing a risk management strategy in order to identify the risks facing the

University and types of protection required to cover these risks. The strategy should

include cover important potential liabilities such as terrorism and be sufficient to meet

any potential risk to all assets. This will be considered and approved by Finance,

Planning and Monitoring Committee on an annual basis.

The Director of Finance and Resources is responsible for effecting insurance cover as

determined by Finance, Planning and Monitoring Committee. The Director of Finance

and Resources is responsible for negotiating claims and maintaining the necessary

records. He/she will also deal with the University‟s insurers and advisers about

specific insurance problems.

Heads of departments must ensure that any agreements negotiated within their

departments with external bodies cover any legal liabilities to which the University

may be exposed. The advice of the Director of Finance and Resources should be

sought to ensure that this is the case. Heads of departments must give prompt

notification to the Director of Finance and Resources of any potential new risks and

additional property and equipment which may require insurance and any alterations

affecting existing risks.

Heads of department must advise the Director of Finance and Resources, immediately,

of any event which may give rise to an insurance claim. The Director of Finance and

Resources will notify the University‟s insurers and, if appropriate, prepare a claim in

conjunction with the head of department for transmission to the insurers.

The Director of Finance and Resources will keep a register of all insurances effected

by the University and the property and risks covered.

The Director of Estates and Buildings is responsible for keeping suitable records of

plant which is subject to inspection by an insurance company and for ensuring that

inspection is carried out in the periods prescribed.

All staff using their own vehicles on behalf of the University shall maintain

appropriate insurance cover for business use.

TAXATION

The Director of Finance and Resources is responsible for advising heads of

departments in the light of guidance issued by the appropriate bodies and relevant

legislation as it applies, on all taxation issues, to the University. Therefore the

Director of Finance and Resources will issue instructions to departments on

compliance with statutory requirements including those concerning VAT, PAYE,

national insurance, corporation tax and import duty.

The Director of Finance and Resources is responsible for maintaining the University‟s

tax records, making all tax payments, receiving tax credits and submitting tax returns

by their due date as appropriate.

SECURITY Heads of department are responsible for maintaining proper security at all times for all

buildings, stock, stores, furniture, cash, etc under his or her control. He/she shall

consult the Director of Finance and Resources in any case where security is thought to

be defective or where it is considered that special security arrangements may be

needed.

Keys to safes or other similar containers are to be carried with the person responsible

at all times. The loss of such keys must be reported to the Director of Finance and

Resources immediately.

The Head of Computer Services shall be responsible for maintaining proper security

and privacy of information held on computer. The restriction of access to computer

areas to authorised persons only by the use of passwords are the types of security

control available that will be used. Information relating to individuals held on

computer will be subject to the provisions of the Data Protection Act. A data

protection officer shall be nominated to ensure compliance with the Act.

SHORT COURSES AND SERVICES RENDERED

In this context a short course is any course which does not form part of the award

bearing teaching load of the department.

Any staff wishing to run a short course must have the permission of their head of

department. The course organiser will be responsible to the head of department for

day to day management of the course.

Courses or conferences organised by members of staff must be costed and agreed with

the Director of Finance and Resources before any commitments are made. Provision

must be made for charging both direct and indirect costs in accordance with the

University‟s policy. All courses must be self financing or surplus generating unless it

is intended that a new course is to be launched as a loss leader. If that is the case, the

reason for it must be specified and agreed by the budget holder and the Director of


The term „services rendered‟ includes commercial consultancy, testing and analysis of

materials, components, processes and other laboratory services or the use of existing

facilities in order to gain additional information.

The costing and pricing of such services must be in accordance with the University‟s

costing and pricing procedures which are contained in the University‟s detailed

financial procedures.

Any deficits on short courses or services rendered accounts will be a charge on

departmental funds.

CODE OF CONDUCT FOR STAFF The University expects that staff at all levels will observe the University‟s code of

conduct contained in the detailed financial procedures. This reflects the three

fundamental principles of openness, integrity and accountability, and covers:

probity and propriety

selflessness, objectivity and honesty

relationships.

Additionally, members of the Governing Body are required to disclose interests in the

University‟s register of interests of members of the Governing Body.

HOSPITALITY

Staff entertaining guests from outside bodies should normally use the University‟s

catering facilities. Where this is not the case prior approval of the Vice-Chancellor

will be required before any claim for reimbursement will be accepted.

The limits concerning acceptable expenditure for entertaining guests are set out in the

University‟s detailed financial procedures.

Staff may accept modest hospitality from third parties subject to the approval of their

line manager.

The acceptance of gifts is strictly prohibited.

STUDENTS‟ UNION The students‟ union is not a constituent part of the University but is required to report

on its financial position annually to the Governing Body.

Subject to the constraints imposed by the Funding Council, the Governing Body shall

determine the level of grant to be paid annually to the students‟ union.

The students‟ union is responsible for maintaining its own bank account and financial

records and preparing its own annual accounts.

At year end the students‟ union accounts will be audited by a firm of auditors

approved by the University and will be presented to Finance, Planning and Monitoring

Committee.

In accordance with an agreement between the University and the students‟ union, the

University‟s internal auditor shall have access to records, assets and personnel within

the students‟ union in the same way as other areas of the University.

USE OF THE UNIVERSITY‟S SEAL Where a deed or document requires the University‟s seal in respect of contractual

arrangements, it must be sealed by the Clerk to the Governors in the presence of one

other member of the Senior Executive Group.

The Clerk to the Governors is responsible for submitting a report to each meeting of

the Governing Body detailing use of the University seal since the last meeting.

TRUST FUNDS

The Director of Finance and Resources is responsible for maintaining a record of the

requirements for each trust fund and for advising Finance, Planning and Monitoring

Committee on the control and investment of fund balances.

Finance, Planning and Monitoring Committee is responsible for ensuring that all the

University‟s trust funds are operated within any relevant legislation and the specific

requirements for each trust.

APPENDIX A

COMMITTEE STRUCTURE:

SWANSEA METROPOLITAN

UNIVERSITY

1. AUDIT COMMITTEE

2. FINANCE, PLANNING AND MONITORING COMMITTEE

3. STUDENT DISCIPLINARY COMMITTEE

4. SUSPENSION AND DISMISSAL OF STAFF SPECIAL COMMITTEE

5. ACADEMIC APPEALS COMMITTEE

6. GOVERNANCE AND NOMINATIONS COMMITTEE

7. REMUNERATION COMMITTEE

8. PERSONNEL COMMITTEE

APPENDIX B

RESPONSIBILITIES OF FINANCE,

PLANNING AND MONITORING

COMMITTEE:

ensuring that the University maintains proper accounts and related records

ensuring that systems are in place for all employees and creditors to be paid by

their due date and that such systems are effective

ensuring that all income received is correctly accounted for and that income

receivable is collected promptly

receiving and commenting on the University‟s revenue and capital budgets

ensuring that the requirement of the financial memorandum with the Funding

Council to maintain financial solvency is fulfilled

managing the University‟s investments

overseeing

– cash management and borrowing policies

– the University‟s banking arrangements

– the University‟s insurance arrangements

any other matters as directed by the Governing Body.

APPENDIX C

AUDIT COMMITTEE DUTIES (AS DESCRIBED IN HEFCW‟S AUDIT CODE OF PRACTICE)

reviewing the processes for ensuring the effectiveness of the financial and other

control systems;

advising the Governing Body on the criteria for the selection and appointment of

the internal auditor;

reviewing the scope and effectiveness of internal audit‟s work including planning

and operation of the work and the internal audit annual report;

ensuring the institution has systems and procedures to promote economy, efficiency

and effectiveness - this may require identifying specific value for money studies;

advising the Governing Body on the criteria for the appointment and remuneration

of the external auditor and the scope of his work including any non-audit services

provided;

considering the institution‟s annual financial statements after review by the

Finance, Planning and Monitoring Committee and prior to submission to the

Governing Body;

reviewing the external auditor‟s Management Letter and Management‟s response

and having direct access to the external auditor;

reciewing relevant reports from the WFCAS, NAO and other organisations;

monitoring the performance and effectiveness of internal and external audit.

The Audit Committee should ensure that all significant losses have been properly

investigated and that the internal and external auditors and the WFCAS have been

fully informed of the matter.

Reporting Procedures

The Committee should circulate the minutes of its meetings to the Governing

Body.

The Committee will produce an annual report which it will submit to the

Governing Body, accompanied by the internal auditor‟s annual report.

APPENDIX D

INTERNAL AUDIT

RESPONSIBILITIES (BASED ON OBJECTIVES DESCRIBED IN HEFCW‟S AUDIT CODE

OF PRACTICE)

To achieve the following objectives:

to review and appraise the soundness, adequacy and application of internal

controls

to ascertain the extent to which the systems of control ensure compliance with

stablished policies and procedures

to ascertain the extent to which the University‟s assets are protected from losses

arising from:

– fraud

– irregularity

– corruption

to ascertain the reliability of accounting and other information as a basis for the

production of accounts and other returns and for use in decision making

to ascertain the extent to which systems of control operate to promote the most

economic, efficient and effective use of resources.

APPENDIX E

STRUCTURE OF THE FINANCE FUNCTION

(Total FTE staff excluding Director and Secretary = 12.51)

DIRECTOR OF FINANCE

AND RESOURCES

HEAD OF FINANCE

SENIOR ACCOUNTANT

(0.74 FTE)

Secretary to Finance and

Personnel Services (0.8 FTE)

ASSISTANT

ACCOUNTANT

Payroll

Payroll Manager

(0.61 FTE)

Payroll Assistant

Hardship Fund

Student Hardship Officer

Administration (including commitment

processing, travel and

expenses)

Administrative Assistant

Administrative Assistant

(0.61 FTE)

Clerical Assistant

Purchase Ledger

Payments Officer

Sales Ledger

Credit Controller

Income Officer

Income Officer

Cashier (0.55 FTE)

IT INFRASTRUCTURE

PERSONNEL SERVICES

CENTRAL PRINT SERVICES

SOUTH WEST WALES HIGHER EDUCATION

PROCUREMENT PARTNERSHIP

(based at Swansea University)

INTERNAL AUDIT

(contracted out to Bentley Jennison)

APPENDIX F

MAIN POINTS INCLUDED IN THE

UNIVERSITY‟S CODE OF TENDERING

PRACTICE:

duty to comply by the University‟s staff

EU directives to be complied with

competitive tendering procedure

This will:

– ensure fairness of competition

– ensure that companies invited to tender are financially and technically able

to meet the University‟s requirements

– indicate the terms of the contract

– outline the appropriate British and/or international standards to be complied

with

quotation procedure

This will indicate:

– the minimum number of firms that should be expected to provide quotations

– lists of available firms in existence, which have been approved by the

University, that might undertake the work specified

– the terms by which the contractors will be paid

– the national requirements concerning good practice that should be followed

submission of tenders (eg time, date, etc)

receipt and safe custody of tenders and records

admissibility and acceptance of tenders

acceptance of tenders/quotations

justification of acceptance of tenders not at the lowest price.

APPENDIX G

CONTENTS OF „CONDITIONS OF

CONTRACT FOR THE PURCHASE OF

GOODS‟

LIST OF HEADINGS

Interpretation

Variation of conditions

Specification

Identification of goods

Packaging

Containers and pallets

Forms

Delivery

Property and risk

Rejection of goods

Default by contractor

Force majeure

Price and payment

Indemnity

Insurance

Transfer and sub-contracting

Patents, etc

Confidentiality

Inducements to purchase

Insolvency

Publicity

Law.

APPENDIX H

APPROVED BUDGET HOLDERS

Vice-Chancellor and Chief Executive Deputy Vice-Chancellor

Clerk to the Governors

Director of Estates

Director of Finance and Resources

Head of Personnel

Dean of Faculty of Applied Design & Engineering

Dean of Faculty of Art and Design

Dean of Faculty of Education and Humanities

(all Deans of Faculty have authority to nominate Assistant

Deans or Heads of School as budget holders if required)

Dean of Quality Assurance

Academic Secretary

Academic Registrar

Head of IT Infrastructure

Head of Library & Learning Support Services Head of Student Services

Head of Marketing

Head of Commercial Services

Entrepreneurship Champion

Catering and Accommodation Manager

Health & Safety Officer

Print Unit Manager

University Nurse

ANNEX B

AUTHORISATION RULES IN RESPECT OF

EXPENDITURE

All orders under £1,000 in value shall be authorised by the Head of Finance or the

Director of Finance and Resources.

Where alternative suppliers exist budget holders are required to obtain a minimum

of three competitive quotes for purchases of single items costing in excess of

£1,000 or a combination of items costing in excess of £2,500. If three quotes

cannot be obtained the budget holder shall attach a memo to the official order

stating the reasons three quotes cannot be obtained. The requirement for quotes

shall be waived if the purchase is from a supplier approved by a purchasing

consortium to which the University subscribes (currently City and County

Supplies and the Higher Education Purchasing Consortium for Wales). A list of

current approved HEPCW suppliers may be obtained from

www.hepcw.procureweb.ac.uk.

Where the order is expected to exceed £20,000, formal competitive tendering

procedures shall be applied.

All orders over £1,000 in value shall be authorised by the Director of Finance and

Resources or, in his absence, the Head of Finance.

All orders for computer equipment must also be authorised by the Head of

Computer Services, regardless of which budget holder is paying for the items.

All orders for building works must also be authorised by the Director of Estates,

regardless of which budget holder is paying for the work.

All orders over £10,000 in value shall be counter-signed by the Vice-Chancellor

or, in his absence, the Deputy Vice-Chancellor.

Expenditure on a single item or related combination of items of plant or

equipment costing in excess of £50,000, or on building works or service contracts

in excess of £100,000 shall require the approval of the Finance, Planning and

Monitoring Committee.

ANNEX C

CONDITIONS OF CONTRACT FOR THE

PURCHASE OF GOODS

TO FOLLOW

ANNEX D

CONDITIONS OF CONTRACT FOR THE

PURCHASE OF SERVICES

TO FOLLOW

ANNEX E

THE FINANCIAL MEMORANDUM BETWEEN

THE UNIVERSITY AND THE HIGHER

EDUCATION FUNDING COUNCIL FOR WALES

UNDER REVIEW

REVISED MEMORANDUM EXPECTED MID TO LATE 2005

FINANCIAL MEMORANDUM BETWEEN THE HIGHER EDUCATION FUNDING COUNCIL

FOR WALES AND SWANSEA METROPOLITAN UNIVERSITY

PARAGRAPH

Introduction 1-6

Accountability 7-14

Allocation of Funds 15-17

Payment of Funds 18-20

Financial Management 21-27

Estate and Equipment Management 28-31

Property Acquisition & Disposal of Land & Buildings 32-34

Capital Finance 35-43

Financial Statements 44-46

Research Contracts and Other Services 47

Audit 48-50

Provision of Information 51

OHMCI Inspection 52

Repayment

Insurance

Disability Discrimination Act 1995,

Revision,

Interpretation,

Effective Date.

53-54

55

56

57

58

59

Appendix

FINANCIAL MEMORANDUM BETWEEN THE HIGHER EDUCATION FUNDING COUNCIL

FOR WALES AND SWANSEA METROPOLITAN UNIVERSITY

Introduction

1 This Memorandum sets out the terms and conditions under which the Higher

Education Funding Council for Wales will make payments to Swansea Metropolitan

University out of funds made available by the Secretary of State for Wales.

2 For the purpose of this Memorandum:

'Accounting Period' means the period covered by the Institution's audited financial

statements, usually the twelve months from 1 August to 31 July;

'Academic Year' means the twelve months from 1 August to 31 July;

'Act' means the Further and Higher Education Act 1992;

'Council' means the Higher Education Funding Council for Wales;

'Deficit' means the historical cost deficit after tax as calculated in accordance with the

SORP’.

'Designated Office holder' means the holder of the Vice-Chancellor office of the

Institution designated by the Governing Body for the purposes of satisfying the

Governing Body that funds from the Council are used only in accordance with the Act,

this Memorandum and other conditions which the Council may prescribe;

‘Discretionary reserves’ comprise General endowments and Income and

Expenditure Account Reserves as defined in the SORP.

'Exchequer Funds' means Government grant or grant-in-aid. In the context of this

Memorandum, the definition of such funds encompasses grant or grant-in-aid paid by

the Council and its predecessor funding bodies, the research Councils, and the Welsh

Office to former voluntary and direct grant colleges, but not including funds provided

by a local authority.

'Exchequer-Funded Assets' means fixed assets acquired or developed, wholly or in

part, with Exchequer funds in the form of specific capital grant;

'Fixed Assets' means those assets which are intended to be held for use on a

continuing basis by the Institution;

'Governing Body' means the Governing Body which has ultimate responsibility for

the management and administration of the Institution's resources, expenditure and

property, and of the conduct of its affairs;

'Institution' means Swansea Metropolitan University, being one of the higher

education Institutions in receipt of Council funds;

'Month' means calendar month;

'Secretary of State' means the Secretary of State for Wales;

'SORP' means the ‘Statement of Recommended Practice: Accounting in Higher

Education Institutions’ issued jointly by CVCP, COSHEP and SCOP in June 1994; and

‘Surplus’ means the historical cost surplus after tax as calculated in accordance with

the SORP.

3 Payments will be made by the Council to the Institution under the terms of Section 65

of the Act in order to meet expenditure eligible for funding under that Section. Any

funds so provided shall be used in accordance with the purposes for which they are

granted.

4 Following the consultations required in the Act, payments will be made subject to the

provisions of the Act, the conditions set out in this Memorandum and such terms and

conditions as the Council may from time to time prescribe in accordance with the Act.

5 Nothing in this Memorandum shall require the Institution to act in a manner which

would cause it to lose its charitable status or which would be inconsistent with

Instruments, Charter and Statutes or Acts applying to it. The conditions set out below

do not override the duties and powers of the Institution under the Act.

6 The Council will have regard to the desirability of not discouraging the Institution from

maintaining or developing its funding from other sources.

Accountability

7 The Chief Executive of the Council has been appointed as its Accounting Officer. As

such, the Chief Executive of the Council is responsible and accountable to Parliament

for ensuring that the uses to which the Council puts funds received from the Secretary

of State are consistent with the purposes for which the funds were given and comply

with the conditions attached to them. The Chief Executive of the Council is also

responsible for the regularity and propriety of expenditure from those funds and for

promoting and securing the best possible value for money in the use of those funds.

8 In order to meet these responsibilities, the Chief Executive of the Council will require

to be satisfied: (a) that the Institution has appropriate arrangements for financial

management and accounting; and (b) that the uses to which the Council's payments

to Institutions are put are consistent with the purposes for which they were given.

9 The Governing Body of the Institution is responsible for ensuring that funds from the

Council are used only in accordance with the Act, this Memorandum and any other

conditions as prescribed by the Council from time to time. It is also responsible for

ensuring that the financial and other management controls applied by the Institution

are sufficient to safeguard funds from the Council.

10 The Governing Body of the Institution has ultimate responsibility for the proper

stewardship of the public funds it receives and for ensuring that these funds are used

for the purposes intended. Therefore, it must ensure that in conducting its affairs it

exercises its discretion appropriately and gives due consideration to any relevant

guidance on accountability or propriety issued by the Council, the National Audit

Office, or the Public Accounts Committee. The Governing Body of the Institution is

also responsible for delivering value for money from public funds and it should keep

under review its arrangements for managing all the resources under its control.

11 The primary responsibility for ensuring that the Institution complies with the Financial

Memorandum and related guidance, and any other terms and conditions under which

grants or loans are made, rests with the Governing Body of the Institution, and not the

Council.

12 The Governing Body shall designate, subject to acceptance by the Council, a Vice-

Chancellor Office of the Institution, the holder of which office will need to satisfy the

Governing Body that there is compliance with all such terms and conditions to which

reference is made earlier in this section. The designated office holder may be

required to appear before the Public Accounts Committee alongside the Chief

Executive of the Council on any matters relating to grant paid to the Institution which

arise before that Committee.

13 The designated office holder of the Institution shall have the responsibility for advising

the Governing Body if, at any time, in his opinion, any action or policy under

consideration of the Governing Body is incompatible with the terms and conditions of

this Memorandum. Should the Governing Body decide nevertheless to proceed, the

designated office holder is required to inform the Chief Executive of the Council

immediately in writing.

14 The Chief Executive of the Council shall report to the Council and inform the

Governing Body and/or the Audit Committee of the Institution of matters of serious

concern regarding the Institution’s financial affairs. Following discussions with the

Governing Body, if the Council is not satisfied that appropriate action is being taken,

the Council may suspend the payment of grant, either in whole or in part, and either

permanently or temporarily.

Allocation of Funds

15 The amount of the funds to be paid to the Institution shall be decided by the Council

after considering the uses to which the funds will be applied and after taking account

of competing demands on resources. As specified in paragraph 6, the Council will

also be mindful of the requirement as set out in the Act not to discourage Institutions

from maintaining and developing funding from other sources.

16 In making payments to the Institution, the Council may designate funds for specific

purposes. The Institution shall use funds so designated by the Council in accordance

with any terms and condition that may be attached to those funds. These terms and

conditions may permit certain specific and limited transferring of funds between

different designated grants.

17 The main allocation of funds for teaching and for research will be notified to the

Institution as soon as possible in advance of the academic year to which the funds

relate. Other grants will be announced as and when they are determined by the

Council.

Payment of Funds

18 The Council recognises that the terms and conditions set out in this Memorandum

(and any other conditions prescribed by the Council) which relate to payments as

specified in paragraph 3 do not relate to the application of funds derived otherwise

than from the Council.

19 The Council will make payments of funds for recurrent purposes to the Institutions in

monthly instalments, in accordance with a funding profile for the whole academic year

which takes account of expected need within the sector as a whole and receipts of

tuition fees from local education authorities.

20 The Council will be prepared, on written application from the Institution, to make

changes to the timing of payments of grant in exceptional cases as it sees fit. Such

payments will take account of the timing of the Institution's need to make

disbursements.

Financial Management

21 The Governing Body shall ensure that the Institution has a sound system of internal

financial management and control.

22 The Institution shall plan, conduct and control its financial and academic affairs so

that: (a) its total income is not less than sufficient taking one accounting period with

another to meet its total expenditure; and (b) its financial viability is maintained.

23 The Institution must take all reasonable steps to ensure that it has sufficient financial

resources to meet its needs in the form of liquid assets or borrowing facilities or has

plans to generate such resources.

24 In pursuit of its longer term objectives, the Institution may incur an annual deficit, if:

24.1 the planned deficit has been explicitly approved by its Governing Body, or an

approved Sub Committee, and either

24.2 the Institution has established clear and realistic plans to recover the deficit

within a reasonable period of time, or

24.3 the deficit is covered by reserves which can be applied at the discretion of the

Institution.

25 More specifically, deficits can only be incurred if:

25.1 the Institution has forewarned the Council of any deliberate intention to incur

an annual deficit. This information should normally be supplied to the Council

as part of the planning process which involves the Institution's strategic and

financial plans, including the financial forecasts;

25.2 the Institution should inform the Council of the likelihood of an unplanned (or

greater than planned) annual deficit as soon as is practicable; and

25.3 the Institution shall not have an historic cost deficit in more than two

consecutive accounting periods unless there are sufficient discretionary

reserves to cover the deficit. A deficit of less than 0.5 per cent of total income

as defined in the audited financial statements for the year in question, or

£300,000, whichever is the lower, will not be taken into consideration for these

purposes.

26 Negative discretionary reserves must be cleared by the end of the third accounting

period after the period in which the deficit began to accumulate, unless agreed

otherwise by the Council, following written application from and, if necessary,

discussion with the Institution. An accumulated deficit will be considered as cleared if

it is less than 0.5 per cent of the total income as recorded in the Institution’s audited

financial statements for the latest available financial year, or £300,000 whichever is

the lower.

27 The Council may waive these conditions and substitute others on written application

from the Institution.

Estate and Equipment Management

28 The Institution shall manage and develop its estate with regard to the guidance issued

from time to time by the Council on estate procedures, including strategic estate and

equipment management, option and investment appraisal, and private finance.

29 The Institution shall keep its holdings of land and buildings under review with the

objective of rationalising and disposing of those which it considers, in light of its estate

strategy, to be no longer needed. Former voluntary colleges and other Institutions

holding land and buildings not covered by exempt charitable status shall also take into

account the requirements of the Charity Commissioners.

30 The Institution shall maintain its estate in accordance with a maintenance plan, which

is approved by its Governing Body or an approved Sub committee, covering its long-

term and routine maintenance requirements.

31 The Institution should maintain a register of land, buildings and equipment assets.

Property Acquisition and Disposal of Land and Buildings

32 The Institution shall inform the Council about transactions involving capital sums of

more than 5 per cent of its annual income as recorded in its latest available audited

accounts or £1 million, whichever is the lower, affecting any capital asset, however

financed, if the maintenance of the relevant asset is, or is intended to be, a charge on

Council funds. A 'capital sum' in this context means the funds deployed in connection

with either: (a) any asset purchased directly by the Institution using its own or

borrowed monies; or (b) the ‘capitalised’ value of any rental or lease (of whatever

type) which exceeds 5 per cent of annual income or £1 million, whichever is the lower,

over the term of the intended use of the asset not exceeding ten years. A 'capital

asset' in this context may include land, buildings and equipment, and may represent

the creation or purchase of a new asset; the replacement of an existing asset; or the

refurbishment or remodelling of an existing asset.

33 If grant (or any part of it) from the Council is used by the Institution to acquire an

interest in or to develop any land or buildings, to pay rent or to repay debts or to pay

interest on any outstanding debt in respect of any land or buildings:

33.1 No transaction significantly affecting the value or ownership of the property

shall be entered into by the Institution without the written consent of the

Council,

33.2 If the property or any interest in it is disposed of the Institution shall pay to the

Council:

i) in cases where the property or interest was acquired or developed wholly

with the aid of grant from the Council or its predecessor Council, all the

proceeds of the transaction (including any element in respect of intangible

assets disposed of as part of the transaction) after deduction of the

expenses of the transaction: or

ii) in cases where an outstanding debt was repaid or interest thereon paid

wholly or in part with the aid of grant that proportion of the proceeds (after

deduction of the expenses of the transaction) which corresponds to the

proportion of the sum of the grant payments to the aggregate cost of

acquisition or development of the property: or

iii) in other cases the proportion of the proceeds (after deduction of the

expenses of the transaction) which corresponds to the proportion of the

aggregate cost of the acquisition or development which was discharged

out of the payment from the Council or its predecessor Council.

33.3 If the property is leased for use for activities other than vacation lettings and

those eligible for funding by the Council under section 65(2) of the Act, then

rent or an appropriate proportion thereof (after deduction of any ground rent

or other charges, administration costs and any expenditure necessary to keep

the property in a state to command that rent) shall be paid to the Council.

34 The Secretary of State may, after consultation with the Council and with the

agreement of the Treasury, specify conditions under which he would waive the

application of paragraph 33. The present policy on waivers is set out in the appendix

to this Memorandum. If pursuant to such a waiver the Institution uses proceeds of

sale or rent to acquire an interest in, or to develop any land or buildings, the conditions

in paragraphs 32 and 33 will apply to the funds so used. Conditions similar to those of

paragraph 33 have normally been imposed in the past as conditions on the provision

of Exchequer funds otherwise than through the Council for the acquisition of an

interest in the development of any land or buildings, to pay rent or to repay debts,

including associated interest payments, in respect of any land or buildings. Under

section 69(4) of the Act, the Secretary of State has directed the Council to be his

agent in enforcing conditions similar to those in paragraph 33 relating to the disposal

or leasing of assets acquired with grant paid by him.

Capital Finance

35 It is the Council’s responsibility to protect the public investment in Institutions. In

furtherance of this responsibility, and in its role of monitoring financial health, the

Council will require the Institution to meet all of the conditions on capital finance set

out in paragraph 36 and in related requirements as specified by the Council from time

to time.

36 The conditions which should be met regarding the Institution’s ability to enter into

capital finance arrangements are:

36.1 the Institution can demonstrate its ability to repay the finance, and to pay

interest thereon, without recourse to requesting additional grant from the

Council;

36.2 the Institution can demonstrate that its ability to maintain financial and

academic viability will not be impaired as a result;

36.3 the Institution can demonstrate the value to be generated by the transaction

whether it involves refinancing, or purchase of any new investments or

assets, the acquisition of which is to be financed by the borrowing; and

36.4 the Institution can demonstrate that any such new investment or asset

acquisition is in accordance with the Institution’s strategic plan and, where

appropriate, its estate strategy.

37 Further, the Institution shall obtain prior written consent from the Council before it

undertakes a level of capital finance where the annualised costs of all capital finance

(being the sum of the servicing and capital repayment costs of each loan or other

arrangements spread evenly over the period of the relevant loan or arrangement) or

the actual annual cost in any one year of all capital finance would:

37.1 exceed 4% of total income as reported in the latest audited financial statements or of

the estimated amount of such total income for the current year if that is lower; or

37.2 exceed half of the average surplus recorded in the audited financial

statements for the last three years or half of the surplus forecast for the

current year if that is lower. The surplus should be calculated as the historical

cost surplus after tax, but before interest payable and other annual capital

finance charges.

38 In assessing total long-term borrowing and total income, all inherited debt which is

fully reimbursed by the Council, and all such reimbursements shall be ignored.

39 In seeking the Council’s approval required under paragraph 37, the Institution should

demonstrate to the Council in writing its compliance with the conditions set out in

paragraph 36.

40 For the purposes of paragraphs 35 to 39, capital finance includes borrowing, finance

and operating leases, and other schemes, such as Private Finance Initiative (PFI)

projects, where the substance of the transaction is akin to borrowing, in line with the

principles of Financial Reporting Standard (FRS) 5 - ‘Reporting the Substance of

Transactions’. If a PFI project is not covered by FRS 5 because, for example,

sufficient risk is transferred or ownership of the asset does not revert to the Institution,

then the Council must be informed where the agreement is of a duration greater than

five years and the amount payable per annum is more than 5% of total annual

income, or £1million whichever is the lower.

41 Under Section 69(4) of the Act, the Secretary of State has directed the Council to

exercise on his behalf his functions in respect of an interest in or development of any

land, building or other asset which was acquired by the Institution using funds

provided by him and where those funds were provided subject to a condition which

has the effect of requiring the Institution to obtain the Secretary of State’s consent

before raising capital finance on the security of those assets. In exercising its

functions under this provision the Council will require the Institution to obtain prior

written consent from the Council where the Institution wishes to grant security over

such an asset. In seeking such approval from the Council the Institution should

demonstrate to the Council in writing its compliance with the conditions set out in

paragraph 36.

42 Similarly, where an Institution seeks to borrow on the security of any land, building or

other asset which it acquired an interest in, or developed, with Exchequer funds

provided other than through the Council, the Secretary of State, the Universities’

Funding Council or the Universities’ Grant Committee and where these funds were

provided subject to a condition which has the effect of requiring the Institution to

obtain the approval of the provider of the funds, the procedures set out in paragraph

41 will apply.

Short Term Borrowing

43 The Institution shall obtain prior written consent from the Council before its negative

net cash or cash equivalents, as determined on a cash book basis and as defined in

FRS 1: Cash Flow Statements, exceeds the lower of 5 per cent of total income or

£2m.

Financial Statements

44 The Institution shall keep proper accounting records and shall prepare financial

statements in respect of each accounting period. The Institution shall provide the

Council with three copies of its audited financial statements for the accounting period

by 31 December immediately following the end of the accounting period. The

Institution shall make reasonable arrangements to make copies of the financial

statements publicly available.

45 The Institution shall ensure its financial statements comply with the Accounts Direction

issued from time to time by the Council. Such a direction will cover information to be

contained in the financial statements, the manner in which they are to be presented

and the methods and principles according to which they are prepared, and will be in

accordance with Generally Accepted Accounting Principles.

46 The financial statements shall be signed by the designated office holder and by the

Chair or one other member of the Governing Body as appointed by the Governing

Body. In the case of an Institution which is a company limited by guarantee, the

requirements of the Companies Act 1985 as revised by the Companies Act 1989 in

respect of signatories to the financial statements shall apply.

Research Contracts and Other Services

47 In determining the price to be charged for research contracts, residences, catering,

and other external services, the Institution shall have regard to the need to assess

and to recover full costs unless the Institution considers it appropriate to do otherwise

having regard to the circumstances of particular cases. The Institution should ensure

in such circumstances that it is aware of the extent to which it will be providing its own

resources towards the cost of the activity.

Audit

48 The Institution shall appoint an audit committee, and arrange to provide for internal

and external audit, in accordance with the Audit Code of Practice and any other

directions drawn up by the Council, in consultation with Institutions.

49 The Council's audit service will, from time to time, evaluate the Institution's internal

control arrangements. The Council's audit service shall be provided with access to all

records, information and assets and can require any officer to give any explanation

which it considers necessary to fulfil its responsibilities. Welsh Office internal auditors

may accompany the Council's auditors on their visits to the Institution. On such visits

the Welsh Office auditors will be concerned with the way in which the Council's

auditors are carrying out tasks and will not themselves audit arrangements within the

Institution.

50 The books and records of the Institution will be open to inspection by the Council and

the Comptroller and Auditor General. The Council may carry out reviews designed to

improve economy, efficiency and effectiveness in the management or operation of the

Institution including value for money studies. The Comptroller and Auditor General

may also carry out value for money studies of the Institution's use of resources.

Provision of Information

51 The Institution shall furnish the Council with such information as the Council may

require for the purpose of the exercise of its functions under the Act. The Council

shall have regard both to the costs of providing this information and, where

appropriate, to the confidential nature of certain personal data. For the purposes of

this paragraph the Council will rely for its main requirements upon Higher Education

Statistics Agency to provide the required information on behalf of individual

Institutions, except as the Council may from time to time determine following

consultation with Institutions. In such circumstances the Council will endeavour to

ensure a reasonable timescale for providing the data.

OHMCI Inspection

52 Where initial teacher training is delivered, it is a condition of grant that Office of Her

Majesty’s Chief Inspector of Schools in Wales (OHMCI) inspectors should be allowed

access to inspect the quality of provision which is wholly or mainly intended for

students on courses leading to qualified teacher status. OHMCI inspectors should

have access to higher education courses of initial teacher training on the same basis

as they have access to all education in schools; entry to the premises at all

reasonable times; the ability to inspect and to take copies of any relevant records or

documents; and the right to publish inspection findings.

Repayment

53 Under section 65(4) of the Act, the Council may require repayment by the Institution in

whole or in part, of funds received from the Council if the Institution fails to comply

with any terms and conditions which were attached to the funds. The Council is also

empowered to require the payment of interest in respect of any period during which a

sum due to the Council in accordance with this or any other condition remains unpaid.

54 In relation to paragraph 53 above, interest will be levied upon any sum demanded

from the date of demand until the date of payment at the rate of two per cent per

annum above the base lending rate of the Bank of England.

Insurance

55 The Institution will be totally responsible for taking out and paying for adequate

insurances in respect of its assets and activities.

Disability Discrimination Act 1995

56 The Institution shall publish a disability statement as required by the Disability

Discrimination Act 1995, which satisfies the guidance issued by the Council.

Revision

57 The Council may from time to time revise, revoke or add to any of the conditions of

this Memorandum after consultation with the Institution and such bodies representing

the Institutions as the Council considers appropriate as required under Section 66(1)

of the Act, except in relation to grants which have already been paid to or accepted by

the Institution, unless there is specific agreement otherwise. The Institution may itself

make proposals to the Council for revision, revocation or addition.

Interpretation

58 While the Council reserves the ultimate right to resolve any questions arising on the

interpretation of any provision of this Memorandum it shall only do so after consulting

with the Institution and taking into account any representations made by the Institution

or any other bodies which the Council considers appropriate.

Effective Date

59 This Memorandum shall take effect from 1 January 1997 and will supersede the

Memorandum which has been in effect since 1 August 1993.

APPENDIX

CIRCUMSTANCES UNDER WHICH AN INSTITUTION MAY RETAIN PROCEEDS OF SALE

OR RENTAL INCOME (PARAGRAPH 33)

1 Notwithstanding the provision of paragraphs 33, the Institution may retain proceeds of

sale or rental income in the circumstances set out below.

PROCEEDS OF SALE 2 Where an Institution, with the Council's approval, disposes of land or buildings (including

leases for a term of 25 years or more) the Institution may retain up to £200,000 of the

proceeds of sale (or any premium payable on the grant of the lease) on the condition

that;

a) the Council is told how the Institution proposes to use such proceeds; and

b) such proceeds are used within three years of their receipt by the Institution on building or

adaptation work, long term maintenance, or the acquisition of property. Such proceeds

may also be used for projects related to Institution/industry collaboration, subject to the

approval of the Secretary of State and the Treasury.

3 Where the Institution disposes of land or buildings for which the proceeds are more than

£400,000 the Institution may, as an alternative to paragraph 2 and with the approval of

the Council, retain up to half the proceeds for the purposes and on the conditions

described in paragraph 2b above.

4 The Institution may, with the Council's approval, retain up to 100 per cent of such

proceeds where they are to be used within three years for the replacement of existing

facilities in line with the institutions’ estates strategy.

RENTAL INCOME

5 The Council may waive repayments of rental income where:

a) the property is in commercial use of benefit to the Institution or to the academic

community over and above the purely financial benefit of receiving an income.

b) the property is used to accommodate tenants displaced from other property acquired and

developed for the Institution's use; or

c) some different arrangement has been approved exceptionally by the Council in particular

circumstances.

1 „Modest hospitality‟ shall be defined as hospitality of a standard similar to that offered by the

University to its guests. On that basis, acceptance of an occasional working lunch or evening meal paid

for by a third party is acceptable if the member of staff feels he/she would be able to reciprocate on

another occasion. Staff should not accept any form of hospitality which is purely social in nature and

which is not associated with a meeting arranged to discuss specific official business; this particularly

applies to the acceptance of invitations to sporting or entertainment events.