TB074

Finance & Risk Regsiter report to Board

Purpose: An update on what has been happening in regard to financial positionat Liverpool Hope SU since the previous meeting

Recommendation:That the Board notes the report and approves action plan

Summary:To keep the Board informed of partnership work with the university in regard to progressing the current financial status of the union

Financial impact:Discussed within each section if appropriate

Student impact:Discussed within each section if appropriate

Risk:Discussed within each section if appropriate

ContactCaroline Bates, Union Development Manager

  1. Introduction

This Report & Action Plan arises from a meeting held on Wednesday 4th December 2013 attended by Ms Anne Seddon (Chair of Finance and General Purposes Committee), Mr Frank Cogley (Chair of Audit Committee), Mr Mike Gilbertson (member of University Council and Audit Committee) and Mr Graham Donelan (Clerk to University Council).

The Group received the unsigned Students’ Union Financial Statements for year ended 31st July 2013, the SU Trustees’ Report and the Internal Examiner’s Management Letter. All three reports raised significant concerns with the group that the situation within the Students’ Union was more serious than expected.

  1. Immediate actions approved by the Chair of University Council and the Vice-Chancellor:-
  1. Require SU to submit monthly management accounts to Clerk to Council to be forwarded to Council members of the group. Management accounts to include income and expenditure account and balance sheet. To be effective from month ending 31st December 2013. First submission should be for five month period from 1st August 2013 (not required to be broken down by month) and be submitted no later than 31st January 2014.

Update: following meetings between Caroline Bates and Mr Mike Gilbertson, Mr Gilbertson has suggested he continues to work with Caroline and do the half year accounts (to 31 1 14) rather than produce 5 month accounts, given that we do not need to report on financial matters in any detail at Jan board meeting (qtr2 updates are scheduled for the March meeting).

  1. Quarterly management accounts to be submitted to the March and June meetings of Finance & General Purposes Committee and a schedule of dates for submission to be agreed between the Clerk to Council and the Students’ Union up to and including the meeting of University Council on 25th November 2014.

Update: in progress.

  1. In order to assist this process, a member of University Finance Office should be allocated to work with the Union Development Manager at least for the remainder of the financial year. The University to determine whether this should be a charged for service. The Clerk to Council to inform the Director of Finance.

Update: Following meetings between Mr Gilbertson, Caroline Bates and Ben Ramsdale three options were considered:

a)Full training and supportgiven toCaroline Bates to bring her skills and abilities up to the level needed for unionto be self-sufficient. Points to consider; whilst the Union is striving to be a self-sufficient organisation do we wish to invest substantial finance training for the UDM and pull the post away from the development aspect of the role?

b)Interim support given to Union from the University’sFinance Office in order to assist with processes. Points to consider; interim support allows union to explore staffing arrangements and review staffing priorities and infrastructure moving forward

c)All finance processes to be handed over fully to the university to do on the unions’ behalf. Points to consider: as an independent charity are we comfortable with ourparentinstitution having full control and responsibility for this area? Does this move us further away from our goal of being self-sufficient?

Recommendations:

Option b to be implemented with UDM exploring staffing roles as detailed in Staffing Matters (agenda item 6).

UDM to liaise with other small & specialistunions in proposalof ‘FinanceTraining for Non-Financemanagers’ to enable her to sense check accounts, review and develop budget setting skills etc.

  1. Mr Mike Gilbertson to be appointed on behalf of University Council to work with the Students’ Union on their system of controls and to attend the SU Board of Trustees ex officio until the end of the financial year.

Inter alia, Mr Gilbertson to

(i)As a matter of urgency, discuss with the Chair of the SU Trustees the Trustees’ Report and the advisability of some of the wording. Where there is reference to formal actions/role of Trustees and, in particular, where the report is to be signed off, the stated name/title should be Chair rather than President.

(ii)Review the Financial Procedures Manual adopted by the SU.

(iii)Review banking arrangements including how budgets are allocated to clubs and societies and sporting teams and arrangements for cash handling by clubs, societies and sporting teams.

(iv)Review contracts held by the SU and to instruct SU that any new contracts have to be approved by the Finance & General Purposes Committee.

(v)Investigate the balances within Restricted Funds in order to advise the University Council on whether a gift/donation or additional grant of £47,000 from the University (equivalent to the amount owed to the University) could be used to balance the Restricted Funds and clear any deficits, once an understanding of the deficits is obtained.

Update: (i – iii) are in process.

(iv) further clarification to be sought in regard to which contracts are beingreferred to i.e. we have contracts with NUS media re website

(vi)Women’s’ Gaelic have raised over £600 almost clearing their inherited debt from previous years however they have a national tournament coming up (which the money they raised was for) they will immediately go back into the red. Further discussion at board level with Mr Gilbetson’s insight onthis is needed.

  1. The Students’ Union Trustees to be instructed not to agree to salary advances to Sabbatical Officers given the serious nature of the situation.

Update: board to agree/disagree and direct UDM accordingly.

  1. The Clerk to Council to ascertain how the University grant is paid to the Students’ Union.

Update: completed

  1. The Students’ Union to provide by 20th December 2013 a timetable of key dates for 2014 including schedule of Trustee meetings, date of Independent Examination on accounts year ending 31st July 2014, dates of submission of accounts and independent examiner reports to Clerk of Council for Council Committee meetings.

Update: completed

  1. The Action Plan to be sent to Mr Ramsdale as Chair of the SU Trustees with a clear instruction that it should be sent to the whole Board of Trustees immediately.

Update: completed

  1. Future payments of the University grant to the SU to be conditional on the agreement of the Students’ Union to this plan.
  1. Council reserves the right that Internal Audit may be requested in early 2014 to review operation of financial, management and governance processes with their report for Council meeting in April.

Recommendation: In addition to working with University Audit committee we establish an Audit & Finance Sub-Committee of the Trustee Board who will, in addition to other functions, complete a Risk Register for the Union. Terms of Reference in appendix 1.

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