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Financial statements 2018/19

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The University of Bradford’s financial performance in 2018/19 shows an operating surplus of £0.4m.

This is strong improvement on a £5m deficit originally planned for the year.  Major factors were the 2018 student enrolment figures being better than planned and rigorous cost management.

Cash generated from operations was £4.5m. Liquidity improved, with closing cash reserves of £24m.

Along with other UK universities, Bradford has to factor in the long-term cost of pension schemes.*

Pensions accounting is complex, very long-term, highly regulated and volatile from year to year.

For each of our pension schemes, an independent actuary assesses how much money there will be in the funds over the long-term. 

In the case of 2018/19 there is a charge of £41m, with a long-term pension liability of £59m.  The University does not need to pay this liability in the short term; but it is a factor to consider in years to come.

Combined with the current student intake for 2019/20 the University is confident that it is on track to deliver its medium-term financial strategy. This is the result of a huge team effort in an environment that remains competitive.

*Universities are required to account for a large increase in the USS national pension scheme deficit in 2018/19 arising under the 2017 USS scheme valuation. This shows itself as an increase in the value of liabilities on individual university balance sheets. This liability, technically the liability to make deficit repayments as part of the USS deficit recovery plan, will be paid down over the next 10 years. It also shows up as a large one-off accounting charge to the Income & Expenditure Account, causing many universities to post exceptionally large deficits for the year. 

These large university deficits are not a reflection of the cash or day-to-day spending position of universities, nor do they mean that spending has been significantly higher than income. They are a reflection of accounting for the increase in USS pension liabilities. These liabilities are future commitments to pay down the deficit, not current expenditure.

Without these one-off large accounting charges the vast majority of universities would report a surplus for the year as well as positive cash inflows from their operating activities. Most universities generally remain in a strong financial position, although they are facing significant increases in their pension liabilities and in the cost of funding future pension benefits.

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