Council July 18 th 2008 Executive Report – G C Gilbert

Finance department mission Primary To ensure that there is a match between the University’s strategic objectives and its capacity to generate, manage and acquire the resources needed to support them Secondary To ensure that both cost and contribution centres have an understanding of and the means to deliver efficient and effective use of resource To ensure that the University has sound financial control systems To produce management information which can support a meaningful planning horizon both in departments and corporately and can provide timely and accurate monitoring of on-going performance To source and manage external funding including borrowing To manage financial risk and assist the Executive and Council to ensure an appropriate balance between risk and ambition To ensure that financial strategy is consistent with the key elements of the corporate plan To undertake and support commercial initiatives

Areas of Responsibility Finance Systems Resource management & decision support Funding Development Key risks Failure of main accounting system Failure to produce reliable budgets and forecasts Failure to secure funding for capital development Failure to identify opportunity

Director of Finance Commercial Director Research Support Office VAT & Companies Management Accounts Planning & Decision Support Support StaffFinancial Controller Payroll & Pensions Compliance & Financial Accounting Operations Cash & Banking Payments Billing Systems

Finance Systems Everything from development and operation of the main accounting platform, to financial operations, to working capital management, to routine treasury operations, to supervision of pensions and investments Highlights –Major upgrade of main accounting platform - March 2008 –Revision of financial regulations –Further roll-out of FEc –Salary sacrifice, pensions and investment –Restructuring of RSO –Revision of arrangements for management of money market deposits –Revision of supplier payment conditions

Resource management & decision support Budget setting & Long-term financial planning and the support of departmental resource allocation, monitoring and control Highlights –Central management accounts team strengthened and complemented by appointment of management accountants to larger departments –Support of Better Management programme –Continuous improvement of financial planning and budget setting process –TRAC audit Current objectives –‘Surprise-free’ budgetting –More reliable financial projections –Earlier warning of potential problems –More effective response –More efficient and effective use of resource –Better identification of opportunities

Funding Sourcing and acquisition of funds to support the capital investment programme Peak medium term borrowing projected to be £130m Key objectives: Achieve adequate and stable income and cash generation to satisfy banking covenants and retain a margin for risk and opportunity Secure funds on optimal terms Current position: 80% 0f medium term requirement sourced and similar proportion covered against adverse interest rate movements On-going discussions regarding remaining 20%

Development focused on transactions and arrangements that generate resource but are independent of ‘core’ activities In the past has included the development of the Science Park as well as the creation and early management of spinouts such as YEMC,YSP(IC), YHEC, Xceleron, and the White Hart hotel. Several of these continue to contribute positively to the University’s bottom line. Today we continue to look for spinouts but are particularly concentrated on exploring how to release the development value inherent in the Heslington East planning approval.

Performance against KPIs BudgetLatest est. OCF£6.43m£12.07m Op. result£3.92m£4.79m Tr. Result £3.7m£8.75m Staff costs58.41%58.27% as % of inc.