Minutes of the Finance & Business Operations Committee - 25 September 2019
|Group||Minutes of Finance & Business Operations Committee|
|Location||PRINCIPAL/CEO’S OFFICE, WELSH BRIDGE CAMPUS, SHREWSBURY|
|Date||25th September 19|
|Minutes Membership||G. Channon, R. Heath, D. Pulford (co-opted Committee member), R. Rosson, J. Staniforth (Principal/CEO), P. Tucker and R. Wilson. 1 Vacancy|
|In Attendance|| Member of the Senior Leadership Team: |
P. Partridge, Finance Director (FD)
Clerk to the Board, T. Cottee
28/19. Election of Chair
Resolved: That Gordon Channon be appointed Chair of the Committee.
Gordon Channon in the Chair.
29/19. Appointment of Vice-Chair
Resolved: That the appointment of a Vice-Chair be deferred until consideration at the March 2020 meeting.
30/19. Declarations of Interest
R. Heath declared a standing interest as an employee of Harper Adams University.
31/19. Minutes of Meeting Held 26 June 2019
Resolved: That the Minutes of the meeting held on 26 June 2019, be approved as a true and correct record, subject to a minor typographical correction on page 2 (Minute No. 20/19, second bullet point).
32/19. Matters Arising
Further to F&BO Min. No. 19/19, the Principal/CEO advised that the College was unable to obtain LEP funding for expansion of its brick workshop facilities given the need for the facility to be in place for the start of the new academic year. Given the growth in applications and the significant employer demand for the skills, the decision had been taken to prioritise this capital expenditure over other plans which would now require investment from the LEP if they were still to go ahead later in the year.
Regarding the Brick workshop, the Principal/CEO reported that the additional workspace had now been erected and was fully utilised, meaning it would recoup project costs within 18 months. The Committee expressed its disappointment that this LEP priority activity had not been supported.
Further to F&BO Min. No. 20/19, the Finance Director advised that SBC had confirmed that it could increase its Non Levy funding allocations to the College, which significantly reduced the projected gap between the Non Levy funding available through SBC and the funding required to meet demand and budget. The College was also exploring the new Levy Transfer scheme launched by the WMCA at the start of September 2019.
The Finance Director also explained that all Apprenticeship providers were required to re-apply to the Register of Approved Training Providers (RoATP). The College needed to have completed this exercise successfully by March 2020.
33/19. Management Accounts – Full Year to Date 2018 - 2019 (Appendix – Agenda Item 7)
The Committee considered a report (previously circulated) with respect to the management accounts featuring the Full - Year Management Accounts report which highlighted the key results, measures and risks. All governors had been supplied with a copy of the Report.
The Committee was advised that these management accounts were based on the Education & Skills Funding Agency (ESFA) R12 income submission and included forecast estimates for expected achievement funding due but not yet included within the R12 submission.
The Committee reviewed the Accounts and particularly noted the following -
- AEB Delivery - Trade Union and TU functional skills delivery showed a significant pick-up in activity. As a result, July 2019 saw a £153k increase in recorded revenue with full year income ending at c£855k (up from £662k last year).
- Distance Learning activity exceeded budget income by £33k.
- Subcontract partners were provided with final additional contract allocations in June 2019.
- The College had delivered 104% of the AEB contract allocation. The ESFA has stated it will fund high quality delivery of up to 3% above contract.
- Other income was £34k higher than previously forecast.
- Apprenticeship achievement funding remains a small risk.
- The Committee reviewed the 2-year cashflow forecast. The Finance Director explained the factors affecting the cashflow forecast and the mitigating actions being taken. As highlighted to the July 2019 Board meeting, unless the uncertainty over the apprenticeship funding was fully resolved there remains the risk of under-performance in relation to income which would directly impact cash-flows over the period from September 2019 to March 2020. The Committee reviewed the impact of this risk, set out in the report and confirmed its support for the actions taken by the College to mitigate the cash-flow risk.
- The draft financial health score was “Good” with a score of 200, the same as for 2017/18.
- The Budget Financial Health for 2020/21 was also “Good”, but with a reduced score of 180 – the lowest score in the “Good” range.
- The Committee reviewed the 2018/19 key financial risks and observed that risk probabilities had been reduced as these risks had either been absorbed into the updated forecast or the increasing proximity of the year end provided additional comfort that the risk would not materialize.
Resolved: That, having considered the report, the Committee received the Management Accounts – Full Year to Date 2018 - 2019.
34/19. College Budget 2019 – 20 Risk Analysis and Pressures (Confidential Appendix – Agenda Item 8)
The Committee considered a Confidential report (previously circulated) which highlighted the key financial sensitivities inherent in the 2019-20 Budget and the potential impact that each of these might have on the College’s financial position should these all occur; the details of which are set out in a Confidential Minute.
Resolved: That, having considered the report, the Committee RECOMMENDED TO BOARD the report.
35/19. Draft Committee Work Plan 2019 – 2020 (Appendix – Agenda Item 9)
The Committee reviewed the Draft Workplan for 2019 – 2020 (previously circulated), which reflected the committee evaluation that the Committee increase the number of meetings held to maintain focus on the financial stability of the College.
The Clerk was directed to investigate holding the committee meeting scheduled for 31 March 2020, prior to the Board scheduled for 30 March 2020, instead.
Resolved: That the Draft Workplan be noted.
As part of the discussions on the College’s Risk Register and Board Assurance Framework agreed by Board (Board Min No. 67/17 refers), the Committee examined those risks within its remit to ensure that they have either been identified or adequately discussed at the meeting.
The Committee concluded that the risks connected with the Committee had been identified and that there had been sufficient discussion of the issues at the meeting.
37/19. Date of Next Meeting – At the request of the Chair, the next meeting would be held on Tuesday, 05 November 2019 at 5.30 p.m. Venue – CEO/Principal’s Office, Welsh Bridge Campus.
The meeting concluded at 7.35 p.m.