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  • Executive summary
  • Introduction
  • Guidance
    • Annual assurance return
    • Annual monitoring statement
    • Corporate planning statement
    • Audited financial statements
    • Financial results and forecast tables
    • Financial commentary on past performance and future prospects
    • Audit committee annual report
    • External audit management letter
    • Internal audit annual report
    • Transparent approach to costing (TRAC) return
    • Higher Education Students Early Statistics Survey
    • Research Activity Survey
  • Submission of the returns
  • Annex A Sample annual monitoring statement 2010
  • Annex B Financial results and forecast tables: guidance notes
  • Annex C Financial commentary template
  • Annex D Sample financial tables 2010
  • Annex E Annual assurance return template
  • List of abbreviations

Executive summary


1. This document asks higher education institutions (HEIs) to send us their annual accountability returns for 2010. The accountability returns form a significant way in which HEIs can demonstrate accountability for the public funds distributed to them.

Key points

2. The accountability returns enable HEFCE to reassess HEIs' overall risk assessments and to ensure that HEIs are meeting their accountability responsibilities.

3. The various returns cover corporate strategy, financial performance, financial sustainability, risk management, control and governance, value for money (VFM), and the management and quality assurance of data. In addition to the documentation requested in the annual process itself (as detailed below), we will also consider other sources of assurance.

4. Following our review of the returns we will notify each HEI of our risk assessment through a letter to the chair of the governing body and head of HEI. This is an annual process, but we may revisit an HEI's overall risk assessment at any time if there is a significant change in circumstances. We also remind all HEIs of their obligation, under the Financial Memorandum with HEFCE, that they should inform us of any material adverse change in circumstances.

5. The documents to be sent to us, and their submission dates, are as follows:

Annual assurance return
Annual monitoring statement (AMS)
Corporate planning statement (CPS)
Audited financial statements
Financial results and forecast tables
Financial commentary on past performance and future prospects
Audit committee annual report
External audit management letter and management responses
Internal audit annual report

1 December 2010
HESES return 9 December 2010
Research Activity Survey (RAS) 14 December 2010
Transparent Approach to Costing (TRAC) return 31 January 2011

6. This publication gives guidance on the returns that are to be submitted to us by 1 December 2010 and, in the case of TRAC, by 31 January 2011. Note that this guidance lays out the minimum requirements for submission, and we request that HEIs provide all of the requested information in the return; for example, please ensure that your financial commentary answers all of the questions in the guidance. Detailed guidance on the requirements of the HESES and RAS returns are provided in separate HEFCE publications.

7. We will primarily use the information collected to:

  1. Monitor the use of our funds for the purposes intended.
  2. Assess compliance with the Financial Memorandum. A new edition of the Financial Memorandum has been issued (HEFCE 2010/19) and is effective from 1 August 2010. Although the relevant period for the annual accountability return is 2009-10, during which the previous Financial Memorandum (HEFCE 2008/19) was in effect, we would welcome early adoption of the revised Financial Memorandum.
  3. Form a basis for discussion with HEIs about their progress in key areas, their priorities for strategic development, and their current and future performance.
  4. Largely determine our risk assessments of each HEI.
  5. Identify trends across the sector and advise the Secretary of State for Business, Innovation and Skills on the needs and development of the higher education sector.

Action required

8. The returns must be submitted by the deadlines shown in paragraph 5 as scanned PDF copies via the HEFCE extranet. The required documents are as follows:

  • completed annual assurance return (Annex E) with part 1 signed by the accountable officer and part 2 signed by an appropriately authorised trustee (note: part 2 is not required from HEIs that are either not a charity or are registered and make an annual return directly to the Charity Commission). Please note that we are requesting electronic submission of a PDF copy of the signed completed annual assurance return
  • completed AMS template
  • CPS
  • signed audited financial statements
  • completed financial results and forecast tables
  • financial commentary on past performance and future prospects (for which detailed questions are provided in paragraph 38 and an optional template is provided in Annex C)
  • audit committee annual report
  • external audit management letter and management responses
  • internal audit annual report.

Templates for the AMS and financial tables will be available by the end of September 2010. We will write to heads of finance and our AMS contacts in each HEI at the end of September with details on how to access the templates and how to return information to us.

Date: 1 September 2010

Ref: 2010/25

To: Heads of HEFCE-funded higher education institutions, Heads of universities in Northern Ireland

Of interest to those
responsible for:

Audit, Estates, Finance, Governance, Management, Planning, Student data, Research data

Enquiries should be directed to:

HEFCE higher education policy advisers (on annual monitoring and corporate planning statements and data returns)

HEFCE assurance consultants or assurance advisers (for financial and audit accountability returns)