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Returns should be made in December 2013 and July 2014.

Executive summary


1. This document asks higher education institutions (HEIs) to send us their annual accountability returns for 2013. The accountability returns are a significant part of the 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. They also help us understand issues and developments relating to higher education (HE) in England more broadly.

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

4. The following requirements will apply:

  1. HEIs must submit, by Monday 2 December, the returns and reports specified in paragraph 9, updated financial tables showing the actual performance and position for 2012-13, and an updated forecast for 2013-14, along with a commentary that explains any significant changes from the data submitted in the July 2013 forecasts.
  2. HEIs must submit, by Thursday 31 July 2014, financial tables showing the updated forecast for 2013-14 and forecasts for 2014-15, 2015-16 and 2016-17, along with a full commentary that answers the specified questions.

By exception, we may request that some institutions submit full forecasts in December, but this will be discussed with any institutions affected in advance of the submission date.

5. We give the approval levels of specific returns in paragraph 9. If the timetable creates difficulties for HEIs, we request that they contact their HEFCE assurance consultant to discuss.

6. Following our review of the returns, we will notify each HEI of our risk assessment through a letter to the head of HEI (copied to the chair of the governing body) usually during April to May. 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. Until a new letter is issued, HEIs can assume that the last risk assessment letter is still valid.

7. We remind all HEIs of their obligation, under the Financial Memorandum with HEFCE, that they should inform us of any material adverse change in their circumstances (see ‘Model Financial Memorandum between HEFCE and institutions‘, HEFCE 2010/19).

8. We are currently consulting on the new Financial Memorandum (effective from 1 August 2014), although we do not anticipate that this will affect the annual accountability information we collect.

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



Approval level

Submission date

Annual assurance return

Accountable officer re Part 1

Trustees re Part 2.

2 December 2013

Annual monitoring statement (AMS)

Member of senior management team

Signed audited financial statements

Governing body

Financial results and updated forecast tables for 2012-13

Governing body

Commentary: explanation of significant variances between the current and July 2013 submissions

Governing body

Audit committee annual report

Governing body

External audit management letter and management responses

Reported to audit committee

Internal audit annual report

Reported to audit committee

Value for money report (optional)

Governing body or audit committee

Annual sustainability assessment (optional)

Governing body

Higher Education Students Early Statistics Survey (HESES) 2013-14 return


Accountable officer

10 December 2013

Transparent Approach to Costing (TRAC) return

Board committee

31 January 2014, although earlier returns would be appreciated.


Accountable officer

28 February 2014, although earlier returns would be appreciated.

Financial forecast tables to 2016-17,

Financial commentary

Governing body

31 July 2014

10. This publication gives guidance on the returns that must be submitted to us by:

  • 2 December 2013
  • 31 January 2014 (in the case of TRAC)
  • 28 February 2014 (for this year, in the case of TRAC (T)
  • 31 July 2014 (in the case of financial forecasts and commentary).

11. While the submission of the annual value for money report remains optional we have found the information in these reports extremely useful in demonstrating to key stakeholders that the sector continues to improve its efficiency and effectiveness. We therefore encourage institutions to submit these VFM reports.

12. Institutions should note that submission of the annual sustainability assessment is not currently part of the annual accountability suite of returns and is voluntary this year. See paragraph 42 for further information.

13. We will provide detailed guidance on the requirements of the HESES return in a separate HEFCE publication, ‘HESES13: Higher Education Students Early Statistics Survey 2013-14’ (expected to be published by the end of September 2013).

14. We will use the information collected primarily to: 

  1. Monitor the use of our funds for the purposes intended.
  2. Assess compliance with the 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 issues and developments across, and within, parts of the HE sector. This will inform our advice to the Secretary of State on the provision of HE in England, and will help us to anticipate, change and develop well-informed policy responses where necessary. We will share broad findings in a number of ways, including: in our sector-wide report on our analysis of the financial health of the sector, and in our annual report on HE in England.

15. We may also use this information internally for other analyses that concern our core roles. We may share these analyses with other public bodies (for example, the Department for Business, Innovation and Skills) as the need arises.

Action required

16. The returns must be submitted by the deadlines shown in paragraph 9 via the secure area of the HEFCE web-site. The required documents are:

  • scanned PDF copy of the 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 with, and make an annual return directly to, the Charity Commission)
  • completed AMS template
  • scanned PDF copy of the signed audited financial statements
  • completed financial results and forecast tables
  • financial commentary (specific questions to be covered and an optional template is provided in Annex D)
  • audit committee annual report
  • external audit management letter and management responses (combined in a single document)
  • internal audit annual report
  • value for money report (optional)
  • annual sustainability assessment (optional)
  • completed and appropriately authorised TRAC return reporting for 2012-13.

17. Templates for the AMS, financial tables and TRAC return will be available by early October 2013. We will write to heads of finance and our AMS contacts in each HEI at the beginning of October with details about how to access the templates and how to return information to us.

18. Templates for the financial forecast tables for the July submission will be made available in early May 2014. We will write to the heads of finance in each HEI at the beginning of May with details about how to access the template and how to return information to us.

Date: 26 September 2013

Ref: HEFCE 2013/23

To: Heads of HEFCE-funded further education colleges, 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 data returns)

HEFCE assurance consultants (for financial and audit accountability returns)

See searchable contact details for HEFCE staff.