The OfS confirms it has no plans to collect data or reform the TRAC(T) methodology at this point in time. TRAC(T) data collection is removed as regulatory reporting requirement for OfS-regulated providers. Consequently, SFC and DfE (Northern Ireland) have confirmed they will not collect TRAC(T) data from institutions in Scotland and Northern Ireland, and HEFCW will not proceed with implementation of TRAC(T) in Wales.
From 2020-21 submission onwards, the requirement for a Committee of the governing body to approve the TRAC return has been removed. The Committee of the governing body is required to review the process for producing the TRAC return and be assured that it complies with the TRAC requirements. Please refer to sections 2.1.4.3 and 2.1.5.22 for more details of the TRAC requirements.
The TRAC Oversight Group is responsible for reviewing the information provided to the Committee of the governing body as well as undertaking reasonableness checks of the data used within the TRAC return and agreeing the return prior to it being signed off by the accountable officer.
The UK Research and Innovation (UKRI) Funding Assurance Programme (FAP) provides assurance on the regularity of expenditure to the UKRI Accounting Officer. Information about the FAP process can be obtained from the UKRI website, or by contacting UKRI directly. UKRI will inform institutions how they will review TRAC systems in advance of each visit, and are likely to consider institutional self-assessment when designing their assurance programme. The TRAC requirements that were included in the TRAC guidance for the year being reviewed are the requirements that an institution’s level of compliance will be reviewed against (summarised in the TRAC Statement of Requirements document for ease of reference). The TRAC Development Group (TDG) has undertaken work to identify the more common areas where institutions may fall out of compliance with the TRAC requirements. To assist institutions in checking on their compliance, Annex 2.1b ‘TRAC assurance reminders checklist’ has been added to the TRAC guidance. This is a useful reference source of common issues for TRAC Practitioners when reviewing their own systems. It also contains a consolidation of the ‘What could go wrong’ sections of the TRAC Guidance. In addition, TDG has produced a good practice guide ‘An assurance framework for TRAC’ which is strongly supported Gareth MacDonald, UKRI Head of Assurance.
The impact of FRS102 affects research income that is received for revenue and capital purposes, and there will be variation according to whether the accrual or performance model has been selected as the accounting policy for government grants. As the assessment of publicly funded research for dispensation purposes is an average taken over a five-year period, it is not expected that the impact of FRS102 will be material. Capital grants do, however, have the potential to distort the calculation of eligibility for dispensation.
Pensions are by nature technical, and can be complex to understand. It is therefore necessary to consider the detail in order to understand how the accounting approaches differ for different schemes. The schemes used by universities are not all treated the same way in the Transparent Approach to Costing (TRAC). The purpose of this briefing note is to provide TRAC practitioners and members of higher education (HE) providers’ internal TRAC oversight groups with background information and understanding on the accounting treatment of the different pension schemes that are used by universities in the UK. View the pensions briefing note
Staff costs in the financial statements include staff pay, national insurance costs, pension contributions, pension servicing costs and costs attributable to a deficit recovery plan for USS, SAUL and the Oxford University Staff pension scheme.
In the indexation template, pension contributions for all pension schemes should be excluded from the pay costs line and included under the pension contributions line. Each pension scheme will have different levels of contribution, so a side calculation will likely be necessary to collate the overall data for the institution for entry into the template.
The non-contribution related pension costs for USS, SAUL and the Oxford University Staff Pension schemes are also excluded from the staff costs line in the template, in line with the pension costs being deducted in TRAC (in Table A1). All other pension related costs are included in the pay costs line.
The indexation template has a base year’s data that will likely be taken from the OfS annual finance return (AFR) / HESA Finance return (FR). The TRAC model will detail the adjustments made for USS / SAUL / University of Oxford Staff Pension Scheme. For institutions in England the AFR also contains the forecast information, whereas for institutions in Scotland, Wales and Northern Ireland, the information should be taken from the Financial Forecasts as approved by the Governing Body.
The total expenditure for the base year should not agree to the total expenditure stated in the financial statements/AFR/ HESA FR due to the exclusion of the adjustments made for USS / SAUL / University of Oxford Staff Pension Scheme.
No changes are required in TRAC for the year ending 31 July 2023 or 31 July 2024. Further announcements will be made regarding future years.