Finance Regulations

1. Background

The University is a company limited by guarantee (registered number SC7335), and is constituted by Statutory Instrument under The Queen Margaret University, Edinburgh (Scotland) Order of Council 2007 (made in accordance with the Further and Higher Education (Scotland) Act 1992) which sets out the objects, powers and framework of governance of the University.

The University is a charity within the meaning of Section 506(1) of the Income and Corporation Taxes Act 1988 (ICTA 1988) and is recorded on the index of charities maintained by the Office of the Scottish Charity Regulator (Charity No. SC002750) under the provisions of The Charities and Trustee Investment (Scotland) Act 2005.

The Financial Memorandum between the Funding Council and the University sets out the terms and conditions on which grant is made. The governing body (University Court) is responsible for ensuring that conditions of grant are met. The Financial Regulations of the University form part of this overall system of accountability.

2. Status of Financial Regulations

The Financial Regulations were originally approved by University Court on 17 October 2012. They apply to the University and all its subsidiary entities and are subject to regular review. The Financial Regulations are subordinate to the Statutory Instrument and to any restrictions contained within the University’s Financial Memorandum with the Funding Council.

The purpose of these Financial Regulations is to provide control over the totality of the University’s resources and provide management with assurances that the resources are being properly applied for the achievement of the University’s objects and of the University’s strategic plan and business objectives while:

• ensuring financial viability and sustainability;
• achieving value for money;
• fulfilling its responsibility for the provision of effective financial controls over the use of public funds;
• ensuring that the University complies with all relevant legislation; and
• safeguarding the assets of the University.

Compliance with the Financial Regulations is compulsory for all staff connected with the University. It is the responsibility of Budget-holders to ensure that members of staff are made aware of the existence and content of the University’s Financial Regulations.

The Audit & Risk Committee is responsible for maintaining a continuous review of these Financial Regulations, through the Director of Operations & Finance, and for advising the University Court of any additions or changes necessary.

The University’s detailed financial procedures set out how these Regulations will be implemented and are contained in separate documents available via the Finance intranet site.  

B. CORPORATE GOVERNANCE

3. Authority of University Court in respect of these Regulations

The authority for the Regulations shall be the University Court, which shall have sole responsibility for approving any amendments.

4. Delegated Authorisation Schedule

The specific powers reserved to University Court and those delegated to others are set out in the Delegated Authorisation Schedule.

5. University Court – Financial Responsibilities

University Court is responsible for making such arrangements as are appropriate and as it thinks fit for the conduct of the financial affairs of the University, subject to any conditions which may be imposed as conditions of payment of grant from the Funding Council, as set out in the Financial Memorandum.

The primary financial responsibilities of University Court are to:

• oversee the management of all of the revenue and property of the University and to exercise general control over its affairs, purposes and functions, taking all final decisions on matters of fundamental concern to the institution;
  
  
• ensure the solvency of the University and to safeguard its assets;
  
  
• approve the mission of the University and its strategic plans, setting out its aims and objectives in teaching and research and identifying the financial, physical and staffing requirements for their achievement;
  
  
• approve a financial strategy, long-term business plans and annual budgets;
  
  
• monitor the University's performance against approved plans and key performance indicators;
  
  
• ensure the proper use of public funds awarded to the University and observance of the terms of the Financial Memorandum between the University and the Funding Council;
  
  
• act as trustee for any legacy, endowment, bequest or gift in support of the University's activities;
  
  
• establish and monitor effective systems of internal control and accountability throughout the University;
  
  
• oversee the University's arrangements for internal and external audit and to approve the University's annual financial statements.

6. Designated (or ‘Accountable’) Officer

The Principal is the designated officer of the University and as such will be required to satisfy the University Court that there is compliance with all such conditions as may be prescribed by the Funding Council. The designated officer may be required to appear before committees of the Scottish Parliament along with the Chief Executive of the Funding Council on any matter relating to grant to the University which arises before such committees.  The designated officer is responsible for advising the University Court if at any time in their opinion any action or policy of the University Court is incompatible with the terms of the Financial Memorandum with the Funding Council. In the event of University Court deciding nevertheless to proceed with such action or policy, the designated officer is required to inform the Chief Executive of the Funding Council in writing.  

The Principal shall, together with the Chair of University Court, be required to sign the University’s annual financial statements.

7. Committee Structure

The University Court has ultimate responsibility for the University’s finances, but delegates specific powers and processes to certain committees that it has established and that are detailed below. These committees are accountable to the University Court.

7.1 Finance and Estates Committee

The University Court has a Finance and Estates Committee whose terms of reference and membership are as set out in Appendix 1.

The Finance and Estates Committee is inter alia responsible to the University Court for the overall financial arrangements of the University. The Committee considers and reports to the University Court on the development, implementation and review of financial strategy, policy and procedures. It also considers and reports on the annual estimates of income and expenditure, the capital programme and all proposals for the borrowing of money. The Committee reviews the annual financial statements and may recommend to the University Court that they be approved. The Committee also monitors the financial position of the University throughout the financial year.

7.2  Audit & Risk Committee

The University Court has an Audit & Risk Committee whose terms of reference and membership are as set out in Appendix 2.

The Audit & Risk Committee is responsible to University Court for ensuring compliance with the relevant requirements placed on the University in terms of the Financial Memorandum with the Funding Council.

The Committee considers the financial statements for each financial year from a compliance and disclosure perspective. The Committee has the right of access to obtain all the information it considers necessary and to consult directly with the internal and external auditors.

7.3 Senior Management Remuneration Committee

The University Court has a Senior Management Remuneration Committee, whose terms of reference and membership are set out in Appendix 3.

The Senior Management Remuneration Committee considers and determines the pay and conditions of the senior officers of the University.

7.4 Nominations Committee

The University Court has a Nominations Committee whose terms of reference and membership are as set out in Appendix 4.

The Nominations Committee advises the University Court on membership of the University Court and its Committees.

8  Others with Financial Responsibility

8.1  Director of Operations & Finance

The Director of Operations & Finance is responsible to the Principal, in the latter’s role as designated officer, for the administration of the financial affairs of the University and for ensuring that proper financial records are kept and that adequate and effective methods and procedures for financial control are followed.

The Director of Operations & Finance reports to the Principal and shall provide regular reports on estimates, budgets, and monthly and annual financial statements.

The Director of Operations & Finance shall keep the Principal and the Audit & Risk Committee informed of (i) any material changes in the University’s procedures and controls and (ii) any instance of material failure to comply with approved procedures and controls.

The Director of Operations & Finance shall advise the Principal and University Court and its committees on relevant financial matters; and, on behalf of the Principal and as required by the Financial Memorandum, shall ensure that adequate financial and accounting arrangements are made within the University and throughout all Schools and support areas.

The Director of Operations & Finance or their authorised representative shall have authority to (a) enter at all reasonable times any University premises in relation to relevant financial matters, (b) gain access to all records, documents and correspondence relating to any financial or other transactions of the University, (c) require and receive such explanations as are, or as they deem to be, necessary concerning any financial matter under examination, and (d) require any employee of the University to produce money, goods or other University property under that employee’s control.

 8.2  Budget-holders

Budget-holders are responsible for financial management for the areas or activities they control. They are advised by the Director of Operations & Finance in executing their financial duties. The Director of Operations & Finance will also supervise and approve the financial systems operating within their cost centres, including the form in which accounts and financial records are kept.

Budget-holders are responsible for establishing and maintaining clear lines of responsibility and accountability within their School or service area for all financial matters.

Budget-holders will provide the Director of Operations & Finance with such information as may be required to enable (a) compilation of the University’s financial statements, (b) implementation of financial planning; and (c) implementation of audit and financial reviews, projects and value for money studies.

8.3  All members of staff

All members of staff of the University and its subsidiary entities shall be aware of, and have a general responsibility for, the security of the University’s property, for avoiding loss and for due economy in the use of resources.

Members of staff shall ensure that they are aware of the University’s financial authority limits and the values of purchases for which quotations and tenders are required (see Financial Procedures).

They shall make available any relevant records or information to the Director of Operations & Finance or to their authorised representative in connection with the implementation of the University’s financial policies, these Financial Regulations and the systems of financial control.

They shall provide the Director of Operations & Finance with such financial and other information as they deem necessary from time to time, to carry out the requirements of University Court.

Members of staff shall immediately notify the Director of Operations & Finance whenever any matter arises that involves, or is thought to involve, irregularities concerning, inter alia, the funds or property of the University.

9  Risk Management

The University acknowledges the risks, including financial risks, inherent in its business and is committed to managing those risks. The University Court has overall responsibility for ensuring that there is a risk management policy and associated Risk Register and that there are appropriate processes for the identification, evaluation and monitoring of individual significant risks. The University Court has responsibility for determining and articulating risk appetite. The University Court has adopted a risk management strategy and this is implemented through the Executive Board and the Audit & Risk Committee.

Managers must ensure that any agreements negotiated within their areas with external bodies cover any legal liabilities to which the University may be exposed. All contracts must be approved in accordance with the Delegated Authorisation Schedule adopted by the University Court.

10  Whistleblowing

 Whistleblowing in the context of the Public Interest Disclosure Act is the disclosure by an employee (or other party) of suspected malpractice in the workplace.

Normally, any concern about a workplace matter at the University should be raised with the relevant member of staff’s immediate line manager. However, the University recognises that the seriousness or sensitivity of some issues, together with the identity of the person the member of staff thinks may be involved, may make this difficult or impossible. If this is the case then reference should be made to the University’s Public Interest Disclosure Policy.

The full policy and procedures for whistleblowing are set out in the University’s Public Interest Disclosure Policy. QMU Staff and Students can view this policy via the Intranet -  http://intranet.qmu.ac.uk/sites/humresources/

11  Code of Conduct

The University is committed to the highest standards of openness, integrity and accountability. It seeks to conduct its affairs in a responsible manner, having regard to the principles established by the Committee on Standards in Public Life, which members of staff at all levels are expected to observe. These principles are set out in Appendix 5.

Members of University Court, senior officers of the University and all members of staff involved in procurement are required to disclose interests in the University’s Register of Interests maintained by the University Secretary, and to ensure that entries in the Register are kept up to date.

No member of University Court or member of staff will be a signatory to a contract on behalf of the University where he or she (or a related party) also has a personal interest in the activities of the other party.

It is an offence within the Bribery Act 2010 for a member the University Court or a member of staff to accept corruptly any gift or consideration as an inducement or reward for doing, or refraining from doing, anything in an official capacity or showing favour or disfavour to any person in an official capacity. The guiding principles to be followed by all Court members and members of staff must be;

• the conduct of individuals should not create suspicion of any conflict between their official duty and their private interest
  
  
• the action of individuals acting in an official capacity should not give the impression that they have been (or may have been) influenced by a benefit to show favour or disfavour to any person or organisation

Thus, members of staff and Court members should not accept any gifts, rewards or hospitality (or have them given to members of their families) from any organisation or individual with whom they have contact in the course of their work that would cause them to reach a position whereby they might be, or might be perceived by others to have been, influenced in making a business decision as a consequence of accepting such gifts, rewards or hospitality.

The frequency and scale of hospitality accepted should not be significantly greater than the University would be likely to provide in return.

When it is not easy to decide between what is and what is not acceptable in terms of gifts or hospitality, the offer should be declined or advice sought from the Director of Operations & Finance, who will maintain a register of gifts and hospitality received where the value is other than nominal (ie, greater than £25). Members of staff in receipt of such gifts or hospitality are obliged to notify the Director of Operations & Finance promptly.

University Court members should seek advice where required from the Secretary to the Court on matters pertaining to conduct.

See also section 8.3 on staff responsibilities and section 15.4 on corruption and fraud. 

C. FINANCIAL MANAGEMENT AND CONTROL

12 Financial Planning

12.1 General

 The Director of Operations & Finance is responsible for preparing financial forecasts for submission to the Funding Council. These financial forecasts should be consistent with the University’s Strategic Plan and strategies approved by University Court, such as Research, Learning and Teaching, Estates and Information and Human Resources. They include Income & Expenditure, Balance Sheet and Cash Flow forecasts and their scope includes a projected out-turn for the current year along with forecasts for the following three years.

12.2 Budget preparation

 The Director of Operations & Finance is responsible for preparing each year an annual revenue budget for consideration by Finance and Estates Committee before submission to University Court for approval.

The Director of Operations & Finance must ensure that budget-holders are notified as soon as their budgets are approved by University Court. Budget-holders are responsible for the economic, effective and efficient use of budgets.

12.3 Capital programme

 Capital expenditure includes all expenditure on land, buildings, equipment, vehicles, furniture and associated costs, whether or not they are funded from capital grants or from internally generated resources. Expenditure of this type can only be considered as part of the capital programme approved by the University Court.

Major capital projects, defined as having a value in excess of £500k,should be supported by:

• a statement that demonstrates the project’s consistency with the University’s Strategic Plan and subsidiary strategies;
  
  
• a statement of the objectives of the project;
  
  
• an options appraisal;
  
  
• a full risk assessment and project plan;
  
  
• a capital budget for the project, which should include a comprehensive statement of costs and proposed funding sources;
  
  
• a financial evaluation of the project, including investment appraisal, cash flow forecast, and impact on revenue budgets;
  
  
• a demonstration of compliance with tendering procedures and Funding Council requirements.

Regular reports summarising the progress and financial performance of all capital projects will be submitted to the Finance and Estates Committee for monitoring purposes.

Following completion of a major capital project, a final report should be submitted to the Finance and Estates Committee including actual income and expenditure against budget, along with other matters concerning completion of the project.

Business plans for projects involving non-capital expenditure will be subject to approval by the Finance and Estates Committee or the University Court, according to the thresholds contained in the Delegated Authorisation Schedule.

Proposals should be supported by:

• a statement that demonstrates consistency with the Strategic Plan and subsidiary strategies;
  
  
• details of the business and what product or service will be delivered;
  
  
• details of the business case, including market assumptions;
  
  
• details of all resources required to deliver the business;
  
  
• a financial evaluation of the proposal, including its impact on revenue, sensitivity analysis, and consideration of taxation issues.

In planning and undertaking overseas activity, the institution must have due regard to the relevant guidelines issued by the Funding Council and the Quality Assurance Agency and to the University’s internationalisation strategy.

13  Financial Control

The control of income and expenditure within an agreed budget is the responsibility of the designated budget-holder, who must ensure that day-to-day monitoring is undertaken effectively. Significant departures from agreed budgetary targets must be reported immediately to the Director of Operations & Finance and, if necessary, corrective action taken.

The budget-holders are assisted in their duties by management information provided by the Director of Operations & Finance, in particular monthly management accounts. The types and timing of management information prepared is regularly reviewed by the Director of Operations & Finance to reflect the particular management needs of the University.

The Director of Operations & Finance is responsible for supplying budgetary reports on all aspects of the University’s finances to the Finance and Estates Committee. These reports are subsequently presented to University Court, which has overall responsibility for the institution’s finances.

At the year end, budget-holders will not normally have the authority to carry forward an unspent balance on their recurrent budget to the following year. Any requests to do so on an exceptional basis will be considered in the context of the setting and review of the subsequent year’s budget.

Non-recurrent funds allocated to budget-holders shall be disbursed or committed within a specified period of time, failing which any funds not committed shall be reallocated.

14   Accounting Arrangements

14.1 Financial year

 The University’s financial year will run from 1 August until 31 July.

14.2 Basis of accounting

 The consolidated financial statements are prepared on the historical cost basis of accounting and in accordance with the Companies Acts and with applicable accounting standards.

14.3 Format of the financial statements

 The Financial Statements are prepared in accordance with the Statement of Recommended Practice, “Accounting for Further and Higher Education”, subject to any specific requirements of the Funding Council.

14.4 Capitalisation and depreciation policies

 The University Court shall from time to time agree policies on limits for the capitalisation of tangible fixed assets and on the rates of depreciation to be applied to tangible fixed assets.

The limit for capitalisation of tangible fixed assets will be set at £10,000.

No depreciation shall be applied to heritable land. Heritable buildings shall be depreciated on a straight line basis over their expected useful lives of between 35 and 50 years. Capitalised furniture and equipment shall be depreciated on a straight line basis over its expected useful life, generally between three and five years. A full year’s depreciation charge is made in the year of acquisition.

14.5 Accounting records

 The Director of Operations & Finance is responsible for the retention of financial documents. These should be kept in a form that is acceptable to the relevant authorities. The University is required by law to retain prime documents for six years, including invoices, bank statements and payroll records. The Director of Operations & Finance will make appropriate arrangements for the retention of electronic records. Retention arrangements must also comply with specific requirements of funding organisations, for instance EU bodies.

14.6 Public access

 The University Court is required to supply any person with a copy of the University’s most recent financial statements. The University Court may levy a reasonable fee and this will be charged at the discretion of the Director of Operations & Finance. The University will also allow members of the public to inspect the annual statutory accounts during normal working hours and will make the accounts available on the University’s website. The University may also be required to disclose financial information under the Freedom of Information (Scotland) Act 2002.

14.7 Taxation

The Director of Operations & Finance is responsible for advising budget-holders on all taxation issues and will issue instructions on compliance with statutory requirements including those concerning VAT, import duty, Corporation Tax, PAYE and National Insurance. The Director of Operations & Finance is responsible for maintaining the institution’s tax records, making tax payments, receiving tax credits, and submitting tax returns by their due date as appropriate.  

15  Audit

15.1 General

 External and internal auditors shall have authority to:

• access University premises at reasonable times;
  
  
• access all assets, records, documents and correspondence concerning any matter under examination;
  
  
• require and receive such explanations as are necessary concerning any matter under examination;
  
  
• require any employee of the University to account for cash, stores or any other University property under his control;
  
  
• access records belonging to third parties, such as contractors, when required.
  
  

15.2 External Audit

The Audit & Risk Committee shall, after consideration and on advice received, appoint an independent external auditor. The Audit & Risk Committee shall keep under review its external audit arrangements and conduct a formal review at the end of each contract period. Subject to the outcome of such review, the Members of the University shall formally reappoint the external auditor each year at the annual general meeting.

The primary function of the external auditor will be to report on the Financial Statements of the University and to carry out such examination of the statements and underlying records and control systems as is necessary to reach their opinion on the statements. The external auditor's report shall also cover the regularity of transactions (in other words, whether the terms and conditions attached to the funds provided to the University have been complied with).

The Director of Operations & Finance is responsible for drawing up a timetable for final accounts purposes and will advise staff and the external auditor accordingly.

15.3 Internal Audit

 The Audit & Risk Committee shall appoint an internal auditor or an internal audit service for the purpose of providing the University Court with assurance on the adequacy and effectiveness of the University’s system of internal control. The contract for internal audit services should be tendered at least every five years.

The responsibility for the maintenance and operation of the systems of internal control shall remain fully with officers of the University.

The internal audit service remains independent in its planning and operation but has direct access to University Court, the Principal and the Convener of the Audit & Risk Committee.

15.4 Fraud and corruption

 It is the duty of all members of staff to notify the Director of Operations & Finance as soon as possible of any financial irregularities within their areas of responsibility. The Director of Operations & Finance shall immediately notify the University Secretary, the Head of Human Resources and the internal audit service of all financial irregularities to enable an investigation to be carried out in accordance with the Fraud Response Plan. In addition, any employee may make appropriate disclosures under the Public Interest Disclosure Policy (see paragraph 10).

 15.5 Value for money

 The University Court is responsible for delivering value for money from public funds. It should keep under review its arrangements for managing all the resources under its control, taking into account guidance on good practice issued from time to time by the Scottish Funding Council, Audit Scotland, or other relevant bodies.

Internal audit will have regard to value for money in its programme of work. This will be used to enable the Audit & Risk Committee to refer to value for money in its annual report.

 15.6 Other auditors

 The University may, from time to time, be subject to audit or investigation by external bodies such as the Scottish Funding Council, Audit Scotland, the Scottish Government, EU auditors and HM Revenue & Customs. These have the same right of access as external and internal auditors.

16 Treasury Management

16.1 Treasury management policy

 The University Court, on the advice of the Finance and Estates Committee, is responsible for approving a treasury management policy statement (based on CIPFA’s Treasury Management in the Public Services: Code of Practice together with cross-sectoral guidance and sector-specific guidance) setting out a strategy and policies for cash management, long-term investments and borrowings. This will require compliance with Funding Council rules regarding approval for any secured or unsecured loans that go beyond the general consent levels set out in the financial memorandum. The University Court has a responsibility to ensure implementation, monitoring and review of such policies.

All executive decisions concerning borrowing, investment or financing (within policy parameters) shall be delegated to the Director of Operations & Finance. All borrowing shall be undertaken in the name of the University and shall conform to any relevant funding body requirements. The Director of Operations & Finance and his or her staff are required to act in accordance with CIPFA’s Code of Practice.

The Director of Operations & Finance will report to the Finance and Estates Committee at least annually on the activities of the treasury management operation and on the exercise of treasury management powers delegated to him or her.

16.2 Appointment of bankers and other professional advisers

The University Court is responsible for the appointment of the University’s bankers and other professional financial advisers (such as investment managers) on the recommendation of the Finance and Estates Committee. The appointment shall be for a specified period after which consideration shall be given by the Finance and Estates Committee to competitively tendering the service.

16.3 Banking Arrangements and Borrowing Powers

No member of staff of the University other than the Director of Operations & Finance, acting on the authority of University Court, shall open a bank account either in the name of the University or otherwise into which shall be paid any monies which belong to the University or which may be due to the University.

Cheques and other documentation issued by the University’s bank shall be held in safe custody as directed by the Director of Operations & Finance.

All cheques shall bear the signatures of authorised officers from a list of such officers as shall be approved by University Court. Two signatures shall be required to operate University bank accounts.

All automated transfers on behalf of the University, such as BACS or CHAPS, must be authorised in the appropriate manner. Details of authorised persons and limits shall be set out in the financial procedures.

The Director of Operations & Finance is responsible for ensuring that all bank accounts are subject to regular reconciliation and that large or unusual items are investigated as appropriate.

The bank accounts shall not be overdrawn in excess of a sum approved by University Court and the University’s bankers.

17 Income

17.1 Maximisation of income

The Director of Operations & Finance is responsible for ensuring that appropriate procedures are in operation to enable the University to receive all income to which it is entitled. It is the responsibility of all staff to ensure that revenue to the institution is maximised by the efficient application of agreed procedures for the identification, collection and banking of income. In particular, this requires the prompt notification to the Director of Operations & Finance of sums due so that collection can be initiated.

The Director of Operations & Finance is responsible for ensuring that all grants notified by the Funding Council and other bodies are received and appropriately recorded in the University’s accounts.

The Director of Operations & Finance is responsible for ensuring that all claims for funds, including research grants and contracts, are made by the due date.

 17.2 Receipt of cash, cheques and other negotiable instruments

 The Director of Operations & Finance is responsible for the prompt collection, security and banking of all income received. All monies received by and for the University shall be passed promptly to the Finance Office for immediate lodging in the University's bank account. The Director of Operations & Finance shall keep accurate chronological records of such deposits.

Receipts shall normally be issued in acknowledgement of all sums received, unless some other form of control is in operation with the consent of the Director of Operations & Finance. All receipt forms, invoices, tickets or other official documents in use and electronic collection systems must have the prior approval of the Director of Operations & Finance.

All sums received must be paid in and accounted for in full, and must not be used to meet miscellaneous departmental expenses or be paid into the departmental petty cash float. Personal or other cheques must not be cashed out of money received on behalf of the University.   

 17.3 Collection of debts

 In accordance with the University’s Debt Policy, the Director of Operations & Finance shall ensure that:

• amounts due to the University are raised promptly on official invoices
• invoices are prepared with care, showing the correct amount due with VAT correctly charged where appropriate
• monies received are posted to the correct debtor account
• swift and effective action is taken in collecting overdue debts, in accordance with financial procedures
• overdue debts are monitored and reports prepared for management.

Only the Director of Operations & Finance is authorised to implement credit arrangements and indicate the periods in which different types of invoices must be paid.

The Director of Operations & Finance has authority to write off debts up to the limit set out on the Delegated Authorisation Schedule.

17.4 Student Fees

The procedures for collecting tuition fees and residence fees must be approved by the Director of Operations & Finance, who is responsible for ensuring that all student fees due to the institution are received.

Amounts due from any student who has not paid an account for tuition fees, residence fees or any other item owing to the University shall be dealt with in accordance with the University’s Student Debt Recovery Procedure.

18 Research Grant and Contracts

All income arising from research grants and contracts awarded to staff of the University shall be vested in the University.

All expenditure on pay and non-pay items in respect of research grants and contracts shall be governed by the Regulations.

Where approaches are to be made to outside bodies for support for research projects or where contracts are to be undertaken on behalf of outside bodies, it is the responsibility of the budget-holder to ensure that the financial implications have been appraised in order to ensure that there is adequate provision of resources to meet all commitments. This will include obtaining a set of grant terms and conditions from each organisation providing funding to enable appropriate monitoring of compliance.

The research agreement must be in line with the institution’s policy with regard to recovering the full economic cost of research projects, taking into account different procedures for the pricing of research depending on the nature of the funding body.

The Director of Operations & Finance shall maintain financial records relating to all research grants and contracts and shall initiate all claims for reimbursement from sponsoring bodies by the due date. Each grant or contract will have a named principal investigator and will be assigned an unique project code within the School.

Control of pay and non-pay expenditure may be delegated by the budget-holder to the grant holder but any overspend or under-recovery of overheads is to be the clear responsibility of the School, with any loss being a charge on it.

Many grant-awarding bodies and contracting organisations stipulate conditions under which their funding is given. In addition, there are often procedures to be followed regarding the submission of interim or final reports or the provision of other relevant information. Failure to respond to these conditions often means that the institution will suffer a significant financial penalty. It is the responsibility of the named grant-holder to ensure that conditions of funding are met. Any loss to the University resulting from a failure to meet conditions of funding will be charged to the School.

In order to ensure high quality outputs from commercial projects and safeguard the reputation of the University, Research Centre Directors should review quality of outputs prior to presentation to the external funder. Involvement of external reviewers will be required where internal expertise is insufficient and where such external involvement is practicable.

19 Other income-generating activity

19.1 Commercial activity

Commercial activity includes all income-generating activity other than core teaching or research funded by a public or charitable body. All commercial activity shall be priced in such a way as to provide a surplus over the full economic cost of the activity, unless there is a clear commercial or financial justification.

The Director of Operations & Finance shall cause financial records to be maintained relating to all commercial activity. Control of pay and non-pay expenditure may be delegated by the budget-holder to the lead consultant but any unexpected loss on the contract will be the responsibility of the School.

19.2 Off-site collaborative provision

Any contract or arrangement whereby the University provides education to students away from institution premises and in collaboration with a partner, or with the assistance of persons other than the University’s own staff, must be subject to the following procedures.

The proposal shall be subject to scrutiny by the Portfolio Development Group, which will consider the strategic fit and will consider the risk factors associated with the proposed partnership and agree an appropriate entry in the University’s risk register. It shall also be subject to scrutiny by Senate, which shall be responsible for approving academic standards and quality assurance arrangements.

There shall be a Memorandum of Agreement signed by the Principal and on behalf of the partner organisation before any provision is made. Details of new collaborative arrangements must be reported to the University Court on a regular basis.

19.3 Matched funding

Any project which involves matched funding requires the approval of the budget-holder, acting on the advice of the Director of Operations & Finance and the Head of Finance, prior to any commitment being entered into. Such approval shall be dependent upon the relevant budget-holder being able to demonstrate that eligible matching funds are available and that the project is financially viable by the application of the University’s costing and pricing policy.

If the University sub-contracts such work to external providers, the Head of Finance shall ensure that:

• There is a written contract approved by the Dean, which allows for full audit access to detailed records
• Appropriate monitoring procedures are in place to ensure that the outputs are achieved and the provision is of suitable quality
• Payments are only made against detailed invoices.

 

19.4 Intellectual Property

19.4.1 General

Certain activities undertaken within the University including research and consultancy may give rise to ideas, designs and inventions which may be patentable. These are collectively known as intellectual property.

19.4.2 Patents

The University Court, on the recommendation of the Finance and Estates Committee, is responsible for establishing procedures to deal with any patents accruing to the University from inventions and discoveries made by staff in the course of their research.

19.4.3 Intellectual property rights

 In the event of the University deciding to become involved in the commercial exploitation of inventions and research, the Finance and Estates Committee will be responsible for establishing procedures for dealing with intellectual property.

20 Endowment and Trust Funds

The Director of Operations & Finance shall ensure the proper and safe custody of all funds administered by University Court and shall make the necessary arrangements for the proper administration of each fund in accordance with the conditions laid down by the trust or other deed.

The Director of Operations & Finance is responsible for maintaining financial records in respect of gifts, benefactions and donations made to the University and for initiating claims for recovery of tax where appropriate.

21 Expenditure

21.1 Scheme of Delegation

Each budget-holder is responsible for expenditure within his or her area of responsibility. Authority to incur expenditure may be delegated to named members of staff within the budget-holder’s area of responsibility. In exercising this delegated authority, members of staff are required to observe these financial regulations and all related procedure manuals.

The following duties must be appropriately segregated:

• placing orders or awarding contracts;
• approving orders;
• receiving goods;
• checking invoices;
• authorising invoices.

21.2 Paper-based systems

 The Director of Operations & Finance shall maintain a register of authorised signatories and budget-holders must supply him with specimen signatures of those authorised to authorise orders, invoices, payroll instructions etc.

 21.3 Electronic systems

 The Director of Operations & Finance shall control the creation of requisitioners and authorisers and their respective financial limits through the PECOS system.

The Director of Operations & Finance must be notified immediately of any changes to those authorised to commit expenditure, including staff leavers.

21.4 Procurement

The University requires all budget-holders, irrespective of the source of funds, to obtain supplies, equipment and services at the lowest possible cost consistent with quality, delivery requirements and sustainability, and in accordance with sound business practice and statutory regulations. Factors to be considered in determining lowest cost are noted in the detailed financial procedures.

The Director of Operations & Finance is responsible for:

• taking such action as necessary to ensure that the University’s procurement policy and procedures are known and observed by all involved in purchasing for the institution;
• advising on matters of procurement policy;
• advising budget-holders where required on specific purchases;
• developing appropriate contracts and approved supplier arrangements to assist budget-holders in meeting their value for money obligations;
• ensuring that the University complies with EU regulations on public purchasing policy.

Where possible, orders should be placed using University or consortium contracts or approved suppliers. Where a suitable contract is not in place, procedures covering tenders and quotations should be followed. The University has entered into a contract with the University of Edinburgh who provide a service to manage and administer the procurement process and provide advice on procurement matters.

21.5 Purchase orders

The ordering of goods and services shall be in accordance with the University’s detailed financial and procurement procedures in furtherance of the procurement strategy. Official University orders must be placed for the purchase of all goods or services using the University’s electronic purchase order processing system (PECOS) wherever possible, with any exceptions approved by the Director of Operations & Finance. All purchase orders must refer to the University’s conditions of contract.

21.6 Building contracts

Building contracts are administered by the Director of Campus & Commercial Services.

Consultants may be appointed if the project is too large or too specialised for internal resources. Appointments shall be subject to tendering and will comply with the University’s procurement procedures.

Investment appraisals should be prepared for all major projects in conjunction with the Director of Operations & Finance for consideration by Finance and Estates Committee and approval by University Court. Investment appraisals should comply with appropriate funding body guidance.

Where appropriate, following consideration by the Committee and approval by the University Court, submissions should be forwarded to the Funding Council. If the required agreement is secured, the Funding Council procedures should then be followed. The Funding Council guidance on good practice should be followed even when approval is not required.

21.7 Receipt of goods

All goods shall be received at designated receipt and distribution points. They shall be checked for quantity and/or weight and inspected for quality and specification. A delivery note shall be obtained from the supplier at the time of delivery and signed by the person receiving the goods.

If the goods are deemed to be unsatisfactory, the record shall be marked accordingly and the supplier immediately notified so that they can be collected for return as soon as possible. Where goods are short on delivery, the record should be marked accordingly and the supplier immediately notified.

All persons receiving goods on behalf of the University must be independent of those who negotiated prices and terms and authorised the official order.

21.8 Payment of invoices

 The procedures for making all payments shall be in a form specified by the Director of Operations & Finance.

The Director of Operations & Finance is responsible for deciding the most appropriate method for payment for categories on invoice. Payments to UK suppliers will normally be made by BACS transfer or computer cheque.

Invoice payments will only be made against orders which have been authorised by the budget-holder. Payment will be made if:

• the goods have been received, examined and approved with regard to quality and quantity or that services rendered are satisfactory;
• the goods/services have been checked against the official purchase order;
• invoice details are correct as regards quantity, unit price, discount etc;
• the invoice is arithmetically correct;
• the invoice has not previously been passed for payment;
• where appropriate, an entry has been made on a stores record or inventory;
• the budget holder has specified an account code for which they are an authorised signatory and which is appropriate to the nature of the goods/services.

Where the purchase order has been placed via the electronic PECOS system, payment may be made against invoices that can be matched to a receipted order.

21.9 Staff reimbursement

The University’s purchasing and payment procedures are in place to enable the majority of goods and services to be procured without staff having to incur any personal expense. However, on occasion staff may incur expenses where it is clearly not practicable for the University to procure these, particularly in relation to travel. Reimbursement of expenses shall be by BACS transfer.

Where this is the case, the University’s procedures on travel and subsistence expenses, as set out in the Expenses and Benefits Procedures Manual, must be strictly adhered to. Members of staff and other persons authorised to travel on official University business shall do so in accordance with these procedures, with the general object of using the most cost-effective and convenient form of transport appropriate to the circumstances. All arrangements for overseas travel must be approved by the budget-holder or line manager in advance of committing the University to those arrangements or confirmation of any travel bookings.

Where spouses, partners or other persons unconnected with the University intend to participate in a trip, this must be clearly identified in advance and agreement to the reimbursement to the University of the expected additional costs shall be obtained in advance of travel.

All claims for reimbursement shall be counter-signed by a signatory other than the claimant and at a more senior level within the University. This will usually be the authorised signatory on the relevant cost centre. If the claimant is the authorised signatory, the claim should be counter-signed by the claimant’s line manager. If the claimant is senior to the authorised signatory, the claim should be counter-signed by both the authorised signatory and the claimant’s line manager. All claims shall be submitted to the Finance Department within three months of the claimant’s return to the University and claims submitted thereafter will not normally be accepted.

Authorisation of an expense claim shall be taken to mean that:

• the travel was authorised
• the expenses were properly and necessarily incurred and receipts have been supplied as required
• consideration has been given to value for money in choosing the mode of transport.

21.10 Allowances for members of University Court

Claims for out-of-pocket expenses from members of University Court shall be authorised by the Secretary to the University Court.

21.10A Allowances for the University Chancellor

Claims for expenses incurred by the University Chancellor on University business shall be authorised by the Principal.

21.11 Petty cash

Where necessary, members of staff may purchase certain items and claim reimbursement from the University or department petty cash, up to a maximum limit of £30. A petty cash voucher should be completed, indicating the item purchased and the account code to be charged. It must be signed by the member of staff and an authorised signatory, and must be supported by an itemised receipt.

Where appropriate, the Director of Operations & Finance may make available to departments such imprests as are considered necessary for the disbursement of petty cash expenses. It is important for security purposes that any department petty cash imprests are kept to a minimum. The member of staff granted a float is personally responsible for its safe-keeping. The petty cash box must be kept locked in a secure place in compliance with the requirements of the University’s insurers when not in use and will be subject to periodic checks by the budget-holder and by members of Finance division staff.

Under no circumstance shall official petty cash floats be borrowed or used for personal purposes for the cashing of personal cheques or for the payment of salaries.

Cash rolls from suppliers’ tills which do not give details of the items purchased are not acceptable as receipts for petty cash purposes and suppliers should be requested to supply an itemised receipt.

21.12 Payments to students

Payments to students on behalf of sponsoring organisations shall be made on the authority of the Director of Operations & Finance, on the basis of detailed supporting documentation supplied by the relevant department.

21.13 Late payment rules

The Late Payment of Debts (Interest) Act 1998 was introduced to give small businesses the right to charge interest on late payments from large organisations and public authorities. It has now been extended to medium, large and public sector organisations. Interest can be charged at 8% above Bank of England base rate.  In view of the penalties in this Act, departments should ensure that invoices are authorised and presented for payment without undue delay.

22 Pay Expenditure

22.1 Remuneration policy

All University staff will be appointed to the salary scales approved by University Court and in accordance with appropriate conditions of service. All letters of appointment shall be issued by the Human Resources Department.

Salaries and other benefits for senior management will be determined by the Senior Management Remuneration Committee appointed by University Court.

22.2 Appointment of staff

All contracts of service shall be concluded in accordance with the University’s approved personnel practices and procedures. This includes offers of employment of casual hourly-paid temporary or part-time staff.

Budget-holders shall ensure that the Head of Human Resources and the Director of Operations & Finance are provided promptly with all information they may require in connection with the appointment, resignation or dismissal of employees.

22.3 Salaries

The Director of Operations & Finance shall be responsible for the payment of all salaries and all appropriate deductions therefrom and shall account for all such payments and deductions to the appropriate authorities or agencies. Payment of salaries shall be made monthly in arrears through BACS.

All timesheets and other pay documents, including those relating to fees payable to external examiners, visiting lecturers or researchers, will be in a form and to a timescale prescribed or approved by the Director of Operations & Finance.

All payments must be made in accordance with the University’s detailed financial procedures and comply with HMRC regulations.

The Director of Operations & Finance shall be responsible for keeping all records relating to payroll, including those of a statutory nature.

22.4 Superannuation schemes

The University Court is responsible for undertaking the role of employer in relation to appropriate pension arrangements for employees.

The two principal pension schemes for the University’s staff are the Scottish Teachers’ Superannuation Scheme (STSS) and the Local Government Pension Scheme (LGPS) through the Lothian Pension Fund. A small number of staff have been permitted to remain in the Universities Superannuation Scheme (USS) on appointment.

The University is authorised by members of staff who participate in any of the above Schemes to deduct from their salary payments the appropriate percentage of income due to the Scheme. If they participate in any associated “salary sacrifice” scheme, alternative arrangements apply. The University contributes for each participating member of staff at the rate laid down by the relevant Scheme from time to time.

The Director of Operations & Finance is responsible for the management of pension arrangements, including:

• paying contributions to various authorised superannuation schemes
• preparing the annual return to various superannuation schemes
• administering eligibility to pension arrangements.

 

22.5 Severance and other non-recurring payments

Severance payments shall only be made in accordance with relevant legislation and under any scheme that may be in place. Payments above the thresholds set by the Funding Council require to be approved by the Senior Management Remuneration Committee. Professional advice should be obtained where necessary and the HR Directorate involved in all such cases.

 

23 Property and Assets

23.1 Property

Contractual arrangements for the purchase, disposal, lease or rent of land, buildings or fixed plant shall be jointly authorised by the University Secretary and the Director of Operations & Finance.

23.2 Equipment

Budget-holders shall exercise responsibility and control on behalf of University Court in respect of all equipment, furniture, goods, cash and other property within their department and shall ensure that proper and effective inventories or records of them are maintained for audit and other inspection and in accordance with such guidelines as may be issued from time to time. Budget-holders shall provide details of such inventories and stocks from time to time as may be required by the Director of Operations & Finance.

The University shall maintain an asset register for all land and buildings and for equipment purchases above the University’s capitalisation threshold. This shall form the basis for relevant entries within the University’s annual financial statements and for such other purposes as may be required. The Director of Operations & Finance shall ensure that the register is properly maintained, recording all additions and disposals, and reflecting any relocation or deterioration.

23.3 Stocks and stores

Budget-holders are responsible for establishing adequate arrangements for the custody and control of stocks and stores within their department. The systems used for stores accounting must have the approval of the Director of Operations & Finance.

Budget-holders are responsible for ensuring that regular inspections and stock checks are carried out. Stocks and stores of a hazardous nature should be subject to appropriate security checks and health and safety arrangements.

Where stocks require valuation in the balance sheet, the budget-holder must ensure that the stock-taking procedures in place have the approval of the Director of Operations & Finance and that instructions to appropriate staff within their departments are issued in accordance with advice contained in the University’s financial procedures.

23.4 Vehicles

All vehicles owned or operated by the University shall be used only in accordance with the regulations governing such use as are currently in force.

23.5 Security

Keys to safes or other similar containers are to be kept secure by those responsible at all times. The loss of such keys must be reported to the Director of Operations & Finance immediately.

The Head of Information Services shall be responsible for maintaining proper security and privacy of information held on the University’s computer network. Appropriate levels of security will be provided, such as passwords for networked PCs together with restricted physical access for network servers. Details of these controls are contained in the appropriate IT policies.

Information relating to individuals is subject to the provisions of the Data Protection Act 2018. The University Secretary is the designated data protection officer for the University and is responsible for ensuring compliance with the Act and the safety of documents.

 

23.6 Personal use

Assets owned or leased by the University shall not be subject to personal use without proper authorisation.

 

23.7 Asset disposal

Disposal of equipment and furniture must be in accordance with procedures contained in the detailed financial procedures.

Disposal of land and buildings must only take place in accordance with the authorisation procedures set out in the Scheme of Delegation. The Funding Council consent may also be required if exchequer funds were involved in the acquisition of the asset.

24  Insurances

As part of the overall risk management strategy of the University, all risks will have been considered and those most effectively dealt with by insurance will have been identified. This is likely to include those important potential liabilities which are insurable and will provide sufficient cover to meet any potential risk to all assets.

The Director of Operations & Finance shall be responsible for maintaining adequate insurance for property, personal and other appropriate risks, whether statutory or otherwise, and shall deal with all claims on behalf of University Court.

Budget-holders must ensure that any agreements negotiated with external bodies cover any legal liabilities to which the University may be exposed. The advice of the Director of Operations & Finance should be sought in these circumstances.

Budget-holders are required to inform the Director of Operations & Finance immediately of any alterations which will or might affect existing risks or require additional or new cover.

Budget-holders are responsible for all equipment, stock and other items under their control and shall ensure that, where there is a requirement for independent inspection for general safety or to comply with legislation, such inspections are carried out timeously and that suitable records are kept which shall record any defects noted at the time of inspection and the remedial measures taken.

Budget-holders shall immediately notify the Director of Operations & Finance of any loss, damage or injury which may give rise to an insurance claim. If a loss results from theft or other criminal offence, the Director of Operations & Finance shall be notified immediately irrespective of whether the loss or damage caused as a result thereof shall be a matter in respect of which an insurance claim may be made or not.

Items of equipment or stock shall not be removed from the University for official use without the prior permission of the budget-holder. Any such movement of items of equipment or stock should be notified to the Director of Operations & Finance for insurance purposes. No equipment or stock of whatever nature shall be removed from the University other than for approved University use.

All staff using their own vehicles on behalf of the University shall maintain appropriate insurance cover for business use and may be required to produce the relevant records demonstrating such cover.

25 Subsidiary Entities

In certain circumstances it may be advantageous to the University to establish a company or a joint venture to undertake activities on behalf of the University. The establishment of subsidiary entities shall be authorised by the Court on the recommendation of the Principal and the Director of Operations & Finance. The process involved in forming a subsidiary entity and arrangements for monitoring and reporting on the activities of these entities are documented in the financial procedures.

The Director of Operations & Finance shall report annually on subsidiary companies where the University is the sole or majority shareholder to University Court, via the Finance and Estates Committee, except where they are dormant. He or she will also submit business plans or budgets as requested to enable the Committee to assess the risk to the University. The directors of such companies are responsible for appointing external and, where appropriate, internal auditors for the company.

Where the University is the sole or majority shareholder in a company, that company’s financial year shall be consistent with that of the University.

All companies and their subsidiaries in which the University has an interest shall be governed by the requirements of the Companies Acts. All wholly-owned companies shall also operate within the spirit of these Regulations, provided that such operation is not in conflict with the Companies Acts and is not specifically over-ridden by a resolution of or separate guidelines issued by such a company.

26 Students’ Union

The Students’ Union is a separate legal entity from the University but is recognised to fulfil a valuable role in relation to the University’s students.

The Students’ Union is responsible for maintaining its own bank account and financial records and preparing its own financial statements. These will be audited by an appropriately qualified firm of auditors and will be presented to the University Court for information.

In accordance with an agreement between the University and the Students’ Union, the University’s internal auditor shall have access to records, assets and personnel within the Students’ Union in the same way as other areas of the University.

 

 

 

 

 

 

 

 

In these Regulations the following references shall bear the following meanings:

"Budget-holder" shall mean the member of staff who has been assigned his or her own budget..

"Financial Memorandum" shall mean the Financial Memorandum entered into between the Scottish Further & Higher Education Funding Council (Scottish Funding Council) and Queen Margaret University, Edinburgh in force for the time being.

"The Funding Council" shall mean the Scottish Further & Higher Education Funding Council (Scottish Funding Council).

"The Regulations" shall mean these Financial Regulations.

"University" shall mean Queen Margaret University, Edinburgh.

"University Court" shall mean the University Court of Queen Margaret University.

Throughout these Regulations gender references shall apply equally to male and female.

 

APPENDIX 1

Finance & Estates Committee

Terms of Reference and Membership

The Committee and its Convener shall be appointed by the Court from amongst its own members and will consist of no less than four and up to six members with no executive responsibility for the management of the institution. At least one member should have a background in finance, accounting or auditing but membership should not be drawn exclusively from people with such a background. The Principal and the Deputy Principal will be ex officio members of the committee. A quorum will be two non-executive members. The Committee may also, if it considers it necessary or desirable, invite one or more advisors with particular expertise to attend meetings.

Authority
The Committee is authorised by the Court to seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee.

The Committee is authorised by the Court to obtain independent professional advice and expertise if it considers this necessary.

Proceedings
The Committee should normally meet at least four times per year. Members may invite university staff or specialist advisers to a meeting if appropriate.

Responsibilities

1. To advise the Court on all matters relating to the finances and financial viability of the University.

2. To ensure that the requirements of the financial memorandum with the Scottish Funding Council are fulfilled, in particular the requirement to maintain financial solvency.

3. To review the annual budget, financial forecasts and cashflow forecasts of the University, and to provide advice thereon to the Court.

4. To receive and consider regularly reports of actual financial performance against budget, review financial performance indicators and to provide advice thereon to the Court.

5. To consider financial aspects of capital developments, with particular regard to their affordability and potential impact on institutional viability.

6. To consider the position of the University’s borrowings and other liabilities, in detail at least annually, and to advise the Court of any related issues.

7. To review the investment and treasury management policies of the University. This will include monitoring the performance of investments and the performance of the investment advisers and the investment portfolios under their management.

8. To review the annual financial statements of the University.

9. To provide strategic guidance to the Court on all aspects of the University’s heritable estate and property interests.

10. To receive reports on the condition and management of the University’s heritable estate and property interests and to provide guidance in regard to these, particularly monitoring the maintenance programme to ensure that a backlog does not build up.

11. To report regularly to the Court on all aspects of the University’s heritable estate and property interests.

12. To give advice as appropriate on the development and funding of the University’s spin-out companies.

13. To review the budget, financial forecasts and annual financial statements of the Students’ Union.

14. To provide an annual report to the Court on the matters considered by the Committee.

15. To discuss and advise on any other matters involving finance and estates.

Membership
• No fewer than four and up to six lay members of the Court of whom one is Convener
• Principal
• Deputy Principal

Secretary: Head of Finance

In attendance:
Director of Operations & Finance
Director of Campus & Commercial Services
Head of Planning

Agenda Setting
The Agenda will comprise certain standing items – reports from the internal and external auditors – and occasional items as proposed by the Convener, Principal, Director of Operations & Finance and Director of Campus & Commercial Services and as determined by the Convener.

Members may request that items be put on the agenda by contacting the Finance & Estates Committee Secretary at least two weeks in advance of the meeting. The Secretary will confer with the Convener and if the item is appropriate, it will be added to the agenda.

The agenda will always invite ‘Any other competent business’ which is a further opportunity for members to raise pertinent business.

 

APPENDIX 2
Audit and Risk Committee

Terms of Reference and Membership

The Committee and its Convener shall be appointed by the Court from amongst its own members and will consist of members with no executive responsibility for the management of the institution. There shall be not less than three and up to five members. A quorum shall be 2 members. At least one member should have a background in finance, accounting or auditing but membership should not be drawn exclusively from people with such a background. The Committee may also, if it considers it necessary or desirable, invite an advisor with particular expertise to attend meetings.
Authority
The Committee is authorised by the Court to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co-operate with any request made by the Committee.

The Committee is authorised by the Court to obtain independent professional advice and expertise if it considers this necessary.
Proceedings
The Committee should normally meet at least 3 times per year. The Principal and Director of Operations & Finance should normally attend Audit & Risk Committee meetings, together with other staff invited to attend. The external auditor should attend Audit & Risk Committee meetings, together with other staff invited to attend. The external auditor should attend, as a minimum, any meetings where an external audit report is being considered. The same arrangements shall apply to the internal auditor. In addition, the Convener may call a meeting without the presence of University staff should circumstances arise which necessitate this.

Responsibilities

1) To review the systems and controls established by management to :-
a. Ensure proper financial management within the University
b. Ensure the effectiveness of the internal control and management systems
c. Ensure economy, efficiency and effectiveness of University’s activities
d. Identify and manage risks, and safeguard the University’s assets and interests against losses of any kind
e. Ensure that a robust business continuity plan exists and is regularly tested
f. Ensure compliance with established policies, procedures, laws and regulations
g. Ensure any potential matters of financial irregularity or impropriety are fully investigated

2) To report as appropriate to the Court on any internal control or risk management matters highlighted to the Audit & Risk Committee

3) To receive regular reports on risk management from the Executive Board and to review the annual report on risk management.

4) To consider the content of the annual financial statements of the University and the appropriateness of accounting policies and issues in accordance with Financial Reporting Standards, to note any relevant issues raised by the external auditor and to make recommendations to Court on these matters as appropriate.

5) To review the University’s compliance with corporate governance requirements and good practice guidance and advise the Court thereon.

6) To consider the selection, appointment, annual reappointment and remuneration of the internal and external auditors and to make recommendations to the Court.

7) To receive all relevant reports from the internal and external auditors, to consider any salient issues arising from these reports and to advise the Court thereon.

8) To review the scope, efficiency and effectiveness of the work of internal audit, including the basis and results of their internal audit needs assessment, and to approve the annual internal audit programme of work.

9) To advise the Court on potential topics for inclusion in a programme of value for money reviews or risk assessments, and to review relevant reports from SFC and Audit Scotland.

10) To produce an annual report to Court on the matters considered by the Committee and on the adequacy and effectiveness of the institution’s internal control systems.

Membership
No fewer than three and up to five lay members of Court of whom one is the Convener

Secretary: Head of Finance
In attendance:
Principal
Director of Operations & Finance
University Secretary

Convener of Finance & Estates Committee may attend

Agenda Setting
The Agenda will comprise certain standing items – reports from the internal and external auditors – and occasional items as proposed by the Convener, Principal and Director of Operations & Finance and as determined by the Convener.

Members may request that items be put on the agenda by contacting the Audit & Risk Committee Secretary at least two weeks in advance of the meeting. The Secretary will confer with the Convener and if the item is appropriate, it will be added to the agenda.

The agenda will always invite ‘Any other competent business’ which is a further opportunity for members and auditors to raise pertinent business.

APPENDIX 3

Senior Management Remuneration Committee

Terms of Reference and Membership

The Senior Management Remuneration Committee is a Committee of the University Court.

The Committee and its Convener shall be appointed by the Court from amongst its own members and will consist of up to four members with no executive responsibility for the management of the institution. These include ex officio the Chair, Vice Chair and Convener of the Finance & Estates Committee.

Authority
The Committee is authorised by the Court to seek any information it requires from any appropriate source, including independent professional advice and expertise if it considers this necessary.
Proceedings
The Committee reviews the salaries of the Principal and members of the Executive Board with effect from 1 August each year in line with policies and processes determined by the University Court.

The Committee reviews arrangements in place for determining the salaries of those senior staff with Professorial title.

In the event of significant changes in role or responsibilities, the Committee may undertake interim reviews based on recommendations and advice from the Principal and the Head of Human Resources.

Responsibilities

1. To develop, on behalf of the University Court, Senior Management Remuneration policies and processes for final determination by the University Court.

2. To determine and review the salaries and terms and conditions of the Principal and the Executive Board in line with agreed policies, and in accordance with good corporate governance.

3. To consider and approve the arrangements in respect of any payment to any member of the Executive Board in respect of the termination of their employment with the University.

4. To report to the Court on its decisions such as to allow the Court to be satisfied that such decisions are in line with agreed policies.

Membership
The membership of the Committee is as follows:

Vice Chair of the Court (Chair)
Chair of the Court
Two lay Court members with appropriate skills and experience

In Attendance: Principal
University Secretary

NB – The Principal and the University Secretary do not participate in any review by the Committee of their own salary or reward package.

Agenda Setting
Given the precise nature of the business of this Committee, it is likely that the agenda will remain largely consistent at each meeting.

The agenda will always invite ‘Any other competent business’ which provides an opportunity for members to raise other pertinent business.

APPENDIX 4

Nominations Committee

Terms of Reference and Membership

The Nominations Committee is a Committee of the Court. The Committee shall be appointed by the Court from amongst its own members and will consist of up to seven members. These include ex officio the Chair and Vice Chair of Court and the Principal.
Authority
Under the specific powers delegated to it by the Court, the Committee makes recommendation to the Court on suitable candidates for appointment to vacancies on the Court, and to membership of its sub-committees.

The Committee also makes recommendation to the Court on suitable candidates for the role of Chancellor of the University.

In pursuit of these powers, the Committee is authorised by the Court to seek any information it requires from any appropriate source, including independent professional advice and expertise if it considers this necessary.

Responsibilities

1. To publicise vacancies for lay membership of Court within and outwith the University, inviting nomination for such membership from existing members, staff and students of the University and inviting application from suitably qualified candidates.

2. To prepare and publish written descriptions of the role and capabilities desirable in a new member, having regard to the qualifications, experience and balance of existing Court membership.

3. To consider candidates for lay membership with regard to:
a) Article 6 of the Queen Margaret University, Edinburgh (Scotland) Order of Council 2007.
b) The qualifications, experience and balance of existing Court membership.
c) The Strategic Plan of the institution.

4. To approach, on behalf of the Court, those candidates who are considered suitable.

5. To make recommendation to the Court on suitable candidates to serve as members of Court.

6. To publicise a vacancy for the position of Chair within and outwith the University, inviting nomination for such membership from existing members staff and students of the University and inviting application from suitably qualified candidates.

7. To approach, on behalf of the Court, those candidates for Chair who are considered suitable.

8. To consider candidates with regard to:
a) Article 5 of the Queen Margaret University Edinburgh (Scotland) Order of Council 2007;
b) An evaluation of the skills, attributes and experience required of the position of Chair.

9.. To make recommendation to the Court concerning the appointment of a suitable candidate as Chair.

10. To receive and consider nominations and applications for the role of Chancellor and to make recommendation to the Court accordingly.

11. To make recommendation to the Court on the re-appointment of members.

12. To make recommendations to the Court on the membership of its sub-committees.

13. To provide an annual report to the Court on the matters considered by the Committee.

Membership

• Chair of Court
• Vice Chair of Court
• Principal
• Two lay members of Court in addition to the Chair and Vice-Chair
• One elected or nominated staff member of Court
• One student member of Court

The secretary is the Secretary to the University Court.

The Chair of Court will convene, except where the business of the Committee includes managing the appointment of the Chair’s successor. In such circumstances, the Committee will appoint from amongst its members an alternative convener.

APPENDIX 5

THE SEVEN PRINCIPLES OF PUBLIC LIFE

FROM THE REPORT OF THE COMMITTEE FOR STANDARDS IN PUBLIC LIFE
(THE NOLAN REPORT)

SELFLESSNESS
Holders of public office should take decisions solely in terms of the public interest. They should not do so in order to gain financial or other material benefits for themselves, their families or their friends.

INTEGRITY
Holders of public office should not place themselves under any financial or other obligation to outside individuals or organisations that may influence them in the performance of their official duties.

OBJECTIVITY
In carrying out public business, including making public appointments, awarding contracts, or recommending individuals for rewards and benefits, holders of public office should make choices on merit.

ACCOUNTABILITY
Holders of public office are accountable for their decisions and actions to the public and must submit themselves to whatever scrutiny is appropriate to their office.

OPENNESS
Holders of public office should be as open as possible about all their decisions and the actions that they take. They should give reasons for their decisions and restrict information only when the wider public interest clearly demands.

HONESTY
Holders of public office have a duty to declare any private interests relating to their public duties and to take steps to resolve any conflicts arising in a way that protects the public interest.

LEADERSHIP
Holders of public office should promote and support these principles by leadership and example.