Middlesex University
Financial Statements 2016/17
economically. This process has been in place for the year ended 31 July 2017 and up to the date of approval of the financial statements, and accords with HEFCE guidance.
The Board of Governors has delegated the day to day responsibility to the Vice-Chancellor, as Accountable Officer, for reviewing the adequacy of the system of internal control and making any appropriate amendments. He is also responsible for reporting to the Board of Governors any material weaknesses or breakdowns in internal control.
The following processes are in place to ensure the effectiveness of the University’s internal control and risk management:
— The Board of Governors meets six times a year to consider the plans and strategic direction of the Institution. It is advised by its key committees, receiving regular reports from each committee and other reports from management as required. In addition the Board of Governors holds two away days each year to discuss the strategic plan in greater detail. The assumptions and aims are reviewed against domestic demand, international demand, funding and research and business development.
— The Executive team receives reports setting out key performance and risk indicators and considers possible control issues brought to their attention by early warning mechanisms which are embedded within the operational units.
— The Executive team and the Audit and Risk Committee also receive regular reports from internal audit, which include recommendations for improvement. The Audit and Risk Committee’s role in this area is to conduct a high level review of the arrangements for internal financial control.
— The Internal Controls Committee is responsible for overseeing an assessment of the effectiveness of internal control on a rolling basis and provides periodic reports to the Governors through the Audit and Risk Committee. The Committee identifies and evaluates the key controls required for significant risks faced by the University and to consider a risk-based assessment of effectiveness.
— The Board of Governors’ review of the effectiveness of the system of internal control is informed by the work of the internal auditors who operate to the standards defined in the HEFCE code of audit practice.
— An organisation-wide risk register is maintained and is available on the University’s intranet. The register is reviewed and updated regularly, and management report on the actions taken to mitigate risks. The register and strategic plan are cross referenced to each other as an additional mechanism for the identification of risks. Departmental plans report on the local management of corporate risks, identify risks at an operational level and include plans for the mitigation of these risks. A review of the University’s risk management processes has been undertaken during 2016/17. Building on our previous processes, a Strategic Risk Register will be maintained at corporate level, aligned to the University’s strategic objectives. The register will continue to be reviewed and updated regularly, including an assessment of the internal controls in place and the actions needed to mitigate the risks. To help ensure “bottom-up” as well as “top-down” identification and escalation of risk, departmental registers will report on the local management of strategic risks and identify risks and mitigations at operational level.
— Monthly management accounts are presented to the Finance Committee and the Board of Governors. The annual budget and financial forecasts are presented for formal approval by both of these committees, while any strategic plan revisions and the annual monitoring statement go to the Board.
The Board of Governors is of the view that there is an ongoing process for identifying, evaluating and managing the University’s significant risks; that it has been in place for the year ended 31 July 2017 and up to the date of approval of the annual accounts and that it is regularly reviewed by the Governing Body. The University also complies with the CUC Higher Education Code of Governance published in December 2014.
These processes enable the University to identify those elements of internal control which require further strengthening and these reviews have not identified any significant area of internal control weakness for the University.
Going Concern
After reviewing detailed papers the Board of Governors considered, at its meeting on 27 November 2017, that the University has adequate resources to continue in operational existence for the foreseeable future. For this reason they continue to adopt the going concern basis in preparing the financial statements.
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