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Budget Preparation Guide

2007 / 08

7 February 2007
BUDGET GUIDE – 2007/08

CONTENTS
Page

1. Introduction 3

2. Planning Assumptions 4

3. Financial Forecast and Financial Envelope 6

4. Timetable 9

5. Roles and Responsibilities 10

6. The Budgeting Process: Step-by-Step Guide 14

7. Staff Costs – Permanent, Fractional, Sessional and Temporary 15

8. Budgeting for IT Requirements 17

9. Estates Capital Budgets 19

10. Soft-funded Projects 20

11. Donated Services and Gifts…………………………………………………………21

12. Ensuring Value for Money 22

13. Budget Monitoring and Forecasting Process 23

APPENDICES
Appendix 1 Income and Expenditure Codes legend
Appendix 2 Estates budgets bid form
Appendix 3 Fundraising – project funding request form
Appendix 4 Budget Submission template

1. INTRODUCTION
This document has been introduced to provide to budget holders all the
information that they might need to support them in the preparation of
Soji Otudeko – Head of Finance Page 2
their 2007-08 budgets. It is intended that it will be published annually as
part of the planning process thus ensuring an integrated planning and
budgeting process.

Integrated planning process - Efforts have been made in this guide to


integrate our requirements for central resources such as IT and Estates into an
all-encompassing planning and budgeting process. There is a renewed
emphasis on forward planning for central resource requirements. Heads of
service in Resources, Estates, ICT, MIS, IT R&D and Development Office were
consulted and have made valuable contributions on the processes to be
followed by budget holders for resources they will require from their
departments.

To ensure that the 2007-08 process is in line with the longer term strategy, the
2007-08 strand of the financial forecast to 2014 has been translated into a
faculty/departmental format. The key underlying financial assumption is that
of a no-growth budget but allowing for inflation and pay awards.

Sustainable Capacity – The College is the phase of transition pending our


relocation to Greenwich. The message from the Board and the Management
Committee is that of maintaining our capacity levels both for students’ level
as well as resources at the current level. This of course takes into
consideration the work of the Development Office in seeking external sources
of funding as well as the initiative to develop the Asian international students
market, as well as our collaborative work with Rose Bruford to deliver a joint
course for the first time in 2007-08. To that extent the 2007-08 budget will be
a ‘no-growth’ budget.

2. PLANNING ASSUMPTIONS

Soji Otudeko – Head of Finance Page 3


Transition Budget - This budget guide relates to the on-going ‘business as
usual’ bit of our work. A separate budgeting process is in place to deal with
our relocation to Greenwich. However a transition budget has been created
which will be used for academic and service developments to ensure that work
practices are aligned with our move to Greenwich.

The funding proposal sent to HEFCE for approval indicates that the College will
be contributing £2.5 million out of its reserves to fund the relocation. At the
end of the 2005-06 year, we achieved £101k. An additional £239k (excluding
soft-funded projects) is budgeted for in the 06-07 accounts. Indications are
that the final 06-07 surplus will significantly increase once the mid-year
forecast outturn is completed. These funds form part of our general reserve.

Prudence dictates that we do not allocate all of our reserves on the Transition
budget, a level of General reserves needs to continue to be made to support
on-going activities. This has traditionally been set at 2.5% of income. A
dedicated ‘Transition Fund’ is being set aside to distinguish our general
reserves from the transition fund. An amount of £300k has been provided for
in the 2007-08 budgets to augment the Transition Fund. There is further
potential to allocate funds to the Transition Fund from the following pots -
• 2006-07 transition and contingency - £311k
• 2007-08 contingency - £141k
This will give a total potential fund of £752k at the end of 2007-08.

Inflation and salary uplifts – We have assumed an inflation allowance of 3%


for non-salary costs. This has been incorporated in the financial envelope. The
staff costs will be based on the 2007-08 pay awards for each post as agreed as
part of the Hay Job Evaluation process.

Externally-funded projects – Project managers are expected to produce full


income and expenditure budgets for all soft projects that the College is
involved in. The Management Committee has started the process of quarterly
monitoring of all soft projects. This will intensify during 2007-08.

Financial envelope - The financial envelope has been developed as a tool to


help deliver the College’s financial strategy. Consideration needs to be given
to the five principles in HEFCE’s recommended approaches to financial
strategy, which are –
1. Long-term viability and matching resources with objectives
2. Maintaining productive capacity to meet current objectives
3. Financing development and investment
4. Evaluating strategic alternatives and managing risks
5. Integrating financial and other corporate strategies
Traditionally, the College has aimed to deliver a surplus budget of at least
2.5% of income. The impact of the new fee regime has been evaluated; the
additional income generated will help towards meeting our future investment
in the transition budget. Consequently, we are planning for an operational
surplus of £279k.

Soji Otudeko – Head of Finance Page 4


Student Numbers – These are based on the long-term Greenwich relocation
forecast. These are financial targets, rather than target student numbers, to
ensure that the financial projections achieve a conservative position and
minimise the risk of optimism bias. The planning figures in FTEs are as follows

PLANNING LEVEL

EU and home students 982

Overseas students 119

FE students 16-18 230


19+ 20
TOTAL 1,351

Fee Income – In total we are forecasting that we will generate £554k of


additional income in 2007/08. This is based on the following matrix:

STUDENT NUMBERS 2007-08


Years 2 & TOTA
Year 1 3 L

Undergraduate –
Honours 402 556 958

Foundation Degrees
Post Graduate 24 24
426 556 982

UG - OVERSEAS 34 53 87
1
PGT-OVERSEAS 11 1 22
FE-OVERSEAS 10 10
55 64 119

FE – Under 19 230 230


Over 19 20 20
TOTAL STUDENT 1,35
NUMBERS 731 620 1

Soji Otudeko – Head of Finance Page 5


3. FINANCIAL ENVELOPE

3.1 Financial Forecast to 2014

RAVENSBOURNE COLLEGE - FINANCIAL FORECAST

Student Numbers 1375 1351 1412 1443 1432 1429 1450 1477
CHISLEHURST SITE GREENWICH SITE
Forecast Forecast Forecast Forecast Forecast Forecast Forecast Forecast
2009/1 20010/1 2011/1 2012/1
INCOME 2006/7 2007/8 2008/9 0 1 2 3 2013/14
Core Funding
HEFCE Core Funding 5,911 6,168 6,334 6,571 6,816 7,071 7,335 7,609
Widening Participation 455 467 479 492 505 519 533 548
LSC Core Funding 1,037 1,064 1,092 1,122 1,152 1,183 1,215 1,248
7,403 7,699 7,906 8,185 8,474 8,773 9,083 9,404
Fee Income
Home/EU Fees - undergraduate 1,174 1,550 2,132 2,193 2,215 2,239 2,338 2,456
Home/EU Fees - postgraduate 91 100 109 112 115 121 127 134
Home/EU - Foundation 620 793 877 922 947 985 1,036 1,091
FE 16 16 16 17 17 18 18 19
Overseas Fees 813 899 926 951 977 1,014 1,053 1,094
Less Bursaries -120 -239 -350 -371 -377 -384 -402 -422
2,594 3,120 3,709 3,823 3,893 3,991 4,171 4,371
Net Commercial profit
Short course 36 37 38 47 50 54 59 63
Consultancy 36 37 38 41 44 48 51 55
Telephone masts 25 26 26 0 0 0 0 0
Business Incubation Services 6 6 6 11 12 14 16 18
Commercial Hire 0 0 0 27 28 29 29 18
103 106 108 125 134 144 155 154

Net sponsorship 55 103 105 54 56 57 59 60

Net Other Income


Levy 153 61 18 18 19 19 20 20
Halls of Residence - net 175 205 211 0 0 0 0 0
Interest receivable 30 0 0 0 0 0 0 0
Other student services 52 53 55 56 58 59 14 14
410 319 283 75 77 79 34 35
Deferred capital grants
released in year
Equipment 301 334 267 198 0 0 0 0
Buildings 72 72 72 100 100 100 100 100
373 406 339 298 100 100 100 100

TOTAL INCOME 10,939 11,752 12,451 12,560 12,734 13,144 13,601 14,125

EXPENDITURE
Salary Costs
Administration 2,763 2,876 2,995 3,135 3,229 3,326 3,450 3,579
Academic 2,185 2,275 2,406 2,518 2,593 2,671 2,751 2,878

Soji Otudeko – Head of Finance Page 6


Sessional 736 766 813 853 879 905 933 979
Pensioners 22 23 24 25 25 26 27 28
Other ( including temp) 118 123 128 132 136 140 144 148

5,824 6,063 6,366 6,663 6,863 7,068 7,305 7,611


Faculty
Consumables 355 267 230 237 244 251 259 267
Development 100 155 159 164 169 174 179 184
Teaching Transition 0 258 265 0 0 0 0 0

Rewarding and Developing


Staff / Relocation Transition 100 361 371 109 0 0 0 0

Additional widening
participation initiatives 235 258 265 55 56 58 60 61

Depreciation
Building 262 262 262 758 758 758 758 758
Fixtures and Equipment 710 569 428 562 533 483 486 507

Overheads (Excl Salary


costs)
Computing 337 347 358 368 379 391 402 414
LRC 114 155 159 164 169 174 179 184
Administration 1,505 1,550 1,597 1,645 1,694 1,745 1,797 1,851
Estates 777 880 997 1,330 1,370 1,469 1,513 1,559

Relocation & other


contingencies 350 350 500 50 50 100 100 150

VFM Savings -85 0 0 0 0 0 0 0

Interest Payable 0 0 0 313 300 288 275 263

TOTAL EXPENDITURE 10,584 11,473 11,958 12,417 12,586 12,959 13,314 13,811

SURPLUS / (LOSS) 355 279 493 143 148 185 287 314
SURPLUS AS % OF
INCOME 3% 2% 4% 1% 1% 1% 2% 2%
SURPLUS WITHOUT
INTEREST PAYABLE AS %
OF INCOME 3% 2% 4% 4% 4% 4% 4% 4%

CAPITAL BUDGET
CAPITALISED BUILDING -45,500
CAPITALISED FIXTURES AND
FITTINGS -1,500
Fixtures and Fittings -103 -100 -50 -150 -150 -150 -150 -150
Computer Costs -456 -300 -300 -150 -150 -150 -150 -150
HEFCE Round 4 Income 347 412 0

CAPITAL BUDGET: COLLEGE


CONTRIBUTION -212 12 -350 -47,300 -300 -300 -300 -300

Soji Otudeko – Head of Finance Page 7


3.2 Draft Budget Envelope by Faculty/Department

RAVENSBOURNE COLLEGE OF DESIGN & COMMUNICATION


2007-08 DRAFT BUDGET ENVELOPE BY FACULTY//DEPARTMENT

2006-07 Budget 2007-08 Budget - Draft 29 Jan


Expenditure
Expenditur
Description Income e Income Staff costs Non-Staff Total Exp

Faculty of Design 3,015,759 1,120,614 3,185,848 1,067,969 104,607 1,172,575


Faculty of Communication 5,266,541 1,607,425 5,563,574 1,486,811 194,373 1,681,185
Foundation Diploma 1,168,945 437,207 1,234,873 422,561 35,020 457,581
Postgraduate 377,960 297,775 399,277 263,258 47,972 311,230
TOTAL COURSES 9,829,205 3,463,021 10,383,572 3,240,598 381,972 3,622,571

Student Support Services 0 275,730 0 247,779 40,479 288,258


Academic Link Tutors 0 14,991 0 15,711 0 15,711
Enterprise & Innovation 0 115,476 0 111,063 9,785 120,848
Finance 44,750 995,529 47,321 228,243 801,072 1,029,315
ICT 0 703,606 0 384,098 347,213 731,311
Personnel, Development &
Training 0 522,254 0 232,031 309,876 541,907
Premises & Housing 258,532 1,076,345 273,113 190,585 921,324 1,111,909
Shop & Stores 77,000 102,506 81,343 40,721 65,560 106,281
Quality 0 526,268 0 164,884 380,004 544,888
Management Information Sys 0 155,078 0 146,802 15,450 162,252
Registry 0 378,759 0 208,081 185,614 393,696
Student Union 0 38,727 0 16,559 23,614 40,173
Learning Resource Centre 0 315,892 0 224,291 104,930 329,221
Marketing & Shows 15,000 622,806 15,846 246,077 399,640 645,717
Management 50,000 520,372 52,820 359,854 182,310 542,164
Total Administration 575,282 6,494,339 607,775 2,816,779 3,920,770 6,737,549

Ravensbourne Limited Surplus 103,000 0 108,809 0 0 0


Additional Pension
contributions 0 20,000 20,000
Contingent 0 211,323 0 0 141,037 141,037
Transition Fund 0 100,000 0 0 300,000 300,000
TOTAL - CORE
OPERATIONS 10,507,487 10,268,683 11,100,156 6,077,377 4,743,780 10,821,157
Surplus/(Deficit) 238,804 279,000
% of income 2.3% 2.5%

Projects 617,043 350,821 651,844 0 651,844 651,844


Projects Surplus/(Deficit) 266,222 0

Soji Otudeko – Head of Finance Page 8


Overall Total 11,124,530 10,619,504 11,752,000 6,077,377 5,395,623 11,473,000
Surplus/(Deficit) 505,026 279,000

2007/08 forecast in Financial


Forecast to 2014 11,752,000 11,473,000
4. TIMETABLE

2007-08 Budgeting Process


When What Who

7 February Budget Preparation Guide is issued Soji

7 February Bid forms for capital requirements sent out. Cathy B./Soji

21 Completed IT bids returned to Ian Hole Heads of Faculty


February & Heads of
Service
21 Completed Estates budget bid forms returned to Heads of Faculty
February Cathy & Heads of
Service
5 March Faculties and departments submit draft budgets to Heads of Faculty
Head of Finance & Heads of
Service
26 March Management Committee - reviews Soji / Ian /Rachel
faculty/departmental plans & budgets (including IT Mgt Committee
and Property capital bids) and agrees required next
steps to ensure Ravensbourne is within budget
23 April Management Committee - 2nd round of budgets Soji /
submitted, reflecting budget adjustments made in line Mgt Committee
with decisions taken at the 26 March meeting,
approves IT and Estates bids including cost estimates
and source of funding.
Approval
7 May Management Committee - Final budgets submitted for Management
approval Committee

17 May Budget papers mailed in advance of FGPC meeting Soji

13 June Finance & General Purposes Committee approves the


budget
11 July Board of Governors sign off the budget

Processing
29 June Budgets loaded onto the financial system (QLX) Soji

16 July Detailed profiled budget reports issued to budget Soji


holders

Soji Otudeko – Head of Finance Page 9


5. ROLES AND RESPONSIBILITIES

5.1 Responsibilities

The responsibility for producing the faculty or departmental plan is that of the
respective Management Committee member. The following people are
responsible for co-ordinating the budget preparation within each
faculty/department:

List of Contacts

Corporate Responsibilities -
Planning Process Janthia Taylor & Genevieve Cowcher
Budgeting and Financial Co-ordination Soji Otudeko
Staff Establishment Kathy Steele
IT Capital Projects Ian Hole
Estates Capital Budget Rachel Green/Cathy Blackford
Donated Goods and Services Amba Sessions

Faculties -
Faculties Budget Support Business Support Officers;
• Masters James Norman
• Foundation James Norman
• Communication Sarah Gaffney
• Design Kerry O’Halloran

Support Departments -
Service/Support departments Soji Otudeko

The role of the responsible person is to:

 Ensure the budget holders, within their area of responsibility, are aware of
the process to complete a budget for 2007/08
 Organise the production of a budget pack to collect the data needed to
produce the consolidated budget
 Circulate the budget timetable, monitor adherence to it and ensure that on
the due dates accurate and relevant plans and budgets are received ready
for consolidation
 Be the focal point for their faculty/department to answer questions and
queries.

Each responsible person has a nominated Finance or Business Support Officer


to assist with budget preparation. Any financial queries on issues such as
assumptions, policies etc should be addressed to that individual.

Soji Otudeko – Head of Finance Page 10


5.2 Budget Preparation Responsibility
Budget Description Budget Holder Finance/Busines
Centre s Support
No. Officer

CHIEF EXECUTIVE'S OFFICE


GGOV Board of Governors Robin Baker Soji Otudeko
GTEAM Directorate department Robin Baker Soji Otudeko
SBUDP Relocation Robin Baker Soji Otudeko

COMMUNICATION MEDIA FACULTY


CBADM Broadcasting Admin Barbara Howell Sarah Gaffney
CBTEC Broadcast Media Technology Barbara Howell Sarah Gaffney
FFOPN Broadcast Operations & Barbara Howell Sarah Gaffney
Production
CPPRN Broadcast Post Production Barbara Howell Sarah Gaffney
CBCCM Content Creation Barbara Howell Sarah Gaffney
CBRSD Creative Sound Design Barbara Howell Sarah Gaffney
DDANM Computer Visualisation & Barbara Howell Sarah Gaffney
Animation
DDGRA Graphic Design Barbara Howell James Norman
DDMID Design for Moving Image Barbara Howell James Norman
FFCVA Comp Vis & Animation Barbara Howell Sarah Gaffney
FFSND Creative Sound Design Barbara Howell Sarah Gaffney
FFMTC Broadcast Media Technology Barbara Howell Sarah Gaffney
FFPPN Broadcasting Post Production Barbara Howell Sarah Gaffney

DESIGN FACULTY
MLINK Academic Link Tutors Nicky Pickett Soji Otudeko
GSSUP Student Support Services Sharon Hocking Soji Otudeko
CCFOU Foundation Diploma Rosy Crehan James Norman
SINDI India Project Rosy Crehan Kerry O’Halloran
SCHIN China Project Rosy Crehan Kerry O’Halloran
DDFAS BA Fashion Rosy Crehan Kerry O’Halloran
DDADM Design Admin Rosy Crehan Kerry O’Halloran
DDPAF BA Product & Furniture Design Rosy Crehan Kerry O’Halloran
DDACT BA Interaction Design Rosy Crehan Kerry O’Halloran
DDINT Interior Design Environmental Rosy Crehan Kerry O’Halloran
Architectures (IDEAS)

MASTERS PROGRAMMES
DMIDM MA Interactive Digital Media Janthia Taylor James Norman
DMNME MA networked Media Janthia Taylor James Norman
Environments

LEARNING RESOURCE CENTRE


LLIBY Learning Resource Centre Stephen Bowman Soji Otudeko

ENTERPRISE & INNOVATION


GEMPL Employability Janthia Taylor Soji Otudeko

Soji Otudeko – Head of Finance Page 11


Budget Description Budget Holder Finance/Busines
Centre s Support
No. Officer
QUALITY
GQUAL Quality and Academic Services John O’Boyle Soji Otudeko

INFORMATION SYSTEMS
MMANI Information Systems Eduardo Ossa Soji Otudeko

STUDENTS UNION
SSTUD Students Union Nick Busby & Tania Soji Otudeko
Holbrook

REGISTRY
GREGY Registry Renate Divers Soji Otudeko

FINANCE
GFINA Finance department Soji Otudeko
XINTR I & E Interest/ Instalment Soji Otudeko
Charges
XINVT I & E Investment income Soji Otudeko
WPENS I & E Pensions Soji Otudeko
YZMOR I & E Depreciation Soji Otudeko

ICT
MNETA Information Communication Ian Hole Soji Otudeko
Technology
SREPR Photocopying Ian Hole Soji Otudeko

HUMAN RESOURCES

GPERS Human Resources Department Doreen de Bellote Soji Otudeko


GEQUAL Equal opportunities Doreen de Bellote Soji Otudeko
MTRAI Training Doreen de Bellote Soji Otudeko
MSTDV Staff Development Doreen de Bellote Soji Otudeko

RESOURCES

SHOUS Accommodation Rachel Green Soji Otudeko


PPREM Estates Rachel Green Soji Otudeko
GSTOR Central Stores Rachel Green Soji Otudeko
GGOFF General Office Rachel Green Soji Otudeko
MHEAL Health & Safety Rachel Green Soji Otudeko
CBSTC Broadcasting Station Control Rachel Green Soji Otudeko
SSHOP College Shop Rachel Green Soji Otudeko

MARKETING
MMAKT Marketing Department Paul Bonnici /Jill Hogan Soji Otudeko
MMAKI International students Paul Bonnici /Jill Hogan Soji Otudeko
Marketing
KCOME Communication Media Shows Paul Bonnici /Jill Hogan Soji Otudeko
KBOSA Rave On Air marketing Paul Bonnici /Jill Hogan Soji Otudeko
Soji Otudeko – Head of Finance Page 12
Budget Description Budget Holder Finance/Busines
Centre s Support
No. Officer
KNEWD New Designers marketing Paul Bonnici /Jill Hogan Soji Otudeko
KGFWF Graduate Fashion Week Paul Bonnici /Jill Hogan Soji Otudeko
KFOUD Foundation Marketing Paul Bonnici /Jill Hogan Soji Otudeko

SOFT-FUNDED PROJECTS
SHRSP HR HEFCE-Support Doreen de Bellote Soji Otudeko
SFUND Fundraising Amba Sessions Soji Otudeko
SERAS Exchange Students Dianne Taylor/Rosy Soji Otudeko
Crehan
CBEXT Broadcasting External Janthia Taylor Soji Otudeko
SHEW1 YCTV Project Nicky Pickett Soji Otudeko
SHEW2 Learning & Teaching Janthia Taylor Soji Otudeko
Development
SHEWP Widening Participation Nicky Pickett Soji Otudeko
SCAD4 Good management Practice Robin Baker Soji Otudeko
SBUDP Bromley Unitary Development Robin Baker Soji Otudeko
SAAHL Aim Higher Nicky Picket Soji Otudeko
SDPRO Disability Provision Sharon Hocking Soji Otudeko
SLEAN E-learning Janthia Taylor Soji Otudeko
SITC4 HEFCE Capital Round 4 Ian Hole Soji Otudeko
SHACF HE Active Community Fund Nicky Pickett Soji Otudeko
SNALN National Arts Learning Network Ruth Keynes /Rosy Soji Otudeko
Crehan
SHEIF He Innovation Fund Janthia Taylor Soji Otudeko
SEDVT Emerald Fund – DVT Sock Janthia Taylor Soji Otudeko
SEBIK Emerald Fund – Cycle Lamp Janthia Taylor Soji Otudeko
SELUM Emerald Fund – Luminaire Janthia Taylor Soji Otudeko
SEOUT Emerald Fund – Outlet Janthia Taylor Soji Otudeko
SEUSF European Social Fund Mike O’Sullivan Soji Otudeko
SESU1 European Social Fund – In The Mike O’Sullivan Soji Otudeko
Picture
SITGP Innovation Thames Gateway Sonia Medin/Janthia Soji Otudeko
SJISC Design for Learning (JISC) Miles Metcalf Soji Otudeko
STQEF Teaching Quality Enhancement Janthia Taylor Soji Otudeko
SSSCH Summer School Nicky Pickett Soji Otudeko
SDIS3 Disability Round 3 Sharon Hocking Soji Otudeko
SPROF Professional standards Janthia Taylor Soji Otudeko
SITC3 HEFCE Capital round 3 Ian Hole Soji Otudeko
GCREA Creativity Incubator Janthia Soji Otudeko
AHEFC Higher Education Genevieve Cowcher Soji Otudeko
SINDI India Project Rosy Crehan Kerry O’Halloran
SCHIN China Project Rosy Crehan Kerry O’Halloran

Soji Otudeko – Head of Finance Page 13


6. THE BUDGETING PROCESS
This is a general guide. In addition, there will be function-specific guidance to
reflect unique planning and budgeting issues that relate to each function by
their respective finance managers.

The following highlights the major steps that budget holders should follow in
constructing the budget:

1. Permanent and fractional salary budget figures will be provided by the Head
of Finance.

2. Budget for all external-related payments and services, for example


stationery.

3. Ensure that all direct costs, which are specific to your faculty or department,
are budgeted for.

4. Liaise with Amba Sessions to ensure that expected donated gifts and
services have been budgeted for.

Please bear the following in mind:

The correct list of expenditure codes for 2007-08 is attached as appendix 3.


Please adhere strictly to this. Although the full list of cost codes is displayed in
this appendix, as indicated, some codes are restricted to certain departments.
If in doubt, please contact the Finance department.

Ensure that the annual budgets are phased in such a way that each month
reflects the expenditure to be incurred (or income to be received) during that
month. This should be for purchase orders and sales invoices raised during the
month. Finance department will ensure that appropriate phasing is done for
the students’ fee income.

The budget template attached as appendix 4 should be completed by the


budget holder for each budget cost centre under their control. Please type in
the budget figures for each expenditure code across each of the twelve
months. The spreadsheet will automatically do the additions.

Soji Otudeko – Head of Finance Page 14


7. BUDGETING FOR SALARY COSTS
Staff costs account for more than 55% of our annual budget each year.
Permanent and fractional salary budgets are prepared by the finance
department in liaison with the Human Resources department based on the
agreed establishment. Preparation of the sessional staff budgets is the
responsibility of the Heads of faculty as supported by their Business Support
Officers.

7.1 Permanent and Fractional Staff Salaries

The staff salary budgets will be based on the establishment list supplied by
Kathy Steele in HR. Heads of faculty and Heads of service should check with
HR to ensure that they have up-to-date establishment information for their
faculty/department. This includes staff in post and all approved vacancies.

The 2007-08 salary budgets will take into consideration the outcomes of the
recent Hays job evaluation process. Agreed salary awards will be incorporated
into the budgets based on information supplied by Human Resources and the
payroll department.

The underlying assumptions for salary on-costs are as follows:

Pay Award effective - 1 August 2007 ~ 3%


- 1 May 2008 ~ 3%

Employer’s Pension contributions –


Teachers’ Pension Scheme ~ 14.1%
Bromley LG Pension scheme ~ 9.9%

7.2 Sessional Staff Salaries

The Business Support Officers with the support of the Head of Finance (as
required) will work with the Heads of Faculty in preparing the sessional
contracts.

7.3 Temporary Staff

All vacancies, whether permanent or temporary, should be handled by the


Human resources department. Managers have salary budgets which cover the
agreed establishment for their departments, including vacancies.

Exceptional occasions where temporary staff can be recruited include –

Soji Otudeko – Head of Finance Page 15


• Filling vacancies in the short term due to a permanent staff vacancy,
while recruitment is underway. We will expect temp salaries arising from
recruitment to be offset against permanent staff salary savings.
• Known seasonal ad-hoc workloads that are agreed in the staff complement
as temporary rather than permanent.

Where you have obtained HR approval to fill a temporary post, this will have
to be paid for from your departmental budget. Do bear in mind that temporary
staff employed through an agency, will incur agency fees, which include
national insurance, holiday pay and VAT.
Should bids for new posts be agreed, budget holders must ensure that all non-
salary costs e.g. computers, desks and telephones have been budgeted for
and that the relevant head of service (e.g. Head of ICT for computers) have
been notified.

Soji Otudeko – Head of Finance Page 16


8. BUDGETING FOR IT REQUIREMENTS
8.1 Process for Applying for New IT project

The Management Committee has ultimate responsibility for approving all


requests for major items of IT expenditure. The IT Steering Committee (ITSC)
however is responsible for delivering the IT Strategy.

Budget holders should bear in mind that capital expenditure is agreed with
HEFCE. A glance at the list of strategic objectives for the year, and the HEFCE
Round 4 projects indicates that there is very little wiggle-room. Whilst ITSC
could from time to time rearrange, or in extremis, change, strategic
objectives to meet emerging needs, its more direct function is to feed into
strategy and strategic objectives for following years, and to inform the
contents of HEFCE capital round bids. All of this should arise out of consensus
over which projects are likely to uphold institutional aims.

So, unless the heads of ICT and IS have voids in their annual plans, and are
looking for these to be filled by significant project work, ITSC will either
recommend a project be added to strategic plans, reprioritise plans in order
to bring a project forward, or reject a proposal as undoable within existing
constraints.

Faculties and departments should complete project mandates for any new IT
project, making the business case and including full costing and risk analysis,
and submit these to the –

• Head of ICT for software or equipment for learning and teaching,

• Head of IS for business information systems, or

• Head of ICT R&D for systems that facilitate interaction without specifying
the parameters.

For clarification, software for a lab or a new computer lab is the responsibility
of ICT. Software in support of an enterprise process (e.g. HR, Finance and
Student Records) is the domain of IS.

Soji Otudeko – Head of Finance Page 17


ICT R&D provides consultancy and advice in identifying software and systems
that are compatible with the organisation’s infrastructure and future plans.
Software and systems that are aimed at enhancement or transformation, and
can't have a goal expressed except in those terms are the role of ICT R&D.
In reality the distinction is not always clear-cut; it is inevitable that projects will
involve both ICT and IS. For example ICT provides infrastructure and
purchasing support to all kinds of projects, and many research projects need
to draw on the outputs of enterprise systems. When a project involves
combined issues, ICT and IS will mutually consult each other before the ITSC.
Such projects will be conducted collaboratively.

The head of ICT or the Head of IS, in consultation with the head of ICT-R&D (or
in mutual consultation when necessary), will advise on priorities according to
the IT strategy, and prepare a draft recommendation for the consideration of
the IT Steering Committee (ITSC).

Faculty and departmental heads will be expected to ensure that any mandates
they produce comply with the College’s strategic priorities and plans, prior to
them being considered by the Steering Committee.
Issues to consider in preparing your mandates –
• Where budget will be held; budget holders, ICT or IS revenue, or capital
• Source of funding; Capital - HEFCE round 4, others. Revenue – ICT or IS
revenue budget, or budget holder’s revenue budget
• Ongoing cost of support and maintenance
• Life of project and replacement. Is the project sustainable?
• Extra IT resources to run the projects; staffing, training, maintenance,
software, warranties, environmental considerations (eg air conditioning,
power)

• Is external resource required, on top of our internal resources, to deliver the


project?

• Impact of the project – who are the beneficiaries, and how will the effects
be realised?

A proforma has been designed to capture the issues above and to ensure
standardisation. This will be available on the ICT website. Please contact the
Head of ICT if you have any queries.

Soji Otudeko – Head of Finance Page 18


9. ESTATES CAPITAL BUDGETS
All requests for property-related capital expenditure should be made to Cathy
Blackford, the Estates Manager. Cathy will consolidate the requests and
present to the Management Committee for approval.

Estates department has developed a bid form (see appendix 1) that should be
completed in support of your requests. This submission form is for requests for
appropriate works to be undertaken by the Estate Department during
Academic year 2007/08. This bid form should not be used for general
maintenance issues, these requests should be submitted via the normal
maintenance request form.

A submission will not automatically result in requests being included in the


Estate budget for 07/08. All requests for works will be considered in context
with College strategic plans and budget constraints.

The timetable in section 4 contains deadlines for the various activities within
the process, the key features of which are as follows –
• Bid forms have been sent out as part of the Budget Guide.
• The forms are to be completed and returned to Estates manager by 21
February.
• The bids will be presented to the Management Committee for their
consideration and approval.
• The list of approved projects will be sent to budget holders after
Management Committee meeting’s meeting of 26 March.

Soji Otudeko – Head of Finance Page 19


10. SOFT-FUNDED PROJECTS
This will be the first year that we will be asking for information on the soft-
funded projects. Each project manager should put in their best estimates of
what this will look like in 2007-08 for both income and expenditure. Please use
the budget template in appendix 4 for your submission. The estimates should
be profiled over each of the twelve months in line with when the income is
expected to be received, or the expenditure will be incurred. You are also
expected to provide the rationale behind your submissions.

Periodic performance reviews will be carried out by the Management


Committee during the course of the year. Project managers are required to
complete the quarterly projects pro-forma, as approved at the Management
Committee, for each project they are responsible for. This will give us an
opportunity to re-visit our assumptions and provide a basis to improve the
process for the following years.

The current list of Soft-funded projects and their project managers can be
found in section 5 of this guide.

Soji Otudeko – Head of Finance Page 20


11. BUDGETING FOR DONATED SERVICES AND GIFTS
Gifts in kind (GIK) arise where goods or services are donated to the college
rather than being purchased by the college. The gift on offer should further
the aims and objectives of the college. This can be determined either by the
goods or services already being in budget, or a decision being made by the
Director, the Director of Finance and the relevant Head of faculty or service.

All gifts in kind over £1,000 in value must be recorded in the college’s
accounts. Efforts should therefore be made to budget for all expected gifts in
kind. This will ensure that the receipt of the GIK does not result in the budget
holder being shown as overspent by the value of the gift.

If the gift received was in budget the recipient will be ‘charged’ for the gift and
Fundraising will show the income. When not in budget an agreement will be
made between the relevant Head of faculty/service, fundraising and finance
on its treatment.

Accounting rules require that GIK donations are reflected in the accounts at a
“fair value”. The object of fair value measurement is to estimate an exchange
price for the goods or services, in the absence of an actual transaction. Fair
value is described as the amount for which goods or services could be
exchanged between knowledgeable, willing parties in an arm’s length
transaction. This statement effectively requires reference to an open market
valuation wherever this is possible, practical and cost effective to obtain.
Should this not be reasonably possible to obtain a market valuation, the head
of fundraising and the ‘receiving’ department should agree on the estimated
value supported by a logical argument.

Examples of donated goods and services:

Donation Valuation approach


i Donated item of Check catalogue price inclusive of
equipment VAT
ii Donated services Find out costs of similar services
already used
iii Seconded member of Ravensbourne’s equivalent
staff sessional hourly rate (including on-
costs) x number of hours service
iv Volunteers time No valuation required

Soji Otudeko – Head of Finance Page 21


12. ENSURING VALUE FOR MONEY
The College aims to ensure that we continue to;

• Achieve Best Value for all goods & services;


• Strive to reduce non-essential spending particularly around consumables;
• Create head-room for developments and flexibility.

Overall, we should strive to ensure that the financial framework is sustainable in the
long-term and that we use resources in the most effective and efficient way.

During 2006/07, the management committee approved a savings target of


£85,000 at the corporate level. We have started using the management
accounts to identify areas of over and underspends across all expense lines.
The analysis of these variances will intensify during 2007/08 with the objective
of ensuring that we have a clearer understanding of our spending patterns
thereby enhancing our financial management.

Soji Otudeko – Head of Finance Page 22


13. BUDGET MONITORING AND FORECASTING
PROCESS
This section describes the process of monitoring financial performance,
particularly adherence to budgets, explanation of variances and how they
impact on management decision-making.

Management Accounts – Produced monthly, show the financial performance


of each faculty and department as well as corporately for each line of income
and expenditure. Actual performance is compared to budgets and variances
are investigated and reported. There is a focus on staff costs (over 55% of our
costs).

Each budget holder also receives a more detailed set of accounts, specific to
their budget centre, showing budget performance for the month, and year to
date, for each item of income and expenditure. It also shows how much of the
annual budget is available to spend.

Payroll List – This is a report generated by the payroll and sent to the budget
holders quarterly. It shows the names and FTEs on payroll for the month. The
budget holders/managers check these and report back to payroll.

Forecasts - At the end of each quarter (with the exception of quarter 4),
working with the Head of Finance, each faculty/department is expected to
submit a forecast outturn for the year. Deviations from the budget are
highlighted and investigated. This gives a roadmap of the months ahead and
is key to management decision-making.

Soji Otudeko – Head of Finance Page 23


Appendix 1
ESTATE BUDGET BIDS 2007/08

NOTES

This submission form is for requests for appropriate works to be undertaken by the Estate
Department during Academic year 2007/08. This bid form should not be used for general
maintenance issues, these requests should be submitted via the normal maintenance request
form.

This form must be submitted via email to the Estate Manager no later than XX February 2007.
Applications received after this date will not be considered for inclusion in the 07/08 budget.

A submission will not automatically result in requests being included in the Estate budget for
07/08. All requests for works will be considered in context with College strategic plans and
budget constraints.

Name:

Department/Faculty:
-----------------------------------------------------------------------------------------------------------------
Description of Works Requested:
(Include details of any cost estimates if known)

Location:

Justification:
(If a health and safety issue attach the appropriate risk assessment)

Soji Otudeko – Head of Finance Page 24


Appendix 2

PROJECT FUNDING REQUEST


Please complete this form at least 6 months prior to actual project start date to ensure funding applications
can be submitted and reviewed by the Management Committee. Projects will be assessed and selected
according to how well they match the criteria stated below. If successfully selected, fundraising will be
undertaken with external sources. The Development Office will inform you if your project has been selected
within 4 weeks of submitting the Project Funding Request.

Please ensure you fill in all sections otherwise the Development Office will be unable to submit your project
for review.

FUNDING CRITERIA
Your project must demonstrate at least ONE of the following objectives:

• Improve diversity through providing transparent opportunities to develop civic engagement


• Support student excellence
• Widening access for disadvantaged and/or under-represented students
• Improving student and/or the Ravensbourne-user experience

STAFF NAME: __________________________________________________________________

COURSE TITLE: _________________________________________________________________

FACULTY: ______________________________________________________________________

DATE OF PROPOSAL: ____________________________________________________________

NAME OF PROPOSED PROJECT: ___________________________________________________

PROJECT START DATE: ___________________________________________________________

LENGTH OF PROPOSED PROJECT: _________________________________________________

PLEASE EXPLAIN THE ACTIVITY FOR WHICH YOU ARE SEEKING FUNDING AND HOW IT FITS WITH THE
STATED FUNDING CRITERIA. (MAX 50 WORDS)

PLEASE GIVE A BREAKDOWN OF THE COSTS OF YOUR PROJECT

Soji Otudeko – Head of Finance Page 25


FOR OFFICE USE ONLY
DATE RECEIVED: APPROVED(Y/N): DATE NOTIFIED:

Soji Otudeko – Head of Finance Page 26