Contents
Chief Executive's Review 5
What We Do 8
Performance in the Financial Year 2013 to 2014 9
Our Achievements 10
At the heart of skills reform 10
What we funded 11
The European Social Fund 13
Managing the quality of what we fund 13
Further investment in skills and improving quality 15
Raising standards through competitions 15
Skills for growth: meeting local skills priorities 15
Working with employers to offer high-quality Apprenticeship and Traineeship opportunities 16
Traineeships 17
Our programmes and services 18
24+ Advanced Learning Loans 20
Capital funding for the FE estate 21
Equality and diversity within our programmes 21
Our buildings 21
Our people 22
Training our people 22
Our own commitment to equality and diversity 22
Environmental, social and community issues 23
Our Management Team 25
Executive Officers of the Skills Funding Agency 25
Members of the Skills Funding Agency Advisory Board 25
Members of the Audit and Risk Committee 26
Programme Assurance 27
Assurances on entitlement to, and the proper use of, Skills Funding Agency funds 27
Overview 27
Assurance on grants 27
FE colleges and other training organisations 27
Assurance on funding under contracts: private sector and other training organisations 28
Statistical sampling and extrapolation methodology 28
Sampling methodology for direct assurance work 28
Extrapolation methodology 29
The nature of errors 29
Intervention 29
Reporting of Personal Data-related Incidents 31
Financial Commentary 32
Accounts direction and statutory background 32
Going concern 32
Year-end position 32
Development and performance 33
Main trends and factors underlying development and performance 33
Auditor 34
Sustainability Report 36
Overview 36
Summary of performance 36
Summary of future strategy 36
Targets and direction of organisation 36
Performance data 37
Biodiversity action planning 39
Sustainable procurement 39
Notes 40
Remuneration Report 41
Introduction and components of remuneration 41
General 41
Chief Executive 41
Base pay changes for the financial year 2013 to 2014 42
Executive Management Team members and other senior staff 42
Highest paid director and relation to median pay 42
Remuneration tables 43
Senior management group emoluments 44
Senior management group pension entitlements 45
Salary 46
Benefits in kind 46
Civil service pensions 46
Cash equivalent transfer values 46
Real increase in CETV 47
Statement of Accounting Officer's Responsibilities 48
Governance Statement 50
The purpose of the Governance Statement 50
Scope of responsibility 50
The organisation's governance framework 50
The risk and internal control framework 51
Significant risks and mitigation 51
Audit and Risk Committee 52
Executive Management Team 52
Internal audit 53
Counter-fraud strategy 53
Financial management 54
Provider Financial Assurance Audit team 54
Tax compliance 55
Review of effectiveness 55
Internal control issues 55
Information assurance and protective security 55
Conclusion 56
The Certificate and Report of the Comptroller and Auditor General to the Houses of Parliament 58
Respective responsibilities of the Accounting Officer and auditor 58
Scope of the audit of the financial statements 58
Opinion on regularity 59
Opinion on financial statements 59
Opinion on other matters 59
Matters on which I report by exception 59
Report 59
Statement of Comprehensive Net Expenditure 60
Statement of Financial Position 61
Statement of Cash Flows 62
Statement of Changes in Taxpayers' Equity 63
Notes to the Accounts 64
1. Statement of accounting policies 64
2a. Staff costs 70
2b. Pension costs: Principal Civil Service Pension Scheme employer contributions 71
2c. Average number of staff employed 72
2d. Civil Service Compensation Scheme analysis 73
3a. Other costs 74
3b. Depreciation, impairment and losses on disposal 75
4. Programme costs 76
5. EU and other income 79
6. Property, plant and equipment 80
7. Intangible assets 81
8. Financial instruments 82
9a. Trade receivables and other current assets 83
9b. Trade receivables and other current assets: analysed by type of organisation 83
10. Cash and cash equivalents 84
11a. Trade payables and other current liabilities 85
11b. Trade payables and other current liabilities: analysed by type of organisation 85
12. Provisions for liabilities and charges 86
13. Financial Guarantee: Professional and Career Development Loans (Defaults) 88
14. Operating lease commitments 89
15. Capital commitments 89
16. Commitments to make grants to colleges 90
17. Contingent liabilities 90
18. Related-party transactions 90
19. Losses and special payments 91
19a. Losses statement 91
19b. Special payments 92
19c. Fruitless payments 92
19d. Constructive losses 92
20. Events after the date of the statement of financial position 92
Glossary of Financial Terms 93
Glossary of Further Information 95
Programme Assurance 28
Table 1. Position of FE colleges in the academic year 2012 to 2013, representing £2.08 billion in grant funding 28
Reporting of PersonalData-related Incidents 31
Table 1. Summary of protected personal data-related incidents formally reported to the Information Commissioner's Office in 2013 to 2014 31
Table 2. Summary of other protected personal data-related incidents in 2013 to 2014 31