Financial Management Code
We are required to develop a Financial Management Code relating to the organisation and management of the financial affairs of regulated institutions. We will monitor compliance with the Code and intervene should a regulated institution fail to comply with the Code. This ensures that regulated institutions are well run, have effective financial management arrangements and are sustainable for the future. This protects the interests of students, safeguards public funds and protects the reputation of higher education in Wales.
The Code took effect from 01 August 2017 and we continue to keep it under review.
Universities are accountable to us, and ultimately to the National Assembly for Wales, for the way they use our funds. We have a number of processes in place through which we ensure that the funds we allocate are used properly and that institutions’ financial health is sound.
Terms and Conditions of Funding
From 1 August 2021, the Terms and Conditions of Funding replaced the Memorandum of Assurance and Accountability. The Terms and Conditions of Funding is issued annually to regulated institutions who receive payments in support of activities specified in section 65(2) of the Further and Higher Education Act 1992. It sets out the terms and conditions which regulated institutions must abide by for receiving payment of HEFCW grant.
The Terms and Conditions of Funding does not supersede the Financial Management Code, but operates in parallel with it, and regulated institutions must also comply with the requirements set out in the Financial Management Code.
Memorandum of Assurance and Accountability
Prior to 1 August 2021, the Memorandum of Assurance and Accountability was in place. The Memorandum of Assurance and Accountability set out the terms and conditions for payment of HEFCW grant.
We engage strategically with institutions to:
- understand, and be comfortable with, their strategic direction
- assure ourselves that the university is sustainable
- contribute to our understanding of the overall sustainability of higher education in Wales
- enhance each university’s understanding of Welsh Government and HEFCW priorities, and
- allow us to meet our statutory responsibilities in advising the Welsh Government on the funding needs of the higher education sector, and on other matters relating to the development of higher education in Wales
In all of these, we seek to assure ourselves that universities are making proper use of public funds, are meeting their statutory obligations and are having due regard for Welsh Government priorities.