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32 City of Glasgow College Annual Report & Accounts 2019-20

The College's position with regard to risk across various

categories is described in the Policy in a series of statements

for each category as follows:

• Reputation

• Compliance

• Financial

• Student Experience

• Major Change or Development Activities

• Environment and Social Responsibility

• People and Culture

• Business Continuity.

Risk tolerance varies from Low, e.g. in the case of College

Reputation and Compliance, where no potential gain may

be accrued as a consequence of accepting such risk, to

Medium, such as in the case of development activities,

where potential gains may be such that a degree of

sustainable risk is acceptable, with commensurate risk score.

This represents a development in the Board's perception and

management of risk, in the light of the new College Strategic

Plan with its new Strategic Priority 8: "To secure diversity of

income and sustainable development" (CoGC Strategic Plan

2017-25).

Details of significant risk-reported matters are outlined under

the Audit and Assurance section within this Annual Report

above. A number of key Strategic Risks have been affected

by the Covid-19 pandemic, in particular those relating to

Student Experience, Commercial/International Development,

and the Financial position of the College.

Data Related Incidents

The College maintains a register of all data-related incidents.

There were 10 such incidents recorded in the year to 31 July

2020. Data subjects were notified as appropriate. None of

these incidents were sufficiently serious to warrant reporting

to the Information Commissioner.

Section 22 Report

In April 2020, the Auditor General published a report on the

recent fraud investigation at City of Glasgow College, made

under Section 22 of the Public Finance and Accountability

(Scotland) Act 2000. The report identifies the nature, extent,

and value of the fraud perpetrated against the College.

The report highlights that the fraud was identified by the

College and that the employee concerned has been charged

following an internal staff disciplinary exercise and a Police

Scotland investigation.

The report states that: " The annual audit report notes that

for the purposes of the annual accounts audit, the value of

the identified fraud is not material in the year under audit or

in total" and that full disclosure of the fraud was made by the

College, and all regulatory bodies informed.

The report refers to the steps taken by the College

including the forensic review of the incident, the subsequent

improvement actions, the review of Finance and IT functions

by the external auditor, and the ongoing co-operation with

Police Scotland. The Auditor General anticipates a further

report "once legal proceedings are concluded".

Financial Responsibilities and Control

The Board must keep accounting records that disclose the

financial position of the College and ensure the financial

statements are prepared in accordance with the Statement

of Recommended Practice (2019).

In addition, the Board, through its designated office holder,

and within the terms and conditions of the Financial

Memorandum agreed with the Scottish Funding Council

(SFC), must prepare financial statements for each financial

year that give a true and fair view of the College's state of

affairs and of the surplus or deficit and cash flows for that

year. In causing the financial statements to be prepared, the

Board has ensured that:

• Suitable accounting policies are selected and applied

consistently.

• Reasonable and prudent estimates and judgements have

been made.

• Applicable accounting standards have been followed,

subject to any material departures explained in the

financial statements.

• Ensure SFC funds are used only for the given purposes

and in accordance with the memorandum with the SFC

and any other conditions the SFC may prescribe.

• Financial statements are prepared on the going concern

basis unless it is inappropriate to presume the College will

continue in operation.

• The Board is satisfied that it has adequate resources to

continue in operation for the foreseeable future. Therefore,

the going concern basis continues to be adopted in the

preparation of the financial statements.

The Board has taken reasonable steps to:

• Ensure there are appropriate financial and management

controls in place to safeguard public funds and funds from

other sources.

• Safeguard the assets of the College and prevent and

detect fraud.

• Secure the economical and effective management of the

College's resources and expenditure.

• The key elements of the College's system of internal

financial control, which is designed to discharge the

responsibilities set out above, include:

• Clear definitions of the responsibilities of, and the authority

delegated to senior managers

• A comprehensive medium and short-term planning

process, supplemented by detailed annual income,

expenditure, capital and cash-flow budgets.

• Regular reviews of key performance indicators and

business risks and quarterly reviews of financial results

involving variance reporting and updates of forecast

outturns;

• Clearly defined and formalised requirements for approval

and control of expenditure, with investment decisions

involving capital or revenue expenditure being subject to

formal detailed appraisal and review within approval levels

set by the Board.

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