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Trading income lost due to temporary cessation or part-cessation of activities (item (iv))

  • Costs incurred against trading accounts which experience significant loss of income, due to total or near-total temporary cessation of activities during periods when buildings cannot be accessed, should continue to be charged against normal trading accounts, for the time being. Exposed costs arising from the loss of trading income should not be charged to ALBE[1];
  • Affected departments and institutions should seek to mitigate the impact of lost income through appropriate cost efficiencies[2] (in the context of maintaining the activity as a going concern) and pursuit of alternative sources of income (e.g. grants);
  • This may lead to some trading accounts going into deficit and perhaps remaining in deficit for a period; the University will not allow institutions to fail as a consequence of the financial impact of the pandemic and is prepared to allow activities to continue to operate under these conditions;
  • The Central University will not make good all trading income lost. However, where the impact of the pandemic results in a permanent deficit for certain trading accounts which cannot be recovered from future activities, and where the trading account is a material component of an institution’s overall finances, the Central University will consider requests, based on sustainable business plans, for funding top-ups to restore the financial position and sustainability of the activity;  requests won’t be considered until the end of this financial year (July 2021) at the earliest, at a time when there is a better understanding of the pandemic’s impact on University and local accounts;
  • In the meantime, resulting overspends should remain in the local trading account (not ALBE), so that significant emerging funding issues attached to specific activities, can be tracked at a high-level across the University; 
  • If some costs relating to trading activities have already been transferred to ALBE, these costs should be transferred back to the appropriate local trading account to be included within any overall local deficit or reduction in reserves.

Page last updated 16-Dec-20


[1] This represents a clarification of previous guidance, which anticipated that some costs relating to temporarily ceased trading activities, would be transferred to ALBE once it was clear that no mitigating funds had been identified. Such charges to ALBE should now be reversed out.

[2] Organisational change that is likely to result in compulsory redundancies should be considered only as a last resort.

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