Accounts

Statement of Comprehensive Net Expenditure

This account summarises the expenditure and income generated and consumed on an accruals basis. It also includes other comprehensive income and expenditure, which include changes to the values of non-current assets and other financial instruments that cannot yet be recognised as income or expenditure.

For the Year to 31 March 2023

Statement of Financial Position

This statement presents the financial position of the department. It comprises three main components: assets owned or controlled; liabilities owed to other bodies; and equity, the remaining value of the entity.

As at 31 March 2022

Professor Sir Ian Diamond
Accounting Officer
UK Statistics Authority
07July 2023

Statement of Cash Flows

The Statement of Cash Flows shows the changes in cash and cash equivalents of the department during the reporting period. The statement shows how the department generates and uses cash and cash equivalents by classifying cash flows as operating, investing and financing activities. The amount of net cash flows arising from operating activities is a key indicator of service costs and the extent to which these operations are funded by way of income from the recipients of services provided by the department. Investing activities represent the extent to which cash inflows and outflows have been made for resources which are intended to contribute to the departments’ future public service delivery.

For the period ending 31 March 2023

Statement of Changes in Taxpayers’ Equity

This statement shows the movement in the year on the different reserves held by the Department, analysed into ‘general fund reserves’ (i.e., those reserves that reflect a contribution from the Consolidated Fund). The Revaluation Reserve reflects the change in asset values that have not been recognised as income or expenditure. The General Fund represents the total assets less liabilities of a department, to the extent that the total is not represented by other reserves and financing items.

For the period ending 31 March 2023

Notes to the Accounts

1. Statement of Accounting Policies and Accounting Convention

The financial reporting framework that has been applied in the preparation of the financial statements is applicable law and UK adopted international accounting standards.

The 2022/23 Government Financial Reporting Manual (FReM) applies International Financial Reporting Standards (IFRS), adapted or interpreted for the public sector. Where the FReM permits a choice of accounting policy, the accounting policy which is judged to be most appropriate to the particular circumstances of the UK Statistics Authority for the purpose of giving a true and fair view has been selected. The particular policies adopted by the Authority are described below. They have been applied consistently in dealing with items that are considered material to the accounts.

In addition to the primary statements prepared under IFRS, the FReM also requires the Authority to prepare additional primary statements. The Statement of Parliamentary Supply and supporting notes show outturn against Estimate in terms of the net resource requirement and the Net Cash Requirement.

These accounts have been prepared under the historical cost convention modified to account for the revaluation of property, plant and equipment and in-house software.

The Authority is primarily resourced by funds approved by the House of Commons through the annual Appropriation Act. Resources are drawn down each month to meet expenditure requirements and are credited to the General Fund. The functional currency for the UK Statistics Authority is pounds sterling; the Authority keeps a small balance of sterling and euros as well as shopping vouchers and postage stamps.

Going concern

The Authority anticipates continued funding to promote and safeguard the production of official statistics that serve the public good, as evidenced by the inclusion of financial provision for that service in the SR21 settlement agreement with HM Treasury. This is sufficient evidence that the Authority remains a going concern in accordance with the continuity of service principle outlined within he FReM.

Property, plant and equipment

Property, plant and equipment (PPE) assets include computers, and associated equipment, office machinery, and furniture and fittings.

Civil Estate property is occupied in Newport, Titchfield and Christchurch. Ownership of the land and buildings was transferred to the Government Property Agency on 30th September 2021 at current market value using professional valuations.

Expenditure on the short-term property lease at Drummond Gate was stated at current cost by using indices taken from the Authority’s publication “Price Index Numbers for Current Cost Accounting”. The Authority has now served notice on this property lease with the lease break date of 4th January 2023 when we vacated the property.

All other PPE assets are re-valued from the beginning of the quarter of acquisition. These assets are stated at current costs by using indices taken from the Authority’s publication Price Index Numbers for Current Cost Accounting.

PPE assets must exceed the capitalisation threshold of £5,000 (excluding VAT) and have a life greater than one year.

The Authority adopted IFRS 16 Leases in April 2022. Therefore, PPE previously classified as a Finance Lease, will now be recognised under Right of Use Asset. Please see Lease note.

Intangible assets

Intangible assets consist of software licenses and in-house developed software. Software licenses are not re-valued and are included at depreciated historical cost.

In-house developed software is stated at current costs by using indices developed by the Office for National Statistics (ONS) National Accounts Division.

In House Developed Software assets must exceed a capitalisation threshold of £50,000 (excluding VAT) and have a life greater than one year.

Software Licences must exceed a capitalisation threshold of £5,000 (excluding VAT) and have a life greater than one year.

Statistical records

Statistical information has built up over many years and is stored for reference purposes. No attempt is made to value this data, as there is no realistic way of doing so that would arrive at a meaningful valuation. The cost of storing and maintaining the data is charged to the Statement of Comprehensive Net Expenditure as incurred.

Depreciation and amortisation

Depreciation is calculated so as to write off the re-valued cost of assets over the estimated useful economic life on a straight-line basis (except where otherwise indicated), as follows:

Assets in the course of construction

Assets under construction are capitalised as appropriate where meeting the requirements of IAS 16 or IAS 38 and transferred out of assets under construction into the relevant category of PPE or intangibles on completion.

Research and development

The Authority undertakes certain research into statistical and survey methodology. Costs are charged to the Statement of Comprehensive Net Expenditure as they arise.

As required under European System of Accounts (ESA) 10 Research and Development costs are charged to Capital within the Statement of Parliamentary Supply. The reconciliation between the Statement of Comprehensive Net Expenditure and the Statement of Parliamentary Supply is shown at SOPS Note 2.

Assets held for sale

Assets held for sale comprise properties, plant and equipment that are no longer in operational use and are available for immediate sale in their present condition and are being actively marketed. The assets are classified from non-current to current assets at sales prices less costs to sell. Assets held for sale are not depreciated.

Revenue from contracts with customers

Under IFRS 15, key judgements in determining the recognition and timing of revenue recognition are identified at the point when:

• control of goods and services is transferred under contractual arrangements and services to the customer, and
• performance obligations are satisfied, whether at a point in time or over time.

Most of the Authority’s performance obligations relate to services satisfied over time.

The Authority applies the five-stage model for the recognition of revenue from contracts with customers:

Step 1 – Identify the contract(s) with a customer.

Step 2 – Identify the performance obligations in the contract.

Step 3 – Determine the transaction price.

Step 4 – Allocate the transaction price to the performance obligations in the contract.

Step 5 – Recognise revenue when the Authority satisfies a performance obligation.

The application of the model depends on the facts and circumstances presented in a contract with a customer and requires the exercise of judgement. Revenue related to performance obligations recognised over time as the service is rendered is measured by reference to the input (resources consumed in satisfying a performance obligation) method.

The Authority recognises revenue using an input method based on overheads incurred. Revenue is calculated by reference to reliable estimates and total expected costs. Revenue and associated margin are therefore recognised progressively as costs are incurred. The Authority has determined this method faithfully depicts the Authority’s performance in transferring control of the services to the customer.

The new COVID-19 Infection Survey (CIS) Digital delivery model and programme continued in 2022/23 but at a markedly reduced cost and a corresponding lower income. The CIS work is funded via the UK Health Security Agency and is based on a cost plus agreed overhead rate and recognised progressively as costs are incurred. If the ‘over time’ criteria for revenue recognition are not met, revenue is recognised at the point in time that control is transferred to the customer, when the Authority has right to payment on delivery.

Prices charged to customers are calculated in accordance with Managing Public Money (published by the Treasury).

Foreign exchange

The Authority conducts a small number of transactions which are denominated in a foreign currency which are reviewed in accordance with IAS 21 and 39 (derivatives).

Transactions, other than Euros, are translated into sterling at the exchange rate ruling on the date of each transaction. Assets and liabilities denominated in Euros are translated into sterling at the exchange rate ruling at the date of the Statement of Financial Position.

Leases

IFRS 16 “Leases” has been implemented from 1 April 2022; this introduces a single lessee accounting model that requires a lessee to recognise assets and liabilities for all leases (apart from the exemptions included below).

For government bodies reporting under the FReM, IFRS16 was brought into effect on 1 April 2022 and replaces IAS 17 (Leases).

In respect of lessees, IFRS 16 removes the distinction between operating and finance leases and introduces a single accounting model that requires a lessee to recognise (‘right of use’) assets and lease liabilities.

The definition of a lease has been updated under IFRS 16, there is more emphasis on being able to control the use of an asset identified in a contract.

Implementation and Assumptions

The Authority has applied IFRS 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under IAS 17 Leases. IAS 17 operating leases are included within the Statement of Financial Position as a lease liability and right of use asset for the first time in 2022/23.

The option to reassess whether a contract is, or contains, a lease at the date of initial application has not been used, the Authority has used the practical expedient detailed in IFRS 16(C3).a

The definition of a contract is expanded to include intra-UK government agreements where non-performance may not be enforceable by law. This includes, for example, Memorandum of Terms of Occupation (MOTO) agreements.

The Authority has elected not to recognise right of use assets and lease liabilities for the following leases:

• intangible assets;
• non-lease components of contracts where applicable;
• low value assets (these are determined to be in line with capitalisation thresholds on Property, Plant and Equipment) and – leases with a lease term of 12 months or less.

Previous treatment

In the comparative period, Leases were reviewed in accordance with IAS 17. As a lessee the Authority classified leases that transfer substantially all the risks and rewards of ownership as finance leases. The leased assets were measured at an amount equal to lower of the fair value or the present value of minimum lease payments. This fair value cap has been removed under IFRS 16 and has resulted in re-measurement of finance leased assets within 22/23 if they meet the re-measurement criteria mentioned below.

Leases other than finance leases are classified as operating leases. Assets previously held as operating leases were not recognised in the Authority’s Statement of Financial Position. Payments were recognised in the SoCNE on a straight-line basis over the term of the lease. Any lease incentives were recognised as an integral part of the total lease expense, over the term of the lease.

Policy applicable from 1 April 2022

At inception of a contract, the Authority assesses whether a contract is, or contains, a lease. A contract is, or contains a lease if the contract conveys the right to control the use of an identified asset for a period of time. This includes assets for which there is no consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Authority assesses whether:

• The contract involves the use of an identified asset;
• The Authority has the right to obtain substantially all of the economic benefit from the use of the asset throughout the period of use; and
• The Authority has the right to direct the use of the asset.

The policy is applied to contracts entered into, or changed, on or after 1 April 2022.

At inception or on reassessment of a contract that contains a lease component, the Authority allocates the consideration in the contract to each lease component on the basis of the relative standalone prices.

The Authority assesses whether it is reasonably certain to exercise extension options or not to exercise break options at the lease commencement date. The Authority reassesses this if there are significant events or changes in circumstances that were not anticipated. This is evident in the Authority’s application of the IFRS16 hindsight methodology whereby the event of serving notice on segments of its leased properties in March 2023 led to the Right of Use Assets and corresponding lease liabilities being re-measured as at recognition date of 1^st April 2022.

Right of use assets

The Authority recognises a right of use asset and lease liability at the commencement date. The right of use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for initial direct costs, prepayments or incentives, and costs related to restoration at the end of a lease.

The right of use assets are subsequently measured at either fair value or current value in existing use in line with property, plant and equipment assets. The cost measurement model in IFRS 16 is used as an appropriate proxy for current value in existing use or fair value for the majority of leases (consistent with the principles for subsequent measurement of property, plant and equipment) except for those which meet one of the following:

• A longer-term lease that has no provisions to update lease payments for market conditions or if there is a significant period of time between those updates; and;
• The fair value or current value in existing use of the underlying asset is likely to fluctuate significantly due to changes in market prices.

The right of use asset is depreciated using the straight line method from the commencement date to the end of the lease term. The estimated useful lives of the right of use assets are determined on the same basis as those of property plant and equipment assets.

The Authority applies IAS 36 Impairment of Assets to determine whether the right of use asset is impaired and to account for any impairment loss identified.

Lease liabilities

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease, or if that cannot be readily determined, the rate provided by HM Treasury (HMT). The HMT discount rates were 0.95% for leases entered into prior to 31 December 2022, or 3.51% after 1 January 2023.

The lease payment is measured at amortised cost using the effective interest method. It is re-measured when there is a change in future lease payments arising from a change in the index or rate, if there is a change in the Authority’s estimates of the amount expected to be payable under a residual value guarantee, or if the Authority changes its assessment of whether it will exercise a purchase, extension, or termination option.

Lease payments included in the measurement of the lease liability comprise the following:

• Fixed payments, including in-substance fixed payments;
• Variable lease payments that depend on an index or a rate, initially measured using the index rate as at the commencement date;
• Amounts expected to be payable under a residual value guarantee;
• The exercise price under a purchase option that the Authority is reasonably certain to exercise, lease payments in an optional renewal period if the Authority is reasonably certain to exercise an extension option, and penalties for early termination of a lease unless the Authority is reasonably certain not to terminate early.

When the lease liability is re-measured a corresponding adjustment is made to the right of use asset or recorded in the SoCNE if the carrying amount of the right of use asset is zero.

The table below reconciles the operating lease commitments under IAS 17 as presented in the Annual Report and Accounts 2021/22 to the lease liability calculated under IFRS 16 on 1 April 2022:

Financial instruments

The Authority does not hold any complex financial instruments.

Provisions and early departure costs

The Authority provides for legal or constructive obligations which are of uncertain timing or amount at the Statement of Financial Position date on the basis of best estimate of the expenditure required to settle the obligation. Where the effect of time value is significant, provisions are discounted using the discount rates published by HM Treasury. These provisions are reviewed each year in accordance with IAS 37.

The Authority meets the responsibility of additional costs of employees who take voluntary early severance or who retire early by paying the amounts required over the period between early departure and normal retirement date. The Authority provides for this in full when the early retirement programme becomes binding.

The Authority recognises a liability for early departure costs where an obligation to pay employees exists.

The Authority recognises the obligation as a provision in the financial statements when:

• the scheme has been announced
• it has created a valid expectation that it will fulfil the obligations of the scheme

The Authority recognises the obligation as an accrued liability in the financial statements when:

• a formal signed agreement with the member of staff is in place
• the member of staff has agreed a specified leaving date

In the circumstances where we have not met the criteria listed above the exit costs will be recognised in the following financial years.

Trade receivables

Trade receivables are recognised at their amortised cost less expected credit losses in accordance with IFRS 9. Expected credit losses are based on the Authority’s expectation of recovery at the year end.

Staff costs

Under IAS19 Employee Benefits, all staff costs must be recorded as an expense as soon as the organisation is obliged to pay them. This includes the cost of any untaken leave at the year end.

Cash and Cash Equivalents

The Authority holds balances of cash and cash equivalents in a readily realised form; these include cash balances, shopping vouchers and postage stamps.

VAT

Irrecoverable VAT is charged to the relevant expenditure category or included in the capitalised purchase cost of assets. Where output VAT is charged or input VAT is recoverable, the amounts are stated net of VAT.

Programme Expenditure

Net expenditure for the year is analysed in the Statement of Comprehensive Net Expenditure between income and operating costs. The classification of expenditure and income as programme follows the definition of programme costs set out in HM Treasury Consolidated Budgeting Guidance, and as voted by Parliament in the Treasury’s Supply Estimate.

Pensions

Past and present employees are covered by the provisions of the Principal Civil Service Pension Schemes as described in notes to the accounts and in the Authority’s Remuneration Report. The Principal Civil Service Pension Scheme (PCSPS) and the Civil Servant and Other Pension Scheme (CSOPS) are unfunded, except in respect of death in service or ill health retirement. Employees can opt to open partnership pension accounts, a stakeholder pension with employer contributions ranging from 8% to 14.75 % depending on the Employee’s age. The Authority recognises the expected costs of these elements on a systematic and rational basis over a period during which it benefits from employees’ services by payment to the Principal Civil Service Pension Schemes (PCSPS) of amounts calculated on an accruing basis. Liability for payment of future benefits is a charge on the PCSPS. In respect of the defined contribution elements of the schemes, the Authority recognises the contribution payable for the year.

Contingent liabilities

In addition to contingent liabilities disclosed in accordance with IAS 37, the Authority discloses for parliamentary reporting and accountability purposes certain statutory and non-statutory contingent liabilities where the likelihood of a transfer of economic benefit is remote, but which have been reported to Parliament in accordance with the requirements of Managing Public Money.

Where the time value of money is material, contingent liabilities which are required to be disclosed under IAS 37 are stated at discounted amounts and the amount reported to Parliament separately noted. Contingent liabilities that are not required to be disclosed by IAS 37 are stated at the amounts reported to Parliament.

Accounting Estimates and Judgements

In preparation of the Authority’s financial statements, management has made estimates and judgements that impact the amounts being reported for assets and liabilities as at the date of the Statement of Financial Position and amounts reported against income and expenditure during the year. Uncertainties are inherent in business activities, and as such, some elements of financial statements cannot be measured precisely and therefore can only be estimated. Estimation involves judgements based on the latest available, reliable information.

Definitions

Estimate

A tentative evaluation and rough calculation, of value, quantity or size. These would include:

• Depreciation
• Revaluations
• Provisions
• Accruals

Judgement

The capacity to assess situations or circumstances shrewdly and to draw sound conclusions. These would include:

• Revenue from contracts with customers
• Useful Economic Life and Impairment of In-house Software Intangible Assets Useful Economic Life
• Leases

Revenue from contracts with customers

Judgements are applied to measurement and timing of revenue recognition and related balances for contract assets, trade receivables and accrued and deferred income in the context of satisfaction of performance obligations over time or at a point in time.

The Authority has several income streams where the level of revenue is based on levels of expenditure; judgements are applied to ensure the costs associated with specific projects are reliable and accurately reflect the level of expenditure of the project.

Judgements are applied to calculate a corporate overhead rate which is used to derive the charge out rate when charging for staff time. The level of overheads associated with each revenue stream are agreed with the customer prior to contract commencement.

Depreciation

Intangible Assets Useful Economic Life

Applicable expenditure incurred in the development of internally created software is capitalised and recognised as an intangible asset if the criteria set out in the relevant accounting standards are met. The Authority has made judgements and assumptions when assessing whether a project meets these criteria and recognises an intangible asset, whether purchased or built in-house (at cost) if, and only if:

• the Authority intends to complete the asset and bring it into use
• the Authority has the ability to use the asset
• there are adequate technical, financial and other resources to complete the development and use the asset
• it is probable that the future economic benefits that are attributable to the asset will flow to the entity
• the cost of the asset can be measured reliably

Having recognised the costs and determined the economic life attributable to an intangible asset by applying IAS 38, the Authority undertakes an annual review of in-house developed software by applying IAS 36, adapted by HM Treasury for the public sector. The software does not generate future cash flows; its purpose is the support of future service potential and where an asset is not held for the purpose of generating cash flow, the value of the asset is assumed to equal the cost of replacing the asset, unless there has been a reduction in the service level. The Authority gauges the continued service potential of each in-house developed software asset by referring to the following factors:

• management information from the in-house software, including usage statistics where available
• future plans highlighted by the ONS Strategic Roadmap and the Digital, Technology and Methodology transformation plan
• information technology reviews
• business area expectations and intelligence of ongoing requirements
• the estimated remaining useful economic life of the asset

The remaining economic lives for intangible assets are estimated at between two and six years for internal projects.

A reduction in the value of in-house developed software or impairment of assets in the course of construction, resulting from decisions undertaken by the Authority in the course of normal business operations is charged to Departmental Expenditure Limit (DEL). Normal business operation covers all loss and damage to assets that result from management or staff action and the actions of third parties.

Provisions

IAS 37 defines and specifies the accounting for and disclosure of provisions, contingent liabilities, and contingent assets.

A provision is a liability of uncertain timing or amount. The liability may be a legal obligation or a constructive obligation. A constructive obligation arises from the Authority’s actions, through which it has indicated to others that it will accept certain responsibilities, and as a result has created an expectation that it will discharge those responsibilities.

The Authority recognises a provision if it is probable that an outflow of cash or other economic resources will be required to settle the provision. If an outflow is not probable, the item is treated as a contingent liability.

A provision is measured at the amount that the Authority would rationally pay to settle the obligation at the end of the reporting period. Risks and uncertainties are considered in measuring a provision which is discounted to its present value.

Provision for Unredeemed Survey Incentive Vouchers

The Authority issues shopping vouchers to survey respondents as an incentive to complete certain surveys and is billed for the cost of these vouchers once the voucher has been redeemed by the recipient. Vouchers issued to survey respondents have a three-month expiry date so an estimated judgement is made, based on redeemed rates during the year, of the probable value of unredeemed vouchers at year end that will be redeemed before expiring. As the expenditure relates to the past event of issuing the vouchers and the cash outflow is not certain, the estimated value of vouchers redeemed before expiring are accounted for as a provision.

Estates Dilapidations

The terms of a specific lease that the Authority had entered states that the building should be returned in a fit state to the landlord. At any such time the Authority should consider whether there is any liability to return the property to its original state and commence discussion with the landlord. We have now vacated the premises and negotiations with the landlord are ongoing. Any provision will be based on the estimated cost of returning the property back to its original state.

As this lease has not been recognised under IFRS16, the accounting treatment for Potential Claims and Dilapidations is to charge the costs to the Statement of Net Comprehensive Expenditure in the accounting period they arise, along with increasing the provision balances held on the Statement of Financial Position. When an actual payment is made relating to these specific entries, the actual payment is made against the provision with no charge to the Statement of Net Comprehensive Expenditure.

Accruals

Accruals are an accounting methodology that records income and expenditure when they occur; ensuring costs are recorded in the same period as the activity regardless of when cash is exchanged. The term accrual refers to any individual entry recording income and expense in the absence of a cash transaction. These occur throughout the year to ensure monthly reporting is as complete as possible, but its primary purpose is to ensure the Annual Accounts represent a true and fair view of the Authority’s financial position.

When goods or services are received prior to the financial year end but the invoice is not expected until the following financial year, an accrual is made to ensure that the charge is recognised in the correct accounting period. Other goods and services will require a quote previously provided such as a capital item to be delivered or calculation, such as a timesheet multiplied by the hourly rate for an employment agency accrual.

Holiday and flexi leave pre-payments and accruals are calculated by comparing the expected year-end balance against the actual balance at 31 March. The expected balance is calculated by spreading the entitlement evenly over the year taking into consideration the leave year start date for each member of staff. This is compared to the actual balance held; the balance is valued by grade using staff planning rates.

The Authority is currently compliant in meeting its reporting requirements relating to estimates and judgements and where these estimates change, they are amended within the guidelines of accounting standard IAS 8.

Leases

The valuation of right of use assets at IFRS 16 adoption has accounted for the Authority’s intention to reduce occupancy at sites leased from the GPA by serving notice on elements of the properties. The notice period applied to elements being surrendered is 18 months from 31^st March 2023 in line with the break clauses in the lease agreement. The subsequent remeasurement of these assets has been applied as per the standard’s hindsight methodology, because of intentions to reduce occupancy being made known following initial asset recognition. The Authority’s interpretation of hindsight is that the decisions made during 2022-23 should be applied at the IFRS16 transition date of 01/04/2022.

The Authority is reasonably certain not to exercise the full termination options within its property lease agreements and have therefore recognised the right of use asset and corresponding liability across the full 15-year term of the lease agreement for the segments of its assets that it wishes to retain. There are several reasons why this judgement has been made one of which is the significant economic incentive to remain at the current sites for the full term of the lease.

As the lease liability and the right-of-use asset is based on unadjusted lease payments as known at the commencement date, no uplifts for inflation or RPI have been factored into the calculations. Therefore, when the lease payments change because of inflation or RPI the Authority will account for the remeasurement of the lease by recalculating the new lease liability by discounting adjusted lease payments with the original discount rate. The difference will be a right-of-use asset adjustment.

Standards Not Yet Adopted

IFRS17 Insurance Contracts

IFRS 17 Insurance Contracts, which replaces IFRS 4 Insurance Contracts, will be adopted in the UK from 1 January 2023. HM Treasury have agreed with the Financial Reporting Advisory Board (FRAB) to delay the implementation of IFRS 17 in central government by 2 years to 1 April 2025

The headline of the new standard is that the scope of an insurance contract will change from that under IFRS 4 Insurance Contracts, meaning that some contracts issued by organisations and not previously considered to fall within an insurance category could now be classified as an insurance contract. e.g. product breakdown contracts or warranties. The standard only applies to insurance contracts issued and not those held.

Following a review, the Authority does not believe it issues any contracts that fall within the scope of IFRS17 and therefore will continue to apply IFRS 15 Revenue Recognition to the Authority’s income generation.

2. Segmental Information of Expenditure and Income

The following information is regularly provided in order to inform the decision making by the National Statistician’s Executive Group and the primary Chief Operating Decision Maker (CODM) of the UK Statistics Authority to make decisions regarding planning, resource allocation and income, as well as performance monitoring.

Census related expenditure and income reported in the Segmental Information Table

Reconciliation between segment information and net operating cost in the statement of comprehensive net expenditure.

3. Staff numbers and related costs

Staff costs

For the period ending 31 March 2023

Staff numbers

Capitalised staff costs

4. Programme costs

For the period ending 31 March 2023

5. Income

For the period ending 31 Mar 2023

An analysis of income from services provided external and public sector customers is as follows:

The new CIS Digital delivery model and programme continued in 2022/23 but at a markedly reduced cost and a corresponding lower income. The CIS work is funded via the UK Health Security Agency.

6. Property, plant and equipment

For the period ending 31 March 2023

7. Intangible Fixed Assets

For the period ending 31 March 2023

Intangible Fixed Assets – In-house developed software applications

For the period ending 31 March 2023

Notes:

CORD (Central ONS Repository for Data) is the primary system used to compile the National Accounts including Quarterly National Accounts, Retail Sales Index and Trade (Goods and Services). The CORD platform capability is currently being enhanced to support the processing requirements to deliver the National Accounts in-line with the European System of Accounts 2012 Programme. This will be achieved through progressive improvements in statistical methods, data and system performance.

The Social Survey Repository replaced the Annual Population Survey/ Labour Force Survey re-weighting and Scientific Information Retrieval 2002 systems based in Newport, which currently weight, re-weight, impute, produce derived variables, attach geographies and store the APS and LFS data. It is built on the CASPA platform (Common Architecture for Statistical Processing and Analysis). In March 2023 the useful economic life has been fully realised, and the asset fully written down. As we move to a replacement platform some operational activities may continue during the transition with no further inputs or outputs to this current platform with no further economic benefit to the Authority.The Electronic Data Collection programme (EDC) aims to develop systems, methods and processes to improve the collection, integration and processing of data in relation to the UK’s economy and society.

The software is part of an ongoing Data Collection Transformation Programme to modernise antiquated data collection modes, such as paper-based questionnaires, with a range of electronic data collection channels, making further use of the Web and administrative sources.

The Business Prices programme provides additional functionality to include more respondents in line with Prices Surveys. The useful economic life has been fully realised, and the asset fully written down. The asset has no further economic benefit to the Authority.

The Life Events software replaces the legacy system for processing and quality assuring life events registrations. The data held relates to registrations of Births, Deaths, Abortions, and Birth Notifications.

The software itself is an interim step towards the inclusion of Life Events on a corporate platform in 12 months time. Due to the short time period until the transfer onto Corporate Platforms. In March 2023 the useful economic life has been fully realised, and the asset fully written down. As we move to a replacement corporate platform some operational activities may continue during the transition with no further economic benefit to the Authority.

DCTP Business Registers is a result of a Project Review in 2017-18, where three separate components, the Address Index, the Business Index and the Statistical Business register were reviewed and combined within one project. The development provides a new capability for ONS, increases efficiency, joins up across ONS and government, and puts ONS at the forefront of data management in government. This project will create high quality statistics, where discontinuities between the current and future system can be explained to an appropriate level of granularity. It will enable the ONS milestone of making short-term surveys integrated and online.

Data Access Platform (DAP) – The ONS Strategy is to utilise new data sources and processing techniques to enable us deliver “Better Statistics, Better Decisions” this means utilising Big Data, bringing in data from other departments and companies, being able to explore that data and link it together to gain new insights. DAP is an enabler for that strategy, giving the ONS the tools and technology it needs to securely store all our data and the processing power to make use of it. The useful economic life has been fully realised, and the asset fully written down. The asset has no further economic benefit to the Authority.

Clerical Matching – The ONS requires a capability to match records from multiple datasets and assure that the quality of the matches meet strict targets. The immediate need relating to successful delivery of the 2021 Census. The ONS has an additional requirement that gives the option to re-use the capability for wider business needs beyond the Census with other datasets and to support the overall linking of datasets. This will require the flexibility to build on the existing capability of the tool to potentially meet emerging business need, for example, adding extra fields to the tool as required.

ARIES Prices – ONS collects and analyses prices data for goods and services in the UK. A high-profile use of this data is calculation of the rate of inflation. The wider uses of the data include fiscal and political decision making, commercial planning in the public and private sectors, and uses in academic settings. With observable impacts on currency exchange rates, credit interest rates and political discourse the reliability and security of prices and inflation data is of critical importance. Methods and sources used by ONS for analysis of prices have changed in the past. A further need for Alternative Data Sources (ADS) in price statistics to address current and near-term requirements has become clear through high profile independent reviews such as the ‘Independent Review of UK Economic Statistics’ by Professor Sir Charles Bean and ‘UK Consumer Price Statistics: A Review’ by Paul Johnson.

In-house developed software applications – Assets Under Construction

For the period ending 31 March 2023

8. Financial Instruments

For the period ending 31 March 2023

As the cash requirements of the Authority are met through the Estimates process, financial instruments play a more limited role in creating and managing risk than would apply to a non-Public Sector body of a similar size. The majority of financial instruments relate to contracts for non-financial items in line with the Authority’s expected purchase and usage requirements. The Authority is, therefore, exposed to little credit, liquidity or market risk. The Authority revalues outstanding Euro transactions at year end.

Currency risk

9. Trade Receivables and Other Assets

As at 31 March 2023

Total Trade Receivables Outstanding

Notes:

2022/23 figures reflect a net yearly increase of £324,000 in the value of pre-paid holiday and flexi pay. The Authority calculates the holiday and flexi prepayment at the year end with the figure being reflected in the category of prepayments and accrued income. In accordance with IFRS 9 the Authority has reviewed its activities and concluded as a standalone non- ministerial body it does not hold complex financial instruments.
The only financial instruments included in the accounts are receivables and payables.
Trade receivables are recognised at their amortised cost less credit loss. The Authority primarily transacts with public sector bodies, historically outstanding debts are recovered.
The Authority’s payment terms are thirty days. At 31 March 2023 £252,000 debt is outstanding over thirty but less than 60 days, all of which is allocated to public sector bodies which it does not consider a credit risk.

Re-presentation of 2021/22 showing a full disclosure of contract assets within the table rather than in the note.

10. Cash and Cash Equivalents

For the period ending 31 March 2023

11. Trade Payables and Other Current Liabilities

For the period ending 31 March 2023

Notes:

2022/23 figures reflect a net yearly decrease of £366,000 of accrued holiday and flexi pay. The Authority calculates the holiday and flexi accrual at year end with the figure being reflected in the category of accruals and deferred income. In accordance with IFRS 9 the Authority has reviewed its activities and concluded as a standalone non- ministerial body it does not hold complex financial instruments.
The only financial instruments included in the accounts are receivables and payables.
The Authority’s standard contractual payment terms are 30 days, creditors are recognised on receipt of goods or services.
The Authority is not in receipt of loans.

Re-presentation of 2021/22 showing a full disclosure of contract liabilities within the table rather than in the note.

12. Provisions for Liabilities and Charges

For the period ending 31 March 2023

Analysis of expected timing of discounted flows

Notes:

Property Dilapidations
The Authority opted to trigger the break clause to vacate the single floor at the Drummond Gate building in January 2023.
As part of the lease agreement, the Authority took on a repairing obligation for the externals of the building and part of the dilapidation. The UK Statistics Authority is in negotiations with the Landlord in respect of dilapidations due under the Terms of the Lease.

Survey Incentives
The Authority issues shopping vouchers to survey respondents as an incentive to complete certain surveys and is billed for the cost of these vouchers once the voucher has been redeemed by the recipient. Vouchers issued to survey respondents have a three-month expiry date and the Authority will incur expenditure on the element that will be redeemed.

Other Provisions
Ongoing contractual obligations and pending employment tribunals.

13. Capital Commitments

For the period ending 31 March 2023

14. Leases

Right of Use Assets

For the period ending 31 March 2023

Notes

The Authority exercises judgement and estimation in the valuation of Right of Use Assets when considering indexation linked increase/decreases and break and extension clauses within contracts. This may include the application of IFRS16 hindsight methodology when re-measuring Right of Use Asset values. Further information can be found in the Notes to the Accounts on pages 120 to 130 of the pdf.

Included in the £8,518,000 of additions are £ £901k of capital creditors. The total amount of capital creditors brought forwards from 2021/22 was £nil.

Included within the £27,539k adjustment for IFRS16 adoption is £31k of invoices paid prior to the transition date. These have therefore been recognised within the Right of Use Asset but excluded from the opening lease liability.

Maturity analysis Lease Liability

A maturity analysis of contractual undiscounted cash flows relating to lease liabilities is given below. Management monitors rolling forecasts of The Authority’s cash balance on the basis of expected cash flows, to ensure we are able to pay contractual commitments as they fall due.

Notes

Darlington Lease – A formal financial commitment has been signed by the authority for the future occupation of the Darlington Economic Campus (DEC), a central hub for seven government departments and agencies. The lease has been agreed over a 30 year term and is forecasted to be ready for occupation by Spring 2026. The lease has therefore not been recognised because the commencement date is in the future.

GPA Leased Properties –The valuation of right of use assets at IFRS 16 adoption has accounted for the Authority’s intention to reduce occupancy at sites leased from the GPA by serving notice on elements of the properties. The subsequent remeasurement of these assets has been applied as per the standard’s hindsight methodology, because of intentions to reduce occupancy being made known following initial asset recognition. The Authority’s application of the hindsight methodology is that decisions made to reduce occupancy during 2022-23 is accounted for at the IFRS16 transition date of 1^st April 2022.

Amounts recognised in the Statement of Comprehensive Net Expenditure

Amounts recognised in the Statement of Cash Flows

Commitments under Low value & short term leases

The total future minimum lease payments are detailed in the table below.

2021/22 figures relate to commitments under operating leases as per IAS 17 prior to IFRS 16 adoption in April 2023.

15. Other Financial Commitments

For the period ending 31 March 2023

The Authority entered into non-cancellable contracts (which are not Leases or PFI contracts) for Information Management Services, Statistical Services and Facilities Management. As a result the Authority is committed to the following payments.

16. Contingent Liabilities

For the period ending 31 March 2023

None.

17. Related Party Transactions

For the period ending 31 March 2023

The Authority has had various material transactions with other Government Departments and other Central Government bodies.

The table below shows all Government Department and other Central Government bodies with whom we had total transactions in excess of £1m during the year. The figures below are net of VAT.

18. Events Arising after the Reporting Date

None.

19. Date of Authorisation of the Accounts

The Accounts were authorised for issue on the date of the Comptroller and Auditor General’s certification.