GLASGOW COLLEGE OF NAUTICAL STUDIES
DUE DILIGENCE
2 EXECUTIVE SUMMARY
2.1 Overall summary
2.1.1 Based on our brief review of the areas contained within this report it appears
that GCNS is a well-run college which has generated a surplus in each of the
years from 2007 to 2009 although the surplus has reduced significantly in
2009.
2.1.2 GCNS's key strengths appear to be in the following areas:
a) GCNS has demonstrated an ability to generate surpluses over the years and
despite having a SSAP 24 pension provision of £1,386k and an FRS 17
provision of £2,129k has a surplus on income and expenditure account of
£3,939k as at 31
st July 2009.
b) GCNS has a strong Balance Sheet with cash at bank of £6,939k which
could be utilised for future projects if required.
c) GCNS appears to have reasonable overall controls and committee
structures, based on our review, which could be of benefit to a combined
college in the future.
d) GCNS has much less of a dependency on Funding Council grants than
most colleges given its significant income from tuition fees and education
contracts.
e) GCNS generated a surplus despite an over delivery of WSUMs of 7,048
WSUMs for the year ended 31 July 2009.
f) GCNS is the recognised leader in the provision of marine engineering and
nautical studies in Colleges throughout Scotland and is renonwned
nationally and internationally.
2.1.3 GCNS's key areas of weakness appear to be as follows:
a) Although GCNS generated a surplus of £144k in 2009, this included
investment income of £314k and surpluses on residences of approximately
£200k prior to any allocation of indirect overheads. If GCNS were to go
ahead with the new residences project as described below this could make
it more difficult to generate an overall surplus. Additionally GCNS had
one off credits to the income and expenditure account in 2009 relating to
the release of a holiday pay accrual of £109k and the release of £123k of
old fund balances. The underlying position for 2009 was therefore a
deficit.
Appendix 5: Due Diligence Executive Summaries
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