TREASURY MANAGEMENT POLICY
THE UNIVERSITY OF WESTMINSTER
COURT OF GOVERNORS
23 OCTOBER 2000
TREASURY MANAGEMENT POLICY
1. Introduction
1.1 Treasury management is the management of all cash, money
market investments and capital market
transactions in connection with cash
resources and funding requirements of the University,
and the control of the associated risks.
1.2 Treasury management must be carried out within the context
of the University
statutory background, its Memorandum and Articles of Association
and the Financial Memorandum with the Higher Education Funding
Council (England).
1.3 The University's investment policy objective is to
optimise returns to the institution consistent with its cash flow
requirements and the overriding need to protect the capital value
of the University's funds. In borrowing, the primary purpose
of treasury management is to ensure the stability of the
institution's financial position through use of sound
debt management techniques.
1.4 Treasury management should be operated in relation
to:
(i) the University's strategic plan;
(ii) the revenue budget and capital programme;
(iii) the estate strategy;
(iv) working capital management, including debt collection and
policy on creditor payments, including payroll;
(v) cash flow forecasts.
1.5 This policy must be approved by the
Court of Governors and will be subject to its review at the first
regular meeting of each financial year. The policy relates to the
University and all its subsidiary companies.
1.6 Treasury management will be carried out by the Finance
Department of the University, under the direction of the Director
of Finance and in accordance with financial regulations and
treasury management procedures. Treasury management procedures will
be approved by the Finance and Property Committee of the
University.
2. Borrowing
2.1 All raising of capital finance must be approved, in
advance, by the Finance and Property Committee and the Court of
Governors. The Court of Governors may, at its discretion, authorise
an ad-hoc committee of its members to agree final documentation and
execute documents within certain parameters set by the Court of
Governors.
2.2 All borrowing raised on the security of any of the
University's assets must be approved, in advance, by the Finance
and Property Committee and the Court of Governors. The Court
of Governors may, at its discretion, authorise an ad-hoc committee
of its members to agree final documentation and execute documents
within certain parameters set by the Court of
Governors.
2.3 Unsecured, overdraft borrowing must be within limits set
by the Director of Finance. Authorisation by the Director of
Finance must be given for unsecured, overdraft borrowings within
such limits.
2.4 Lease finance arrangements for items with a capital value
greater than £100,000 must be approved, in advance, by the
Finance and Property Committee.
2.5 The University has no pre-determined restrictions on
sources of funding with any consideration of suitability of
potential lenders being carried out at the time of approval by the
Finance and Property Committee.
2.6 Wherever possible borrowing should be at a
fixed rate of interest, but should bear in mind market expectations
and future cash requirements; the costs of doing so should be
related to the need to spread the risk through a balanced
portfolio.
3. Lending and Investment
3.1 All lending and investment of University funds will be
carried out by the Finance Department of the University (under the
direction of the Director of Finance) who shall be required to act
in accordance with financial regulations and treasury management
procedures.
3.2 Lending and investment of such funds will be restricted to
a list of institutions specified in the treasury management
procedures.
3.3 Any lending or investment for a period greater than three
months must have the written approval of the Director of Finance
and, in instances of over 12 months, the prior approval of the
Finance and Property Committee and the Court of Governors.
4. Delegated Powers
4.1 Treasury management procedures must set out the delegated
powers of the Finance and Property Committee, the Director of
Finance and specific Finance Department staff. The use of these
powers will be reported annually.
5. Reporting
5.1 The Director of Finance must report annually to the
Finance and Property Committee on the treasury management strategy
for the ensuing year.
5.2 The Director of Finance must report to each meeting of the
Finance and Property Committee on the activities and results of the
treasury management function. The format of this report shall be
determined by the Finance and Property Committee.
5.3 A report, having been approved by the Finance and Property
Committee, shall be made annually to the Court of Governors on the
activities, plans, policies and results of treasury
management.
6. Recommendation
6.1 It is recommended that the Court of Governors approve the
Treasury Management Policy.
Philip Harding
Director of Finance
06 October 2000