�鶹��madou

• Home
• Finance
• �鶹��madou Strategic Report and Financial Statements 2025
• Strategic Report

Strategic Report

Status
�鶹��madou, Edinburgh is an autonomous Scottish higher education institution. The University’s governing instruments and arrangements are set out under the �鶹��madou, Edinburgh (Scotland) Order of Council 2007, amended from 1 October 2019 through the �鶹��madou, Edinburgh (Scotland) Amendment Order of Council 2019. The 2007 Order is made under section 45 of the Further and Higher Education (Scotland) Act 1992. The University is registered under the Companies Acts as a company limited by guarantee, with its registered office at �鶹��madou Drive, Musselburgh, East Lothian, EH21 6UU. The University has been entered into the Scottish Charity Register and is entitled, in accordance with section 13(1) of the Charities and Trustee Investment (Scotland) Act 2005, to refer to itself as a Charity registered in Scotland.

Scope of the Financial Statements

The primary financial statements presented on pages 31 to 34 comprise the consolidated results of the University and its subsidiary company, �鶹��madou Enterprises Limited. �鶹��madou Enterprises Limited undertakes commercial consultancy work, utilising the expertise of the University’s academic and technical staff, and also deals with vacation letting of the University’s student accommodation. Separately, the University holds 50% of the issued share capital of Edinburgh Innovation Park Joint Venture Company Limited. Activity has increased in the Joint Venture, and development of the hub has progressed substantially through the 2024/25 financial year.  

The financial statements have been prepared on a going concern basis in accordance with Financial Reporting Standard 102 (FRS 102) and the Statement of Recommended Practice – Accounting for Further and Higher Education 2019 (SORP 2019), with the Accounts Direction issued by the Scottish Funding Council (SFC) and with the United Kingdom Companies Acts. Information on the process which has been undertaken to inform the decision to prepare the financial statements on a going concern basis is set out in section (A) in the statement of principal accounting policies.

Strategic Plan 2020-25

The University’s 2020–25 Strategic Plan outlined five core goals:

• delivering distinctive, accessible, high-quality education;
• advancing transformative research and innovation;
• fostering partnerships and collaboration;
• investing in the long-term future of the institution; and
• embedding sustainability across all its activities. 

Over the lifetime of the strategy, notable progress has been achieved in educational provision, research, and partnership development. Examples include the successful introduction of initial teacher education and paramedic science programmes and a growing range of fully online, asynchronous postgraduate programmes, the development of a commercially viable alternative to palm fat for the bakery sector, and the expansion of college partnerships in Scotland alongside new transnational education partnerships in Uzbekistan, India, and Sri Lanka. 

However, progress on investment in the University’s long-term future and embedding sustainability has been more constrained, reflecting external challenges such as the impact of Covid-19, Brexit-related reductions in EU student numbers, tightening immigration policy, and sustained real-terms reductions in core funding from the Scottish Funding Council.

Work on the new strategic plan is well underway in collaboration with the University Court. While some continuity will remain, the external environment and financial outlook require a change to our strategy development approach. The new strategy will therefore adopt Lafley and Martin’s "Playing to Win " framework, focusing on clear choices regarding the University's markets, programme delivery channels, and capabilities (including shared services where appropriate) to enable the University's competitive advantage and long-term sustainability. It will articulate how the University will deliver value to students and stakeholders in a context characterised by volatility, demographic change, technological disruption, and increasing competition. The emphasis will be on defining a compelling roadmap that enables the University to generate the surplus required for investment, while maintaining its commitment to quality, accessibility, and innovation.

Results for the year 

The Group's consolidated results for the year to 31 July 2025 are summarised as follows:

The main changes in the outturn position for FY2 2024/25 compared to FY 2023/24 were:-

• A decrease in SFC Grant income of £2.5 million due to recognising SFC recovery for under recruitment of non-controlled home students;
• An increase of £1.1 million in income from tuition fees and education contracts with additional students on new programmes, including across our trans-national partnerships, as well as through new online courses;
• A reduction of £0.4 million in income from research grants and contracts reflective of grants awarded, with a decrease in the number of successful grants and reflective of the wider research funding environment;
• An increase of £0.7m in other operating income, with strong performance from our residences, including relating to our summer lets, as well as continued efforts to utilize the estate for conferences and events;
• An increase of £0.6m in staff costs with spinal point increments driving increases across all staff, as well as the unforeseen increase in employer’s national insurance; and
• An increase of £1.7m in other operating expenses, while inflationary pressures were experienced across the cost base, more notable increases were incurred on expenditure relating to professional services and consultancy to support initiatives across the university, as well as increases in IT costs and marketing spend.  
• An expense of £0.7m was included within FY 2024/25 Other Operating expenditure, but related to SFC recovery for under recruitment of Scottish students in FY 2023/24.
• Prior year’s expenditure included a non-cash credit of £1.9m relating to the USS pension scheme, which reduced reported expenditure but did not impact operating performance.

�鶹��madou Enterprises Ltd generated a profit of £616,000 (2023/24: £476,000), which was passed to the University via gift aid under deed of covenant. 

Cash Flows and Liquidity

The result for the year, adjusted for the effect of non-cash items and interest, was a net cash inflow of £2.4 million on operating activities (2023/24, £5.0 million inflow).  Overall cash balances decreased by £14.0million (2023/24; £1.2 million increase), with unrestricted cash balances at 31 July 2025 of £4.6 million (2024: £18.6 million) represented 31 days’ expenditure (2023/24: 148 days). The movement in cash position is due to the refinancing of the Barclays loan from 2023/24 with a £15m unsecured revolving credit facility (“RCF”) with Santander UK plc, which as at 31 July 2025 had £2.5m drawn. This has allowed for a significant reduction in commercial debt of £13.3m, with total debt reducing by £14.0m, and still retaining access to £12.5m of liquidity, which is accessible on demand. 

Management of Principal Risks and Uncertainties

In common with other universities, �鶹��madou has to manage its activities whilst facing significant pressures on its funding and its cost base. Significant risks facing the University include:

• Scottish Government funding of tertiary education, allocated through the Scottish Funding Council (SFC), will continue to experience real-terms reductions over the next few years.
• Competition for Scottish domiciled, Rest of UK and International students traditionally recruited by the university, including those identified as widening participation, will increase, as competitors re-position their recruitment focus and diversify their market focus.  
• Without action to address, pressure on staff costs will continue to build, both in terms of pay awards (where the University continues to participate in the UK-wide national negotiating framework) and also in terms of the cost of employers’ pension contributions.
• Long term inflationary pressure on non-staff costs will continue.
• Cyber security threats continue to grow in both scale and sophistication, and without continued investment into technology, processes, and training, there is a risk of data loss, compromised systems, and interruption to University operations.                                                         

The identification and management of risks is embedded within the University’s governance arrangements. The institutional corporate risk register, which includes a description of actions undertaken to mitigate risks, is reviewed formally by the Senior Leadership Team and the Audit & Risk Committee as well as being discussed by the University Court. The Court also undertakes, from time to time, an exercise to agree its appetite for risk, and to ensure that residual risks, after the application of mitigating actions, sit within the agreed tolerance. A review of the risk management strategy adopted by the University Court in 2021 was progressed during the reporting period, with revised Risk Management Policy, incorporating Risk Appetite, due to be signed off by the University Court by the end of the calendar year 2025.

Financial Sustainability and Going Concern

The University has assessed the going concern as noted on page 35 under the basis of preparation.  The University’s activities and the factors that will affect its future development, performance and financial position are described within this Strategic Report.  The financial performance for the year ended 31 July 2025 is disclosed within the Financial Statements, with further detail contained within the Notes to the Financial Statements.  The current forecasts show that the University will manage its activities, considering relevant risks and uncertainties, and is committed to implementing any mitigating actions required to ensure compliance with loan covenants to retain access to liquidity.  

The University Court considers that the University has adequate resources to continue in operation throughout the going concern assessment period to 31 July 2027, and for this reason it continues to adopt the going concern basis of accounting in preparing the annual financial statements.

Borrowings

The University’s external borrowings as at 31 July 2025 totalled £4.7 million (year ended 31 July 2024: £18.7m). Of this amount, £2.5m relates to an unsecured Revolving Credit Facility with Santander UK Plc, and £2.2 million related to an unsecured loan from the Scottish Funding Council under the Financial Transactions scheme. The University’s secured borrowings from Santander, as described above are subject to covenant terms. Loan covenants are tested as at the year end, and the University was fully compliant with those covenant tests for the year ended to 31 July 2025.

During 2024/25, and as a result of the refinance to the RCF, the University has significantly reduced both borrowing but also cash balances.  This has significantly reduced finance costs to the university, which benefits the overall financial performance, however, it is therefore important that the University retain continued access to the RCF to support liquidity.  As at 31 July 2025, the University had liquid reserves (cash and investments) equivalent to approximately one months’ operating cash requirements, and retains access to £12.5m of liquidity through the Santander RCF.

Social Inclusion

�鶹��madou is committed to widening participation amongst those who have previously been inhibited from entering Higher Education for social, economic or cultural reasons, and to taking active steps to maximise their persistence and success. Our Widening Participation Strategy focuses on increasing participation from non-traditional groups, including those that are: first generation to go to Higher Education; from low progression schools; reside in communities in the lowest 20% and 40% of the Scottish Index of Multiple Deprivation (SIMD20/40); articulating students from Scotland’s Colleges; disabled students; BAME students; male students studying Nursing and Allied Health programmes; ex-service/armed forces; estranged students; student carers and those who are care experienced.

Our approach to widening access offers built-in tailored support throughout the learner journey, including at points of transition. We work to raise awareness of higher education within target communities, including those local to the University. Our contextualised admissions process provides the basis for fair offers to study at the University. We publish our standard and minimum entry requirements for undergraduate programmes in our University prospectus and on our website. The prospectus includes information presented in simple, clear language and developed in accordance with the ‘Common Language’ guidelines produced by Universities Scotland.

We commit to making offers at the published minimum entry requirements to identified groups where we recognise that a range of factors has influenced attainment. We deliver a range of recruitment, outreach, pre and post entry activities to raise aspiration, encourage access and maximise retention from under-represented groups in line with our Student Experience strategy, Mainstreaming Report and Equality Outcomes. 

Fair Work First

We are committed to advancing the Fair Work First criteria, and address this commitment in the following ways:
 
We have an appropriate channel for effective employee voice
 
We engage in constructive dialogue with our employees and their Trade Union representatives to address workplace issues and disputes.
 
Through our Joint Negotiation and Consultation Committee, we negotiate and consult with our recognised Trade Unions on agreed areas for such negotiation and consultation. Our recognised TUs are represented on major committees, including the University Court, Health and Safety and Equality and Diversity Committees. We provide facility time to promote and support regular engagement between our Trade Unions and their members.
 
We are committed to ongoing staff listening activities, including running a staff engagement survey every two years. We are in the process of establishing an Employee Experience Group, meeting three times per year, to provide a further forum for all staff to maintain regular dialogue with senior colleagues on issues that impact on their working lives.

Our governance arrangements also provide for staff and student voices to be heard through membership of all senior decision-making bodies. 
 
We invest in workforce development
 
Formal and informal learning is delivered and encouraged across the workforce, with learning opportunities for employees at all levels delivered through our YourDevelopment calendar. Specific development opportunities for academic staff are provided through our Learning Enhancement and Academic Development (LEAD) team, and through our Research, Knowledge Exchange, and Development Unit (RKEDU). 
 
We are committed to providing apprenticeships and other opportunities for young people. We provide training for employees to become Mental Health First Aiders, who volunteer to offer confidential support to other employees in times of vulnerability.
 
We hold an institutional Athena Bronze Award and participate in the Disability Confident Employer scheme.
 
We do not use zero-hours contracts inappropriately
 
We abolished the use of zero hours’ contracts in 2014. We are committed to minimising our use of casual and fixed term contracts through the implementation of our Appropriate Contract Use Policy. We have a clear process in place to allow workers to move from a casual engagement to a temporary or open-ended contract where a longer-term need for the work has been identified.
 
We take action to tackle the gender pay gap and create a more diverse and inclusive workplace
 
Our equality outcomes support several actions to ensure we continue to understand any actual or perceived barriers to employment and progression. We gather data to understand our workforce diversity and pay gap information and report on our progress annually through our Equality and Diversity committee to the University Court.
 
We support flexible working across the University, offering a wide range of working options, with all employees entitled to apply for flexible working from day one of employment. We offer the vast majority of employees the opportunity to adopt hybrid working, supporting employees to find the appropriate balance of home and on campus working.
 
We are committed to a working environment where carers and those with caring responsibilities are valued and supported
 
We are a Disability Confident employer, encouraging the employment and retention of disabled people and those with health conditions. We make reasonable adjustments for employees with a disability or who have a short or long-term impairment that could affect their ability to work.
 
We commit to paying the Real Living Wage
 
We are an accredited Living Wage employer. The Living Wage commitment sees everyone working at �鶹��madou, regardless of whether they are permanent employees or third-party contractors, receive a real Living Wage. The University’s third-party contractors adopt the Living Wage as and when existing contracts are renewed.
 
We offer flexible and family-friendly working practices for all staff
 
These include Part time and term time working arrangements, Flexible and Hybrid Working, Maternity Leave, Partner Leave and Shared Parental Leave, Time off for Care of Dependents, Parental Bereavement Leave / Baby Loss Leave, Fertility Leave, Career Break, and Bereavement Leave.
 
We oppose the use of fire and rehire practice
 
We only consider affecting change where there is a legitimate business need. We are committed to working with our Trade Unions to ensure there is effective consultation and negotiation relating to significant organisational change.

Student Satisfaction

The University’s National Student Survey (NSS) saw a welcome increase in positive responses compared to 2024. Benchmark data indicated that �鶹��madou exceeded the benchmarks by up to 4% in 14 of the 27 core questions. In 2024, programmes with results significantly below their benchmark were asked to produce NSS-specific action plans, and all but one of those programmes saw significant improvements in their 2025 results.  For the University as a whole, the theme results with the greatest improvements were:

• 72.6% responded positively to questions relating to ‘Organisation and Management’ compared to 62.5% in 2024 (+10.1%)
• 80.4% were satisfied overall with the quality of their course compared to 72.7% in 2024 (+7.7%)
• 80.1% responded positively to questions relating to ‘Assessment and Feedback’ compared to 74.4% in 2024 (+5.7%)

�鶹��madou’s most positive score was in response to the question, ‘How good are teaching staff at explaining things?’, with a result of 93.4%. For the second year running, the Students Union scored the highest among Scottish Higher Education Institutions for the question, ‘How well does the students' union (association or guild) represent students' academic interests?’, achieving a score of 84%, a score that was 8% and 12.2% higher than the average UK and Scottish results, respectively.

Graduate Employment

The University offers a coherent, distinctive portfolio of programmes in healthcare, social sciences, creative arts, business, management and enterprise, and primary and secondary teaching - with a particular focus on meeting the employment needs of the public sector in Scotland. Consequently, over half of our undergraduate and postgraduate programmes provide students with the qualifications necessary to enter the health and education sectors. A significant proportion of those programmes (Nursing, Paramedic Science, and Initial Teaching Education) fall under the SFC’s controlled funded places.  

The University offers the widest range of allied health programmes in Scotland and is one of only two providers in speech and language therapy, audiology, and in therapeutic radiography. Similarly, in addition to delivering the BA (Hons) Education Studies (Primary), our largest single cohort of students, we deliver postgraduate initial teaching education provision in Home Economics (PGDE Secondary), acknowledged by SFC as a ‘hard to fill’ PGDE Secondary subject. We expanded our PGDE Secondary provision for 2023-24 to include another hard to fill subject, Religious, Moral and Philosophical Studies, as well as Business Education. These developments demonstrate the University’s ongoing commitment to ensuring its provision directly addresses the workforce needs of the Scottish public sector. Going forward, we will continue to review areas where we continue to expand provision in line with these needs.

Our focus on graduate employability is being advanced through our Employability Strategy, which outlines the measures we take to create an environment in which students develop the skills and attributes needed to flourish in a rapidly changing labour market. It represents an agreement on the focus and priorities of the Careers and Employability team, programme teams and our external partners over the period 2021-2026. Developed against the backdrop of the COVID-19 pandemic, it includes projects which support students to navigate uncertain labour markets and the economic downturn, and to maximise opportunities presented by changing working practices across all industries and sectors.

Our annual Employability Strategy report includes data and reflections on a range of achievements. These include increased uptake of internships, the continued growth of our Employer Mentor Scheme, and success in the 2024 WhatUni Student Awards (ranking first in Scotland for career prospects). Our Careers and Employability Team also piloted a programme of input to our undergraduate Education Studies, Psychology and Sociology degrees. 

Our HESA Graduate Outcomes data (July 2025) shows that we are within the top six of Scottish universities for the number of graduates in full-time employment 15 months after they have graduated. 84% of respondents were in high skilled work 15 months after they had graduated, placing �鶹��madou third top among Scottish higher education institutions on this measure. We were also pleased to see a 100% graduate employment rate for seven of our programmes. 

In September 2024, we launched the Careers Registration Framework, providing an important new source of data on undergraduate students’ career readiness. The headline results show that most �鶹��madou students are in paid employment and therefore have limited capacity for extra-curricular activities. The responses also show that not all students are seeking graduate level employment, although there may be confusion around the wording of this question. We are analysing this year’s data to see if there are any changes in cohort reporting and/or trends within subjects. However, we anticipate that we will only really be able to make reasonable predictions for more informed interventions once we have three years of data (to understand the full undergraduate cycle). 

Thus far, we have used the data to send more personalised information, for example, around internship opportunities. We will also use the data to create a communications plan and identify areas where students may benefit from additional support or resources. 

In 2024-25, we also reflected on skills development for our doctoral community through an analysis of all Researcher Skills Development Plans (RSDP) submitted since the introduction of this requirement in 2023-24. This showed that the RSDP process is well embedded, highlighting the importance of good communication with candidates about the benefits of tracking skills and identifying gaps, as well as support for supervisors in this area. 

Sustainability and Environmental Issues

The University recognises the wide range of climate change impacts that will influence our environment both locally and globally. While these have the potential to pose a significant threat to the sustainability of the University, we embrace our role in contributing to the delivery of real change through reductions in our own carbon emissions, as well as influencing the understanding and behaviour in our staff and students. To support our commitment, the University has signed up to the UN backed campaign ‘Race to Zero for Universities and Colleges’ and completes annual Public Bodies Climate Change Duties reporting, in compliance with the Climate Change (Scotland) Act 2009.

Senior leadership responsibility for climate change action sits with the Chief Operating Officer as part of the sustainability remit. Operational aspects are delivered through the Campus Services Directorate which has responsibility for Estates, Engineering, Campus Operation and Commercial Services. Procurement responsibility sits within Finance and is delivered via an embedded role of Head of Procurement through a partnership with the sector body Advanced Procurement for Universities and Colleges (APUC). Academic activity related to teaching, learning, and research is governed by the Senate. Operationally, academic program reviews include an assessment of 

sustainability within the course content and work to curate resources on how to embed within the curriculum by our Learning Enhancement and Academic Development (LEAD) is being taken forward. 

Overarching aspects of the University's sustainability activity, including climate change, fall within the remit of the Sustainability Committee, which reports directly to the Senior Leadership Team. In 2024/25 the Sustainability Committee's remit was updated and was reconvened as the Sustainability Advisory Committee at the beginning of the 2025/26 academic year.

The University made a significant contribution to green house gas emission reduction when moving campus in 2007. This was recognised through the accreditation of BREEAM excellent and CEEQUAL standards, with the former achieving the highest ever score recorded for an HE institution. The campus development reduced our annual operational greenhouse gas emissions by 38% and the holistic approach we adopted to environmental sustainability has ensured that further operational based awards have been achieved. These include recognition for our low carbon IT solutions, renewable fuel sources and a range of active travel awards. 

Our future ambitions are set out clearly in the University Climate Change and Net Zero Strategy – A Shared Common Future, approved by the Court in February 2023. We continue to deliver on the Climate Emergency and sustainability across the three pillars – environmental, economic, and social. The current target in our Climate Change and Net-Zero Strategy is for the University to be net-zero by 2044 with an interim reduction target of 42% by 2030 (scope 1 and 2 emissions), based on a 2020/21 baseline. The University remains on track to achieve the interim reduction target by 2030, however, achieving net zero will require the development of and investment into sustainability initiatives.

As part of the annual operational planning process the Campus Services Directorate will establish targets for energy efficiency, waste management, travel and transport, as well as landscape and biodiversity. These are subsequently tracked through a series of key performance indicators relating to carbon, energy and waste management, with an annual review conducted. Substantive progress is being made towards this interim target, with the potential that this will be achieved significantly ahead of schedule.

Progress toward net zero, as reported through annual Public Bodies Climate Change Duties reporting is summarised below:

Future Developments

The funding environment for Scottish higher education remains challenging, with sector-wide evidence that public funding for teaching and research does not cover the full cost of delivery. In response, our future developments will focus on cost containment and growth in net-income generating activities.

• an operating context notable for its uncertainty and volatility, for example, domestic and international events and the potential for domestic policy change (reserved and devolved) affecting the university sector;  
• continuing pressure on public spending by both UK and Scottish Governments;  
• a likely increase in demand for reform to make the operation of universities more efficient and ensure public investment in universities is well spent;  
• the impact on future recruitment of greater competition in the HE sector, in addition to alternative pathways for learning and training, population movement and demographic change; 
• changing needs and expectations from students (on-campus and online), employers, and other stakeholders, and a changing HE workplace; and 
• technological change, with both opportunities and threats from generative AI

• Increasing postgraduate student numbers;
• Developing new online provision at scale; and
• Growth in transnational education partnerships.
• Notable progress has been made in two of three development areas identified above.

Notwithstanding the challenging environment, we are actively working to increase our on-campus international student population; however, given the volatility of this market, we will adopt a conservative approach to income projections from this source. Our primary growth strategy will concentrate on expanding online and transnational education.

To support these priorities and meet the expectations of a post-Covid on-campus community, the University is aligning its operating structures and processes with these strategic objectives. We have engaged external expertise to develop a Professional Services Blueprint, which will define the vision for professional services, service delivery models, channels, structural implications, and workforce requirements. This blueprint will also provide high-level organisational design focused on key capabilities and team structures.

On behalf of the University Court
Pamela Woodburn
Chair
19 December 2025