The University of Law made a net profit of over £14 million in its first year of ownership by a private equity house but, with magic private equity accounting, managed to record a multi-million pound loss and so paid no corporation tax.
The UoL, formerly a charity, was sold to Montagu Private Equity in 2012 for £177 million. £114.5 million of the purchase price was allocated to goodwill in the business, covering UoL's intangible assets such as its relationships with the law firms and the Open University (which, erm, ran away). However accounts filed at Companies House reveal that the goodwill is to be written down and set off against profits in annual £22 million chunks for five years (after which Montagu will presumably sell up).
So, in the year ending August 2013 the UoL was able to record an overall loss of £7.72 million and paid zero tax. And presumably won't be paying any tax for the foreseeable either, unless it strikes oil under Moorgate*.
The UoL says it also incurred a loss because it spent £1.2 million improving life for staff and students. The accounts describe how it is replacing 1000 computers over the next six months, making the internet run four times faster and has made a "commitment" to replace the antique boilers, windows and ventilation which have in the past alternately boiled and frozen students. A spokesman for the UoL confirmed that it has done all this while managing to pay President Nigel Savage the same as it did last year, a healthy £340k.
*And actually they'd probably find a way of accounting for that as some sort of massive environmental liability and finish up paying no tax ever again. And then claiming for breach of warranty against the seller for not telling them about the oil in the first place and forcing them to go to the trouble of drilling holes to get the damn stuff out, And actually probably then selling the oil to their own grandmothers at an over-inflated price, thus forcing the grandmothers into insolvency, but then buying their assets for peanuts in a pre-pack administration. And then selling those assets to orphans.
Tip Off ROF
The UoL, formerly a charity, was sold to Montagu Private Equity in 2012 for £177 million. £114.5 million of the purchase price was allocated to goodwill in the business, covering UoL's intangible assets such as its relationships with the law firms and the Open University (which, erm, ran away). However accounts filed at Companies House reveal that the goodwill is to be written down and set off against profits in annual £22 million chunks for five years (after which Montagu will presumably sell up).
So, in the year ending August 2013 the UoL was able to record an overall loss of £7.72 million and paid zero tax. And presumably won't be paying any tax for the foreseeable either, unless it strikes oil under Moorgate*.
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A former charity yesterday |
The UoL says it also incurred a loss because it spent £1.2 million improving life for staff and students. The accounts describe how it is replacing 1000 computers over the next six months, making the internet run four times faster and has made a "commitment" to replace the antique boilers, windows and ventilation which have in the past alternately boiled and frozen students. A spokesman for the UoL confirmed that it has done all this while managing to pay President Nigel Savage the same as it did last year, a healthy £340k.
*And actually they'd probably find a way of accounting for that as some sort of massive environmental liability and finish up paying no tax ever again. And then claiming for breach of warranty against the seller for not telling them about the oil in the first place and forcing them to go to the trouble of drilling holes to get the damn stuff out, And actually probably then selling the oil to their own grandmothers at an over-inflated price, thus forcing the grandmothers into insolvency, but then buying their assets for peanuts in a pre-pack administration. And then selling those assets to orphans.
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"Company correctly writes down goodwill in accordance with standard accounting practices"
Wake up - the investors and the company are in the business of making profit.
Who writes this crap? Did you voluntarily pay more tax than you were supposed to?
Piers and Matthew making donations to HMRC?
The student union is that way--------------------->
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I am a member of staff and all the new ownership has achieved for me is to take away my pension and make me work harder for less money with almost daily threats of redundancy.
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Shame on the marketing department too for advertising that students 'will become top lawyers'.... they place accepts people with a 2:2.
Most law firms wont even let you in the door with such grades.
Top lawyer with a 2:2 - very unlikely.
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Let's save on salaries by using visiting lecturers - the money for which comes from a different budgetary stream?
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Staff are totally disillusioned by the way we are treated by local management. Most of your Centre Directors are a joke - failed tutors who play at being managers and are as useless as a chocolate tea pot.
Wake up to the fact that we are damned good at what we do but are held back by muppets. If you want this business to be a success, ask staff what they think about local management and then have the balls to do something about it
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