Part II - TRAC Principles

Section C: Quality assurance and validation

Chapter C.1 Internal review

1. Institutions should understand the data and any unexpected or outlying results. Tests for reasonableness should be carried out. The results of these should be presented to the Finance Committee or appropriate Committee of the Board, or equivalent, to give assurance that the outcome is fair and reasonable.
2. Examples of these comparisons and tests are:
   • study the results – do they match the records, observations and expectations of heads of department?
   • compare with results from previous comparable periods – are the data consistent?
   • match with income – are the results understandable, explainable and fair and reasonable?
   • benchmark – compare with data from other (peer) institutions; or with sector data;
   • plot results – prepare a graph of time or costs of each activity by department against student numbers, and against income;
   • compare with information produced by external bodies – calculate an average pay cost per FTE student and compare with relativities for each subject type with those used in the relevant Funding Council’s funding methodologies for Teaching;
   • carry out a small number of surveys or interviews to test the validity of results;
   • carry out a sensitivity analysis on key cost drivers and cost pools – test equally appropriate but different cost drivers or weightings in the cost drivers. (An example here might be to use weighted cost drivers in the estates cost pool which reflect actual, or standard, costs of each building or campus);
   • convene a small group to discuss the profile of academic activity in a year – they could consider what activity took place during the various periods (Easter, term, vacation etc) or for different purposes (library services used by students; estates used by PGR students).

3. ‘Outliers’ can be investigated through surveys, interviews or workshops. It is important to give heads of department, the TRAC implementation project group, and the senior management team an opportunity to understand and comment on the figures. When they do so, their comparability with other figures from the management accounts, the resource allocation model and/or the strategic planning model, needs to be understood.
4. The results of these tests and checks should be given to the relevant institutional committee to provide assurance that the outcome is fair and reasonable.