How is Transparent Approach to Costing used?

The OfS and UKRI use TRAC data, along with other information, to inform decisions around future funding. For example, the data form part of the submission to Treasury to support the case for continued and increased public investment in research.

TRAC is also used to calculate the overhead rates that are used when costing research proposals (Estates, Indirect and Infrastructure Technician rates). The rate is calculated as an amount per overhead generating staff on a research project.

What does TRAC show?

The TRAC results for the prior year are here: TRAC results 20-21 (powerpoint)‌‌

The College’s mission is to achieve enduring excellence in research and education in science, engineering, medicine and business for the benefit of society. TRAC data shows that some of our most important activities, including teaching Home undergraduates and undertaking publicly-funded research (e.g. Research Council-funded), actually make a loss. Since these activities are integral to the College’s mission, they must receive continued support, and TRAC helps us to understand the nature and scale of the deficit that they generate and what surplus-making activities need to be undertaken in order to fund that support.

What is TRAC?

TRAC is an activity-based costing system designed for use by Higher Education in the UK.  Funders of Higher Education, including the Office for Students (OfS) and UK Research & Innovation (UKRI), require all institutions to apply the TRAC system if they want to be eligible for funding. The return is reviewed by the TRAC Committee annually; prior to submission (the deadline is the end of January).

How does TRAC work?

TRAC uses the figures reported in the College’s published financial statements as the starting point. Income and expenditure items are allocated across the College’s main activities – Teaching, Research and Other activities.

Some costs can be directly assigned to an activity as they are specific to that type (e.g staff costs on a specific research project). However, costs which are not specific to an activity need to be apportioned using “cost drivers”. For example, costs relating to space can be apportioned by the amount of space each department uses. Another example of a cost driver is the TOAST survey all academics complete. The output of this is used to allocate academic staff costs across the main activities.

What does TRAC do?

The output shows the surplus or deficit generated by activities reported. These are:

•          Publicly funded teaching (mostly UK/EU taught students);

•          Non-publicly funded teaching students (mostly Overseas taught students);

•          Research (e.g. Research Councils and Industry, this also includes postgraduate research students);

•          Other (e.g. consultancy, residences, catering and conferences)