Raffles College Pty Ltd: Registration conditions 28 September 2016
Imposing conditions on registration
Report on imposing four conditions on the registration of Raffles College Pty Ltd (t/a Raffles College of Design and Commerce ("RCDC"))
On 28 September 2016, TEQSA imposed, under subsection 32(1) of the TEQSA Act, four conditions on the registration of Raffles College Pty Ltd, trading as Raffles College of Design and Commerce (RCDC):
Within 28 days of being notified of the decision to impose this condition, RCDC must provide TEQSA with a copy of its financial projections for FY2016/17, FY2017/18 and FY2018/19, as approved by the Raffles College Council. The financial projections must include:
- key assumptions underpinning the projections including but not limited to student load, staff FTE, course fees, overheads, and capital structuring, and
- specific details of the planned expenditure on each item in RCDC's plan of action.
No later than 10 working days prior to the end of each calendar quarter, RCDC must provide TEQSA with:
- a copy of the budget for the following quarter, which includes the same matters required to be included in the financial projections under Condition 1 above,approved by the RCDC Council; and
- bank statements which show that RCDC has access to sufficient cash reserves to fund budgeted operating expenses for that quarter
Within 28 days of being notified of the decision to impose this condition, Raffles must provide TEQSA with a list of bank accounts used for the purposes of meeting RCDC's operating expenses, and a list of individuals authorised to draw from those accounts on behalf of RCDC. RCDC must notify TEQSA no later than 5 working days after making any changes to the list of individuals authorised to draw from those accounts.
Within 30 days after the end of each calendar quarter, RCDC must provide TEQSA with a report, approved by the RCDC Council, on the actual financial performance compared with budgeted financial performance for the preceding quarter. The report must include sufficient detail to identify actual performance of each and every income and expense line identified in Condition 2a.
Main Reasons for the Decision
TEQSA considers that the decision to impose conditions on the registration of RCDC is consistent with the basic principles for regulation in Part 2 of the TEQSA Act, as it is a necessary and proportionate to respond to the circumstances surrounding RCDC's corporate governance practices. Specifically TEQSA found that RCDC had failed to:
- ensure it has adequate mechanisms in place to ensure access to, and application of the necessary financial resources to ensure achievement of the higher education objectives,
- maintain accountability for appropriate human resource practices,
- adequately monitor, address and respond to risks in relation to the actions of representatives of Raffles Education Corporation, and
- ensure appropriate delegation and that these delegations are observed.
The conditions also take into account the view of TEQSA that RCDC is at risk of not having the capacity to continue to apply sufficient financial resources to ensure the achievement of its higher education objectives in accordance with Provider Registration Standard (PRS) 2.1 and are designed to ensure that RCDC continues to apply sufficient financial resources to provide its students with the requisite standard of education. TEQSA considered that the conditions are a proportionate response to both this risk and to RCDC's non-compliance with the Threshold Standards to date.
TEQSA notes that RCDC has indicated that it has the means to comply with the conditions. TEQSA considers that the conditions do not impose unnecessary burden on the provider.