Blog

Transparent Approach to Costing (TRAC)

Share this page

TRAC is an Activity-Based Costing system which seeks to identify the full cost of key activities in Higher Education Institutions (HEIs). Activities are analysed into “Teaching”, “Research” and “Other” (commercial activities, residences etc.). Teaching is further analysed into publicly funded and non-publicly funded and Research according to the main sponsor types.
TRAC calculates the full cost of an institution’s activities by taking the income and expenditure from the annual published accounts and adjusting for two sustainability factors. The first adjusts the depreciation charge on buildings to an insurance-based replacement value to better reflect the full cost of maintaining the current infrastructure. The second sustainability adjustment covers the surpluses required for rationalisation, updating and development of future productive capacity.
This data is submitted annually to HEFCE in a return (TRAC return) and is used for the cost-based pricing of research projects (full economic costing – fEC) for the Research Councils and other public funders of research. Further analysis of the teaching costs are submitted in a separate return (TRAC (T)).
There are two different schools of thought across the sector concerning the usefulness of TRAC – some consider it to be bureaucracy, others an under-utilised tool. The new Guidance discussed below does not alter TRAC fundamentally and so is unlikely to sway opinion either way.

Insight

Industry news and commentary from Uniac


Good Internal Audit

Following our recent commentary on internal audit in higher education, this briefing sets out our thoughts on what 'good'…


See more

Latest from the Uniac blog


Silla Maccario RIP

Silla has been our colleague since July 2004. Talented, individual, passionate, dedicated (and maybe sometimes a little bit…

Race Equality in Higher Education

The tragic murder of George Floyd has caused many to reflect on attitudes and actions towards minorities. In this paper, we…

COVID-19 Update

In March, we published our initial reaction to the changes forced upon the sector by the virus. Now that the situation has…


Need some more information?