The Parochial Church Council of the Ecclesiastical Parish of Barnard Castle with Whorlton

APCM 2016 Finance Report 1

APCM 2016 Finance Report2

APCM 2016 Finance Report3

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Notes on the Financial Statements 2016

  1. Basis of Statements.  The Financial Statements of the PCC have been prepared under The Charities Act 2011 and in accordance with the Church Accounting Regulations 2006 governing the individual accounts of PCCs, together with applicable accounting standards and the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) issued on 16 July 2014.

The Financial Statements have been prepared using the accruals and prepayments method.

Income, including grant income, is recognised when the charity becomes entitled to the resources and the monetary value can be measured with sufficient reliability.

Expenditure is recognised where it is more likely than not that there is a legal or constructive obligation committing the charity to pay out resources and the amount of the obligation can be measured with reasonable certainty.

Investments included in the Financial Statements are shown at fair value (market (bid) value).

The accounts were subject to an independent examination.  The Independent Examiner’s Report is attached to the Financial Statements.

  1. Bankers.  The PCC’s bankers are Natwest (Barnard Castle branch).  The current account is used for transactions other than voluntary giving by standing order, with a Business Reserve deposit account which receives voluntary giving by bank standing orders.  Transfers are made from the Business Reserve account to the current account to meet expenditure as necessary.  During the year the PCC obtained internet access to its accounts and many payments are now made by BACS.  Internet transactions are made on a single online authorisation basis (as Natwest does not offer dual authorisation).  All BACS transactions are pre- authorised by two signatories on paper before payment is made.  All other transactions require two signatories.

The PCC also has a deposit account with CCLA Investment Management Limited’s CBF Church of England Deposit Fund.

  1. Property.  The PCC owns the Parish Hall, Newgate and Whorlton Village Hall.  These assets are not included in the Financial Statements. Both the halls are leased in return for fixed rental income.

Property valuations are Parish Hall (£185,000) and Whorlton Village Hall (£145,000).  These valuations are unchanged from 31st December 2009 and were confirmed as reasonable as at 31st December 2015 by Simon Nixon of Addisons (valuation not updated annually).  

The Parish Hall is leased to the Parish Hall Association (registered charity no.1103536). Rental income is £965.60pa.  Rent is payable quarterly.  The next rent review is in 2019. 

Whorlton Village Hall is leased to the Whorlton Village Community Association on a 21 year lease from 1 August 1998.  Rental income is currently £460.00 pa due on 1st January each year.  There are no further rent reviews until the expiry of the lease.

  1. Invested Assets.  Invested Assets are included in the Balance Sheet at fair value (bid price).  These assets are:

183.50 units, value £2,480.17 (2015: £2,278.81) in the CCLA Charities Investment Fund Income Units.  This investment is for the Children’s Endowment fund (formerly the Dent Trust).  Income is restricted for use in connection with work with children.

984.15 units, value £14,717.27 (2015: £13,234.65) in the CCLA CBF Church of England Investment Fund Income Shares.  This is a Permanent Endowment with income being available for general purposes (unrestricted).

8171.121 units, value £11,933.11 (2015: £11,150.31) in the CAF IM CAF UK Equity Fund B Income Fund.  This is a permanent endowment, with income for the benefit of Whorlton Church fabric.  The endowment arises from the former Whorlton Church Restoration Fund.

56,366.57 units, value £95,158.04 (2015: 90,547.25) in CBF Church of England Fixed Interest Securities Fund income shares.  This investment arises from the proceeds of the sale of Church Cottage in December 2015.

  1. Petty Cash.  Petty Cash is held by the Wednesday Coffee team, the Flower Guild, Smuffies (for subscriptions), Smuffies (for its selected charity) and the Dinner Group.  Monies are regularly banked to the current account.  Records of petty cash transactions for the Flower Guild, Smuffies and Smuffies (Charity) are maintained in cash books. For Wednesday Coffee, a £10 float is carried forward from week to week, with other takings being banked.  The Dinner Group petty cash is recorded on spreadsheets, updated copies of which are passed to the Treasurer monthly.
  2. Policy for Reserves.  The policy is to hold unrestricted reserves (to include any Gift Aid tax due but not yet claimed and/or received) of approximately 3 months expenditure (from general funds) to provide for uneven cash flow and for minor but necessary unbudgeted expenditure.  Reserves at this level are currently held.  The policy also states that Restricted Funds of £20,000 should be held to meet the cost of works arising from quinquennial reports, plus £3,000 for organ maintenance.  Reserves are currently held at these levels.
  3. Policy for Pay to Employees.  In 2015, the PCC agreed that pay for employees should be increased in annual steps (additional to inflationary increases) so that pay rates are at the Living Wage Foundation’s Living Wage by April 2017 (note The Living Wage Foundation’s Living Wage is currently £8.45 per hour, which is higher than the Government’s “living wage”, which will be £7.50 per hour from April 2017).
  4. Pay, Employees and Pensions.   The PCC employs a part-time caretaker for 6 hours per week to undertake church cleaning and other general duties, with additional hours, as agreed, paid at an hourly rate. 

The PCC also employs a part-time Director of Music, who is contracted to play the organ at specified services in Barnard Castle.

Employee costs were:

 

£

Gross pay to employees

£6,034.63 (2015: £4,632)

Employer National Insurance costs

-

Employer Pension contributions

-

Total

£6034.63 (2015: £4,632)

There were no pension arrangements for employees and no employees will qualify for Automatic Enrolment from our 1st July 2017 Staging Date (as pay is below threshold), although they may opt-in, should they so decide.

The payroll is managed by Susan Peat on behalf of the PCC.

Organists play for services at Whorlton on a “by agreement” basis with no contractual remuneration.  In 2016, an honorarium of £175 was given to Jean Tallentire (who is a PCC member).

For weddings and funerals, the organist is remunerated by payment of the organist fee received for the service.  The Director of Music has first refusal but is not obliged to play at such services.  The PCC acts as paying agent and these fees are not therefore included in the 2016 financial statements.

  1. Whorlton Churchyard.  Grass cutting and general maintenance of the churchyard is undertaken by the caretaker on an hourly paid basis at the same rate as applies for caretaking duties.  Grass cutting takes 6 hours and is carried out every two weeks in the growing season.
  2. PCC remuneration.  PCC members receive no remuneration. 
  3. Payments to Connected Persons.  Jean Tallentire received an honorarium of £175 in respect of organ playing for some services in Whorlton on a non-contractual basis.
  4. Contracts with Central and Local Government.  The PCC has no contracts with Central or Local Government.
  5. Grants from Central and Local Government.  A grant of £100 was received from Durham County Council towards our costs in maintaining the closed churchyard at Barnard Castle Church (the maintenance of the churchyard is the responsibility of Durham County Council). 

The PCC received a grant of £46,100 under the Government’s Listed Places of Worship Roof Repair Scheme (see note 17).

During the year, the PCC has received grants of £913.25, £786.70, £4,537.16, £5,584.43 and £1,053.47 (with a further £786.70 claimed and included in the accounts but not received by 31st December 2016) from the Listed Places of Worship Grant Scheme (total £12,875.01).  This Scheme enables listed places of worship to claim grants equal to the amount of VAT paid on certain specific works relating to the maintenance of the church.  All of the grants are in respect of St Mary’s, Barnard Castle (St Mary’s, Whorlton is not a listed building and works there are ineligible for these grants).

A grant of £795.00 was received from Durham County Council’s Councillors’ awards for local projects.  The grant is to support the music festival in 2107 which is being organised by the Director of Music.

  1. Other Grants received.
    1. Trinity College, Cambridge gave £1,375 to replenish the Restricted Fund available to the incumbent to meet expenses which might not otherwise be incurred or might not be reimbursed by the PCC.  
    2. Two grants, each of £1,000, were received from The Friends of St Mary’s towards the roof repair project and the new sound system.
    3. A grant of £500 was received from the Diocese towards costs in respect of the 2017 Music Day.
  2. Legacies. There were no legacies received during the year.
  3. Parish Share. The Parish Share offered and paid in 2016 was £65,250.  For 2017, the PCC has offered a Parish Share to the Diocese of £68,512.56.  The increase offered is in line with the request from the Diocese.
  4. Major Expenditure 2016.  
    1. Roof Repair at Barnard Castle.  The project to replace the tower roof, as well as other roof repairs and drainage repairs, cost £59,074 plus VAT.  A Grant of £46,100 was received from the Listed Places of Worship Roof Repair Scheme.  A grant of £1,000 was also received from The Friends of St Mary’s.  Grants equal to the VAT have been recovered from The listed Places of Worship Roof Repair Scheme.
    2. Barnard Castle sound system.  A new sound system was installed at a cost of £5,791.00 including VAT.  Subsequently it was agreed to purchase a new pulpit microphone at a further cost of £372.00 including VAT.  Parts of the old system have been recycled to provide a sound system at Whorlton at a cost of £580.00
    3. Barnard Castle Lightning Conductor.    A new lightning conductor was installed at a cost of £1,280 plus VAT.  The old lightning conductor had failed its test.
  5. Financial Commitments for 2017.
    1. Barnard Castle Quinquennial Inspection.  It is anticipated that significant costs will be incurred in Barnard Castle in respect of remedial work identified in the Quinquennial Inspection (in addition to the roof repair project already completed).  The next phases of work are:

                                               i.     West end wall of the Nave.  The architect has been instructed to prepare plans to obtain DAC approval and approximate costs.  The fees for this initial preparatory work will be £1,945.00 plus VAT.

                                             ii.     Stained Glass windows.  The PCC has commissioned a report to identify repairs needed to the stained glass windows.  The cost is £850.00 plus VAT.

The costs of carrying out these and further projects have not yet been quantified.  It is likely that fund-raising appeals will be necessary to finance the costs.

    1. Whorlton Church roof.  The PCC has appointed a contractor to carry out works to the roof in early 2017.  The cost will be £14,665.00 plus VAT (£17,598.00 including VAT).  The VAT is not recoverable.  Donations totalling £7,898 (including Gift Aid) have been received towards the cost of these works.
    2. Projector and Screen, Barnard Castle. The PCC has agreed in principle to seek approval to install a permanent projector and screen.  No provision for this has been made in these accounts.
    3. Car Park, Barnard Castle.  The PCC has agreed in principle to replace the damaged section of the car park surface by the entrance.  No provision for this has been made in these accounts.
  1. Diocesan Fees.  The PCC acts as collecting agent for Diocesan Fees due in respect of Weddings and Funerals.  These fees are not included in the accounts.
  2. Mission and Charity Donations.  The PCC donated 5% of its net income (calculated using the previous year’s gross income after deduction of fund-raising and trading costs) to charity.  In 2016 this amounted to £5,000 (2015: £5,000) and was divided equally between Durham-Lesotho Link, USPG, CMS,  Christian Aid (via Churches Together in Barnard Castle’s appeal), The Save the Children Fund (supporting a project in which a member of the congregation is involved), DePaul UK (for Nightstop North East and Cumbria), Open Door and The Samaritans (Darlington District Branch).  This expenditure is included in the financial statements.

A further amount of £440.92 is included under charitable giving in the accounts.  This was equal to half of the plate collection at a funeral service (including an amount equal to half of the Gift Aid claimed on Gift Aided donations in that collection) and was donated to the Bowes Museum’s Catalyst Endowment Fund.

In addition, at some events during the year, attendees have given charitable donations for specific charities.  These monies (and related gift aid forms when completed) have been passed directly to the charities.  The monies have been banked to the PCC current account but credited to a suspense account from which onward payment has been made.  The amounts are not included in the financial statements.  In 2016 these monies were Remembrance Sunday collection for Poppy Appeal (£837.42), Christian Aid (£619.32) and the Children’s Society (£500.92).

  1. Receivable amounts as at 31st December 2016

£596.01 under the Gift Aid scheme and Small Gift Aid Donations Scheme in respect of 2016 was claimed (but not yet received), together with £786.70 claimed but not yet received from The Listed Places of Worship Grant Scheme.

  1. Photocopier.  The PCC leased a photocopier with finance from Grenke leasing.  The service contract is with Mastercopy.  The copier is housed in the vicar’s office in the Vicarage.  After the expiry of the lease in January 2017, the PCC will rent the copier from Mastercopy.
  2. Mayfield. The PCC has been advised that it is not responsible for the future redecorating of 17 Mayfield and has therefore released the £500.00 designated for this back into general unrestricted funds.
  3. Governance Fees.  No costs have been incurred in the Independent Examination of the Accounts or in other Governance.
  4. Gift Aid. 92% of Planned Giving (bank standing orders and weekly envelopes) was Gift Aided in 2016.  The other 8% relates to non-taxpayers but part of this is eligible under the Small Donations Gift Aid Scheme.  In respect of the Small Donations Gift Aid Scheme, the PCC claims separately for each of the two churches as Community Buildings.  For Barnard Castle, the maximum amount available under the Scheme was claimed (£1,250 per fiscal year up to 2015/16, £2,000 from 2016/17).  For Whorlton, there were insufficient eligible donations to be able to claim the maximum amount.
  5. Accounting records.   Accounting records are maintained on Finance Co-ordinator V4.17 software supplied by Data Developments. Gift Aid and Small Gift Aid data is recorded on Donations Co-ordinator V6.11 software supplied by Data Developments.  This software is used to generate and electronically submit the Gift Aid and Small Gift Aid claims to HMRC.  Data on both systems is backed up at least weekly, with a security copy stored offsite.  The PCC subscribes to technical support in respect of this software (and has made use of this during 2016).
  6. Review of Financial Controls.  The PCC reviewed its financial controls during 2016 and agreed procedures to manage risks.  Changes were made to take account of the use of internet banking. The financial controls have been adopted as standing orders of the PCC.