Treasurers’ Training Day 27 th September 2019 _______________________________________

1. Treasurers’ Training Day 27th September 2019 _______________________________________ Bath & Wells Diocesan Board of Finance

2. Welcome to the Old Deanery • Thankyou for coming, talk to us, talk to each other, network and enjoy the day! • Health and safety: location of fire exits and toilets • Format of day • Refreshments breaks ~ every 90 minutes • Lunch arrangements • Finish by 4.00 p.m. • Opportunity for questions throughout day • Feedback at end

3. Opening Prayer

4. Training team for today Imogen Taylor – Head of Finance & Operations Steve Thomas- Finance Manager Jessica Cook- Parish share and Stipends Officer Nic Laycock-Volunteer Cashbook Champion To be joined by Julia Hill, Gary Watson & Sue Whitehead from the Discipleship team

5. Who is the Diocese?

6. Diocesan Structure • Diocesan Synod- elected lay and clergy members from deaneries meets 3 times a year • Bishop’s Council- Standing Committee of Synod , Trustees and Directors of the Diocesan Board of Finance-elected and ex-officio members • Finance Group- Acts for and assists Board in its financial work. Includes Board members and other invited members. Four subcommittee cover Houses, Investments, Common Fund and Audit/Risk • Board delegated authority- Day-to-day management to Diocesan Secretary, supported by Assistant Diocesan Secretary, Head of Finance & Operations , HR manager & Head of Communications

7. What does the Finance Team do all day? • Collecting Parish Share – 99% forecast for 2019 • Collecting parochial fees, returns , accounts • Keeping the cash flowing in and out • Funding for purchasing and selling clergy houses • Managing the financial investments • Paying 200 stipendiary clergy / 60 employees • Reporting to committees • Supporting PCC Treasurers

8. Treasurers’ Training Day 27th September 2019 _______________________________________ Diocesan Strategy and Budget Imogen Taylor

9. Diocesan Vision In response to God’s immense love or us, we seek to be God’s people, living and telling the story of Jesus

10. Bishop Peter’s Message • June 2017 Our vision and priorities

11. Funding the Vision 3 Key areas: • to put mission and evangelism at the heart of everything that we do • to realign our resources towards mission • To identify, develop and use the gifts of all our people

12. Aligning Resources for Mission

13. Aligning Resources for Mission • Common Fund spending • Detailed scrutiny by Finance Group • Annual increase no more than CPI inflation • Diocesan Support Services reviewing priorities and streamlining processes • Identifying resourcing priorities • Magnificat parishes • Growing new Christian communities through the Pioneer project , church planting etc • Review of parish share allocation to ensure it reflects the vision • Deployment strategy for people and buildings

14. DBF finances are relatively strong Net assets/funds £98m at end 2018 DBF Financial Position Buildings, land andinvestments Shares and propertyfunds £15m 3,000acres Clergyhouses 256 256 Land and Investments generate income which help to limit annual Common Fund increases £5m General (free) reserves 5months' normal spending

15. 2019 BudgetWhere oursupport comesfrom £12.2m Operating Income

16. 2019 BudgetHow the funds areused

17. Treasurers’ Training Day 27th September 2019 _______________________________________ Common Fund and Parish Share Jessica Cook

18. Where does the money comefrom? • Common Fund is the sum of all Parish Shares • We anticipate raising £10.4 million in 2019 • 80% of budgeted DBF income comes from Common Fund

19. Common Fund Video Run video This is available to download at: http://www.bathandwells.org.uk/supporting-parishes/finances/common-fund Or view on YouTube at https://youtu.be/5Ax6kgG8jBY

20. Parish Share- calculations Various factors decide your Parish Share …at a diocesan level including : • Change in Common Fund • Changes in overall membership and in socio-economic categories in the diocese … at a parish level: • Number church members and category within your particular parish declared by the PCC in the Annual Survey • Any caps or collars on the increases or decreases (15% cap, 10% collar)

21. Church Membership • Defined in terms of number of adults attending regularly (at least once per month), or who would attend if not prevented by illness etc. • New members ( who have not transferred from another church) are brought into calculation over 3 years. • Survey forms need to be returned promptly • Can not alter your figures after parish share has been set, therefore important to get right

22. Parishes Adult Survey membership 2019 • Membership is declining at a rate of circa 3.0% a year • We need to reverse this decline • Latest declared membership c 19,981

23. SEC Categories; how do you decide? Chosen from a scale of A-G, where • is for parishes most favourably placed • is for parishes least favourably placed Your Church membership’s ability to pay compared to others in the diocese

24. SEC Categories 2020 • At present, 2 ‘A’ parishes and 28 ‘G’s. • The spread from A to G ranges from 100% to 55%, with a G category parish being asked for 55% of what an A category parish is, per declared member.

25. Calculation of Parish Share Payable • Parish share per person in your chosen socio-economic category x membership (adjusted for new members) as defined on the form • Increases and decreases year-on-year will be cappedat 15% upwards and 10% downwards

26. Benefice Ministry Allowance • Benefice Ministry Allowance (BMA) will be given to all benefices where the membership per stipendiary minister exceeds 150. • Certain criteria must be met. • BMA will be calculated as a % reduction (allowance) on parish share per member for each additional member above the 150. • 22 benefices qualify for 2019.

27. Parish Share– contributions and discounts • We encourage you to make monthly contributions to ensure the DBF has enough funds to pay your clergy at the end of every month • Parishes which pay their Parish Share either by direct debit or by CBF standing order receive a discount. • For 2019 1.25% discount for full payment by 17 January or 0.3% for 12 monthly payments • If you need to change your payment method contact Jessica Cook jessica.cook@bathwells.anglican.org

28. Parish share -problems • Do keep your PCC up to date with any issues on managing to meet share contributions. • If your Parish has problems paying the current year share, please do get in touch as soon as possible, so we can support you. • Gary Watson can help with sourcing grant funding for buildings work and planned giving reviews to ensure you can meet your contributions towards the Common Fund

29. 99% of parish share was contributed in 2018- Thank you!

30. For further info or if you have any questions, please contact •Imogen Taylor, Head of Finance imogen.taylor@bathwells.anglican.org • Jessica Cook, Parish Share & Stipends Officer jessica.cook@bathwells.anglican.org

31. Treasurers’ Training Day 27th September 2019 _______________________________________ Roles and Responsibilities Imogen Taylor

32. Overview Key Responsibilities(Things you have to do) • Keep accurate books and records for the PCC • Prepare statutory accounts for the PCC Other Areas(Things you will probably end up doing) • Paying suppliers, wages, expenses etc. • Parish Finance Return, Parish Trusts, parochial fees • Grant and Loan applications, Tax Reclaims • Banking and treasury • Regular reporting to the PCC

33. Accounting Records The books and records you keep must: • Show all money received and spent, with explanations • Include a record of assets and liabilities • Enable the financial position to be shown at any time • Enable statutory accounts to be prepared • Be kept for at least 6 years (longer for items such as warranties, details of legacies etc.)

34. Accounting Records Typical records will include: • An analysed cash book (Diocesan Cash book /Accs software) • Cheque stubs, copies of online payment printouts • Paying-in books • Bank statements • Weekly/daily parish collection summaries • Invoices and other documentation for payments • Correspondence file • Copies of historic statutory accounts and budgets

35. Parish ShareParish Finance ReturnsParochial FeesThese topics are covered in other sessions

36. Preparing Accounts Context: • All PCCs are charities: PCCs with over £100k income must register with the Charity Commission, other PCCs are “excepted” from registration which is why they do not have a charity number. • All PCCs must comply with relevant charity law • All parishes preparing accruals accounts MUST follow SORP 2015. • Parish (not church) accounts.

37. Preparing accounts Which Accounts? (*) or assets >£250k and gross assets >£3.26m (**) by a qualified accountant (ACA, ACCA, ACMA, etc.)

39. Year end Accounts Process • Prepareaccounts • Have independent examination done (or audit if required for larger charities) • Accounts to PCC for approval and signature • Independent examiner signs report • Display accounts for 7 days prior to APCM • Accounts received by APCM (must be held by 30 April) • Send accounts to The Old Deanery within 30 days of APCM

40. Preparing Year end Accounts Follow PCC Accountability • Use a few, meaningful headings (if Receipts & Payments), which are easy to combine for finance return • Keep it simple - put details in the notes • Don’t use pence • Use columnar format • Must show previous year for comparison • Keep each statement to one side of A4

41. Funds There are three types of fund: • Endowment: capital cannot usually be spent (but income can) • Restricted: must be used for particular purpose • Unrestricted: for any purpose of the PCC can be split into • Designated: earmarked by the PCC for a specific purpose ( not a rainy day fund) • General : everything else! • Designated funds have no legal status and can be used by the PCC for any purpose. • Only the original donor can restrict funds, not the PCC

42. For discussion How would you class the following? • A donation of £1,000 alongside a letter requesting that the money is only for organ repair. • A legacy of £5,000 which the vicar would like to set aside for roof repairs. • £242 from a general fundraising BBQ.

43. Tax Reclaims • Gift Aid and GASDS:effective rate 25%, see: www.hmrc.gov.uk/charities/gift_aidfor more details • Listed Places of Worship Grant Scheme re VAT: makes grants towards the VAT incurred in making repairs to listed buildings mainly used for public worship see www.lpwscheme.org.uk for more details

44. Sources of Finance Grants from many external trusts and charities Assistance from the Giving and Funding Adviser- Gary Watson and Sue Whitehead Loans: • Diocesan Loan Fund • CCLA loans

45. Parish Trusts • Permanentendowment trust monies and land legally must be vested with the Diocese (Bath & Wells DBF) • The Diocese is custodiantrusteeonly; the PCC is the management trustee • If the Diocese is holding PCC funds which are not permanent endowment, these can be returned • If your trust is very small it may be possible to wind it up. (i.e. <£1k income or <£10k capital. New legislation has simplified the process – contact Juliette Hill

46. Treasurers’ Training Day 27th September 2019 _______________________________________ Gift Aid Sue Whitehead

47. Gift Aid • Basic Principles: • There has to be a gift; donation of money with NO benefit • Donor must pay sufficient UK Income or Capital Gains tax • Gift Aid Declaration – full name, house name, postcode, signature (sample copies in pack) • Submitting Claims: • Time limit is 4 years • Interim claims, anytime • Aggregation • Record Keeping: Keep the following for 6 years • Envelopes • Bank statements • Gift Aid Declaration • Working papers

49. GASDS – Gift Aid Small Donations Scheme • Different scheme to Gift Aid • Claimed in Tax years • Back Claims: ~ 2 years • Donations up to & including £30 (from April 2019) cash or contactless (from 6 April 2017) – at any one time • Single church parishes can claim up to £8,000 • Multi church parishes can claim up to £8,000 per church per year • Can claim up to 10 x amount of donations claimed under Gift Aid • Donor information not required