## **The Parochial Church Council of the Ecclesiastical Parish of Knowle, Solihull**
## **Charity number 1127404**
## Report and Accounts
## Year ended 31 December 2020
## CONTENTS
||CONTENTS||
|---|---|---|
|Report|Report|Page|
|Trustees Report:|||
|1.|Aim and purposes|1|
|2.|Objectives and activities|1|
|3.|Achievements and performance|1|
|4.|People|3|
|5.|Financial review|3|
|6.|Reserves policy|5|
|7.|Fundraising practices|5|
|8.|Plans for future periods|5|
|9.|Structure, governance and management|5|
|10.|Reference and Administrative details|6|
|11.|Statement of Trustees’ responsibilities|7|
|Accounts for the year ended 31stDecember 2020||8|
|Independent auditor’s report to the trustees||21|
Trustees’ Report (continued)
Knowle PCC 2020 Report and Accounts
## **2020 Annual Report and Accounts for the Parochial Church Council of the Ecclesiastical Parish of Knowle, Solihull (Charity number 1127404)**
The trustees are pleased to present their annual report together with the financial statements of the charity for the year ended 31[st] December 2020.
The financial statements comply with the Charities Act 2011 and Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2015).
## **1. Aim and purposes**
Knowle PCC has the responsibility of cooperating with the incumbent in promoting in the ecclesiastical parish, the whole mission of the Church, pastoral, evangelistic, social and ecumenical. The PCC is also specifically responsible for the maintenance of the Church and nearby buildings – the Guild House, St John’s Hall and St Lawrence House – and two residential properties: St Anne’s Cottage and 46 Crabmill Close.
## **2. Objectives and activities**
The statement of purpose of Knowle Parish Church (KPC), agreed by the PCC and endorsed by the 2015 APCM, is: _‘We are here to help people become lifelong followers of Jesus Christ’_ **.**
The PCC is committed to enabling as many people as possible to worship at our church and to become part of our church community to help resource their discipleship and equip them for service in the world. The PCC maintains an overview of worship in the church and in groups throughout the parish and beyond and makes suggestions on how our services and other activities can be for the benefit of everyone of whatever background. Our services and worship put faith into practice through prayer, scripture reading, teaching, music and sacrament.
When planning our activities for the year, we have considered the Charity Commission’s guidance on public benefit and, in particular, the supplementary guidance on charities for the advancement of religion. We seek to enable people to find and live out their faith in Jesus Christ in our community and beyond, and we also organise a number of activities that benefit the whole community of Knowle such as pre-school groups and a friendship club for senior citizens. We also promote practical and financial support to Christian mission beyond Knowle in the UK and overseas. To facilitate our work, it is important that we maintain the fabric of the Church and related buildings.
## **3. Achievements and performance**
## _**Effect of Covid-19**_
In the early part of the year, services and activities continued in the pattern of the previous year. With ‘lockdown’ due to Covid-19 from Sunday 22[nd] March, we had to adapt to a completely new environment – restricted mainly to meetings and worship by electronic means.
## _**Worship and prayer**_
On Sundays up to mid-March, five services were held with differing styles of worship and preaching, focused on ‘Exploring Worship’.
From late March, thanks to a fast learning curve on electronic communications, a recoded service was broadcast on YouTube each Sunday. These were watched and appreciated by large numbers of church members and others. In the week leading up to Easter, there were also worship and prayer events using Zoom. From the end of March, a pastoral letter from the Vicar was posted most weeks on the KPC website and in the newssheet; these were greatly appreciated.
Themes of sermons after Easter were ‘Our God is here’ and ‘Hope in uncertain times’. A week of prayer was held in late May based on ‘Thy Kingdom Come’, with resources on the KPC website. This included 48 hours of continuous prayer and a prayer event by Zoom on Easter Sunday. Prayer evenings by Zoom were held in most of the following months
In the summer and autumn, sermon themes were successively: ‘Re-discover Church in the Book Acts’, ‘Gideon the unlikely leader’ and ‘Unmasking hidden idols’.
It became possible in late July to re-open the church building and have services with limited numbers, subject to Covid-19 controls, but with the majority of people still accessing a recorded version of each service on YouTube. By October, thanks to a new internet connection into church and other technical developments by a dedicated team, live-steaming of services began. A further lockdown closed the church to worshippers in November, but congregations with limited numbers resumed in December. A series of special Christmas events took place in Church and online by Zoom and YouTube.
1
Trustees’ Report (continued)
Knowle PCC 2020 Report and Accounts
## **3. Achievements and performance (continued)**
## _**Ministry and evangelism**_
The Church continued with its aim of serving and reaching out to people in Knowle and beyond. On Saturday mornings until lockdown in mid-March, ‘Cobbles’ served coffee and cake in the Guild House, giving opportunity for people to meet with us in an informal setting. After careful planning, Cobbles reopened for 6 Saturdays in August and September, serving people socially-distanced in the church grounds. Friendship Club ran on Thursdays providing coffee and lunches until mid-March. Since then, leaders have kept in touch with members by various appropriate means.
Events to which friends and colleagues were invited included a men’s breakfast in St John’s Hall in January and, following lockdown two events by Zoom with engaging speakers on relevant current issues. These events were well attended and received.
The Alpha course at the start of 2020 was attended by 25 people and led to a new discovery group (by Zoom) being formed at its conclusion. In the Autumn, a Christianity Explored course was held by Zoom with 30 participants logging in.
The Knowle branch of Mothers’ Union (MU) met monthly until March, then later in the year by Zoom.
More than 300 people met in 26 home groups in various ways throughout 2020. Generally fortnightly meetings, on a variety of days midweek, daytime or evening, for bible study, prayer and mutual support took place until March. Thereafter, various means of keeping in contact happened – Zoom meetings, regular phone calls, distributions of study materials (physically or by email) and gatherings in smaller groups in gardens in summer. The home group leaders perform an important role in discipleship and pastoral care. We are grateful for their ongoing and innovative commitment to the groups.
Connect groups for under 5s and their parents and carers – Rainbow Tots, Bumps & Babies, Dads & Toddlers and Stepping Stones Pre-school – all functioned successfully until 20[th] March, when they had to close due to lockdown. Stepping Stones reopened in September on a Covid-secure basis, in line with schools. The other Connect groups had to remain suspended.
Children’s work under the leadership of Sarah Covington continued until lockdown in March with KPC Kids on Sundays, operating crèche, Toddlers and Scramblers for 0-5s and ‘Initi8, Gener8 and Reson8’ for 5-11s. Throughout lockdown and various levels of Covid restrictions, support was given to families to nurture the faith of their children at home. Following feedback, a 3-weekly cycle on Sundays was established with one live Zoom service, one pre-recorded YouTube service and one week sending material home. In place of the various lunchtime clubs run at Knowle Academy (covering years 1-4), a weekly collective Worship on YouTube was delivered, which is then used in each class ‘bubble’. The relationship with the school remains strong.
Penny’s Youth Café – opened in September 2019 – is a place which is intended for young people from the local area to come and find out more about the Christian faith in a relaxed context. It remained open for young people Monday to Thursday from 3.30 to 6pm, with evening groups and events also held there, until lockdown in March. During lockdown the relationships developed with young people were sustained by offering daily Instagram video recordings as well as a Sunday evening service on YouTube. Penny’s Youth Café re-opened as a Covid-secure café in July 2020 with an amended timetable to support the work of Arden Academy in limiting the contact young people have with students from different year groups. Two discipleship groups were run, which took place in both the Youth Café and on Zoom while young people are needing to self-isolate. On Sundays a Youth Alpha course was run in the morning and a Youth Service in the evening – both well attended.
## _**Pastoral care**_
The pastoral care teams, led by David Pickering – covering prayer ministry, bereavement counselling and support and visiting the sick and elderly at home and in care and nursing homes – continued to serve people until lockdown in March. In lockdown, a pastoral care helpline was established and operated. Contacts with vulnerable people were maintained by telephone and in other ways, and there was ongoing support via home groups.
## _**Church attendance and membership**_
Attendances at Sunday services pre-lockdown continued at the previous level of 350-400 adults and about 50 children and young people. When church attendance was again possible later in the year, maximum attendance allowed was 70. Large numbers of people logged into YouTube services – average ‘views’ were around 500. Zoom events were also well attended. At the time of the (postponed due to Covid) 2020 Annual Meeting in October, the Church Roll was 528, of whom 309 lived in the parish and the remaining 219 outside the parish. Many additional people have links with the church in a less formal way.
During 2020, 6 Baptisms, 4 marriages and 8 funerals took place in the church. A further 29 funeral services took place at the crematorium and 13 interments in the KPC Garden of Remembrance.
## _**Ecumenical relationships**_
Our clergy met in the early part of the year with the clergy and leaders of other churches in Knowle and Dorridge. A ‘churches together’ service was held in January at KPC.
2
Trustees’ Report (continued)
Knowle PCC 2020 Report and Accounts
## **3. Achievements and performance (continued)**
## _**Christian mission beyond Knowle**_
Our church continues to support and participate in Christian ministry beyond Knowle through its support of various programmes at home and overseas with both prayer and finance. All grants and donations made are specifically approved by the PCC.
During 2020, we contributed to Tearfund ‘where the need is greatest’. Our previous involvement in Kenya continued with support and prayer for the IcFEM project in Kimilili in West Kenya and Education for Life in Timbwani. We also gave to International Needs, the Malawi Task Force of the Diocese of Birmingham; also to the Diocese of Bolivia to support church pastors during the Covid emergency. In the UK, we gave to Reachout Network Ministries, Chaplaincy Plus, Urban Saints, and Scripture Union. In the Birmingham area, we supported links with St Christopher’s, Springfield and with St John’s, Sparkhill and the Narthex project, including food collections for their foodbank in co-operation with Tesco in Knowle. Gifts were also made to a total of 8 other churches in Birmingham to meet the needs of people there. We continue to provide significant financial support to the Diocese of Birmingham.
## _**Fabric**_
During 2020, necessary general maintenance to church buildings and grounds was carried out. A quinquennial inspection of the church was carried out by the church architect and a report thereon was received. Plans for necessary work were formulated to begin in 2021.
## **4. People**
The work of the Church was undertaken by a wide group of people including Clergy, Staff, Readers and very many members of the Church. The principle of ‘every member ministry’ remains strong in the life of the church.
In June, our Curate Ann Peachey completed her curacy at Knowle and left to take up a new post in the Coventry Diocese. In September, our Associate Vicar Matt Simpson left Knowle to take up a new post in Dorset. We expressed our thanks to both Ann and Matt for their ministries at Knowle.
Following vacancies that had arisen in the previous Parish Office team in 2019, a new church management team was put in place during 2020. Helen Allen took up the new post of Operations Manager in March. Gareth Roberts-Davis transitioned from his former role to Facilities and Systems Manager. Natalie Smith and Catherine Robinson joined the office team in January and November respectively.
In the Youth team, Anna Holden was on maternity leave for the year. Natasha Godfrey joined and served as part-time Youth Assistant from January until May.
Our grateful thanks are due to all these people and to many others for time, energy, care and prayer in all that has been contributed. Volunteers continue to play a central role in the work of the Church and are at the heart of most activities.
## **5. Financial review**
The PCC is pleased to report that despite the effect of the pandemic, General Fund reserves have been maintained at a healthy level.
The curtailment of activities because of the Covid-19 pandemic has resulted in substantial reductions in income. The PCC is very grateful that regular giving by standing order from church members has been maintained throughout; but receipts such as donations at church services, fees for weddings and funerals and contributions towards activities are much reduced. However, operating expenses have also been contained to fully offset the loss in income.
In addition, in 2020 the church has become entitled to an unrestricted legacy from a former parishioner of £53,000. The PCC has transferred this to a Designated Legacies Fund until it is allocated to a specific purpose.
The General Fund, which covers the normal running expenditures of the church, showed a surplus of £28k in the year, compared to a deficit of £3k in 2019. The £28k surplus for the year is after charging depreciation of £39k, but before transferring £53k to the Designated Legacies Fund and £10k to the Designated Property Repair Fund and investing £3k in capital equipment; so net current assets, or reserves, have increased from £96k to £97k. This level of reserves is above the policy level of £60k and provides a level of flexibility in readiness for an uncertain 2021.
The Treasurer and the PCC as a whole warmly thank church members and others for their continued financial support, without which we would not be able to carry forward the ministry of Christ in Knowle.
3
Trustees’ Report (continued)
Knowle PCC 2020 Report and Accounts
## **5. Financial review (continued)**
## _**Going concern**_
The trustees have considered the ongoing consequences of Covid-19 and other events and conditions. Despite the curtailment of activities in 2020, reserves have been maintained; and while costs are expected to increase in 2021 because of increased staff levels, the PCC considers that reserves will continue to be maintained at or above the policy level of £60k for a further 12 months, notwithstanding the effects of Covid-19.
Accordingly, the PCC has determined that the current conditions do not create a material uncertainty that casts significant doubt upon the entity’s ability to continue as a going concern for at least twelve months following the date of signature of the balance sheet.
## _**Income**_
Total income decreased by £22k to £688k, due to large decreases in donations and income from activities as a result of the Covid-19 restrictions, offset by a significant bequest and the timing of a grant towards children’s and young people’s work.
Income to General Funds decreased by £1k to £584k. The large increase of £46k in legacy income to £53k (2019: £7k) was offset by reductions in income that are all attributable to reduced availability of the church buildings because of the Covid restrictions; hall lettings were down by £4k, income from church activities such as fees for weddings and funerals were down by £24k and donations were down by £19k, principally because of reduced collections at church services. Planned regular giving, which represents over 80% of general fund income, was maintained at about the same level as in 2019 and is of great benefit in financial planning. The legacy income of £53k has been transferred to a Designated Legacies Fund until the PCC allocates it for specific purposes.
Income to Designated Funds decreased by £37k to £64k, again as a result of much-reduced activity in those groups which operate their own finances as listed in Note 6 to the accounts. The Youth Department had reduced income of £17k and the Stepping Stones pre-school group saw an income reduction of £10k despite continued support from the local education authority and a grant of £10k from the government’s Coronavirus Job Retention Scheme which covered the costs of staff who were furloughed when the group was closed for part of the Easter term and the whole of the Summer Term.
Income to Restricted Funds increased by £16k to £40k. In 2020, grants were received towards youth and children’s work totalling £39k compared to £23k in 2019. The principal reason for the increase is that grants towards youth and children’s workers’ salaries from Knowle United Charity (KUC) were received for both for 2020 and 2021 and in addition, KUC made a grant of £2,700 towards Penny’s Youth Café. The PCC is very grateful for KUC’s ongoing support over many years. A grant of £4,400 was also received from Solihull Metropolitan Borough Council towards equipment purchases for Penny’s and the PCC thanks the Council for its support.
## _**Expenditure**_
Contributions to the Diocesan Common Fund of £169k (2019 £167k) were in line with the amount requested; of this, about £50k is used to support other parishes. The PCC also made contributions to the Church’s wider ministry by continuing the policy of giving 5% of voluntary General Fund income to outside organisations, which amounted to £34k (2019: £32k), making a total of £84k (2019: £95k) towards mission and ministry work beyond Knowle. In 2019, retiring collections and other mission payments not included in the main church accounts totalled £13k, but there were no such collections in 2020 because of the Covid restrictions.
## Total expenditure in 2020 decreased by £100k to £648k.
General Fund expenditure decreased by £32k to £556k. Salaries of youth and children’s workers charged to general fund decreased by £19k; of this, £9k was because one of the youth workers was on maternity leave and £10k was due to increased funding from restricted funds. There was a £23k saving in general expenses across a range of activities and a £6k saving in clergy housing costs as Matt Simpson vacated the property leased from Pickering Fields Trust. Parish Office salary costs increased by £12k as we strengthened the team, principally by the recruitment of a full-time Operations Manager, and giving to other charities including the Diocese increased by £4k.
Designated Fund expenditure decreased by £64k to £69k. The majority of this decrease is because of exceptional expenditure items in 2019, namely a special gift to the Diocesan Common Fund (£25k) and improvements to the choir vestry (£14k). The remainder of the decrease is due to Covid-related reduced activity levels in a range of associated groups, such as Stepping Stones and Friendship Club.
Restricted Fund expenditure reduced by £4k to £23k. Because of the timing of the grant funding from Knowle United Charity, there was a £10k increase in the costs of youth and children’s workers’ salaries that were paid from restricted grants, and £6k of expenditure on Penny’s Youth Café was funded from restricted grants. By comparison, 2019 expenditure from restricted funds included £5k for the choir vestry improvements and £15k for the Moldova mission trip.
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Trustees’ Report (continued)
Knowle PCC 2020 Report and Accounts
## **5. Financial review (continued)**
## _**Principal risks and uncertainties**_
The principal area of risk and uncertainty is the responsibility for the upkeep of an ancient listed building, which can give rise to large and sometimes unexpected expenditure. This risk is mitigated by the maintenance of a Designated Property Repair Fund.
## **6. Reserves policy**
The PCC has reconfirmed its policy to maintain a balance on General Fund of a least 10%, or 5 weeks, of annual payments from the Fund. This is equivalent to £60,000 and is as low as is prudent bearing in the mind the time taken to obtain tax refunds, and the amount of income that still comes as one-off donations. This does, however, mean that any money given to the Church will be put to good use immediately! The actual balances of net current assets in the General Fund at the yearend of £97,515 are therefore in line with PCC policy. The funds held by designated organisations such as Stepping Stones are proportionately larger because their income is less certain that that of the church.
The PCC also maintains a Designated Property Repair Fund to cover the costs of major repairs; the balance on this fund of £76,684 is expected to be sufficient for any works necessary in 2021.
The Designated Legacies Fund, created to hold the balances of legacies received but not yet allocated to specific purposes by PCC, stands at £53,000.
## **7. Fundraising practices**
The church invites voluntary donations from the public which, together with the associated Gift Aid, comprise the majority of the church’s income. The PCC has reviewed its fundraising activity to ensure compliance with the latest Charity Commission guidance. The church does not use any commercial fundraiser or commercial participator. Although the church does not subscribe to particular fundraising standards or to any scheme for fundraising regulation, it follows guidelines for fundraising set by the Church of England. Fundraising activities are normally limited to invitations by the Clergy and/or Treasurer for church members to prayerfully review their giving to charitable activities including the church, and supported by information leaflets and presentations which set out the financial position of the church, normally given on “Stewardship Sunday”. Particular care is taken to ensure the protection of vulnerable people and other members of the public from behaviour which is an unreasonable intrusion on a person’s privacy, is unreasonably persistent, or places undue pressure on a person to give money or other property. No complaints have been received by the church related to its fundraising activity.
## **8. Plans for future periods**
Our aim and purpose will remain as stated in 1 above. We will continue to run and develop our programme of worship services, groups, activities and special events, with changes depending on the Covid-19 situation, to meet needs and initiatives as they arise. In 2021 we are seeking to recruit a new Associate Vicar and look ahead to the arrival of a new Curate in July. Our motivation continues to be that, as KPC, ‘ _We are here to help people become lifelong followers of Jesus Christ’_ . The Trustees regularly consider issues of direction and furtherance of our mission at PCC meetings, with renewal of our vision for the years ahead a specific focus in the first part of the year.
## **9. Structure, governance and management**
The PCC is a corporate body established by the Church of England governed by the Parochial Church Council (Powers) Measure 1956 and the Church Representation Rules. It is a registered charity with the Charity Commission (no. 1127404).
The trustees of the charity are the PCC members. The method of appointment of PCC members is set out in the Church Representation Rules. At KPC, the membership of the PCC consists of the incumbent and other appointed clergy, members (including a Reader and churchwardens) elected by members of the congregation who are on the Electoral Roll of the church. Those who regularly attend services and participate in church activities are encouraged to register on the Electoral Roll and may also to stand for election to the PCC.
Members of the PCC are one of (i) co-opted, (ii) directly elected by the APCM, or (iii) members of our church who have been elected to Diocesan Synod to represent our Deanery.
- As at the year-end, following the APCM on 14[th] October ( _postponed from March due to Covid-19_ ), there were: 6 elected members with Deanery Synod membership and
- 9 elected members without Deanery Synod membership.
Any member of the Church may offer themselves for election to PCC at the APCM provided they qualify under the Church Representation Rules. Appropriate nomination forms may be obtained from the PCC Secretary via the Parish Office. Nominees to PCC can obtain appropriate information on both the role of the PCC and the role of members from the PCC Secretary.
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Trustees’ Report (continued)
Knowle PCC 2020 Report and Accounts
## **9. Structure, governance and management (continued)**
The policies and procedures for the induction and training of trustees are as follows:
Prior to the PCC elections, prospective PCC members receive an information leaflet setting out the role of the trustees and particularly drawing attention to conflicts of interest. After election, PCC members receive the Charity Commission’s “Essential Trustee” booklet, the Church of England booklet “Trusteeship – An Introduction for PCC Members” and an internally-produced document setting out the constraints on payments to PCC members or connected persons. Part of the PCC meeting which follows the PCC election is dedicated to trustee training.
The PCC members are responsible for making decisions on all matters of general concern and importance to the parish including deciding on how the funds of the PCC are to be spent.
The PCC held 7 business meetings during the year. There are 6 permanent Sub-committees: – Standing, Fabric, Finance, Health & Safety (who undertake risk reviews on behalf of the PCC), Human Resources (Paid Staff), and Stepping Stones Pre-school Management.
The key management personnel of the charity is the Standing Committee, made up of the senior clergy, churchwardens, the secretary, the treasurer and the operations manager (from April 2020). The Standing Committee may conduct urgent PCC business that arises from time to time between PCC meetings, in accordance with the Church Representation Rules. Of the key management personnel, only the operations manager (being an employee) receives remuneration from the charity.
All Sub-committees report to the PCC on a regular basis and provide recommendations to the PCC. All matters of policy and finance are determined by the PCC, and are not delegated to Sub-committees; however, detailed implementation of PCC decisions may be delegated to specific Sub-committees from time to time as determined by the PCC. Membership of the Subcommittees is approved by the PCC. Other groups exist on an ad hoc basis to deal with specific matters. Effort was again put into monitoring the balance between spending and income, so as to achieve a balanced budget, with appropriate provision for forthcoming fabric expenditure.
The council has complied with its duty under section 5 of the Safeguarding and Clergy Discipline Measure 2016 to have due regard to House of Bishops’ guidance on safeguarding children and vulnerable adults.
## **10. Reference and Administrative details**
The registered name of the charity is The Parochial Church Council of the Ecclesiastical Parish of Knowle, Solihull, registered charity no. 1127404. In this report, for ease of reading, the charity is also referred to as “the PCC”, “Knowle Parochial Church Council”, “the Council”, “Knowle Parish Church” and “KPC”.
Knowle Parish Church is situated beside High Street and Kenilworth Road, Knowle. It is part of the Diocese of Birmingham in the Church of England. The correspondence address is Knowle Parish Office, St Lawrence House, 1717 High Street, Knowle, Solihull, B93 0LN.
The following members served on the council for all or part of the year; those serving in more than one capacity may appear more than once:
Incumbent: Revd Geoffrey Lanham (Chairman) Associate Vicars: Revd Matt Simpson ( _until September_ ) Curate: Revd Ann Peachey ( _until June_ ) Churchwardens: Matt Baggott (lay deputy chair) Bill Wilson ( _until October_ ) Member of Diocesan Synod: Julian Phillips (Reader)
Elected Representatives to Deanery Synod:
Nick Brown Roy Carr (Secretary) Nick Humby Carol Kay ( _from October_ ) Lindsay Melvin ( _until October_ ) Julian Phillips David Pickering ( _from October_ ) Derek Sheldon ( _until October_ ) Elected members to PCC: Lynn Brown Sarah Chapman ( _from October_ ) Nick Houghton ( _from October_ ) Margaret Johnson ( _until July_ ) Steve Mort (Treasurer) Benjamin Neudorfer ( _from October_ Lucy Saunders ( _until October_ ) Anne Smith ( _from October_ ) Carol Street ( _until October_ ) Rod Street ( _from October_ ) Kay Todman Liz Welton Zoe Wilbourne ( _until October_ )
No co-opted members.
Helen Allen, Sarah Covington and Paul Holden attended PCC meetings in a non-voting capacity.
6
Trustees’ Report (continued)
Knowle PCC 2020 Report and Accounts
## **10. Reference and Administrative details (continued)**
Bank: HSBC Bank plc, 34 Poplar Road, Solihull, B91 3AF
Auditors: Azets Audit Services
First Floor, Copthall House, 1 New Road, Stourbridge, West Midlands, DY8 1PH
## **11. Statement of trustees' responsibilities**
The trustees are responsible for preparing the Trustees’ Report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
The law applicable to charities in England & Wales requires the trustees to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the charity and of the incoming resources and application of resources of the charity for that period. In preparing these financial statements, the trustees are required to:
- select suitable accounting policies and then apply them consistently;
- observe the methods and principles in the Charities SORP;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements;
- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the charity will continue in operation
The trustees are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the charity and enable them to ensure that the financial statements comply with the Charities Act 2011, the Charity (Accounts and Reports) Regulations 2008. They are also responsible for safeguarding the assets of the charity and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Report approved by the PCC and signed on its behalf by
Revd Geoffrey Lanham (incumbent)
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Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **Statement of financial activities for the year ended 31 December 2020**
**----- Start of picture text -----**
Funds Unrestricted Restricted Total Unrestricted Restricted Total
General Designated General Designated
2020 2020 2020 2020 2019 2019 2019 2019
Note £ £ £ £ £ £ £ £
Income from:
Donations and legacies 1.a 545,508 1,823 40,116 587,447 518,483 5,688 16,758 540,929
Charitable activities 1.b 35,951 61,295 - 97,246 59,819 91,556 3,954 155,329
Other trading activities 1.c 1,985 971 - 2,956 5,574 3,915 3,091 12,580
Investments and deposits 1.d 580 - 205 785 994 - 314 1,308
Total income 584,024 64,089 40,321 688,434 584,870 101,159 24,117 710,146
Expenditure on:
Raising funds 2a 2,459 478 - 2,937 5,388 617 - 6,005
Charitable activities 2b 2c 553,727 68,147 23,285 645,159 582,437 132,154 26,993 741,584
Total expenditure 556,186 68,625 23,285 648,096 587,825 132,771 26,993 747,589
Net income/(expenditure) 27,838 (4,536) 17,036 40,338 (2,955) (31,612) (2,876) (37,443)
Transfer General Funds to Designated Funds 6 (63,000) 63,000 - - (10,000) 10,000 - -
Transfer Restricted Funds to General Fund 6 - - - - - - -
Net movement in funds (35,162) 58,464 17,036 40,338 (12,955) (21,612) (2,876) (37,443)
Reconciliation of Funds:
Funds brought forward 1,468,422 130,231 45,043 1,643,696 1,481,377 151,843 47,919 1,681,139
Funds carried forward 1,433,260 188,695 62,079 1,684,034 1,468,422 130,231 45,043 1,643,696
**----- End of picture text -----**
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Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **Balance sheet at 31 December 2020**
|**Balance sheet at 31 December 2020**|**Balance sheet at 31 December 2020**|||
|---|---|---|---|
|**Funds**
_Note_||**Unrestricted**
**Restricted**
**Total**
**General**
**Designated**
**2020**
**2020**
**2020**
**2020**
£
£
£
£|**Unrestricted**
**Restricted**
**Total**
**General**
**Designated**
**2019**
**2019**
**2019**
**2019**
£
£
£
£|
|**Fixed Assets**
Tangible fixed assets
4.1
Investment assets
4.2||1,335,745
-
-
1,335,745
-
-
1,482
1,482|1,372,209
-
-
1,372,209
-
-
1,346
1,346|
|**Sub Total - Fixed Assets**||**1,335,745**
**-**
**1,482**
**1,337,227**|**1,372,209**
**-**
**1,346**
**1,373,555**|
|**Current assets**
Debtors - HMRC gift aid tax recoverable
- Legacy - outstanding settlement
- Prepayments
Cash and cash equivalents
- Bank accounts
- Deposit accounts
- Cash||8,053
-
-
8,053
23,000
-
-
23,000
1,782
1,357
-
3,139
78,963
99,736
42,720
221,419
2,706
90,000
18,000
110,706
501
265
-
766|21,797
-
-
21,797
-
-
-
-
1,081
1,218
-
2,299
52,657
79,631
31,246
163,534
42,238
50,000
18,000
110,238
442
575
-
1,017|
|**Sub Total - Current Assets**||**115,005**
**191,358**
**60,720**
**367,083**|**118,215**
**131,424**
**49,246**
**298,885**|
|**Liabilities: Falling due within one year**
Creditors and accruals in respect of parochial activity
Charity collections not paid over
Deferred Income (rentals and mag adverts paid in advance)||-
14,756
2,663
-
17,419
-
-
123
123
2,734
-
-
2,734|-
18,462
1,193
-
19,655
-
-
5,549
5,549
3,540
-
-
3,540|
|**Sub Total - Liabilities**||**17,490**
**2,663**
**123**
**20,276**|**22,002**
**1,193**
**5,549**
**28,744**|
|**Sub Total - Net Current Assets**||**97,515**
**188,695**
**60,597**
**346,807**|**96,213**
**130,231**
**43,697**
**270,141**|
|**Total Net Assets**||**1,433,260**
**188,695**
**62,079**
**1,684,034**|**1,468,422**
**130,231**
**45,043**
**1,643,696**|
|**Funds**
Unrestricted (General Fund)
Designated
6
Restricted
6||-
1,433,260
-
-
1,433,260
-
188,695
-
188,695
-
-
62,079
62,079
-|-
1,468,422
-
-
1,468,422
-
130,231
-
130,231
-
-
45,043
45,043
-|
||**Total**|**1,433,260**
**188,695**
**62,079**
**1,684,034**|**1,468,422**
**130,231**
**45,043**
**1,643,696**|
Approved by the Parochial Church Council on 24[th] February 2021 and signed on its behalf by:
Revd Geoff Lanham: Chairman
Matt Baggott: Vice Chairman
9
Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **Statement of Cash Flows**
**for the year ended 31 December 2020**
|**Statement of Cash Flows**
**for the year ended 31 December 2020**|||
|---|---|---|
|
**Funds**
_Note_|**Unrestricted Designated Restricted**
**Total**
**2020**
**2020**
**2020**
**2020**
£
£
£
£|**Unrestricted Designated Restricted**
**Total**
**2019**
**2019**
**2019**
**2019**
£
£
£
£|
|**Cash flows from operating activities:**
Net movement in funds per SOFA
**Adjustments for:**
Depreciation charges
(Increase)/decrease in debtors
Increase/(decrease) in creditors|(35,162)
58,464
17,036
40,338
39,365
-
-
39,365
(9,956)
(139)
-
(10,095)
(4,512)
1,470
(5,426)
(8,468)|(12,955)
(21,612)
(2,876)
(37,443)
39,401
-
-
39,401
3,091
(206)
-
2,885
5,058
(259)
607
5,406|
|**Net cash provided by (used in) operating activities**|(10,265)
59,795
11,610
61,140|34,595
(22,077)
(2,269)
10,249|
|**Cash flows from investing activities:**
Purchases of fixed assets
Purchases of investments|(2,902)
-
-
(2,902)
-
-
(136)
(136)|(1,262)
-
-
(1,262)
-
-
(246)
(246)|
|**Net cash provided by (used in) investing activities**|**(2,902)**
**-**
**(136)**
**(3,038)**|**(1,262)**
**-**
**(246)**
**(1,508)**|
|**Change in cash and cash equivalents in the reporting period**|
**(13,167)**
**59,795**
**11,474**
**58,102**|**33,333**
**(22,077)**
**(2,515)**
**8,741**|
|**Changes in cash and cash equivalents:**
**Opening balances:**
Current account
Deposit account
Cash
Total opening balances
**Closing balances**
Current account
Deposit account
Cash
Total closing balances|52,657
79,631
31,246
163,534
42,238
50,000
18,000
110,238
442
575
-
1,017|20,188
112,022
23,761
155,971
41,415
40,000
28,000
109,415
401
261
-
662|
||95,337
130,206
49,246
274,789|62,004
152,283
51,761
266,048|
||78,963
99,736
42,720
221,419
2,706
90,000
18,000
110,706
501
265
-
766|52,657
79,631
31,246
163,534
42,238
50,000
18,000
110,238
442
575
-
1,017|
||82,170
190,001
60,720
332,891|95,337
130,206
49,246
274,789|
||||
|**Increase/(decrease) in net cash holdings (equals A)**|**(13,167)**
**59,795**
**11,474**
**58,102**|**33,333**
**(22,077)**
**(2,515)**
**8,741**|
10
Notes to the Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **1. Income analysis**
|**Funds**|**Unrestricted**
**Restricted**
**Total**
**General**
**Designated**
**2020**
**2020**
**2020**
**2020**
£
£
£
£|**Unrestricted**
**Restricted**
**Total**
**General**
**Designated**
**2019**
**2019**
**2019**
**2019**
£
£
£
£|
|---|---|---|
|**1a Donations and legacies:**
Envelope scheme
Regular Standing orders
One-off donations
Other Stewardship & CAF
Gift Aid Tax recoverable (GAT)
Cash collections
Other income
Collections for charities
Grants/donations for young people's work
Donations, appeals, etc.
Legacies|2,121
-
-
2,121
360,155
-
-
360,155
15,985
-
-
15,985
22,200
-
-
22,200
88,600
440
135
89,175
3,085
-
-
3,085
140
-
-
140
-
-
-
-
-
1,021
39,281
40,302
141
362
700
1,203
53,081
-
-
53,081|5,355
-
-
5,355
355,787
-
-
355,787
18,250
-
-
18,250
28,260
-
-
28,260
88,890
-
-
88,890
11,526
-
-
11,526
524
-
-
524
-
-
-
-
-
4,812
11,072
15,884
3,034
876
5,686
9,596
6,857
-
-
6,857|
|**Total**|**545,508**
**1,823**
**40,116**
**587,447**|**518,483**
**5,688**
**16,758**
**540,929**|
|**1b Income from Church Activities:**
Parish magazine
Bookstall
Ministry group contributions
Church and hall lettings
Wedding and Funeral Fees
Other Group Activities|19,423
-
-
19,423
618
-
-
618
5,098
-
-
5,098
3,589
-
-
3,589
7,183
-
-
7,183
40
61,295
-
61,335|19,742
-
-
19,742
1,320
-
-
1,320
15,889
-
-
15,889
10,450
-
-
10,450
12,269
-
-
12,269
149
91,556
3,954
95,659|
|**Total**|**35,951**
**61,295**
**-**
**97,246**|**59,819**
**91,556**
**3,954**
**155,329**|
|**1c Other trading activities (incl. rentals)**
**1d Investment dividends and interest**|1,985
971
-
2,956
580
-
205
785|5,574
3,915
3,091
12,580
994
-
314
1,308|
|**Total income**|**584,024**
**64,089**
**40,321**
**688,434**|**584,870**
**101,159**
**24,117**
**710,146**|
11
Notes to the Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **2. Expenditure analysis**
|**Funds**|**Unrestricted**
**Restricted**
**Total**
**General**
**Designated**
**2020**
**2020**
**2020**
**2020**
£
£
£
£|**Unrestricted**
**Restricted**
**Total**
**General**
**Designated**
**2019**
**2019**
**2019**
**2019**
£
£
£
£|
|---|---|---|
|**2a Raising funds**
Costs attributable (mainly to rents received)|2,459
478
-
2,937|5,388
617
-
6,005|
|**Sub-total**|**2,459**
**478**
**-**
**2,937**|**5,388**
**617**
**-**
**6,005**|
|**2b Charitable activities: Mission**
Outside giving to charities (see note 7)
**2c Charitable activities: Ministry:**
Diocesan Common Fund
Clergy expenses
Clergy and youth worker housing costs
Ministry groups
Ministry services incl. books and sundries
Pastoral care expenses
Other Group Activities
Children’s ministry
Youth ministry
Church running expenses
Parish magazine costs
Bookstall expenditure
Churchyard upkeep
St John’s Hall expenses
Guild House expenses
Music & Choir expenses
Parish Office and Admin costs
Insurance
Other Expenses
Governance/audit/accounts costs|33,062
507
-
33,569
169,335
-
-
169,335
3,777
-
-
3,777
29,720
-
-
29,720
2,557
-
-
2,557
5,609
-
-
5,609
-
-
200
200
-
945
-
945
55,633
61,995
8,278
125,906
42,141
4,305
14,807
61,253
34,949
-
-
34,949
22,452
-
-
22,452
428
-
-
428
11,660
-
-
11,660
39,275
-
-
39,275
7,826
-
-
7,826
16,802
-
-
16,802
61,825
-
-
61,825
11,921
-
-
11,921
855
395
-
1,250
3,900
-
-
3,900|30,446
1,233
-
31,679
167,002
25,000
-
192,002
6,497
-
-
6,497
36,196
-
-
36,196
4,761
-
-
4,761
9,645
-
-
9,645
328
-
-
328
357
5,516
-
5,873
59,717
67,897
3,375
130,989
60,739
14,981
18,566
94,286
25,273
13,713
4,495
43,481
22,362
-
-
22,362
1,411
-
-
1,411
10,876
-
-
10,876
45,137
-
-
45,137
9,587
-
-
9,587
17,746
1,988
-
19,734
58,010
-
-
58,010
10,653
-
557
11,210
1,739
1,826
-
3,565
3,955
-
-
3,955|
|**Sub-total**|**553,727**
**68,147**
**23,285**
**645,159**|**582,437**
**132,154**
**26,993**
**741,584**|
|**Total expenditure**|**556,186**
**68,625**
**23,285**
**648,096**|**587,825**
**132,771**
**26,993**
**747,589**|
12
Notes to the Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **3. Accounting Policies**
## **3.1 Basis of Preparation**
The accounts include all transactions, assets and liabilities for which the PCC is responsible in law. They do not include the accounts of church groups that owe their main affiliation to another body nor those that are informal gatherings of Church members. The accounts include a number of church organisations that operate their own finances, as required by the Charities Act 2011; these organisations are listed at Note 6.
The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2015) - (Charities SORP (FRS 102)) and the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102).
Knowle PCC meets the definition of a public benefit entity under FRS 102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy notes.
The financial statements are prepared in GBP, which is the functional currency of the charity, and are rounded to the nearest £1.
Going concern - the trustees have considered the ongoing consequences of Covid-19 and other events and conditions. Despite the curtailment of activities in 2020, reserves have been maintained; and while costs are expected to increase in 2021 because of increased staff levels, the PCC considers that reserves will continue to be maintained at or above the policy level of £60k for a further 12 months, notwithstanding the effects of Covid-19. Accordingly, the PCC has determined that the current conditions do not create a material uncertainty that casts significant doubt upon the entity’s ability to continue as a going concern for at least twelve months following the date of signature of the balance sheet.
## **3.2 Funds**
Unrestricted funds represent the funds of the PCC that are not subject to any restrictions regarding their use. The PCC at its discretion has elected to designate certain unrestricted funds for a particular purpose. The practical operation of the funds is as follows:
## **The Parish General Fund**
The PCC is responsible for all church funds, but this is the fund where income is received for the PCC to decide how it is best deployed to achieve the church’s Christian charitable objectives. The General Fund balance is effectively unspent income and is retained as a cushion against uncertainties.
## **Designated Funds**
Designated funds for Property and Churchyard repairs and renovation are maintained by the PCC to separately manage the high and irregular costs involved. Gifts for fabric repairs or renovation are taken to the designated Property Fund if they can be related to costs incurred during the year. If a gift is for a specific fabric related purpose which is not carried out in the current year, then they are allocated to the restricted Property Repair Fund. A Designated Legacy Fund has been established to hold the balance of unrestricted legacies received until the PCC allocates them to a specific purpose. Designated funds also include the funds of the church organisations that operate their own finances; most of the income of these funds is payment for the provision of charitable activities. The designated funds are listed at Note 6.
## **Restricted Funds**
Restricted Funds are funds which are to be used in accordance with specific restrictions imposed by donors or which have been raised by the charity for specific purposes. The restricted funds are listed at Note 6.
## **3.3 Income**
All incoming resources are included in the Statement of Financial Activities (SoFA) when the charity is legally entitled to the income, the amount can be measured reliably and it is probable that the income will be received.
Voluntary income and planned giving, including covenants, are recognised when received by or on behalf of the PCC. Income tax recoverable on gift aid donations is recognised when the donations are received.
Most non-donation income is treated as income from charitable activities as the income derives from the provision of charitable (or Christian) services to local parishioners in pursuit of the Christian objectives of the church.
The amount of purely fundraising activity is small and normally consists of rental income from church facilities and residential property when these are not needed for church purposes.
Sales of books and other material from the bookstall and sales of the Parish Magazine are accounted for gross.
Rental income is recognised according to the period to which it relates and is shown gross, even though some of the rental income comes from other PCC funds such as the Stepping Stones pre-school.
13
Notes to the Financial Statements
for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **3. Accounting Policies (continued)**
Dividends and interest from investments are accounted for when receivable except that interest on deposits with the Central Board of Finance for the Church of England are accrued.
Grants, legacies and donations to the PCC are accounted for as soon as the PCC is notified of its legal entitlement and the amount can be reliably estimated.
Government grants are recognised at the fair value of the asset received or receivable when there is reasonable assurance that the grant conditions will be met and the grants will be received.
A grant that specifies performance conditions is recognised in income when the performance conditions are met. Where a grant does not specify performance conditions it is recognised in income when the proceeds are received or receivable. A grant received before the recognition criteria are satisfied is recognised as a liability.
During the year the company has received support from the HMRC scheme, known as the Coronavirus Job Retention Scheme (CJRS), which has been used to pay the wages of furloughed Stepping Stones staff.
Realised gains or losses are recognised when investments are sold.
Unrealised gains or losses are accounted for on revaluation of investments at 31 December.
## **3.4 Expenditure**
Expenditure is recognised when there is a legal or constructive obligation to make payments to third parties, it is probable that the amount will be paid and the amount can be measured reliably. The charity is not registered for VAT purposes and expenditure is shown inclusive of VAT. Grants and donations by the PCC are accounted for when paid over, or when awarded, if that award creates a binding obligation on the PCC. The Diocesan Common Fund is accounted for when paid.
Expenditure on Raising Funds is the directly attributable cost of renting out church facilities and residential property when these are not required for church purposes, plus an allocation of costs associated with administration. In practice for church facilities, this involves estimating the variable costs per session of operating the facilities and expressing this as a percentage of the average rental charge. For residential property that is normally held for clergy or staff housing, only those outgoings specifically related to the rental activity are identified as fundraising costs.
## **3.5 Fixed Assets**
## **Consecrated and beneficed property**
Consecrated and beneficed property is excluded from the accounts by Charities Act 2011 s.10 (2)(a). No value is placed on movable church furnishings held by the churchwardens on special trust for the PCC and which require a faculty for disposal since the PCC considers this to be inalienable property.
## **Land and Buildings**
Land and buildings are stated at cost (or deemed cost) less accumulated depreciation. Straight line depreciation lives are applied to components as follows:
- Building and roof structures 100 years
- Roof surfaces 70 to 80 years
- Windows, doors plumbing and cabling 40 to 50 years
- Internal facilities and integral equipment 15 years
- Land is not depreciated
- Grade II Listed buildings 900 years
## **Fittings, Furnishings and Equipment**
- Furnishings and equipment are capitalized where the cost is above £1,500. However, lower value items, of immaterial value in total, may also be capitalized where the related records provide a control over the use and deployment of the assets (e.g., laptops). Straight-line depreciation is applied, with lives determined specifically to each type of asset, up to 10 years with computer equipment and related software at 5 years.
## **3.6 Investments**
Investments are valued at market value at 31 December. Realised and unrealised gains or losses on investments are dealt with in the Statement of Financial Activities.
14
Notes to the Financial Statements
for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **3. Accounting Policies (continued )**
## **3.7 Financial instruments**
The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value. Amounts owing to the PCC as at 31 December in respect of fees, rents or other income are shown as other debtors, net of any provision for amounts that may prove uncollectible. Short-term deposits include cash held on deposit either with the CBF Church of England Funds or at the bank or small balances of petty cash.
Creditors and accruals in respect of parochial activity comprise Trade Creditors of £1,943 (2019 - £4,154) and Accruals of £12,813 (2019 - £15,501).
## **3.8 Pension Schemes**
The church contributes to defined contribution pensions for one longer standing employee and also provides pension arrangements for auto-enrolment of staff via the Diocesan Scheme set up in compliance with current pension legislation. The assets of the schemes are held separately from those of the charity. The contributions payable are charged to the statement of financial activities.
## **4. Fixed Assets and Investments for use by the PCC**
## **4.1 Fixed Assets**
The majority of the fixed assets by value comprise the five properties beneficially owned by the PCC as follows:
- Residential properties – St Anne’s Cottage and 46 Crabmill Close
- Offices and meeting places – St John’s Hall, St Lawrence House and the Guild House
Title to all the land on which the buildings are situated is held by Birmingham Diocesan Trustees Registered as custodian trustees, on behalf of the PCC because the PCC is not permitted by law to be the registered owner of land.
On the implementation of FRS102 the residential properties were valued at open market prices and the offices/meeting places at depreciated current replacement cost. The valuation of the Guild House included an impairment appraisal that wrote down to zero the structure of this medieval building that is very expensive to maintain and where the NPV of the related excess costs over a modern equivalent is equal to or greater than the undepreciated replacement cost of a modern equivalent.
||**Land and buildings**|**Fttings,**
**Furnishings and**
**equipment**|**Projects in progress**|**Total**|
|---|---|---|---|---|
|**Cost or deemed cost**
At beginning of the year
Additions
Disposals
Revaluations
Transfers
_At end of the year_
**Depreciation and impairments**
At beginning of the year
Disposals
Depreciation
Impairment
Transfers
_At end of the year_|**£**
1,403,697
2,040
-
-
-|**£**
142,051
862
(2,857)
-
-|**£**
-
-
-
-
-|**£**
1,545,749
2,902
(2,857)
-
-|
||1,405,737|140,056|-|1,545,794|
||(106,933)
-
(23,901)
-
-|(66,607)
2,857
(15,465)
-
-|-
-
-
-
-|(173,540)
2,857
(39,366)
-
-|
||(130,834)|(79,215)|-|(210,049)|
||||||
|**Net book value at beginning of year**|1,296,764|75,444|-|1,372,209|
|**Net book value at end of year**|**1,274,903**|**60,841**|**-**|**1,335,745**|
15
Notes to the Financial Statements
for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **4. Fixed Assets and Investments for use by the PCC (continued)**
## **4.1 Fixed Assets (continued)**
## **Land and Buildings**
Included within Land and buildings is £300,000 (2019 - £300,000) of freehold land which is not depreciated.
## **Fittings, Furnishings and Equipment**
The additions comprised a replacement boiler in St Lawrence House and a replacement staff computer.
## **4.2 Investments**
Investments of £1,482 represent shares in the CBF's Investment Fund at market value as at 31 December 2020 (2019 - £1,346). The historic cost of these shares was £813 (2019 - £771).
## **5. Staff Costs and Numbers Employed**
||**2020**|Average|**2019**|Average|
|---|---|---|---|---|
|||Numbers||Numbers|
||**£**|Employed|**£**|Employed|
|Youth & children’s leadership|91,514|4|100,629|4|
|Parish Office staff|80,371|5|68,251|6|
|Stepping Stones|53,836|7|50,063|7|
|National insurance|10,645||10,155||
|Pension|4,079||3,854||
|**Total**|**240,444**|**16**|**232,952**|**17**|
_(Note: Facilties & Systems Manager and Music Minister are included in Parish Office staff)_
During 2020, one of the youth leaders was on maternity leave and the full-time Operations Manager replaced a part-time post. Stepping Stones costs include those for staff who were furloughed during the Covid shutdown; grants totalling £10,042 were received from the Coronavirus Job Retention Scheme for 80% of these costs.
Parish workers and clergy received £2,168 (2019: £10,025) by way of reimbursement of expenses whilst on PCC business. The large reduction is because of the Covid-related travel restrictions in 2020. In addition, clergy housing costs amounted to £20,134 (2019: £26,875) and accommodation was also provided for a member of the Youth team to carry out his duties effectively. The reduction in clergy housing costs this year was mainly due to the Associate Vicar Matt Simpson leaving for a new post in September. £16,200 (2019: £21,600) of the clergy accommodation costs was paid to Pickering Fields Trust for the rental of a property on Newton Road which normally houses the Associate Vicar.
The average head count during the year was 16 (2019: 17). No employees received employee benefits of more than £60,000.
The key management personnel of the charity is the Standing Committee, made up of the senior clergy, churchwardens, the secretary, the treasurer and the operations manager who was appointed in March 2020. Of the key management personnel, only the operations manager (being an employee) receives remuneration from the charity and their employee benefits in 2020 totalled £27,063 (2019: £nil) including pension contributions of £648 (2019: £nil); note that clergy are not employees of the charity.
## **6. Fund Details**
## **Restricted Funds**
The restricted funds arise where donations have been made for a specific purpose and funds are retained awaiting disbursement.
|**Restricted Funds**|**Balance**
**Movement in resources**
**Balance**
**01-Jan**
**Incoming**
**Gains and**
**Outgoing**
**31-Dec**
**2020**
**losses**
**2020**
**£**
**£**
**£**
**£**
**£**|
|---|---|
|R.A.C.K. Roof Fund
Restricted Legacies and Donations Fund
Property Repair/Renovation Fund
Pontifex Clock Fund
Organ Fund
Soldiers' Chapel
Choir Fund
Grants to employ Children and Youth Workers
Restricted Gifts and Grants for Youth Activities|1,346
41
95
-
1,482
24,020
500
-
(200)
24,320
551
-
-
-
551
1,703
69
-
-
1,772
576
-
-
-
576
7,535
-
-
-
7,535
340
335
-
-
675
-
31,781
-
(16,556)
15,225
8,972
7,500
-
(6,529)
9,943|
|**Totals**|45,043
40,226
95
(23,285)
62,079|
16
Notes to the Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **6. Fund Details (continued)**
## **Restricted Funds (continued)**
The RACK Roof Fund consists of donations received many (30+) years ago towards major roof repairs which are being held for the future. The income and gains/losses arise from investments related to the fund.
The Restricted Legacies and Donations Fund consists of various gifts and legacies where the donor has specified a specific use. The balance on the fund now consists mainly of the remainder of a 2018 grant from a legacy trust, given with a bias towards youth work.
The Property Repair and Renovation Fund consists of restricted donations received in the past towards major property repairs which are being held for the future.
The Pontifex Clock Fund consists of accumulated donations from the Knowle Church Clock Trust (a separate charity), also known as the Pontifex Clock Trust, towards repair and maintenance of the Knowle Parish Church clock and weathervane and for their eventual replacement.
The Organ Fund consists of restricted donations received towards major renovation and repairs to the organ which are being held for the future.
The Choir Fund consists of restricted donations received for the Choir, and also monies received from weddings in excess of the amounts distributed to choir members, and is available for choir activities.
The Soldiers Chapel Fund arose from a major project in c.2010 to restore the decorated plasterwork in the Soldiers Chapel, situated at the north-east corner of the nave in the church. Generous donations were gratefully received towards this project from a number of sources including the Royal British Legion. The fund now consists of the excess of donations received over the cost of the project and is being held over to fund any further restoration work that may be required in the future.
Grants to employ Children and Youth workers include two grants totalling £29k by Knowle United Charities towards payment of salaries; of this, £15k has been retained in the fund towards salaries in 2021.
The Restricted Gifts and Grants for Youth Activities Fund, formerly called the Youth Charity Fund, has been used to account for the dedicated gifts and fundraising income, and the costs incurred, for the mission trips which occurred in previous years; the remaining balance from these trips of £7,849 (which includes a new donation in 2020 of £400) is being held over towards future trips, by agreement with the donors. This fund also holds restricted grants towards Penny’s Youth Café; during 2020, grants of £2,700 and £4,400 were received from Knowle United Charity and Solihull Metropolitan Borough Council respectively. The grant from SMBC was spent in 2020 and £2,094 of the KUC grant remains available for use in 2021.
## **Designated Funds**
|**Designated Funds**
Organisations which operate their
own finances*
Stepping Stones
Others
Funds maintained within church finances:
Church Away Weekend
Property Repair Fund
Churchyard Fund
Designated Legacies Fund
**Totals**|**Balance**
**Movement in resources**
**Balance**
**01-Jan**
**Incoming**
**Transfers**
**Outgoing**
**31-Dec**
**2020**
**2020**
**£**
**£**
**£**
**£**
**£**
22,930
59,137
(62,438)
19,629
24,509
4,952
(6,187)
23,274
1,198
-
-
-
1,198
66,684
-
10,000
-
76,684
14,910
-
-
-
14,910
-
-
53,000
-
53,000
130,231
64,089
63,000
(68,625)
188,695|
|---|---|
*There are a number of church organisations that operate their own finances. The Charities Act 2011 requires their figures to be included and they include Rainbow Tots, Stepping Stones, Bell Ringers, Friendship Club, Youth, Wedding & Funeral Fees, and the Flower Guild.
Church Away Weekend – this is the surplus arising from the last church away weekend in 2018, which is being carried forward to be used for the next church away weekend.
The Property Repair Fund has been designated by the PCC for any major work to the church’s properties. Over recent years, £10k annually has been transferred from General Funds and the PCC keeps this level under review. There have been no other incomings or outgoings in 2020, but major works will be undertaken in 2021 resulting from the quinquennial inspection of the church building which took place in 2020.
The Churchyard Fund has been designated by the PCC for any major work that may be required in the churchyard.
17
Notes to the Financial Statements
for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **6. Fund Details (continued)**
## **Designated Funds (continued)**
The Designated Legacies Fund has been created to hold the balances of legacies received but not yet allocated to specific purposes by PCC, and holds the value of a legacy of £53,000 to which the church became entitled in 2020.
## **Unrestricted Funds**
Included with unrestricted funds is £386,923 of non-distributable reserves which arose on the revaluation of land and buildings on the implementation of FRS102.
18
Notes to the Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **7. Outside Giving & Retiring Collections**
This year the church supported other charities, mission work and individuals to a total of £34k, with £300 of this being a share of the gross receipts of the “Cobbles” Saturday morning informal café, where the Cobbles leadership nominate a different charity every few months. In 2019, £13k was given directly to other charities and mission work through the organisation of retiring collections and fundraising events for specific charities. This latter income was excluded from the accounts but included here to provide a more complete picture of the fundraising activity of the church; however, the Covid restrictions on church services and other events has meant that there have been very few such collections in 2020, amounting to £447. Details of these payments are shown below.
|**Charity**|**Gen/Desig Restricted**
**Total**
**Funds**
**Funds**
**2020**
**£**
**£**
**£**|**Gen/Desig Restricted**
**Total**
**Funds**
**Funds**
**2019**
**£**
**£**
**£**|
|---|---|---|
|Diocese of Bolivia
Kenya Mission Initiatives
St Johns Sparkhill
St Christophers Springfield
Tearfund
Reachout Network Ministries
Malawi Task Group, CofE Birmingham
St Philips & St James Dorridge - Building Project
St Andrews Chelmsley Wood
Urban Saints
International Needs
Scripture Union
Compassion
Aston Parish Church
Chaplaincy Plus - Birmingham
Holy Trinity Smethwick
Matt Roberts-Davies
St Germain’s Edgbaston
St Gabriel Weoley Castle
St Johns Ladywood
St. Margaret Short Heath
St.Thomas Garretts Green
Mad Hatters Tea Party for disabled children - Cobbles
Springfield Project
Knowle & Dorridge Churches Together
Christian Aid
Christians Against Poverty (Carol services)
The Feast (Carol services)
This Way Up
Outreach Angels
Agape
LEADS Sri Lankan Christian Charity
Urban Devotion
Royal British Legion
Shine (from Cobbles)
Solihull Mind
KPC Youth Mission
Betel (UK)
Restore- Birmingham Churches Together
CPAS
Fusion
Solihull Welcome
UCCF
Others|6,025
6,025
3,000
3,000
3,000
3,000
3,000
3,000
2,180
2,180
2,000
93
2,093
2,000
2,000
2,000
2,000
1,500
1,500
1,310
1,310
1,000
1,000
1,000
1,000
654
654
500
500
500
500
500
500
500
500
500
500
500
500
500
500
500
500
500
500
300
300
229
229
125
125
100
100|3,000
3,000
3,000
3,000
3,000
3,000
2,240
657
2,897
2,000
2,000
1,000
1,000
3,500
3,500
1,240
1,240
1,000
1,000
1,000
1,000
540
540
1,000
1,000
700
700
225
225
472
472
203
203
100
2,591
2,691
1,857
1,857
1,847
1,847
1,500
1,500
565
835
1,400
1,250
1,250
521
657
1,178
1,012
1,012
790
790
645
645
608
608
595
595
523
523
523
523
500
500
500
500
500
500
500
500
450
1,191
1,641|
|Total
Less collections made specifically for other charities
Total giving by KPC (per accounts note 2)|33,569
447
34,016
(447)
(447)
33,569
33,569|31,679
13,158
44,837
(13,158)
(13,158)
31,679
31,679|
19
Notes to the Financial Statements for the year ended 31 December 2020 Knowle PCC 2020 Report and Accounts
## **8. Contingent Liabilities**
No contingent liabilities have been identified.
## **9. Related Parties** (as required by Charities Act 2011 and FRS 102 Section 33)
At each meeting of the PCC the council members are required to declare any conflicts of interest that may arise or have arisen and where there is such a conflict then that member will not vote on any proposal involving the related party. There are three related parties of significance in 2020:
- Pickering Fields Trust (PFT) which, with the Church, shares the vicar and two churchwardens as trustees. However, as Knowle PCC has approximately 20 members, there is not common control, as defined in the legislation.
- Knowle Church Clock Trust (also known as Pontifex Clock Trust - Registered Charity Number 514954) which, with the Church, shares the vicar and two churchwardens as trustees. However, as Knowle PCC has approximately 20 members, there is not common control, as defined in the legislation.
- Knowle United Charity which, with the Church, shares a member of clergy as a trustee.
Pickering Fields Trust has the official name ‘Charities for Ecclesiastical and Other Purposes’ - charity number 238492. Apart from a small amount of investment income, it derives all its income from the rental of its house to Knowle Parish Church for clergy use (see note 5) which amounted to £16,200 in 2020 (2019 £21,600). It, in turn, at the discretion of its 3 trustees and within its objectives, generally pays all its donations to the church, in support of renovation and fabric repair projects and the charitable work of the church. There were no payments from the Trust to the church in 2020 or 2019. Group accounts have not been prepared since neither the trustees of Knowle Parish Church nor the electorate of Knowle Parish Church have powers (i) to direct the decisions of the PFT trustees or (ii) to appoint or dismiss the PFT trustees .
Knowle Church Clock Trust’s principal activity and achievement is the donation of the whole of the annual income from its investment funds to Knowle Parochial Church Council, which has the legal obligation of the upkeep of the church clock and weathervane. In 2019, the Trust made a donation to Knowle Parish Church of £69 (2019 £68).
Knowle United Charity makes grants to Knowle Parish Church towards children’s’ and youth work.
20
Independent Auditors Report
To the Trustees of The Parochial Church Council of the Ecclesiastical Parish of Knowle, Solihull
## **Opinion**
We have audited the financial statements of The Parochial Church Council of the Ecclesiastical Parish of Knowle, Solihull (the ‘charity’) for the year ended 31 December 2020 which comprise Trustees Report, Statement of Financial Activities, Balance Sheet, Statement of Cashflows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 _The Financial Reporting Standard applicable in the UK and Republic of Ireland_ (United Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
- give a true and fair view of the state of the charity’s affairs as at 31 December 2020, and of its incoming resources and application of resources, for the year then ended;
- have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and
- have been prepared in accordance with the requirements of the Charities Act 2011.
## **Basis for opinion**
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charity in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
## **Conclusions relating to going concern**
In auditing the financial statements, we have concluded that the trustees’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the charity's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.
Our responsibilities and the responsibilities of the trustees with respect to going concern are described in the relevant sections of this report.
## **Other information**
The other information comprises the information included in the trustees annual report, other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
21
Independent Auditors Report
To the Trustees of The Parochial Church Council of the Ecclesiastical Parish of Knowle, Solihull
## **Matters on which we are required to report by exception**
We have nothing to report in respect of the following matters in relation to which the Charities (Accounts and Reports) Regulations 2008 require us to report to you if, in our opinion:
- the information given in the financial statements is inconsistent in any material respect with the trustees’ report; or
- the charity has not kept adequate accounting records; or
- the financial statements are not in agreement with the accounting records; or
- • we have not received all the information and explanations we require for our audit.
## **Responsibilities of trustees**
As explained more fully in the trustees’ responsibilities statement set out on page 7, the trustees are responsible for the preparation of financial statements which give a true and fair view, and for such internal control as the trustees determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the trustees are responsible for assessing the charity’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the trustees either intend to liquidate the charity or to cease operations, or have no realistic alternative but to do so.
## **Auditor’s responsibilities for the audit of the financial statements**
We have been appointed as auditor under section 144 of the Charities Act 2011 and report in accordance with regulations made under section 154 of that Act.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
- A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/Our Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-and-guidance-for-auditors/Auditors-responsibilities-foraudit/Description-of-auditors-responsibilities-for-audit.aspx. This description forms part of our auditor’s report.
## **Extent to which the audit was considered capable of detecting irregularities, including fraud**
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above and on the Financial Reporting Council’s website, to detect material misstatements in respect of irregularities, including fraud.
We obtain and update our understanding of the entity, its activities, its control environment, and likely future developments, including in relation to the legal and regulatory framework applicable and how the entity is complying with that framework. Based on this understanding, we identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. This includes consideration of the risk of acts by the entity that were contrary to applicable laws and regulations, including fraud.
In response to the risk of irregularities and non-compliance with laws and regulations, including fraud, we designed procedures which included
- Enquiry of management and those charged with governance around actual and potential litigation and claims as well as actual, suspected and alleged fraud;
- Reviewing minutes of meetings of those charged with governance;
- Assessing the extent of compliance with the laws and regulations considered to have a direct material effect on the financial statements or the operations of the company through enquiry and inspection;
22
Independent Auditors Report
To the Trustees of The Parochial Church Council of the Ecclesiastical Parish of Knowle, Solihull
- Reviewing financial statement disclosures and testing to supporting documentation to assess compliance with applicable laws and regulations;
- Performing audit work over the risk of management bias and override of controls, including testing of journal entries and other adjustments for appropriateness, evaluating the business rationale of significant transactions outside the normal course of business and reviewing accounting estimates for indicators of potential bias.
Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.
## **Use of our report**
This report is made solely to the charity’s trustees, as a body, in accordance with Part 4 of the Charities (Accounts and Reports) Regulations 2008. Our audit work has been undertaken so that we might state to the charity’s trustees those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charity and the charity’s trustees as a body, for our audit work, for this report, or for the opinions we have formed.
**Dawn Owen BA (Hons) BFP FCA (Senior Statutory Auditor) For and on behalf of Azets Audit Services**
………………………..
**Statutory Auditor**
1st Floor, Copthall House 1 New Road Stourbridge West Midlands DY8 1PH
Azets Audit Services is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006.
23