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← The Methodist Church In Great Britain

2023-08-31-accounts

The Methodist Church in Great Britain Consolidated Report and Financial Statements for the year ended 31 August 2023

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Table of Contents
Welcome from the Revd Dr Jonathan Hustler 2
The Methodist Church in Great Britain Trustees’ Report 3-40
Strategic objectives, aims and purposes of The Methodist Church in Great Britain 3
Public benefit requirement 3
Structure 3
Overview of the work of The Methodist Church In Great Britain 9
Key activities 9
Grants 23
Plans for the future 24
The environment 25
Remuneration of key management personnel 26
Fundraising activities 26
Financial review 27
Reserves policy 28
Investments 31
Risk management 32
Data protection 35
Going concern 35
Related parties 36
Statement of Trustees’ responsibilities 37
Independent Auditor’s report to the Trustees of The Methodist Church in Great 38
Britain
Consolidated Financial Statements 41-92
Statement of financial activities 42
Statement of financial activities – The Connexional Funds 43
Balance sheets 44
Cash flow statements 45
Notes to the Consolidated Financial Statements 47
Trustees and committee memberships 93
Reference and administrative details 95

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Welcome from the Revd Dr Jonathan R Hustler

Brothers and Sisters

It is my privilege to introduce to you the annual report for 2022-23. With events of the past year shaping the work of the Church, this report demonstrates the variety of work that has been carried out and how it reflects Our Calling to respond to the Gospel of God’s love in Christ and to live out our discipleship.

The priorities of the Methodist Church, which are embedded within Our Calling, underpin everything we do with God at our centre and this report gives us an insight not only to the financial resources of the Church, but the wider work done that has had an impact in the world as well as the Connexion.

The Annual Report gives us the opportunity to engage with the processes followed and enable us to focus on the resources at our disposal. We live in challenging times and this report documents the many ways in which the Methodist Church in Great Britain has faced the challenges. As we discover what it means to live on the other side of a global pandemic, wrestle with the opportunities and risks of the digital world, and accept that in many places the Church of the future will be very different from the church of the past, the responsible stewardship of our resources is a vital task.

This report is an account of that stewardship. Thanks are owed to all involved throughout the Connexion as we use what we have received to be an inclusive, evangelistic, growing, justiceseeking church.

The Revd Dr Jonathan R Hustler

Secretary of the Methodist Conference

January 2024

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The Methodist Church in Great Britain Trustees’ Report

Strategic Objectives, Aims and Purposes of The Methodist Church in Great Britain

The activities covered in these financial statements fall within the work of The Methodist Church in Great Britain (‘The Methodist Church’ or ‘The Church’). The aim of The Methodist Church in Great Britain is to fulfil its calling, which is to respond to the gospel of God's love in Christ and to live out its discipleship in worship and mission.

Public Benefit Requirement

The trustees of The Methodist Church have due regard to the public benefit guidance published by the Charity Commission in compliance with its duties under section 17 of the Charities Act 2011.

This guidance sets out two key principles:

  1. The organisation must have an identifiable benefit.

  2. The benefit must be to the public or a section of the public.

The Church exists, inter alia , to:

  1. increase awareness of God’s presence and to celebrate God’s love;

  2. help people learn and grow as Christians, through mutual support and care; and

  3. be a good neighbour to people in need and challenge injustice.

The trustees consider that for these reasons the charity meets these public benefit requirements.

Structure

The entities included in this report are not a record of all the financial activities of the wider Methodist Church, as they do not include local church, circuit and district financial statements. The names of the entities included in this report, are listed on the group structure diagram in ‘Note 1’ of the financial statements on page 47 and include:

Cliff College (a separately registered charity)
Cliff College Outreach Limited (a separately registered company)
Cliff(Methodist)DevelopmentsLimited (a separatelyregistered company)
All We Can (a separately registered charity)
YCare (a separatelyregistered company)
SouthlandsMethodistTrust (a separatelyregistered charity)
Methodist International Centre Limited (a separately registered company)

These financial statements are the consolidated financial statements for the Methodist Council (the Council) and entities under its control. The above-named organisations have purposes that are consistent with those of the Methodist Church and at least 50% of their trustees are appointed by the Council, thus demonstrating a level of control.

The Methodist Church registered as a charity on 20 October 2009 (charity number 1132208 – ‘The Methodist Church in Great Britain’) when it became necessary for excepted charities with a gross annual income over £100,000 to register.

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The members of the Methodist Conference (the Conference) are the charity trustees, and their names are publicly available on the Charity Commission website. The Methodist Council is appointed annually by the Conference to undertake ongoing work on behalf of the Conference (which only meets once a year). Among other functions, the Council is responsible for the adoption annually of a unified statement of connexional finances, clearly distinguishing between restricted and unrestricted funds, and conforming to the law and accounting regulations to give an overall view of those monies and other assets for which the Council is responsible. The Council is further responsible for presenting the unified statement of connexional finances to the Conference. The names of the members of the Methodist Council are appended at the end of these financial statements.

Governance and Oversight

The Constitutional Practice and Discipline of The Methodist Church (2023 edition) Volumes 1 and 2 contain the governing documents of The Methodist Church. The authority under which the Conference acts is legally given by The Methodist Church Act 1976. The Deed of Union provides for the Conference to be the governing body of the Methodist Church. The next ‘tier’ of authority is given by the Model Trusts in the second Schedule of the Act and the Deed of Union. These derive their authority from the Act. Thirdly, there are the Standing Orders and guidelines adopted by the Conference, which are far more detailed and easily changed, provided that they are within the limits prescribed by the Act, the Model Trusts and the Deed.

Much of the day-to-day work for which the Methodist Council is responsible is delegated to the Connexional Secretary and other members of the senior leadership group of the Connexional Team for matters relating to the objectives of the Connexional Team, and to local trustees in the case of the consolidated entities. These local trustees are accountable to the Methodist Council.

The basic governance structure as far as these consolidated financial statements are concerned is presented in the diagram below.

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The Methodist Church in Great Britain
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The Methodist Conference (Trustee)
Methodist Council
Audit & Risk Connexional
Ministries Mission
Assurance Strategy and Resources Committee Allowances
Committee Committee
Committee Committee
Property
Finance Sub- Safeguarding
Development
Committee Committee
Commiittee
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The Methodist Conference

The Conference is the ultimate decision-making body of The Methodist Church. It sets policy for the Church, exercises discipline and ensures effective management and administration of the Church’s affairs. The Conference meets annually in Representative and Presbyteral Sessions (and there is, in addition, a Conference Diaconal Committee). The Conference is a representative body of 306 members comprising ministers and laypersons from the 29 districts of The Methodist Church as well as other sections of the Church.

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The Methodist Council

The Methodist Council meets three times a year and consists of 54 members most of whom hold office for four years. Its terms of reference are to:

It has agreed the following objectives for the coming year in order to support the delivery of the Church’s strategic objective ‘to respond to the gospel of God's love in Christ and to live out its discipleship in worship and mission’:

  1. Proclaiming the Gospel through worship / The ministry of the people of God in the life of the world

  2. A Church for all people / The Inclusive Church

  3. God’s Church in God’s world Striving for justice and peace

  4. Evangelism / God For All

  5. Resources for the Church: the use of God’s gifts (including Oversight and Leadership)

  6. Responding to the Gospel in partnership

In addition to the above, the Methodist Council is responsible for ( inter alia ):

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The following committees have an oversight/governance role and report to the Methodist Council:

The Strategy and Resources Committee

The Conference appoints annually the Strategy and Resources Committee (SRC), a subcommittee of the Methodist Council. The SRC advises the Council in relation to all matters that are within the SRC’s terms of reference, having regard to advice of non-voting members. The Committee, which met four times in 2022/2023, has specific responsibility for detailed review and subsequent reporting to the Council on the following aspects of its work:

The Audit and Risk Assurance Committee

This is a committee of the Conference appointed on the nomination of the Methodist Council. To safeguard its independence, members of the Methodist Council or the Connexional Team are barred from serving. This committee nevertheless has powers to require the Connexional Treasurers and any appropriate staff members of the Connexional Team to attend its meetings.

Meeting three times in the year and reporting annually to the Methodist Council, the Audit and Risk Assurance Committee has responsibility for:

Oversight Committees

To assist the Methodist Council in discharging its duties there are a number of other committees, the key ones being:

The Connexional Allowances Committee, which is responsible for recommending allowances for ministers and awarding grants from the following funds:

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The Ministries Committee, which reports to the Methodist Council, exists to enable the Church to develop and maintain a strategic vision for the use of ordained, accredited, commissioned and informal ministries and offices, and is accountable for developing and supporting programmes and processes for candidacy, training, oversight and related matters.

The Mission Committee, which reports to the Methodist Council, exists to ensure the mission and activities of the Church are in keeping with the response to Our Calling and agreed priorities. It enables the Church to take up various aspects of Mission as expressed in Part 10 of Standing Orders. It explores the challenges and opportunities faced by the Church for mission, local and global, in the multi-ethnic, multi-cultural and multi-faith context that is the society today.

The Property Development Committee , which works to develop and maintain a connexional property strategy. Its responsibilities include:

The Safeguarding Committee , which has wide-ranging responsibilities for promoting safeguarding practice and safe recruitment across the Connexion. It advises the Methodist Council on all related issues.

Other Oversight Bodies

A comprehensive list of the subsidiaries whose financial statements are included in The Methodist Church Consolidated Financial Statements is provided on page 61. For each of them, a local governance committee or group of managing trustees is appointed by the Council to oversee the entity, within the terms of responsibility delegated to them by the Council. Ultimate control in all these cases resides with the Methodist Council. Through a governance scrutiny process overseen by the SRC, the Council aims to monitor standards of governance in all the entities that are accountable to the Council and the Conference.

The Methodist Council appoints members to the various trustee bodies, on the recommendations of existing members and based on a reasoned statement provided for each nominee. It follows a selection process that involves a skills audit and advertisement for trustees with the appropriate skills and expertise. Appointments are normally for a six-year period, but each trustee body will have its own governing document that will set out the terms of appointment and re-appointment.

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The Council reviews and re-confirms the appointment of all the trustees to each of these bodies on an annual basis regardless of the term of office for each individual.

All new members of the Council undergo induction to familiarise themselves with the aims and work of the charity, and to ensure they understand fully their responsibilities as trustees and the organisational expectations in terms of their commitment. As part of the induction programme, trustees are provided with constitutional, governance, financial and organisational documentation. Trustees receive regular updates and are made aware of relevant events and training opportunities.

Proposed Governance and Oversight changes

Following an extensive review of its governance structure, The Methodist Church is changing its constitution which will move charity trusteeship from the Methodist Conference to a smaller charity trustee body called the Connexional Council. The Conference will remain the governing body of the Methodist Church. The Church has received counsel’s advice on the constitutional amendments required to effect the changes and has notified the Charity Commission of the proposals. It is anticipated that the changes will be implemented on or around 1 September 2024.

The purpose of the proposals is to enable the Church to better fulfil its calling in the 21st century to respond to the Gospel of God’s love in Christ and to live out its discipleship in worship and mission, whilst ensuring that it complies with regulatory requirements and adheres to charity governance good practice. The new Connexional Council will replace the existing Methodist Council and the Strategy and Resources Committee, and other changes to the committee structure are also proposed. The creation of a new Nominations Committee should ensure a transparent and fair process for making committee appointments.

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Overview of the Work of The Methodist Church in Great

Britain

The calling of The Methodist Church is to respond to the gospel of God's love in Christ and to live out its discipleship in worship and mission. Most of the work of the Church occurs within or is associated with local churches throughout the country. Church activity encompasses:

Without the support of volunteers across the connexion the Church would simply be unable to live out its calling to respond to the Gospel of God’s love in Christ. Specifically in relation to the activities covered in this report, we are immensely grateful for the 842 volunteers (note 12 in the accounts) who serve on a whole range of Connexional committees, working groups, and other bodies that support the life of the Church.

This report cannot capture in detail the breadth and depth of the Church’s work. In the section below is a list of a range of activities from around the Connexion as examples of that work.

Key Activities

The Methodist Conference

The government and discipline of the Methodist Church, along with the management and administration of its affairs, are vested in the Methodist Conference that meets annually. The Conference receives reports covering all aspects of the Church’s life and witness. At its meeting hosted from Birmingham, in June 2023:

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those who shared in online services. The numbers indicate a 3,000 reduction between 2021 and 2022, more typical of pre-pandemic trends.

Organisation of the work

The Methodist Church in Great Britain, in response to its calling and in pursuit of the strategic objectives shown at the start of this report, organises its work in the following eight key areas:

  1. Building Communities

  2. Children, Youth and Families

  3. Evangelism and Growth

  4. Global Relations

  5. Learning Network

  6. The Methodist Council and Governance

  7. Ministries

  8. Property

Each of these is reviewed below.

1. Building Communities

The Methodist Church continues to work ecumenically where possible. All the ministries of the Local Churches, Circuits, Districts and Connexional team can only happen after the question is posed: ‘Can this be done ecumenically?’ Only after that question is considered can any further ministry of the Methodist Church be developed.

The Methodist Church continues to play its full role within the ecumenical bodies: Churches Together in England, former ACTS now the nascent Churches Together in Scotland, Cytun Churches Together in Wales and Churches Together in Britain and Ireland. It also keeps bi-lateral ecumenical relationships with several denominations. To name but a few: with the Church of England, the United Reformed Church (URC) and the Roman Catholic Church. With the Church of England it was agreed to re-start work on producing liturgy and legislation regarding mutual

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recognition of ministries. The Methodist Church shares much in common with the URC, a group or representatives participated in the URC’s 50th anniversary celebrations, and the MC shares with the URC in many Local Ecumenical Partnerships locally as well as in ecumenical areas. With the Roman Catholic Church, the National Dialogue Commission continues its work and the Methodist Church has contributed to the Synodical process that the URC is engaged with.

The Ecumenical desk of the Methodist Church supports with advice and guidance over 600 Local Ecumenical Partnerships (LEP) spread across the entire Connexion. There are around 28,000 Methodists worshiping in Local Ecumenical Partnerships. The LEPs offer a solid basis for ecumenical cooperation. They are resilient congregations. Figures from the United Reformed Church and the Methodist Church show a slower decline in number of LEPs than in numbers of single denominational congregations.

The Ecumenical desk has provided training and support for those wanting to create new forms of cooperation or to document existing ones. The ‘A Flexible Framework for Unity in Mission’ continues to guide ecumenical cooperation in establishing the level of complexity required for different forms of collaboration: working agreement, partnership agreement, or the more complex constitutional agreement.

The Ecumenical Officers (EOs) of different denominations meet once a month on zoom to share concerns, plan joint work, and to pray. There are two annual Churches Together in England Conferences that the Methodist ecumenical desk is involved in leading: the All EOs’ Conference and the Conference for new EOs. Globally, the Methodist Church sent a delegation to the World Council of Churches 11th Assembly in Karlsruhe, Germany, 31st August to the 8th September 2022, under the theme: “Christ’s love moves the world to reconciliation and unity”.

The Joint Public Issues Team (JPIT) has continued to support the Methodist Church to be alive to issues of justice and peace and to speak and act for change.

They have led interfaith and civil society groups to campaign on rising levels of poverty in the UK, launching the Let’s End Poverty movement to mobilise local communities to call on political leaders to prioritise tackling UK poverty. In doing so they have sought to amplify the perspectives of people in our communities with first-hand experience of poverty, particularly at the joint ‘Dignity’ conference with Church Action on Poverty and the APLE collective.

They have continued to speak out for welcome towards refugees and people seeking asylum, coordinating over 1,450 church leaders to write to the Prime Minister about the Illegal Migration Bill. They have supported churches to explore the issues raised by the war in Ukraine with a briefing about the ethical and theological implications of the war, and have continued to equip churches to tackle the climate crisis through Net-Zero in My Neighbourhood resources and responding to UN COP27. At the May 2023 elections, JPIT supported the Methodist Church to ensure congregations were aware of the introduction of Voter ID rules, and to support communities to ensure vulnerable groups were not disenfranchised by new rules.

JPIT have continued to equip local leaders to preach and pray about justice and peace, reaching three years of daily Stay and Pray calls to prayer online, running a ‘Preaching the Good News’ roadshow with All We Can as well as continuing to provide the weekly Politics in the Pulpit lectionary based preaching podcast.

The operation and output of the Publishing Services team has continued to shift significantly in two directions. First, towards closer collaboration and providing editorial and design services for the Digital Communications team in response to our ‘digital first’ publishing strategy. This supports both wider distribution and greater accessibility for many in the Church, and our drive towards net zero.

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Second, there has been a marked increase in the proportion of unpriced resources being produced in print or equivalent formats (such as machine-readable plain text, downloadable pdf or PowerPoint), which support the delivery of mission and ministry programmes, rather than, for example, publishing stand-alone books for sale. One notable exception is the popular and profitable annual Methodist Prayer Handbook of which we sold around 20k in the standard edition and more than 1,600 in a large print edition, plus releasing an e-book edition.

Many of our so-called ‘free’ publications are essential to the safe and effective running of our churches and integrate content available online with printed resources, from training manuals for Safeguarding courses, to posters and cards to support outreach at Christmas with video and worship resources provided online. By far the greatest annual investment in unpriced print was the production and distribution to 65k subscribers of four issues of the flagship magazine, the connexion , that shares how local churches and our partner organisations are responding to our calling and engaging in the mission of the Methodist Church.

2. Children, Youth and Families

Direct work with children and young people and supporting local leaders

3Generate 2022 and preparation for 2023

3Generate 2022 took place in September. There were 1,200 children and young people, 456 group leaders, and 252 volunteers joining together at the NEC in Birmingham. The Methodist Children and Youth Assembly report the results of elections held, bring to attention the topics that are important to children and young people, and present resolutions that aim to break barriers which impact children and young people from being full participants in their local churches.

3Generate aims to encourage children and young people to ‘Tune in to God, the World and Each Other’ and to discern what actions need to be taken for themselves, with peers, in their local church or community. One of this year’s resolutions to the Conference from the Assembly asked everyone to speak to children and young people in their context and encouraged the Church to be in dialogue with children and young people. They offered and encouraged access to churches to attend a Youthscape Essentials training module that equips good dialogue. These were run across the year by the Connexional Team and some of the District Ambassadors.

The 2023 Children and Youth Assembly took place form the 6th until the 8th of October at The NEC Birmingham. In January 2023 groups of children and young people from across the Connexion gathered at an Influencers’ Day to shape that year’s Assembly. The Youth President and 3Generate Reps facilitated conversations with children and young people from across the Connexion at this event to explore potential topics for sessions and what experiences and discussions they wanted at this year’s Assembly.

The 2023 Assembly was attended by 1,300 children and young people supported by nearly 500 leaders and a further 230 volunteers and members of the team who facilitate the event. The event included a collaboration with The Methodist Arts Committee to create an immersive art experience based on Eularia Clark, The Five Thousand. This created opportunities to respond and be in dialogue about food, sustainability, spirituality and faith.

The 4-7years intergenerational Assembly area grew from 80 to 120 attendees. This is modelling intergenerational dialogue and faith formation.

Support, Equipping and growing Young leaders across the Connexion The Leadership year is a programme for the development of 18-30 year olds in leadership consisting of three residential weekends across the year where there is the opportunity to explore the Characteristics needed for healthy Christian Leadership.

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13 young adults from across the connexion completed the final Leadership Year weekend for 2022/23 in July.

In the Connexional year 2023/24 twelve funded places are being offered for the Leadership Year and plans include involving some of the new students at Cliff College.

One Programme

Of those who have finished the One Programme in August 2023, 2 have continued to be employed by their project, with 1 hoping to find funding to continue at their project, and 1 has just started the degree course at Cliff College.

The One Programme will be on hold for 2023/2024 as we develop with Cliff College a young adult plan and that will have a number of focus areas for leadership growth and experiences.

3Generate Reps programme

This group are elected into their roles and act as the Youth President Advisory group alongside a selection of focused roles. They attend three residentials across the year where they receive training, mentoring and support. Part of their role is to talk to children and young people and to be involved in consultations representing children and young people. There are currently 13 Reps with the following roles; Conference, Council, Agents of Change (Social Action), Global and Digital.

Training and equipping

We continue to equip leaders across the connexion in Youth Mental Health First Aid and deliver three sessions a year, training up to 48 people in these essential skills annually. We now have 20 people on the list of trainers for Youthscape essentials Youth Ministry Training (a mix of local workers, Connexional team and District Ambassadors) available to deliver the Youthscape Essentials training course. The first Connexional online course is currently underway (being delivered collaboratively by a number of trainers) and Southampton District have been running a local offering. There are also plans for another Connexional course starting January 2024 and some other local courses, including in Cumbria, Solihull and Enfield.

3. Evangelism and Growth

It's been three years since God for All: The Connexional Strategy for Evangelism and Growth launched in September 2020. Overall engagement has deepened in the past year: participation in the key programmes has increased; all districts continue to use the formal process of planning new Christian communities (New Places for New People) to receive their allocated funding; accompanying and supporting superintendents as missional leaders remains a focus; and the Evangelism & Growth Team has continued to offer help to circuits online and onsite.

Some key highlights:

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The Methodist Church in Great Britain has over 100 partner churches and organisations in over 65 countries across the globe, and the continuing development of our relationships is overseen by the Global Relationships Committee (GRC).

The decision to end lay Mission Partner employment in August 2024 and review the stipend levels of ordained Mission Partners to look at the possibility of stipend levels closer to the level of local ministers, was reported to the Methodist Conference in 2023. The processes of consultation with Mission Partners on these different decisions began in autumn 2023, while the GR team continued to provide pastoral support for all Mission Partners during this period.

As well as supporting Mission Partners who commit to serve for a minimum of three years, the Global Relationships (GR) team also run a number of other programmes for people to serve the global Church.

One Global Mission Fellow (GMF) from the USA served the Church until July 2023, this was another enriching placement both for participant and placement site at Wesley’s Chapel and Leysian Mission. One British Methodist serving the Methodist Church in Ireland (MCI) completed his service in March 2023 and through this programme has further discerned his vocation and is now in employment with Coventry Central Hall.

Two successful 3 month Encounter Worldwide placements have taken place with partner churches in Namibia and Georgia (in Europe). These very different placements supported

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partners in the setting up of children’s groups in Namibia and in the support for Russian migrants to Georgia, one of the effects of the ongoing war in Ukraine. Both have served to strengthen ties of partnership, learning about the regions and the discernment of ongoing vocation for the newly retired participants.

Under the Encounter Together short-term group visits programme the ‘Living Christianity in the Holy Land visit’ was supported in January 2023. 13 people took part in this visit with 5 persons supported with qualifying bursaries from the World Mission Fund. Outcomes from this visit have been noted in vocational discernment for at least two participants.

Through the Church CAN programme, Global Relationships and All We Can work together with Partner Churches, enabling the strengthening of their capacity and effectiveness as agents of change in their local context.

With MCI we have jointly hosted online conversations with all our Partner Churches and Organisations, facilitated by a Partner, CREAS (Centro Regional Ecumenico de Asesoria y Servicio), to discern how we can best support one another in mission in our various contexts. This has now moved in to the implementation phase with the first pilot global conversations based around the topic of inequality to be led by partners and facilitated by Global Relationships from September 2023.

We are continuing to encourage British Districts to twin with Partner Churches or parts thereof and have seen district twinning partnership visits to districts in Britain from partners and to partners from British districts. This is an area of ongoing development.

We received representatives from several of our Partner Churches at this year’s Methodist Conference and had fruitful discussions at a 2-day Pre-Conference Consultation around topics chosen by our Partners, with focus from partners around climate change, diversity and migration.

2022-23 Grants

One Year into the new grant payment process, the Essential grants no longer exist however Regional grants were made available to our partners as we continue to also honour our commitments to the existing Nationals in Mission Appointments and SALT for the agreed duration.

Notes:

During 2022-23 we have stayed within the solidarity grants budget of £250,000 with support for 13 partners. Grants were given towards inter-faith and ecumenical peace building work in Cameroon, emergency relief after flooding events in Rwanda, Ecuador, Pakistan, Cyclone in Mozambique, water borehole construction in Tanzania, regional Methodist meetings and food programmes in Venezuela. Church staff wages to 3 partners where external support was deemed essential to the continued existence of the partner or its ability to operate at a minimal level.

55 applications totalling £3,1million in Regional Grants has been approved and sent to partners across four regions in 2022-23. In addition to that, there was a continuous downward trend in the number (23.8%) and amount of Solidarity grants given in 2022-23. It decreased from 21 Solidarity grant totalling £239k to 16 Solidarity grant totalling £197k (a decrease of 17.5% on 2021-22 amount and by 23.8% in number of applications agreed), There were no grants awarded in 2022-23 specifically for Covid-19 related work.

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Due to unforeseen delays, the WMFGC were not able to make decisions on the combined regional grants for Partners in the Americas, Asia, Europe, only Mission Initiative grants for Pacific and none for Partner Organisations in Africa.

We are therefore anticipating spending £2.4million (£130k in Mission Initiative and £2.3m in Capacity-building) in regional grants for our partners in Africa, and £534k (Capacity-building) for the Pacific Partners within the first quarter of 2023/24.

The grants committee drawn with a majority of members from MCB partners around the world continues to function well online and process decisions in an efficient way.

To fulfil British Charity committee guidance, one of our Mission Partners, based in Togo is supporting any Partners who request help with the drafting of a safeguarding policy, or who request any support in Safeguarding training. During this year a West Africa regional safeguarding workshop was held with mission partner support in Sierra Leone.

All We Can supports locally-led community solutions and development to fulfil potential.

All We Can, Methodist relief and development, is a movement of people choosing to seek and bring hope, through committed and sustained support, action, and genuinely equal partnership. Being led by communities and partners in low- and middle-income countries means that the work we do together is driven by the hopes of those who seek it, to help drive them to overcome poverty and injustice and develop flourishing and resilient communities. This is what we do with our neighbours around the globe: we stand with them in hope of a better and more just future for them, for our whole world, for us all. We do this work as part of the Methodist family and as a means of enabling the church to respond to the issues and needs of people around the globe, who need support to enact their solutions to poverty and overcoming injustice.

Through its relational approach to partnership, All We Can believes local partner organisations rooted in their local communities are best placed to achieve meaningful and long-lasting change. By helping these organisations respond to the changing needs of their communities and supporting them with organisational capacity development, training, and resourcing, All We Can aims to leave a legacy of thriving, resilient partners who can continue to deliver impactful programmes long after our partnership ends.

In October 2022, we held a Partner Conference in Malawi to further deepen our partnership approach and bolster our policies and practice in the areas of emphasis for the current 20202025 strategy. The conference of Church and Non-Governmental organisational partners, hinged on our strategic pillar to: ‘creating a legacy of resilient, thriving and impactful partners’ . A critical part of our capacity development approach is to foster relationship building between partners which cultivates a culture of shared learning and mutual support in country and internationally. An investment into an all-partner conference and gathering together is therefore not merely a nicety but a bedrock that catalyses our whole movement. Following the pandemic and a two-year period where no visits could take place, new entrants have joined our movement; and following a particularly challenging operating environment; this conference was needed more than ever to regroup, to recapitulate our values, vision and valour, and regalvanise one another for even greater works, together.

All We Can has provided long-term development support to 24 local partners in eight countries over the last year, including two new focus countries, namely Sierra Leone and Liberia, where we have carried out extensive partner scoping and validation processes. As a result, we have established formal partnerships with four new Sierra Leonean partners and identified four Liberian organisations whose partnerships will commence in the 2022/23 financial year.

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All We Can, in collaboration with the Global Relationships team of the Methodist Church in Britain is supporting various Methodist churches across different regions through the Church CAN initiative. These churches include the Methodist Church in the Caribbean and Americas (MCCA – covering multiple districts and national churches across the region), the Church of North India (CNI), the Methodist Church in Sierra Leone (MCSL), and the Methodist Church of Southern Africa (MCSA- covering multiple districts and national churches within the region). The support involves developing and implementing strategic plans, ultimately towards self-sustaining churches establishing policies and guidelines, training pastors and staff, and investing in digital resources. The impact of the support includes improved governance structures, strengthened departments, and enhanced outreach to communities. This year was the final year of support to the Methodist Church in Sierra Leone and the grant was used to establish a resource centre to improve virtual communication and online training for pastors across the conference and including training organised by Cliff College, UK. This resource centre is solar powered to ensure continuous power and internet connectivity.

Our major focus of our advocacy work has been focused on the importance of decolonising the aid sector, and modelling and influencing others to adapt a locally led partnership approach to development. All We Can was a pivotal partner in the development of research and working groups through the BOND network (the UK network for organisations working in international development), working to develop a comprehensive framework and guidelines for organisations willing to change their way of working. The approach puts local organisations and communities, in low- and middle-income countries, in the lead, to more sustainably and responsibly address poverty. This work will result in new and measurable sector commitments, transformative change that acknowledges the intersectionality between racism and colonial models of aid, and a toolkit that will guide organisations through the process of developing a tangible action plan to change the way support is given around the globe.

Our emergency response work remains a critical part of our organisational impact. Utilising specialist responders and situational analysis, we responded to a variety of disasters and emergencies in the past year. Our decision to respond is based on the premise of added value.

Our joint Ukraine Emergency Appeal response with the Methodist Church in Britain continues to support several humanitarian partners to provide vital housing, medicine, mental health and psychosocial support in multiple surrounding countries.

Through the joint Emergency Pakistan Flood Appeal, All We Can and the Methodist Church in Britain responded with food packages, hygiene kits and supported medical camps through our partners. Support continued through the winter months, providing blankets and quilts due to the extreme cold weather.

We responded to the Turkey & Syria Earthquake in February this year, choosing to focus on the less resourced response in Syria, working closely with our humanitarian aid partner supporting some of the most marginalised communities still affected by war in that country.

Through our flexible funding approach, enabling partners to repurpose their development grants, we also responded to the impact of Cyclone Freddy in Malawi which caused widespread flooding in March this year. We also launched our regional East Africa appeal, responding to the impact of the drought in the countries of Somalia, Kenya and Ethiopia.

All We Can have an ongoing focus on building resilience, with a key focus of our work being on Disaster Risk Reduction (DRR), including disaster preparedness and management. DRR seeks to ensure response work doesn’t just hold people over until the next disaster (returning to predisaster levels of risk and vulnerability), but rather enables and supports solutions that will withstand them.

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Our ongoing commitment to work with refugees, continues to be part of our operational impact. This focus, deriving from our very first Methodist appeal in 1938, continues to focus on work of humanitarian aid partners working in the camps of Cox’s Bazar, Bangladesh alongside Rohingya refugees, as well as with Syrian refugees in Za’atari refugee camp in Jordan.

This All We Can movement, will continue to work tirelessly towards our vision, doing all the good we can, wherever we can, as long as ever we can.

5. Learning network

The last year has continued to see the successful development of a joined-up delivery programme of online learning and development across the Learning Network team. This programme offers a range of options for local church leaders, lay and ordained, to engage with learning and development consistently across the connexion. The programme includes: Line Management and Lay Employees, Theological Literacy, Circuit & Church Stewards training, Explore, Positive Working Together courses, Supervisors and Supervisees, Supporting Rural Churches, Unconscious Bias and Worship Leading and Preaching support. A brochure was created to advertise these programmes, which was shared online and at synods in September 2022.

The Learning Network has worked through a reconfiguration over the year, moving away from a regional structure to operating as a single Learning Network team, with a new management structure. These changes come into effect from 1 September 2023 and will enable the Learning Network to more effectively support, resource and equip lay and ordained leaders across the church through a wide range of learning and development opportunities.

The online learning platform, MCBX was launched, with the mandatory EDI module, Unconscious Bias, and Safeguarding Advanced Module training currently on the platform. There are plans to include the Church & Circuit Steward training later in the year.

Learning Network staff continue to work closely with colleagues in both the Ministries and Mission team, in supporting and resourcing learning and development in all aspects of the church’s life. This includes working closely with the Evangelism and Growth team on the development and delivery of the God for All strategy, Children, Youth and Families, Chaplaincy, Supervision and Worship Leading and Preaching.

The pilot phase of the Reconciliation and Mediation Team (RMT) drew to an end in October 2023. The project was approved for a five-year rollout across the connexion at Conference in 2023. Work has begun on this.

We continue to develop a programme of Mental Health First Aid training and recently added Mental Health Aware, a half-day course.

6. The Methodist Council and Governance

The Methodist Council is charged with responsibility to keep in constant review the life of the Methodist Church, to study its work and witness throughout the Connexion, to indicate what changes are necessary or what steps could be taken to make the work of the Church more effective, to give spiritual leadership to the Church and to report annually to the Conference, bringing to the notice of the Conference matters to which it believes the Conference ought to give urgent attention.

The following are just a few of the actions that the Council carried out during 2022/2023 in accordance with its governance responsibilities.

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Safeguarding

Safeguarding has continued to be an area of concern that is being incorporated across all our church activities. This has been enhanced with the new study guide encouraging all groups to engage with the Theology of Safeguarding report and understand how this is integral to our values and practice. Work has continued in refreshing our core training (updated Advanced Module introduced earlier this year and Foundation early next year) and preparing a new senior leadership course. Alongside this, work is underway to review safeguarding structures with a report to next year’s conference on the employment of DSOs and the benefits of introducing a single connexional safeguarding structure. The safeguarding committee is undertaking a programme of district audit and also addressing the areas of independence in decision making and governance with expected proposals from this emerging next year.

7. Ministries: Vocations & Worship

The Ministries: Vocations & Worship Team has continued to work on the implementation of the Candidating Review: this represents a major moment of change in the life of the Church, requiring a great deal of care, skill and attention. It has been hugely encouraging to witness and experience the ways in which it is producing increased interest and engagement, with higher than expected numbers participating in the Discerning Ordained Ministry first stage (DOV1) of discernment. The year 2023-24 will involve work on the rollout of an ‘Explore’ phase which will enable people to reflect deeply on their vocation and calling to ministry.

During the year, there was continued work in the development of a number of key projects within the team’s responsibilities. These included:

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The Ministries: Vocations & Worship Team has continued to work hard at being intentional in listening to and learning from those in all kinds of ministry across the Connexion. This has included the ongoing “Voices of Identity” project, which has gathered the voices of ministers in specific contexts and situations, as well as forums for those engaged in local ministry, ministerial formation, preaching and worship leading, and lay ministry in all its forms.

The Queen’s Foundation

Foremost in its work as a Network Centre, Queen’s leads the Church’s responsibility for initial ministerial training (IMT), with three basic pathways available: full-time, part-time (The Queen’s Connexional Course), and circuit-based learning (CBLP). In the year 2022/23, the Foundation worked with 51 student presbyters and deacons and 46 probationer ministers, along with 17 ministers continuing to work towards degrees after ordination. These groups combined represent around 40% of Queen’s learning and formational community, alongside Anglicans, Pentecostal Christians and other independent students, particularly from black-led churches. Queen’s offers a probation studies pathway for those entering circuit ministry, which is aligned with Connexional guidelines and allows for continued reflection and study, on either an accredited or not-for-credit basis, with continuity from IMT. Almost all those leaving Queen’s now choose this option as they enter a circuit appointment.

Queen’s continues to offer postgraduate degrees and awards through its validating university partners in Durham and Birmingham (Newman University). The research department offers doctoral awards, through continuing partnership with the Free University of Amsterdam, whose theology department is ranked as one of the world’s best. Queen’s continues also to cherish its connections to and work with the global Church, both in offering student ministers experiences of Christian life and ministry in other parts of the world, and in receiving postgraduate students from overseas to join the college community for a period, especially through projects and initiatives funded through the Methodist Church’s Global Relationships work. The Centre for Black Theology was launched in 2019, and is a vital and urgent initiative in the Foundation’s life, offering courses at undergraduate and postgraduate levels to students across Britain. The re-launched Centre for Discipleship and Theology offers a range of courses in a variety of formats aimed primarily at those exercising lay ministry or interested in deepening their theological learning and reflection.

Cliff College

Cliff College is Methodism’s ‘own’ college, and works under the authority of the Council, delegated via the Cliff Committee. It cherishes its historic commitments to evangelism, and its more recent and growing work in digital and global theological education. Cliff College works in partnership with several teams and clusters across the Connexion to deliver a range of projects and programmes which contribute to current priorities. These include innovative short courses, shared work with the Evangelism and Growth and Global Relationships teams, the Cliff Festival and postgraduate degrees which are especially valuable in continuing ministerial development.

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They also deliver projects in evangelism and digital engagement; global theological education; and online learning and new pedagogies for the worldwide Church’s emerging needs.

Recent work better to align Cliff’s work with the wider Connexion, and to operate more closely together, has begun to bear fruit. There is now a shared set of priorities for work to be delivered in the coming year. The year 2022/23 saw continued embedding of the senior leadership team of Cliff into the Connexional Team, and the ongoing development of new governance plans and business and ministry strategies. MCBX is now established as the online learning site of the Connexion. Closer collaboration in the areas of global theological education, children, youth and family ministry, and evangelism are now consolidated, and continued developmental work is under way on integrated training programmes for Local Preachers and Local Lay Pastors. Cliff’s new BA degree has proved very attractive, with undergraduate recruitment looking very promising through the year.

A growing number of Connexional gathering and meetings now take place on site at Cliff, including work with Ministers of other Churches and Conferences, the pre-ordination retreat for presbyters, committee meetings and Stationing Matching Group. In addition, Cliff has expanded its offer as a conference centre and has been successful in attracting new clients including the annual gathering of the Church of the Nazarene and collaboration with the Chatsworth Estate during its major events.

Southlands Methodist Trust

The Southlands Methodist Trust (SMT) is an educational charity, focused on encouraging the Methodist ethos of Southlands College (the Methodist-founded College of the University of Roehampton) and the development of the College’s contributions to the research and learning of the wider Church and society.

The SMT’s main research and educational activities continue to focus on the Susanna Wesley Foundation (www. susannawesleyfoundation.org.uk). Alongside this, grants from the Trust also supported research and research-related activities across a range of subject areas deemed to be of importance and interest to the Church and society. During the year, there has been continued and deepening collaboration between the SWF and the Connexion in some key areas of current interest and priority, including ecumenical collaboration and the JDS Strategy. In April 2023 Southlands hosted a global gathering of Methodist educators as part of the ‘Transforming Lives’ Conference.

The SMT co-sponsors an ecumenical project to develop a Methodist-Roman Catholic student community housed on campus. It also supports chaplaincy activities and student-led ventures to encourage commitment to social action, such as the Southlands Venture. Information about its projects can be found at www.southlandsmethodisttrust.org.uk. A Methodist presbyter serves in an appointment as chaplain to the University, based at Southlands, and sharing the work with an interfaith team.

The SMT retains ownership of the college’s historic records and continues to upgrade the archive to make it more accessible to the public as a resource for studying teacher training and the Methodist Church’s involvement in education. The SMT acts as a resource and a catalyst for the Methodist Church’s contemporary engagement with education at every stage and level, working with the Connexional Team, and the various Methodist schools-related bodies (MAST, MIST, Wesley Trust, MSC) to offer insight, advice and support. The Trust nurtures and cherishes its relationships with the global Church and its connections to worldwide Methodist educational ministries. The Head of College is currently a director of the International Association of Methodist Schools, Colleges and Universities, a trustee of MAST, and a member of the Methodist Schools Committee.

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8. Property

During the year, the Connexional Property Team (CPT) has continued to provide a wide range of direct and indirect support across the Connexion, from connexional properties through to local church buildings.

Direct support to Managing Trustees and Ministers considering property matters such as redevelopment, reordering or disposal has increased during the year. This has been provided in a hybrid form involving online meetings where practical, alongside more traditional in person site visits. By year end, support covered the following broad themes:

The team provided support for ongoing Connexional property projects including:

Indirect support in the form of written guidance and advice for a general audience supported the wider work of the connexional team:

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The team continue to provide support and input into numerous working areas of the Connexion including Central Hall Manchester and its redevelopment project; the Superintendents’ Conferences; Listed Building Advisory Committee; Property Development Committee and Connexional Manse Committee, Trustees Legal and Governance Committee and Probationer Minister training at Queens Foundation.

The team continue to value the network of District Property colleagues, and at the beginning of the year established a monthly online event for DPS’s which has run throughout the year. They vary between formal speakers or more informal forums for questions and discussions.

In terms of connexional resources, the Property Feasibility Fund, by the end of this year had distributed £49,384 to those who applied; this provided funding to churches exploring future uses of their property for mission (60% of the total costs up to max. £10,000).

Grants

As agreed by the Council the connexional grant-giving processes have been redesigned, in particular those grants which were made from the Mission in Britain Fund, the Fund for Property, and the World Mission Fund. These changes have enabled streamlined and efficient processes in respect of the three funds which were previously under the oversight of the Connexional Grants Committee. Legacy grants previously agreed by the Connexional Grants Committee continue to be honoured and the monitoring of their impact and gathering of learning from them being undertaken by the relevant part of the Connexional Team and reported to the Strategy and Resources Committee.

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Plans for the future

The Methodist Council continues to be shaped by and committed to this vision which was reaffirmed as the strategic driver of the Church’s work in 2021, collectively known as ‘Reaffirming Our Calling’:

The calling of the Methodist Church is to respond to the gospel of God’s love in Christ and to live out its discipleship in worship and mission.

The Church does this through: Worship, Learning and Caring, Service, and Evangelism:

WORSHIP - Ensuring our worship and ministry is effective, relevant and gives glory to God. LEARNING & CARING - We are an inclusive Church

SERVICE - We are a justice-seeking Church EVANGELISM - We are an evangelistic people

The Council is also committed to A Methodist Way of Life (MWOL) which provides a further level of detail to the four aspects of Our Calling by elaborating aspects of each. A Methodist Way of Life aims to provide a clear, detailed, and practical framework for what Methodist discipleship can look like in the 21st century. A Methodist Way of Life seeks to connect the diverse work of the Church in the world and to communicate it clearly to the world:

A MWOL commits us as people to;

Worship

We will pray daily. We will worship with others regularly.

We will look and listen for God in Scripture, and the world.

Learning & Caring

We will care for ourselves and those around us. We will learn more about our faith. We will practise hospitality and generosity.

Service

We will help people in our communities and beyond. We will care for creation and all God’s gifts.

We will challenge injustice.

Evangelism

We will speak of the love of God.

We will live in a way that draws others to Jesus. We will share our faith with others.

The Methodist Council’s work therefore continues to centre around how the work of the Connexional Team and the policies of the Council specifically support the four headings of Our Calling. Alongside this our Strategy for Evangelism and Growth (as agreed by the Methodist Conference in 2020) emphasises being an inclusive, evangelistic and justice-seeking Church to fulfil our calling.

The Methodist Conference affirmed that with the guiding principles of Our Calling and MWOL it seeks to become a growing Church once again: growing spiritually, growing in outreach and influence, growing in the depth of our commitment, and growing numerically.

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The Environment

Action for Hope: care for creation

The Methodist Church has set an aspirational target of becoming a net zero carbon emissions church by 2030. Many districts, circuits and churches have already begun to work towards net zero goals, an Eco District award, or other aims in caring for creation. We call this work Action for Hope .

An Action for Hope Implementation Officer was appointed in early 2023 to co-ordinate and support this work across the Connexion, and to ensure that the priority is embedded in the work of the Connexional Team. A Working Group has been established with representatives from the mission; ministries; finance; property; procurement and communications teams, as well as the Learning Network.

Assets

Work is underway to establish a baseline figure for the carbon footprint of the Connexional Team, and a variety of avenues are being explored for estimating the footprint of churches and other buildings throughout the Connexion.

A variety of guidance for property has been produced, with guides in production and planned. A working group is being established to consider the role of property in mission, and Action for Hope will be part of that work, ensuring a strategic approach to the journey to net zero is offered. Conversations have begun with the Joint Advisory Committee on the Ethics of Investment and the Central Finance Board around the production of guidance on ethical investment and use of money.

Wisdom

At The Methodist Conference in 2023 it was agreed that a process would be established to review and update Hope in God’s Future . The report has the status of a Statement of Conference, so it is vital that this process be undertaken in a way which culminates in a decision of the Conference to accept (or reject) the update. A timeline is in place for this to return to the Conference in 2025, with a contingency built in for an additional year if the review group believes that more fundamental change is required.

The Action for Hope Faith Plan document outlines a goal of 50% of Methodist Churches having signed up to Eco Church or Eco Congregation by 2026. This figure currently stands at approximately 27%, and both Eco Church and Eco Congregation have been valued partners in encouraging participation.

Work is currently underway to gather good examples of worship materials, prayers and small group resources which can be shared and used throughout the Connexion. As and when gaps are identified work will be undertaken to create resources to fill these niches.

Lifestyles

Conversations are taking place with the team developing the Methodist Way of Life materials to ensure that we offer a coherent approach to the lifestyle aim which brings together these key priorities for the Church.

Work towards how best we measure the impact of this work, as well as the carbon footprint of Methodist members, is currently ongoing, but the production and dissemination of resources will take place while our approach to measurement is developed.

Co-operation with JPIT and the Justice Seeking Church team are also valued in this area.

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Remuneration of Key Management Personnel

The Methodist Council oversees the operation of the Church on a day-to-day basis. It acts as the employing body for staff and the appointing body for ministers serving within the Connexional Team. It delegates the monitoring of the Connexional Team to its Strategy and Resources Committee (SRC). The senior management group of the Connexional Team comprises the key management personnel of the Church in charge of directing and controlling, running and operating the Team on a day-to-day basis.

Two senior leadership posts, the Secretary of the Conference and the Assistant Secretary of the Conference, have to be held by ordained ministers. They each receive the standard stipend plus a fixed percentage allowance. The levels of both are set annually by the Methodist Conference. The pay of the senior employed staff is set by a job-grading panel by reference to the Hays Pay and Grading Scale. In view of the nature of the Church’s work, the salaries are benchmarked against pay levels in other charities of a similar size run on a voluntary basis. The salaries for senior staff posts are determined as part of the same salary scale as is used for all staff posts.

Trustees are required to disclose all relevant interests and register them with the Conference Office. In accordance with the Church’s policy, trustees must withdraw from decisions where a conflict of interest arises.

Details of the expenses reimbursed and related party transactions relating to the Council and the SRC are in Notes 25–27 to the financial statements.

Fundraising Activities

The Methodist Church raises funds through investment management, trading activity, property transactions and voluntary donations. It receives a proportion of funds raised locally on the sale of property owned by circuits.

It does not employ external fundraisers or undertake direct fundraising campaigns, such as direct mail or telephone canvassing of donations. Whilst essentially a passive fundraiser, it is registered with the Fundraising Regulator and indirectly raises funds from individuals by the following means:

The Methodist Church is very grateful for all who contribute financially to the work of the Church through whatever means. It also acknowledges the generous support of the Benefact Trust which has provided grants of £1.15m during the 2022/23 financial year.

The Methodist Church has safeguarding procedures that protect vulnerable people and this extends to the indirect fundraising carried out on its behalf by local churches. The Church has not been made aware of any complaints from its fundraising activities.

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Financial Review

The activities covered in these consolidated financial statements are those under the oversight of the Methodist Council. The Methodist Church in Great Britain is the registered charity, and the Charity Commission has agreed that these financial statements can properly serve as the financial statements of the charity.

The net income for the year was a deficit of £4.5m (2022: £2.6m deficit), including net investment losses of £5.6m (2022: £12.0m loss). This investment loss largely reflected the deterioration in the value of investments held by the Church in units invested by the Central Board of Finance of the Methodist Church. These reductions reflected the unstable market conditions in the wider economy.

Other recognised losses for the year were £5.0m (2022: £8.4m loss). A £1.7m loss (2022: £1.9m loss) arose from the actuarial revaluation of the Pension and Assurance Scheme for Lay Employees of The Methodist Church. A detailed disclosure on the Scheme’s financial position is provided in Note 28 (page 87). A £3.3m loss (2022: £6.6m loss) resulted from the revaluation of the Church’s charitable properties.

Income

The total income for the year was £53.0m (2022: £56.2m). The reduction of £3.2m was mainly due to the following:

  1. A £9.2m reduction in donations significantly due to: the one off appeal for the Pension Reserve Fund of £7.2m in 2021/22 and reduced donations to All We Can and Y Care International.

  2. A £0.3m reduction in District Assessment income.

  3. A £3.4m increase in trading income as the activities at MICL continue to recover following the pandemic and a new hotel opened in Camden.

  4. A £5.4m increase in property levies as both the volume and average value of sales have increased.

  5. A £1.8m reduction in gains on disposal of fixed assets.

  6. A £0.4m reduction in grant income to the consolidated entities.

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Expenditure

Total expenditure increased to £51.9m (2022: £46.8m). Of this, £43.9m was spent on direct charitable activities (2022: £41.2m). This was mainly due to the following:

  1. A £2.4m increase in the cost of raising funds due to increased trading activity at MIC.

  2. A £1.6m increase in the expenditure on Evangelism and Growth as implementation of the God For All strategy increased.

  3. A £2.9m increase in Global Relations spend reflecting increased grant making as the approach to supporting capacity development of our partners continued.

  4. A £2.1m increase in Ministries spend as one off cost of living payments were made to all ministers.

  5. A £4.7m reduction in Property spend due to the one off loss in 2021/22.

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Reserves Policy

The total value of funds held at 31 August 2023 was £270m (2022: £279m). There are restricted reserves of £123m (2022: £138m), unrestricted reserves of £127m (2022: £122m), and endowment reserves of £19m (2022: £20m). The Methodist Church in Great Britain does not have a blanket reserves policy to cover its operations. Rather, the policies are set locally by the relevant trustee bodies and take into account the unique risk factors faced by each entity. The unrestricted funds reported in these financial statements are under the trusteeship of the Methodist Council, therefore the reserves policy outlined below is that of the Methodist Council.

General funds

There are five main unrestricted funds:

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At 31 August 2023, the balance of the unrestricted general funds was £56m (2022: £53m). Of this £51m (2022: £50m) is invested in fixed assets, used in the day-to-day running of the Council’s activities and that of its subsidiary undertakings, which is therefore not available for use as a reserve. This consists of £17.7m of tangible fixed assets and £33.2m of investment properties. The trustees approved a reserves balance of £5 million. This would ensure that there is always sufficient cash or near cash at hand to enable operations to continue smoothly and without the disruption that might otherwise arise when receipts and payments occur irregularly or are delayed or accelerated. At 31 August 2023 the free reserves balance was £10.7m (2022: £10.7m). In line with a reduction in Assessment funding over the five year period from 2023/24 onwards, the reserves balance is planned to fall each year reaching the £5m target in 2027/28.

Designated funds

Designated funds are part of the unrestricted funds. The trustees have earmarked them for a particular project or use, without restricting or committing the funds legally. The trustees may cancel the designation if they later decide that the activity should not proceed, or they decide not to continue with the project for which the funds were designated.

At 31 August 2023, the designated funds totalled £72 million (2022: £69 million) of which the main fund balances were as follows:

•
The Connexional Priority Fund
•
Epworth Fund
•
The Pension Reserve Fund
•
Others
Total:		 £13 million
£6 million
£51 million
£2 million
£72 million

The Connexional Priority Fund (CPF), as a large designated fund, reflects the connexional nature of The Methodist Church. Its income is derived from levies on property sales. It serves to redistribute money around the Connexion as a proportion of money released in one area becomes available for new mission and ministry elsewhere. In 2021 the Methodist Council approved a reserves policy for this fund, setting the long-term uncommitted reserves level of the CPF at £1.5 million. This amount allows for one year of existing commitments to be maintained (allowing sufficient time for arrangements to cease funding to be put in place).

The Epworth Fund was set up with the proceeds from the sale of Epworth House, City Road, London in 1987. The Church wanted the fund to be used in the long term for innovative projects, expenditure for which could not always be justified using other resources and they designated an amount of £5 million for this purpose. In 2021 the Methodist Council amended the reserves policy to £1m to allow the capital balance of the fund to be used for missional purposes. This amount allows for one year of existing commitments to be maintained (allowing sufficient time for arrangements to cease funding to be put in place).

The Pension Reserve Fund exists to help mitigate the financial risks associated with the Methodist Ministers’ Pension Scheme (MMPS) and the Pensions and Assurance Scheme for Lay Employees of the Methodist Church (PASLEMC). In 2021, the Methodist Conference made an appeal to Methodist churches, circuits and districts for voluntary donations to help fund the pension deficits on both MMPS and PASLEMC. Donations were received and recorded in the PRF. To date, the fund has received £7.2m. In 2023, the Methodist Conference passed Resolution 26/4 as follows – “The Conference approves that should circumstances allow over the coming years, the voluntary contributions to the Pension Reserve Fund be returned to the donors with interest paid at the CFB Deposit Rate.” It remains uncertain when these repayments will be possible but the position will be reviewed later in 2023/24.

At 31 August 2023 the reserves position on the designated funds is above the policy by £16.5m (2022: £15.2m). Excess balances have been allocated to: the delivery of Our Calling; the God For All Strategy; the Action for Hope aspiration to achieve net-zero carbon by 2030, and investments

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in Information Technology. The balance held in the smaller designated funds is detailed in Note 19c (page 74) in the notes to the financial statements.

Financial risks

The Council’s general reserve enable it to make long-term commitments to projects, and to protect its work against adverse financial events. A formal review of the reserve levels takes place every three years. In the intervening years the Strategy and Resources Committee (SRC) considers the impact of the financial risks associated with the income and expenditure streams and balance sheet items and assesses the appropriateness of the reserve range. This allows time for fundamental restructuring, in the event of a major downturn, and to protect the current programme of work from unexpected demands. The goal is to plan for the effective deployment of the available financial resources to achieve the strategic objectives of The Methodist Church (see page 3).

The Council is faced with the following financial risks:

The MCF assessment is the main source of unrestricted income for the Council. It is a major contributor to the funding of several key activities including the administration of the Connexional Funds, the Learning Network and major aspects of the governance processes such as the Methodist Council and the Conference.

The assessment is a charge upon circuit receipts. The impact of the Covid-19 pandemic has left several circuits expressing doubts about their ability to meet the assessment. These concerns build upon the recent trends of decline in membership of local churches. In response, the Methodist Conference has started a process of reducing the Assessment (by 1% in 2021/22, a further 2% in 2022/23 and then a further additional 3% each year from 2023/24).

Other sources of income available to the Council are donations, legacies and investment income. Legacy income, when received, is significant but prone to fluctuation. Unrestricted donations tend to be very variable and have been impacted by the closure of church buildings for much of the year.

The impact of a sustained fall in the investments and other assets held by the Council could be felt in two ways: first, a deficit in the statement of financial activities occurring over several years; second, difficulties in realising assets with the potential for consequent cash flow, and operational problems.

A key financial risk faced by the Church is the level of the deficit within the defined benefit pension schemes. To mitigate this risk, the Pension Reserve Fund was established by the 2009 Conference as a fund outside the schemes, which could be used to meet future funding deficits. At the 2020 Valuation recovery plans were agreed to eliminate the deficits in both schemes as follows:

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Due to the interim valuations, no conditional payments were paid to either scheme during 2022/23.

The Methodist Council closed the PASLEMC to new entrants with effect from 31 May 2019. Existing members benefit from the scheme arrangements up until this date but are no longer able to make further member contributions, and members therefore do not build up any further benefits in the Scheme. The pension that members have already built up is retained in the Scheme and paid upon retirement (note 28 to the accounts provides more detail).

In addition, the Methodist Council has agreed a Framework Agreement with the trustee of both PASLEMC and MMPS. This covers the requirement for a long-term funding objective, a remedy mechanism should funding deviate from the long-term goal, and a contingent asset that provides the trustees security over Connexional properties should the Council or Conference ever default on payments due.

The level of reserves expected to be held in the Pension Reserve Fund (PRF) forms part of the ‘employer covenant’ with the pension trustee boards and is therefore currently considered appropriate. This fund is defined by SO 974(iA) and decisions regarding its use can only be taken by the Conference. Due to the considerable balance already held in the PRF and the reducing level of risk associated with the pension funding positions, further payments in to the fund have been suspended.

Investments

As at 31 August 2023, the Church held fixed asset investments with a fair value of £186 million (2022: £182 million). The Finance Sub-Committee is responsible for reviewing the investment portfolio and performs an annual review of the investment policy. The Church’s investment objective is to seek an optimal return from income and capital combined. The Finance SubCommittee is satisfied with the overall performance of the investment portfolio against agreed benchmarks.

Funds not immediately required are invested in marketable securities through The Methodist Church’s in-house investment manager, the Central Finance Board (CFB) of The Methodist Church, whose mission is to:

To ensure that the CFB is working to the highest ethical standards, the trustees established the Joint Advisory Committee for the Ethics of Investment (JACEI), which is made up of five people nominated by the CFB and five by the Methodist Council. The committee monitors the activities of the CFB to ensure that it complies with the ethical stance of the Church.

With regard to investment management the Finance Sub-Committee and representatives from the Connexional Team decide, after taking advice from the CFB, the most appropriate investment strategy for each fund under the management of the Connexional Team.

In addition to marketable securities, some funds hold freehold property as investments. These tend either to have been given to the fund, or are redundant properties that are either rented out or are awaiting disposal.

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Performance and holdings

Losses on investments in year were £5.6m (2022: £12.0m). This performance was linked to the global market conditions that were materially impacted by the war in Ukraine and the Church’s ethical stance not to invest in oil and gas. The total returns as at 31 August 2023 for CFB managed funds are summarised as follows:

1 year to
31.08.23		 3 years to
31.08.23 (p.a.)		 11.07.16 to
31.08.23 (p.a.)
ManagedLT Methodist Council Fund -1.0% 5.1% 6.1%
ManagedMT Methodist Council Fund -1.9% 1.1% 3.3%
1year 3 years (pa) 10 years (pa)
CFBUK EquityFund 2.7% 7.0% 5.1%
FTSE AllShare 5.2% 10.5% 5.5%
CFBGlobal EquityFund 6.3% 8.3% 11.0%
Benchmark 5.1% 9.7% 11.7%
CFBShortFixedInterestFund -2.9% -4.4% 0.3%
Benchmark -3.4% -4.5% 0.4%
CFBCorporateBondFund -2.2% -6.1% 1.5%
Benchmark -1.0% -5.8% 1.9%
CFB DepositFund 3.5% 1.3% 0.8%
Compositeindex 3.8% 1.4% 0.7%
Property benchmarks
1 year to
30.06.23		 3 years to
30.06.23 (p.a.)		 11.07.16 to
31.06.23 (p.a.)
ManagedLT Methodist Council Fund 2.2% 5.6% 6.3%
Benchmark 1.5% 5.9% 3.6%
ManagedMT Methodist Council Fund -2.1% 1.1% 3.3%
Benchmark -3.3% 0.5% 3.0%
1year 3 years (pa) 10 years (pa)
CFBUK EquityFund 5.6% 7.5% 5.8%
FTSE AllShare 7.9% 10.0% 5.9%
CFB PropertyFund -18.0% 3.1% 7.3%
IPD All BalancedFundsIndex -18.0% 3.1% 6.2%

Risk Management

The Methodist Church in Great Britain has a risk management policy, which has been set by the Methodist Council for use both by the trustees and by the Connexional Team on behalf of the trustees. The risk management policy is designed to identify and analyse key strategic and operational risks facing The Methodist Church and, where they are at unacceptable levels, to take steps to mitigate the risks.

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We define key strategic and operational risks as those that, without effective or appropriate mitigation, are highly likely to occur and would have a negative impact on the Church’s ability to fulfil its purpose of advancing the Christian faith in accordance with its doctrinal standards. These risks are reported to the trustees through a risk management process, which allows them both to challenge any assumptions the management team has made about risks and to understand the context in which decisions are taken. This helps to ensure that the most serious risks are being managed effectively.

The trustees recognise that it is neither possible nor appropriate to seek to eliminate risk entirely. We recognise that risk-taking is inherent within the task of communicating the gospel; John Wesley himself took risks in establishing the Methodist communities. Our task, therefore, is to embrace risks that aim to advance the Church’s purposes while ensuring that we avoid or minimise those risks that might have a negative impact. Effective risk management processes will help to increase the likelihood of the Church fulfilling its mission.

The most significant risks faced by the Church and the mitigations are as follows:

Risk Current mitigations
Failure to make new disciples means the
membership of the Church continues to decline.		 God For All strategy linked with the Justice, Dignity
and Solidarity Strategy is signalling a desire to
grow in new places.
Ineffective recruitment and training of those who
fulfil ministerial/lay roles results in a shortage of
people to take on key roles within the life of the
institution.		 Work on the formation of leaders in the Methodist
Church continues alongside the ongoing work in
other areas. Review of Stationing Processes set up
by Ministries Committee. New candidating
processes in place has led to increased interest.
New candidating process is more open -
particularlyremovingLocal Preacher requirement.
Safeguarding failures (such as serious allegations
of current or historic abuse).		 Review of policy on responding to survivors,
reflection on the role and nature of internal
enquiries as well as a general review of the actions
taken over the last period. Development of crisis
management policy to support a more effective
response to issues as they arise; review of JDS
Committee Action plan to ensure safeguarding
aspectisfully covered.
Breach of Immigration Rules due to not fulfilling
Home Office criteria that will jeopardise
sponsorship licence, and will require ministers
and their dependents currently stationed to stop
their appointments and to return to their home
country.		 The Connexional Team provide relevant and timely
information to Districts and Circuits regarding their
responsibilities relating to existing and /or
potential individuals covered by the MCIB
sponsorship licence.
Regular review of all documentation for sponsored
individuals to ensure compliance with Home Office
criteria.
Ongoing training and updates from UKVI and share
relevant information with Districts and Circuits to
enable licence compliance.
Inappropriate behaviour from Methodist leaders
leads to reputational damage		 Review of existing processes to determine further
mitigations needed.

In relation to the principal risks identified, these are managed on an on-going basis by the relevant member of the Senior Management Group (SMG) of the Connexional Team. Mitigating actions and risk scores are reviewed monthly at a meeting of the SMG. The risks are reviewed at the Audit & Risk Assurance Committee and at the Methodist Council. The trustees consider that the following framework provides the Church with adequate measures to minimise the impact of identified risks.

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Risk appetite

Risk appetite is the amount of risk the Church is willing to accept in relation to key drivers of the organisation. Our risk management philosophy is to minimise risk, but it enables us to accept additional risk, providing the impact has been evaluated, mitigation measures have been put in place and a regular robust monitoring process is established. This approach to reviewing risk enables the Methodist Council to adopt appropriate behaviours, decisions, and controls according to the priorities in the Connexional Team’s strategy plan.

Prior to any risk being accepted, we consider the likelihood of the risk occurring and the impact on the Church if the risk did occur. Any risk that seriously threatens the ability of The Methodist Church in Great Britain, now or in the future, to further its purpose of advancing the Christian faith will not be acceptable. If such a risk cannot be extinguished, then all steps will be taken to minimise the likelihood of the risk occurring.

Risk strategy and responsibilities

The Council’s role in the oversight of risk is to set out the ethos for risk management and to promote a culture of risk management within the activities of The Methodist Church in Great Britain on behalf of the trustees. This includes:

The Council annually reviews the Connexional Team’s approach to risk management; approving changes or improvements to key elements of its processes and procedures; forming an opinion on whether the Team has complied with expected risk management practice. The following safeguards are in place:

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the removal of any previously listed risks where the threat is no longer significant enough to be included in the document.

Monitoring and review of the policy

The risk management policy is reviewed by the Senior Management Group of the Connexional Team, meeting annually as the Risk Management Group, which makes reports to the Audit and Risk Assurance Committee and makes recommendations to the Strategy and Resources Committee and/or to the Council.

For the year under review, the Council is satisfied that the major risks to which the Church is exposed have been assessed and is satisfied that systems are in place to manage and mitigate exposure to them.

Risk management is part of the wider system of internal control. This system encompasses several elements that together facilitate an effective and efficient operation, enabling the Church to respond to a variety of operational, legal, financial and commercial risks.

Data Protection

In respect of enhancing our Data Protection Governance during 2022/2023, we continue our UK GDPR refresher training for staff, which also now forms part of requirement induction training for new starters. Data Protection handy hints by the Methodist church Data Protection officer have been a regular feature of Connexional meetings, so as to ensure that UK GDPR responsibilities are kept in the forefront of staff and church members minds during their day to day work.

We are continuing to update our IT Data Security Policy to improve our UK GDPR and Data Protection obligations for data processing and handling. We have also reviewed and are updating our Serious Incident Policy to be even more comprehensive and we are implementing new IT software to add to our outlook programme in order to reduce the number of data breaches caused by human error.

Going concern

The trustees continue to prepare the financial statements on the basis that The Methodist Church in Great Britain is a going concern. Evidently, the Church has adequate financial resources and is able to manage business risks. The planning processes, including financial projections, take into consideration the prevailing economic climate and its potential impact on the various sources of income and planned expenditure. The trustees have looked at least 12 months ahead and are satisfied that the Church has adequate resources to continue in operational existence for the near future and there are no material uncertainties that call into doubt the Church’s ability to continue in operation. In-year financial performance was favourable

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to plan due to additional property levy income. Looking forward, the budget for 2023/24 has been set on the basis of a broadly breakeven position on the general fund with planned for reductions in restricted fund balances in line with reserves policy. The more material risk remains as last year, namely the ability of churches to continue to pay their contribution to the District Assessment (£14.2m) and pay their ministers (c£45m). The current balances held by churches and circuits in their Central Finance Board deposit accounts total an estimated £240m. In addition, there are cash balances held in commercial bank accounts of tens of millions. Given an assumed turnover across the wider Church of c£90m there is approximately three years’ worth of expenditure sitting in reserves. Consequently, there is no immediate threat to the District Assessment income and nor should circuits be defaulting in funding the payroll costs of ministers. The ongoing sale of churches across the Connexion continues to provide a flow of money into the Connexional Funds that further supports the medium-term financial viability of the charity. Improvements in the funding position of both pension schemes provide an opportunity to materially reduce risk on a permanent basis.

Related Parties

The various parts of the legal framework within which The Methodist Church is governed allow for the setting up of separate bodies all reporting into the Conference to handle specific aspects of the Church’s work and/or discharge a specific power of the Church. The related parties are:

  1. The Trustees for Methodist Church Purposes (TMCP). These are the custodian trustees of all property held on the Model Trust of The Methodist Church Act 1976, except for properties in the Channel Islands and the Isle of Man, which are held by the Trustees for Jersey Methodist Church Purposes, the Trustees for Guernsey Methodist Church Purposes and the Trustees for Manx Methodist Church Purposes.

  2. The Central Finance Board of The Methodist Church (CFB). This was set up by an Act of Parliament in 1960 to enable Methodist organisations to pool their assets and manage them efficiently. The CFB has its own fund management department enabling it to provide professional investment management for the Connexional Team as well as other organisations within Methodism.

  3. The Methodist Ministers’ Housing Society. This was set up under the Community and Co-operative Benefit Societies Act 2014. It provides housing and associated amenities for retired Methodist presbyters, deacons and their partners. The Methodist Council makes regular grants from the Fund for the Support of Presbyters and Deacons (FSPD) in support of its work under Standing Order 364.

  4. The Queen’s Foundation for Ecumenical and Theological Education. This institution offers training pathways for student ministers to prepare for ordained ministry in The Methodist Church.

  5. Other Methodist bodies with which the Connexional Team have regular dealings include the Methodist Ministers’ and Lay Employees’ Pension Trusts and the Methodist Independent Schools Trust.

Details of transactions with these related parties and any outstanding balances at the year-end are provided under Note 27 (page 85) of the financial statements.

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Statement of Trustees’ Responsibilities

The law applicable to charities in England and 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 the group and of the income and expenditure of the charity and group for that period. In preparing these financial statements, the trustees are required to:

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 and the provisions of the trust deed. They are also responsible for safeguarding the assets of the charity and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The trustees are responsible for the maintenance and integrity of the charity and financial information included on the charity's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Auditor

Following a competitive tender process in 2023, RSM UK Audit LLP were appointed for a further three years as auditor to the charity.

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The Revd Sonia Hicks Chair of the Council

29 January 2024

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INDEPENDENT AUDITOR’S REPORT TO THE TRUSTEES OF THE METHODIST CHURCH IN GREAT BRITAIN

Opinion

We have audited the financial statements of The Methodist Church in Great Britain (the ‘parent charity’) and its subsidiaries (the ‘group’) for the year ended 31 August 2023 which comprise the Consolidated Statement of Financial Activities, the Connexional Funds Statement of Financial Activities, the Consolidated and Connexional Funds Balance Sheets, the Consolidated and Connexional Funds Cash Flow Statements and notes to the financial statements, including significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including FRS 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:

Basis for opinion

We have been appointed as auditors under section 151 of the Charities Act 2011 and report in accordance with regulations made under section 154 of that Act.

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 group and parent 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 group’s or parent 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 Annual Report other than the financial statements and our auditor’s report thereon. The trustees are responsible for the other information contained within the Trustees’ Report. Our opinion on the financial statements does not cover the other information and, 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.

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Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Charities Act 2011 requires us to report to you if, in our opinion:

Responsibilities of trustees

As explained more fully in the Statement of Trustees’ responsibilities set out on page 37, the trustees are responsible for the preparation of the financial statements and for being satisfied that they 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 group’s and parent 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 group or parent charity or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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.

The extent to which the audit was considered capable of detecting irregularities, including fraud Irregularities are instances of non-compliance with laws and regulations. The objectives of our audit are to obtain sufficient appropriate audit evidence regarding compliance with laws and regulations that have a direct effect on the determination of material amounts and disclosures in the financial statements, to perform audit procedures to help identify instances of non-compliance with other laws and regulations that may have a material effect on the financial statements, and to respond appropriately to identified or suspected non-compliance with laws and regulations identified during the audit.

In relation to fraud, the objectives of our audit are to identify and assess the risk of material misstatement of the financial statements due to fraud, to obtain sufficient appropriate audit evidence regarding the assessed risks of material misstatement due to fraud through designing and implementing appropriate responses and to respond appropriately to fraud or suspected fraud identified during the audit.

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the group audit engagement team:

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As a result of these procedures we consider the most significant laws and regulations that have a direct impact on the financial statements are FRS 102, Charities SORP (FRS 102), Charities Act 2011, the parent charity’s governing document. We performed audit procedures to detect non-compliances which may have a material impact on the financial statements which included reviewing the financial statements including the Trustees’ Report and remaining alert to new or unusual transactions which may not be in accordance with the governing documents.

The most significant laws and regulations that have an indirect impact on the financial statements are those in relation to General Data Protection regulations in the UK and safeguarding. We performed audit procedures to inquire of management and those charged with governance whether the group is in compliance with these laws and regulations and inspected correspondence with regulatory authorities.

The group audit engagement team identified the risk of management override of controls as the area where the financial statements were most susceptible to material misstatement due to fraud. Audit procedures performed included but were not limited to testing a sample of manual journal entries and other adjustments, evaluating the business rationale in relation to significant, unusual transactions and transactions entered into outside the normal course of business, challenging judgments and estimates.

A further description of our responsibilities for the audit of the financial statements is provided on the Financial Reporting Council’s website at http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

Use of our report

This report is made solely to the charity’s trustees as a body, in accordance with the Charities Act 2011.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. RSM UK Audit LLP Statutory Auditor Chartered Accountants 103 Colmore Row Birmingham West Midlands, B3 3AG

Date: 5 February 2024

RSM UK Audit LLP is eligible to act as an auditor in terms of section 1212 of the Companies Act 2006.

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Consolidated statement of financial activities for the year ended 31 August 2023

41

The Methodist Church in Great Britain

Consolidated statement of financial activities

For the year ended 31 August 2023

Methodist Church in Great Britain
solidated statement of financial activities
the year ended 31 August 2023
Notes Unrestricted Restricted Endowment 2023 Total Unrestricted Restricted Endowment 2022 Total
£000 £000 £000 £000 £000 £000 £000 £000
Income and endowments from:
Donations and legacies 3a 567 5,913 - 6,480 8,173 7,502 - 15,675
Charitable activities 3e 13,261 269 - 13,530 13,532 335 - 13,867
Investments 4a 2,322 3,714 - 6,036 2,032 4,109 - 6,141
Other trading activities 5a 7,816 1,555 - 9,371 4,566 1,384 - 5,950
Other
Capital levies 6a 15,471 - - 15,471 10,061 - - 10,061
Grants 6b 2 864 - 866 15 1,282 - 1,297
Miscellaneous income 3c 608 428 - 1,036 826 384 - 1,210
Netgains/(losses)on the disposal of tangible fixed assets 139 46 - 185 (57) 2,083 - 2,026
Total income 19a, 20a 40,186 12,789 - 52,975 39,148 17,079 - 56,227
Expenditure on:
Raising funds 6,952 1,066 6 8,024 4,682 964 19 5,665
Charitable activities
Building communities 7a 1,456 957 - 2,413 1,229 759 - 1,988
Children & Youth 7a 1,505 1 - 1,506 1,520 33 - 1,553
Evangelism & Growth 7a 7,496 143 - 7,639 5,510 512 - 6,022
Global relations 7a 1,173 10,633 - 11,806 977 7,961 - 8,938
Learning Network 7a 3,019 2 - 3,021 2,719 59 - 2,778
Methodist Council & Governance 7a 5,168 19 - 5,187 4,777 85 - 4,862
Ministry 7a 3,404 6,772 - 10,176 3,356 4,674 - 8,030
Property 7a 681 146 - 827 655 4,850 - 5,505
Others - Pensions 7a 1,339 - - 1,339 1,496 - - 1,496
Total expenditure 19a, 20a, 21a 32,193 19,739 6 51,938 26,921 19,897 19 46,837
Net gains/(losses) on investments 14a (2,162) (2,839) (579) (5,580) (7,304) (1,046) (3,603) (11,953)
Net income 5,831 (9,789) (585) (4,543) 4,923 (3,864) (3,622) (2,563)
Transfers between funds 22 1,718 (1,985) 267 - 934 (1,305) 371 -
Net income after transfers 7,549 (11,774) (318) (4,543) 5,857 (5,169) (3,251) (2,563)
Other recognised gains and losses:
Remeasurement of net defined benefit pension scheme liability 28 (1,813) 94 - (1,719) (2,201) 311 - (1,890)
Gains(losses)on revaluation of charitableproperties 74 (3,349) - (3,275) - (6,564) - (6,564)
Net movement in funds 5,810 (15,029) (318) (9,537) 3,656 (11,422) (3,251) (11,017)
Total funds at 1 September 121,632 137,909 19,584 279,125 117,976 149,331 22,835 290,142
Total funds at 31 August 127,442 122,880 19,266 269,588 121,632 137,909 19,584 279,125

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The Methodist Church in Great Britain

Statement of financial activities – The Connexional Funds

For the year ended 31 August 2023

the year ended 31 August 2023
Notes Unrestricted Restricted Endowment 2023 Total Unrestricted Restricted Endowment 2022 Total
£000 £000 £000 £000 £000 £000 £000 £000
Income and endowments from:
Donations and legacies 3b 677 2,522 - 3,199 8,173 2,532 - 10,705
Charitable activities 3f 13,261 269 - 13,530 13,532 335 - 13,867
Investments 4b 3,019 3,108 - 6,127 2,348 3,559 - 5,907
Other trading activities 5b 366 1,214 - 1,580 356 933 - 1,289
Other
Capital levies 6a 15,471 - - 15,471 10,061 - - 10,061
Grants 6c 2 94 - 96 2 99 - 101
Miscellaneous income 3d 618 117 - 735 874 60 - 934
Netgains on the disposal of tangible fixed assets 139 46 - 185 (57) 2,083 - 2,026
Total income 19b, 20b 33,553 7,370 - 40,923 35,289 9,601 - 44,890
Expenditure on:
Raising funds 1,511 1,066 6 2,583 1,443 964 19 2,426
Charitable activities
Building communities 7b 1,455 957 - 2,412 1,229 759 - 1,988
Children & Youth 7b 1,504 1 - 1,505 1,520 33 - 1,553
Evangelism & Growth 7b 7,496 143 - 7,639 5,511 511 - 6,022
Global relations 7b 1,173 5,685 - 6,858 977 3,405 - 4,382
Learning Network 7b 3,019 2 - 3,021 2,719 59 - 2,778
Methodist Council & Governance 7b 5,168 18 - 5,186 4,777 85 - 4,862
Ministry 7b 4,029 3,610 - 7,639 3,918 1,616 - 5,534
Property 7b 681 146 - 827 655 4,850 - 5,505
Others - Pensions 7b 1,339 - - 1,339 1,496 - - 1,496
Total expenditure 19b, 20b, 21a 27,375 11,628 6 39,009 24,245 12,282 19 36,546
Net gains/(losses) on investments 14b (2,162) (1,494) (579) (4,235) (7,304) (4,485) (3,603) (15,392)
Net income 4,016 (5,752) (585) (2,321) 3,740 (7,166) (3,622) (7,048)
Transfers between funds 22 1,718 (1,985) 267 - 934 (1,305) 371 -
Net income after transfers 5,734 (7,737) (318) (2,321) 4,674 (8,471) (3,251) (7,048)
Other recognised gains and losses:
Remeasurement of net defined benefit pension scheme liability 28 (1,813) 94 - (1,719) (2,201) 311 - (1,890)
Gains on revaluation of charitableproperties 74 (3,791) - (3,717) - (8,836) - (8,836)
Net movement in funds 3,995 (11,434) (318) (7,757) 2,473 (16,996) (3,251) (17,774)
Total funds at 1 September 118,294 113,062 19,584 250,940 115,821 130,058 22,835 268,714
Total funds at 31 August 122,289 101,628 19,266 243,183 118,294 113,062 19,584 250,940

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The Methodist Church in Great Britain Balance Sheets as at 31 August 2023

The Methodist Church in Great Britain The Methodist Church in Great Britain The Connexional Funds
Notes 2023 2022 2023 2022
£000 £000 £000 £000
Fixed assets
Intangible assets 13c 178 62 106 43
Tangible fixed assets 13a&b 66,704 80,051 56,033 69,228
Investments 14a&b 186,469 182,267 173,482 167,766
253,351 262,380 229,621 237,037
Current assets
Stocks 17 42 44 30 29
Debtors 15 7,138 5,664 6,401 4,393
Short-term deposits 21,554 25,513 19,991 23,605
Cash at bank and in hand 7,539 5,022 4,657 3,012
Total current assets 36,273 36,243 31,079 31,039
Creditors
Amounts falling due within one year 16a (17,057) (15,774) (14,814) (13,975)
Net current assets 19,216 20,469 16,265 17,064
Total assets less current liabilities 272,567 282,849 245,886 254,101
Creditors
Amounts falling due after more than one year 16b (1,748) (2,356) (1,472) (1,792)
Net assets excluding pension liability 270,819 280,493 244,414 252,309
Defined benefit pension scheme liability 28 (1,231) (1,368) (1,231) (1,368)
Net assets including pension liability 23 269,588 279,125 243,183 250,941
The funds of the charity
Unrestricted funds
General funds 55,585 52,706 51,866 50,531
Designated funds 71,857 68,926 70,423 67,763
Defined benefitpension scheme liability 28 - - - -
Total unrestricted funds 19 127,442 121,632 122,289 118,294
Restricted funds 20 122,880 137,909 101,628 113,062
Endowment funds 21 19,266 19,584 19,266 19,584
Total funds 269,588 279,125 243,183 250,940

Total unrestricted funds include revaluation reserve of £7.3m (2022: £7.3m) for both The Methodist Church in Great Britain and the Connexional Funds. Total restricted funds include revaluation reserve of £45.2m (2022: £48.5m) for The Methodist Church in Great Britain and £39.6m (2022: £43.3m) for The Connexional Funds. (Note 24 Page 84)

The notes on pages 47 to 95 form an integral part of these accounts.

Approved and authorised for issue by the Board of Trustees on 29[th] January 2024 and signed on their behalf by:

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The Revd. Sonia Hicks Chair of the Council

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Anne Bolton Connexional Treasurer

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The Methodist Church in Great Britain

Cash flow statements for the year ended 31 August 2023

The Methodist Church in Great Britain Church in Great Britain The Connexional Funds The Connexional Funds
2023 2022 2023 2022
Statement of cash flows Note £000 £000 £000 £000
Cash flows from operating activities
Net cashgenerated used in operatingactivities (5,586) 488 (5,991) (324)
Cash flows from investing activities
Dividends, interest and rents from investments 6,036 6,141 6,127 5,907
Proceeds from the sale of property, plant and equipment 806 30,289 806 30,289
Purchase of property, plant and equipment (1,652) (23,970) (1,244) (23,806)
Purchase of intangible assets 13c (186) (16) (98) -
Proceeds from the sale of investments 14a, 14b 2,841 642 100 75
Purchase of investments 14a, 14b (3,422) (1,287) (1,669) (1,242)
Net cash provided by investing activities 4,423 11,799 4,022 11,223
Cash flows from financing activities
Repayment of loans (279) (48) - -
Net cash from/(used in) financing activities (279) (48) - -
Change in cash and cash equivalents in the reporting period (1,442) 12,239 (1,969) 10,899
Cash and cash equivalents at the beginning of the reporting period 30,535 18,296 26,617 15,718
Cash and cash equivalents at the end of the reporting period 29,093 30,535 24,648 26,617
2023 2022 2023 2022
Reconciliation of net income to net cash flow from operating activities £000 £000 £000 £000
Net income for the year (4,543) (2,563) (2,321) (7,048)
Adjustments for:
Depreciation and amortisation charges 13a, 13c 346 283 127 80
Gain on revaluation of fixed asset (113)
 4,785 (113)
 4,785
Realised loss on the sale of fixed assets (185) (2,026) (185) (2,026)
London Committee property donated to Kings Cross 209 - 209
 -
Net (gains)/ losses on investments 14 5,580 11,953 4,235 15,392
Investment income (6,036) (6,141) (6,127) (5,907)
Decrease in stocks 17 2 10 (1) 7
(Increase) in debtors 15 56 (2,053) (478) (1,051)
(Decrease)/increase in creditors 16 954 (163) 519 (959)
Pension costs/difference between pension costs charged and paid (1,856) (3,597) (1,856) (3,597)
Net cash generated used in operating activities (5,586) 488 (5,991) (324)
2023 2022 2023 2022
Analysis of cash and cash equivalents £000 £000 £000 £000
Cash in hand and at bank 7,539 5,022 4,657 3,012
Short-term deposits (less than 3 months) 21,554 25,513 19,991 23,605
Total cash and cash equivalents 29,093 30,535 24,648 26,617

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The Methodist Church in Great Britain

Cash flow statements for the year ended 31 August 2023 (continued)

Analysis of changes in net assets

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The Methodist Church in Great Britain 01-Sep Cash flows Non-cash 31-Aug
2022 changes 2023
Cash and cash equivalents £000 £000 £000 £000
Short-term deposits 25,513 (3,959) - 21,554
Cash at bank and in hand 5,022 2,517 - 7,539
30,535 (1,442) - 29,093
Borrowings
Debt due within one year (257) (37) - (294)
Debt due after one year (391) 316 - (75)
(648) 279 - (369)
Total 29,887 (1,163) - 28,724
The Connexional Funds 01-Sep Cash flows Non-cash 31-Aug
2022 changes 2023
Cash and cash equivalents £000 £000 £000 £000
Short-term deposits 23,606 (3,615) - 19,991
Cash at bank and in hand 3,011 1,646 - 4,657
Total 26,617 (1,969) - 24,648
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46

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023

1. Accounting policies

a) Scope and basis of the preparation of the financial statements

The Methodist Church in Great Britain is a public benefit entity for the purposes of FRS 102, and therefore the financial statements have been prepared in accordance with the Statement of Recommended Practice: Accounting and Reporting by Charities preparing their financial statements in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (‘the SORP’).

The financial statements have been prepared to give a “true and fair” view and have departed from the Charities (Accounts and Reports) Regulations 2008 only to the extent required to provide a “true and fair” view. This departure has involved following “Accounting and Reporting by Charities preparing their financial statements in the UK and Republic of Ireland (FRS 102)” second edition effective from 1 January 2019, rather than “Accounting and Reporting by Charities: Statement of Recommended Practice effective from 1 April 2005” which has since been withdrawn. The preparation of the financial statements in accordance with FRS102 requires the trustees to make judgements, estimates and assumptions that affect the application of policies and reported amounts in the financial statements. The areas involving higher degree of judgement, or areas where assumptions or estimates were significant to the financial statements are disclosed in Note 2 on page 54. The financial statements are prepared in sterling, which is the functional currency of the Charity. Monetary amounts shown in these financial statements are rounded to the nearest £’000.

b) Preparation of the financial statements on a going concern basis

The trustees continue to prepare the financial statements on the basis that The Methodist Church in Great Britain is a going concern. Evidently, the Church has adequate financial resources and is able to manage business risks. The planning processes, including financial projections, take into consideration the prevailing economic climate and its potential impact on the various sources of income and planned expenditure. The trustees have looked at least 12 months ahead and are satisfied that the Church has adequate resources to continue in operational existence for the near future and there are no material uncertainties that call into doubt the Church’s ability to continue in operation. In-year financial performance was favourable to plan due to additional property levy income. Looking forward, the budget for 2023/24 has been set on the basis of a broadly breakeven position on the general fund with planned for reductions in restricted fund balances in line with reserves policy. The more material risk remains as last year, namely the ability of churches to continue to pay their contribution to the District Assessment (£14.2m) and pay their ministers (c£45m). The current balances held by churches and circuits in their Central Finance Board deposit accounts total an estimated £240m. In addition, there are cash balances held in commercial bank accounts of tens of millions. Given an assumed turnover across the wider Church of c£90m there is approximately three years’ worth of expenditure sitting in reserves. Consequently, there is no immediate threat to the District Assessment income and nor should circuits be defaulting in funding the payroll costs of ministers. The ongoing sale of churches across the Connexion continues to provide a flow of money into the Connexional Funds that further supports the medium-term financial viability of the charity. Improvements in the funding position of both pension schemes provide an opportunity to materially reduce risk on a permanent basis.

c) Group financial statements

The Statement of Financial Activities (SOFA) and balance sheet consolidate the financial statements of the Church and its subsidiary undertakings as set out in the diagram below. The consolidation principles applied are based on the SORP, whereby the parent charity consolidates the subsidiaries it controls. Control in this context is the power to govern the financial and operating policies of an entity in order to benefit from its activities. This control is the power to appoint and remove trustees. The Methodist Council, as managing trustee, has the ability to govern the financial and operating policies of the entities.

47

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

For consolidated companies limited by shares, control is by virtue of shareholdings. For consolidated companies limited by guarantee, control is by virtue of sole or majority membership.

The beneficial element of this control is demonstrated by the concurrence of purpose. All the subsidiary entities included in the consolidation contribute to the purposes and aims of the Methodist Church in Great Britain and benefit its beneficiaries.

The results of the subsidiary entities are consolidated on a line-by-line basis in accordance with section 9 of FRS 102. Any inter-entity balances and transactions have been eliminated on consolidation. All the entities have the same reporting date and uniform group accounting policies have been adopted.

d) The group structure

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48

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

e) Excluded entities

There are a number of entities which form part of the wider picture of the Methodist Church in Great Britain, some of which are mentioned below. These entities are excluded from consolidation because the Methodist Council has no control over their financial and operating policies.

Methodist churches, circuits and districts Methodist Independent Schools Trust Trustees for Methodist Church Purposes (TMCP) The Central Finance Board (CFB) The Methodist Ministers’ Housing Society Westminster College Oxford Trust Ltd Westminster College Oxford Trust

f) Recognition of income and endowments

All income is accounted for when the Church has entitlement to the funds, the amount can be quantified and receipt of the funds is probable. Where income is received in advance of providing goods and/or services, it is deferred until the Church becomes entitled to that income.

All income is reported gross.

Rental income from operating leases (net of incentives given to the lessees) is recognised on a straightline basis over the lease term.

No amounts are included in the financial statements for services donated by volunteers.

District Assessment

The assessment is accounted for on a receivable basis. The amount can be measured reliably by the Church as they are published annually in advance in the Minutes of Conference. Standing Order 361 (2) states that the Methodist Church Fund shall be maintained “by an assessment levied by the Conference on each Circuit in the home church through the Districts [...]”. The assessment primarily funds the decisions of the Conference, part of which is the provision of certain services such as the administration of the connexionally held funds and the processing of ministerial stipends.

Donations

Donations are recognised when there is evidence of entitlement, receipt is probable and the amounts can be measured reliably. Where a donor has specified certain terms and conditions, the Church evaluates whether these conditions can be met before claiming entitlement. In any event, donations or gifts with conditions or terms which are outside of the Church’s stated purposes, or which are illegal are rejected by the Church.

Goods donated for on-going use by the Church in carrying out its activities are recognised as tangible fixed assets or as investments with the corresponding gain recognised as income from donations within the SOFA, subject to the capitalisation threshold of £1,000.

Legacies

Entitlement to a legacy is assumed when there is sufficient evidence that a gift has been left to the Church, usually through the notification of a will. Receipt of a legacy is deemed probable when there has been a grant of probate and it has been established that there are sufficient assets in the estate to pay the legacy and there are no conditions attached to the legacy that are outside the control of the Church, or uncertainty around the receipt of this gift. Income from pecuniary legacies is recognised upon notification or receipt if earlier.

49

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

Where legacies have been notified to the Church or the Church is aware of the granting of probate, and the criteria for income recognition have not been met, then the legacy is treated as a contingent asset and disclosed if material.

Capital (property) levies

Capital levies are due on the disposition of property by churches, circuits and districts under Standing Order 970 of the Constitutional Practice and Discipline of the Methodist Church. These are accounted for on a receipts basis when the disposal proceeds are deposited with the Church’s custodian, Trustees for Methodist Church Purposes. Capital levies are disclosed net of any refunds due back to the church, circuit or district.

Grants

Income from grants is recognised when there is evidence of entitlement to the grant, receipt is probable and its amount can be measured reliably. To this end, evidence of entitlement is assumed to exist when the formal offer of funding is communicated in writing to the Church. Where there is a performance condition attached to the grant, entitlement is only recognised when the conditions have been met.

g) Accounting for leases

Rental income from assets leased under operating leases is recognised on a straight-line basis over the term of the lease. Rent-free periods or other incentives given to the lessee are accounted for as a reduction to the rental income and recognised on a straight-line basis over the lease term.

h) Recognition of expenditure

All expenditure is accounted for on an accruals basis when an obligation that can be measured or reliably estimated exists at the reporting date and it is more likely than not that payment will be made in settlement.

There are two main categories of expenditure shown in the statement of financial activities: expenditure on raising funds and charitable activities.

Expenditure on raising funds includes all expenditure incurred to raise income to spend on charitable purposes. Expenditure on charitable activities includes all costs incurred by the Church in undertaking activities that further its charitable aims for the benefit of its beneficiaries. This expenditure is further analysed into direct and support costs. Direct costs are those specifically related to producing the delivery of an activity or service, for example the costs incurred in training ministers; mission partners working overseas or the payment of grants to beneficiaries. Support costs are those which provide indirect support to front-line services – for example financial services, facilities management, development and personnel, governance costs and management information services. Support costs not attributable to a single activity have been allocated on a basis consistent with identified cost drivers for that cost category such as staff head count and floor space.

Grant commitments

Grants awarded are provided for in the SOFA in the year in which they are approved by the trustees and the offer is communicated to the recipient. Grants awarded but not paid are recorded as a liability within the balance sheet. Grants awarded subject to explicit conditions being met by the recipient before payments are made are not accrued until such conditions have been met. Such commitments are disclosed in the financial statements as contingent liabilities.

50

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

i) Fund accounting

Unrestricted funds are available for use at the discretion of the trustees in furtherance of the general charitable objectives. Designated funds are a portion of the unrestricted funds that have been set aside for a particular purpose by the trustees. Restricted funds are donated for a particular purpose, the use of which is restricted to that purpose. The purposes of the main restricted and designated funds are set out in the notes to the financial statements. Endowment funds are either permanent or expendable. Permanent funds are normally held indefinitely, while trustees have the power to convert expendable funds into income. The return on endowment investments is made up of income earned.

The costs of raising and administering the restricted funds are charged against the specific fund. Any investment income or gain is allocated to the appropriate fund in the case of restricted funds and in accordance with the terms of the endowment in the case of endowment funds.

j) Pension costs

Defined benefit pension schemes

The Methodist Council participates in three main pension schemes: the Methodist Ministers’ Pension Scheme (MMPS); the Pensions and Assurance Scheme for Lay Employees of the Methodist Church (PASLEMC); and the Superannuation Scheme for Lay Mission Partners of the Methodist Church (SSMP).

The PASLEMC scheme is a group plan for accounting purposes, with the Methodist Council as the sponsoring employer with legal responsibility for the plan. There is no contractual arrangement or stated policy for charging the net defined benefit cost of the plan as a whole to individual group entities and therefore the Council has recognised the entire net defined benefit cost and the relevant net defined benefit liability in its individual financial statements. Participation in a group pension plan is a related party transaction.

The pension assets and liabilities in respect of the PASLEMC and SSMP schemes are recorded in line with FRS 102, with scheme valuations undertaken by independent actuaries. FRS 102 measures the value of pension assets and liabilities at the balance sheet date and determines the benefits accrued in the year and the interest on assets and liabilities. Current service costs, together with the net interest cost for the year, are allocated to relevant expenditure headings within the SOFA. The MMPS scheme assets and liabilities are excluded for reasons set out on pages 55-56.

Scheme assets are measured at fair value at the balance sheet date. Scheme liabilities are measured on an actuarial basis at the balance sheet date, using the projected unit credit method, and discounted at a rate equivalent to the current rate of return on a high-quality corporate bond of equivalent term to the scheme liabilities. Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited to other recognised gains and losses in the SOFA. These amounts together with the return on plan assets less amounts included in net interest, and any unrecognised net surplus, are disclosed as re-measurements of the PASLEMC defined benefit liability. The resulting defined benefit asset or liability is presented separately on the face of the balance sheet. Any asset resulting from this calculation is limited to the present value of available refunds or reductions in future contributions to the plan.

The MMPS is a group scheme as all of the participating entities, mainly the circuits and the Council, are under the common control of the Conference. However, the Council has adopted a different accounting policy for this Scheme set out in detail in Note 12 for the reasons set out on pages 55-56. For the MMPS, costs equal to the contributions paid are recognised in the accounts as they fall due. Pension costs are allocated to activities and between funds according to an employee’s normal job function.

51

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

Defined contribution pension schemes

Pension costs in respect of defined contribution schemes are charged to the SOFA for the period in which they are payable. Such costs are allocated to activities and between funds according to an employee’s normal job function.

k) Stocks

Stock consists of purchased goods for resale. Stocks are valued at the lower of cost and net realisable value after making due allowance for obsolete or slow moving items.

l) Foreign currencies

Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are taken to the SOFA.

m) Tangible fixed assets

All tangible fixed assets costing more than £1,000 are capitalised and included initially at cost, including any incidental expenses of acquisition and irrecoverable VAT. Subsequently, charitable (functional) land and buildings are held at valuation. The Church undertakes to perform the valuations every five years to ensure that the carrying amount does not differ materially from the fair value of the asset at the end of the reporting period. Work to existing properties which is capable of extending the useful life or otherwise adding to the value of the property is capitalised. All other expenditure incurred in respect of general repairs to functional assets is charged to the SOFA in the year it is incurred. Assets under construction are stated at cost and transferred to completed properties when ready for use.

n) Depreciation

Tangible fixed assets are depreciated to their estimated residual values over their expected useful lives. The depreciation expense is charged or apportioned to the relevant SOFA heading reflecting the asset’s use on a straight-line basis as follows:

Freehold land nil Freehold buildings nil Computer equipment over 3 years Furniture and fittings over 5 years Motor vehicles over 5 years

o) Impairment

An assessment is made at each reporting date of whether there are indications that a fixed asset may be impaired or that an impairment loss previously recognised has fully or partially reversed. If such indications exist, the Church estimates the recoverable amount of the asset. Shortfalls between the carrying value of fixed assets and their recoverable amounts, being the higher of fair value less costs to sell and value-in-use, are recognised as impairment losses. Impairments of revalued assets are treated as a revaluation loss. All other impairment losses are recognised in the Statement of Financial Activities. Recognised impairment losses are reversed if, and only if, the reasons for the impairment loss have ceased to apply. Reversals of impairment losses are recognised in the Statement of Financial Activities or, for revalued assets, as a revaluation gain. On reversal of an impairment loss, the depreciation or amortisation is adjusted to allocate the asset’s revised carrying amount (less any residual value) over its remaining useful life.

52

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

p) Intangible fixed assets and amortisation

Intangible assets are held on the balance sheet at cost less accumulated amortisation and impairment losses.

Computer software, including development costs, is capitalised as an intangible asset and amortised on a straight-line basis over the expected useful life of five years. Impairment reviews are conducted when events and changes in circumstances indicate that an impairment may have occurred. If any asset is found to have a carrying value materially higher than its recoverable amount, it is written down accordingly.

q) Heritage assets

There are four Methodist Heritage sites in Great Britain which fit into this definition. These are: The Old Rectory, Epworth, Lincolnshire - the childhood home of John and Charles Wesley; The New Room (John Wesley’s Chapel), Bristol - the first ever Methodist building in the world; Wesley’s Chapel & House, and The Museum of Methodism, London - John Wesley’s London base (from which he travelled 250,000 miles to preach, and the place of his death and burial) and Englesea Brook Chapel & Museum of Primitive Methodism, near Crewe - exhibitions and activities focusing on one strand of 19th Century Methodism. These assets have not been consolidated in the financial statements because they belong to entities that are not under the control of the Methodist Council.

r) Investments

Investments are stated at fair value at the balance sheet date and the statement of financial activities shows net investment gains and losses arising from revaluation of the investment portfolio and disposals during the year. Investment properties are initially recognised at cost which includes purchase cost and any directly attributable expenditure. Subsequently, investment properties are measured at fair value. The surplus or deficit on revaluation is recognised in the statement of financial activities for the year. Investment properties are normally revalued triennially by independent professionals who hold recognised and relevant professional qualifications and have recent experience in the location and class of the investment property being valued. In the intervening periods, the trustees carry out the valuations. Investments held in units in the Central Finance Board are stated at the Board’s published valuations. The value of the unlisted investments in William Leech (Investments) Ltd are stated at the underlying value of the net assets based on the company’s audited balance sheet at 31 March 2023, updated by the value of any share acquisitions (at cost) up to 31 August 2023. The assets are held at fair value.

s) Irrecoverable VAT

Irrecoverable VAT has been charged to the expenditure to which it relates within the statement of financial activities.

t) Cash and cash equivalents

Cash and cash equivalents includes cash and cash held on deposit with the Central Finance Board of the Methodist Church and the Trustees’ Investment Fund of the Trustees for Methodist Church Purposes and which has a maturity of less than three months from the date of acquisition and used for working capital purposes. Cash and cash on deposit are cash and cash equivalents for the purposes of the cash flow statements.

u) Financial instruments

The Church has basic financial instruments and financial assets. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value. Trade and other debtors are recognised at the settlement amount due after any trade discount offered.

53

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

Creditors are recognised where the Church has a present obligation resulting from a past event that will probably result in the transfer of funds to a third party and the amount due to settle the obligation can be measured or estimated reliably. Creditors are normally recognised at their settlement amount after allowing for any trade discounts due.

Financial assets comprise investments held by the Church in units invested by the Central Board of Finance of the Methodist Church. The fair value of the investments is based on the closing quoted bid price at the accounting dates. Unrealised gains and losses arising from changes in market value are recognised in the income and expenditure account.

v) Concessionary loans made

Methodist ministers or probationers appointed for the first time to a station within the control of the Church are eligible to receive financial assistance from the Methodist Church Fund. This assistance may be given by way of grant or interest-free loan or a combination of both according to criteria set by the Methodist Council. The maximum amount for a loan is £10,000 repayable over five years. Additionally, loans may be advanced to other Methodist bodies from trusts under the control of the Methodist Council in line with the trust’s individual objectives. Initial recognition and measurement of the loans is based on the actual value of the loan advanced. In subsequent years, the carrying amount is adjusted to reflect repayments. If a loan that has been made is found to be irrecoverable an adjustment will be made for impairment.

w) Termination benefits and payments

The Council may be committed, by legislation, contractual or other agreements with employees or their representatives or by a constructive obligation based on business practice, custom or a desire to act equitably, to make payments to employees when it terminates their employment.

Termination benefits are those that arise as a result of either the Council’s decision to terminate an employee’s employment before the normal retirement date or an employee’s decision to accept voluntary redundancy during an organisational restructure. These are recognised as an expense and charged to the Statement of Financial Activities when the Council is demonstrably committed to terminating the employment of an employee or group of employees before the normal retirement date; or to providing termination benefits as a result of an offer made in order to encourage voluntary redundancy. Termination benefits that arise as part of a settlement agreement are recognised once the period of consultation between the employee and their representative is completed and terms are agreed upon.

2. Accounting estimates and judgments

In preparing the financial statements, the trustees are required to make estimates and judgments. The areas considered below are considered the most important in understanding the judgments that underlie the financial statements as well as the uncertainties inherent in accounting estimates that could affect the figures reported in the operating results, financial position and cash flows of the next or future accounting periods.

The accounting policies are set out in Note 1 to the financial statements.

Grant commitments

The Church empowers and supports the mission of overseas partners by way of annual support grants over a number of years. In addition to the expenditure recognised in the financial statements, the Church has commitments in respect of these programmes at the year end. The partner churches are obliged to report back to the Connexional Grants Committee on the use of the grants before the next instalment is released.

Judgment is exercised as to satisfactory progress being made against the agreed project outcomes.

54

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

Cost allocation

Costs that are not attributable to a single activity are reallocated, or apportioned to activities on a basis consistent with identified cost drivers for that activity. Cost drivers utilised include the headcount and floor space and judgement is exercised in applying cost drivers to cost categories.

Actuarial assumptions in respect of defined benefit pension schemes

The application of actuarial assumptions relating to defined benefit pension schemes incorporated in the financial statements is in accordance with FRS 102. In applying FRS 102, advice is taken from independent qualified actuaries. In this context, significant judgement is exercised in a number of areas, including future changes in salaries and inflation, mortality rates and the selection of appropriate discount rates. Movements on the defined pension schemes are shown in Note 28.

Defined benefit pension scheme commitments

The Pension and Assurance Scheme for Lay Employees of the Methodist Church (PASLEMC)

The Methodist Council is the principal employer of the Pension and Assurance Scheme for Lay Employees of the Methodist Church, with its employees both past and present accounting for more than 80% of the scheme members. As mentioned in Note 12, there are other employing bodies, four of whom are not consolidated in these financial statements. These are The Central Finance Board of the Methodist Church; Trustees for Methodist Church Purposes (TMCP), the Methodist Ministers Housing Association (MMHA) and Methodist Central Hall Trustees. There is no contractual agreement or stated policy for charging the defined benefit cost of the plan as a whole to individual group entities and therefore the Council has recognised the entire net defined benefit cost and relevant net defined benefit asset/liability of the Pension and Assurance Scheme for Lay Employees of the Methodist Church in its financial statements. This is because the Council is the sponsoring employer of this Scheme as it has legal responsibility for the plan. The Council closed the scheme to new entrants from 31 May 2019 following consultations taking place with members.

The Methodist Ministers’ Pension Scheme (MMPS)

The MMPS is a defined benefit pension scheme for Methodist Ministers. It should be accounted for as a group plan as all the participating employers, namely the circuits and Council, are under the common control of the Conference. The scheme has not been included in these financial statements for the reasons set out below:

55

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

responsibility for current payments and for the deficit/surplus in the pension scheme is shared between the Council and the circuits with the bulk of the contributions coming from the circuits.

There is no contractual agreement or stated policy for charging the defined benefit cost of the plan as a whole to individual circuits and other participating employers; such decision would be made by the Conference.

As stated in the reserves policy section of the Trustees’ Report on page 28, the Pension Reserve Fund was set up following a Conference decision to establish a fund outside of the pension schemes, which could be used to meet future funding deficits. The fund was designated by the Conference and has been funded by a transfer of 45% of property sales income levy from the Connexional Priority Fund. Given the current level of funding relative to the decreased risk, these funding transfers have been stopped from 1 September 2023. Hence, the liability is not funded solely from general funds of the Council. It is probable that, if the deficit were to be required to be settled in full, the cost would be allocated at the discretion of the Conference across the Connexion and not from funds of the Council, except to the extent of the Pension Reserve.

Useful economic lives

The annual depreciation charge for tangible fixed assets, particularly buildings is sensitive to change in the estimated useful economic lives and residual value of the assets. As our policy is to revalue the buildings every five years and to undertake full quinquennial inspection in the intervening years, the useful economic lives will be assessed and amended where necessary, to reflect current circumstances. Note 13a shows the relevant tangible fixed assets.

Revaluation of functional property assets and investment properties

The Church carries its functional property assets and investment properties at fair value, with changes in fair value being recognised in the Statement of Financial Activities. The Church obtains valuations to determine fair value on a cyclical basis; normally being every five years for functional properties and three years for investment properties. The trustees consider that this is sufficiently regular to ensure that their carrying amount does not differ materially from their fair value at the reporting date. Some of the key assumptions used to determine the fair value of the assets are based on the valuer’s knowledge and experience of the market, values of similar properties that could be deemed subjective.

Revaluation gains on functional properties and investment properties are shown in Notes 24 and 14 respectively, and the relevant assets are included in Notes 13 and 14.

Leases

In categorising leases as finance leases or operating leases, management makes judgements as to whether significant risks and rewards of ownership have transferred to the lessee, where the Group is the lessor.

56

The Methodist Church in Great Britain Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

3a. Donations and legacies - The Methodist Church
in Great Britain		 Unrestricted Restricted 2023
Total		 Unrestricted Restricted 2022
Total
£000 £000 £000 £000 £000 £000
Donations 500 4,256 4,756 8,063 5,107 13,170
Legacies 67 1,657 1,724 110 2,395 2,505
Total 567 5,913 6,480 8,173 7,502 15,675
3b. Donations and legacies - The Connexional Unrestricted Restricted 2023 Unrestricted Restricted 2022
Funds Total Total
£000 £000 £000 £000 £000 £000
Donations 610 2,136 2,746 8,063 1,990 10,053
Legacies 67 386 453 110 542 652
Total 677 2,522 3,199 8,173 2,532 10,705
3c. Miscellaneous income - The Methodist Church
in Great Britain		 Unrestricted Restricted 2023
Total		 Unrestricted Restricted 2022
Total
£000 £000 £000 £000 £000 £000
Student fees - 165 165
 - 132 132
Seminars and events 148 49 197 131
 - 131
Conference income
 20
 - 20 18
 - 18
Administration & IT services
 2
 - 2 20
 - 20
Bureau & Accountancy services 8
 - 8 84
 - 84
Others 430 214 644 573 252 825
Total 608 428 1,036 826 384 1,210
3d. Miscellaneous income - The Connexional
Funds		 Unrestricted Restricted 2023
Total		 Unrestricted Restricted 2022
Total
£000 £000 £000 £000 £000 £000
Seminars and events 148
 - 148 131
 - 131
Conference income 21
 - 21 18
 - 18
Administration & IT services 2
 - 2 20
 - 20
Bureau & Accountancy services 8
 - 8 548
 - 548
Others
Total		 439
618		 117
117		 556
735		 157
874		 60
60		 217
934
3e. Charitable activities - The Methodist Church in Unrestricted Restricted 2023 Unrestricted Restricted 2022
Great Britain Total Total
£000 £000 £000 £000 £000 £000
District assessment
 13,261 121 13,382 13,532 125 13,657
Rental Income
Total		 -
13,261		 148
269		 148

13,530		 -
13,532		 210
335		 210
13,867
Unrestricted Restricted 2023 Unrestricted Restricted 2022
3f. Charitable activities - The Connexional Funds Total Total
£000 £000 £000 £000 £000 £000
District assessment
 13,261 121 13,382 13,532 125 13,657
Rental Income - 148 148
 - 210 210
Total 13,261 269 13,530 13,532 335 13,867

57

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

==> picture [490 x 378] intentionally omitted <==

----- Start of picture text -----
4a. Investment income - The Methodist Church in 2023 2022
Unrestricted Restricted Unrestricted Restricted
Great Britain Total Total
£000 £000 £000 £000 £000 £000
Central Finance Board 2,176 1,774 3,950 1,863 1,568 3,431
Interest and other investment income 16 4 20 4 12 16
Rental Income 130 952 1,082 165 870 1,035
William Leech Charities Fund - 984 984 - 1,659 1,659
Total 2,322 3,714 6,036 2,032 4,109 6,141
2023 2022
Unrestricted Restricted Unrestricted Restricted
4b. Investment income - The Connexional Funds Total Total
£000 £000 £000 £000 £000 £000
Central Finance Board 2,175 1,664 3,839 1,863 1,492 3,355
Interest and other investment income 16 4 20 4 - 4
Rental Income 828 456 1,284 481 408 889
William Leech Charities Fund - 984 984 - 1,659 1,659
Total 3,019 3,108 6,127 2,348 3,559 5,907
5a Other trading activities - The Methodist Church 2023 2022
Unrestricted Restricted Unrestricted Restricted
in Great Britain Total Total
£000 £000 £000 £000 £000 £000
Publishing 357 - 357 347 - 347
Room and conference hire 7,450 1,555 9,005 4,210 1,384 5,594
Advertising and fees 9 - 9 9 - 9
Total 7,816 1,555 9,371 4,566 1,384 5,950
5b Other trading activities - The Connexional 2023 2022
Unrestricted Restricted Unrestricted Restricted
Funds Total Total
£000 £000 £000 £000 £000 £000
Publishing 357 - 357 347 - 347
Room and conference hire - 1,214 1,214 - 933 933
Advertising and fees 9 - 9 9 - 9
Total 366 1,214 1,580 356 933 1,289
----- End of picture text -----

58

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

6a Capital levies

Standing Order 973 permits capital levies to be refunded for qualifying projects. Some of these levies may be refunded at any time. Therefore, a contingent liability exists in respect of income already recognised in the Connexional Priority Fund.

6b Grant income - The Methodist Church in Great
Britain		 Unrestricted Restricted 2023
Total		 Unrestricted Restricted 2022
Total
£000 £000 £000 £000 £000 £000
Chiesa Valdese - All We Can - 253 253
 - 253 253
The Aldershot Military Trust - 75 75
 - 75 75
Other* 2 536 538 15 954 969
Total 2 864 866 15 1,282 1,297

There are no unfulfilled conditions or contingencies attached to the grants. Cliff College has also received other forms of government assistance

of which they have benefitted in 2021/22. Cliff College received £39k (2022: £39k) from the Office of Students and Derbyshire County Council.

6c Grant income - The Connexional Funds Unrestricted Restricted 2023
Total		 Unrestricted Restricted 2022
Total
£000 £000 £000 £000 £000 £000
The Aldershot Military Trust - 75 75
 - 75 75
Other 2 19 21 2 24 26
Total 2 94 96 2 99 101

59

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

7a. Expenditure - The Methodist Church in Great Grant Direct Support 2023 Grant Direct Support 2022
Britain Costs Costs Costs Total Costs Costs Costs Total
£000 £000 £000 £000 £000 £000 £000 £000
Raising funds
 - 7,704 320 8,024 - 5,375 290 5,665
Charitable activities
Building communities 540 1,507 366
 2,413 522 1,122 344
 1,988
Children & Youth 96 1,015 395
 1,506 95 1,086 372
 1,553
Evangelism & Growth 5,055 1,933 651
 7,639 4,006 1,434 582
 6,022
Global relations 5,395 5,557 854
 11,806 2,798 5,372 768
 8,938
Learning Network 119 2,215 687
 3,021 113 2,014 651
 2,778
Methodist Council & Governance - 4,137 1,050
 5,187 97 3,779 986
 4,862
Ministry 4,903 4,683 590
 10,176 3,245 4,251 534
 8,030
Property 120 555 152
 827 - 5,365 140
 5,505
Others - Pensions - 1,339 -
 1,339 - 1,496 -
 1,496
16,228 22,941 4,745 43,914 10,876 25,919 4,377 41,172
Total 16,228 30,645 5,065 51,938 10,876 31,294 4,667 46,837

The basis of allocation of support costs is described in Note 8. Grant expenditure is further analysed in Note 10. The Charitable activities breakdown was updated to allign with Church's current activities.

7b. Expenditure - The Connexional Funds Grant Direct Support 2023 Grant Direct Support 2022
Costs Costs Costs Total Costs Costs Costs Total
£000 £000 £000 £000 £000 £000 £000 £000
Raising funds
 - 2,263 320 2,583 - 2,136 290 2,426
Charitable activities
Building communities 540 1,506 366
 2,412 522 1,122 344
 1,988
Children & Youth 96 1,014 395
 1,505 95 1,086 372
 1,553
Evangelism & Growth 5,055 1,933 651
 7,639 4,006 1,434 582
 6,022
Global relations 3,385 2,620 853
 6,858 976 2,638 768
 4,382
Learning Network 119 2,215 687
 3,021 113 2,014 651
 2,778
Methodist Council & Governance - 4,136 1,050
 5,186 97 3,779 986
 4,862
Ministry 5,047 2,001 591
 7,639 3,220 1,780 534
 5,534
Property 120 555 152
 827 - 5,365 140
 5,505
Others - Pensions - 1,339 -
 1,339 - 1,496 -
 1,496
14,362 17,319 4,745 36,426 9,029 20,714 4,377 34,120
Total 14,362 19,582 5,065 39,009 9,029 22,850 4,667 36,546
The basis of allocation of support costs is described in Note 8. Grant expenditure is further analysed in Note 10.

Note * The expenditure incured in raising funds for the Methodist Church in Great Britain - £8.0m (2022: £5.7m) and for the Connexion - £2.6m (2022: £ is broken down as follows:

The Methodist Church The Connexional The Connexional
in Great Britain Funds
2023 2022 2023 2022
Cost of raising voluntary income £0.3m £0.3m £0.3m £0.3m
Cost of investment management £0.4m £0.4m £0.4m £0.4m
Cost of other trading activities £7.3m £5.0m £1.9m £1.7m

60

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

8a. Support costs by activity - The Methodist Church in Great Britain and The Connexional Funds

Building Children Evangelism Global Learning Ministry Property Methodist Raising 2023
communities & Youth & Growth relations Network Council & funds Total
Governance
£000 £000 £000 £000 £000 £000 £000 £000 £000 £000
Facilities Per capita 81 90 72 108 161 81 27 233 45 898
Development & Personnel Per capita 83 92 73 110 165 83 28 239 46 919
Financial Services Per capita 111 112 425 516 180 334 67 316 179 2,240
Information Technology Per capita 91 101 81 120 181 92 30 262 50 1,008
Total 366 395 651 854 687 590 152 1,050 320 5,065
8b. Support costs by activity - The Methodist Church in Great Britain and The Connexional Funds
Building Children Evangelism Global Learning Ministry Property Methodist Raising 2022
communities & Youth & Growth relations Network Council & funds Total
Governance
£000 £000 £000 £000 £000 £000 £000 £000 £000 £000
Facilities Per capita 81 91 72 109 163 81 27 235 45 904
Development & Personnel Per capita 89 98 79 118 177 89 30 256 49 985
Financial Services Per capita 95 95 360 436 152 284 57 265 152 1,896
Information Technology Per capita 79 88 71 105 159 80 26 230 44 882
Total 344 372 582 768 651 534 140 986 290 4,667

9. Subsidiaries

The results of the Council's subsidiaries (before consolidation adjustments) are included within the Statement of Financial Activities as follows:

Cliff Southlands All We Methodist Y Care
College Methodist Can International International
Trust Centre Ltd
2023 2023 2023 2023 2023 2023
£000 £000 £000 £000 £000
Income from:
Donations and legacies 428 - 2147 - 816
Investments 96 451 60 1 -
Other trading activities 374 16 - 7,469 -
Other:
Grants 554 - 842 - 7
Miscellaneous income 522 - - - -
Total income 1,974 467 3,049 7,470 823
Expenditure on:
Raisingfunds 305 47 942 6,250 224
Charitable activities
Ministry 2,453 359 - - -
Global relations - 296 3,053 - 730
Total expenditure on charitable activities 2,453 655 3,053 - 730
Total expenditure 2,758 702 3,995 6,250 954
Net gains/(losses) on investments 441 (1,352) 7 - -
Net income/(expenditure) (343) (1,587) (939) 1,220 (131)
Distribution under Gift aid - - - - -
Net movement in funds (343) (1,587) (939) 1,220 (131)
Net assets
Fixed assets 10,229 11 3 500 -
Investments 15 12,330 641 - -
Current assets 637 47 2,061 2,659 1,275
Creditors and loans (479) (406) (453) (2,103) (561)
Total 10,402 11,982 2,252 1,056 714

61

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

9. Subsidiaries (continued)

9. Subsidiaries (continued)
Cliff College Southlands All We Can Methodist Y Care
Methodist Trust International International
Centre Ltd
2022 2022 2022 2022 2022 2022
£000 £000 £000 £000 £000
Income from:
Donations and legacies
 147 - 3,396 - 1,031
Investments
 103 457 19 - 1
Other trading activities
 508 10
 - 4,229 -
Other:
Grants
 799 50 934 13 54
Miscellaneous income
 709 - - - -
Total income
 2,266 517 4,349 4,242 1,086
Expenditure on:
Raisingfunds
 220 54 539 3,556 158
Charitable activities
Ministry
 2,551 325
 - - -
Global relations
 - 482 3,449 - 588
Total expenditure on charitable activities
 2,551 807 3,449 - 588
Total expenditure
 2,771 861 3,988 3,556 746
Net gains/(losses) on investments
 2,268 3,496 (54) - -
Net income/(expenditure) 1,763 3,152 307 686 340
Distribution under Gift aid
 - - - - -
Net movement in funds 1,763 3,152 307 686 340
Net assets
Fixed assets 10,617 15 7 204 -
Investments 16 13,860 625 - -
Current assets 452 83 2,818 1,547 1,200
Creditors and loans (342) (388) (259) (1,915) (356)
Total 10,743 13,570 3,191 (164) 844

Cliff College

Charity Number 529386

Cliff College Outreach Limited Company Number 2331438

Cliff (Methodist) Developments Limited

Company Number 4934377

The College was founded in 1883 to provide training for mission and evangelism to people from diverse backgrounds. It offers degrees validated by the University of Manchester in the areas of theology and mission as well as providing a wide variety of short courses and training events.

All We Can

Charity Number 291691

All We Can works through partnerships to end the cycle of suffering caused by poverty, inequality and injustice.

Southlands Methodist Trust

Charity Number 1100660

Southlands Methodist Trust supports educational activities, including research, chaplaincy and charitable work undertaken in and through Southlands College that reflect its Methodist foundation and ethos.

Methodist International Centre Limited

Company Number 3866984

A company set up for the Methodist Council to conduct trading in support of its charitable activities. It is an accredited ethical social enterprise hotel which also provides student accommodation.

Y Care International

Company Number 3997006

Y Care international is a subsidiary of All We Can.

Y Care International is the international relief and develoment agency of the Young Men's Christian association (YMCA) in the UK and Ireland. They work in partnership with YMCAs that are already playing key roles in their communities. Their mission is to create opportunities with vulnerable young women and men to change lives for the better, fulfil their potential and play a full role in society. The YMCA work to bring social justice and peace to young people and their communities, regardless of religion, race, gender or culture.

62

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

10a. Grant expenditure: The Methodist Church in Great Britain

10a. Grant expenditure: The Methodist Church in Great Britain
2023 2022
Activity Individuals Institutions Total Total
Global relations £000 £000 £000 £000
Regionalgrants - 3,152 3,152 568
Scholarshipprogrammes - 196 196 365
Ministerial and personnel support grants - 36 36 43
Annualgrants - 2,011 2,011 1,823
Total - 5,395 5,395 2,799
Othergrants £000 £000 £000 £000
Building communities 205 335 540 522
Children & Youth - 96 96 95
Evangelism & Growth - 5,055 5,055 4,006
Learning Network - 119 119 113
Methodist Council & Governance - - - 97
Ministry 3,979 924 4,903 3,244
Property - 120 120
 -
Total 4,184 6,649 10,833 8,077
Grand Total 4,184 12,044 16,228 10,876
10b. Grant expenditure: The Connexional Funds
2023 2022
Activity Individuals Institutions Total Total
Global relations £000 £000 £000 £000
Regional grants - 3,152 3,152 568
Scholarship programmes - 196 196 365
Ministerial and personnel support grants - 37 37 43
Total - 3,385 3,385 976
Othergrants £000 £000 £000 £000
Building communities 205 335 540 522
Children & Youth - 96 96 95
Evangelism & Growth - 5,055 5,055 4,006
Learning Network - 119 119 113
Methodist Council & Governance - - - 97
Ministry 3,952 1,095 5,047 3,220
Property - 120 120
 -
Total 4,157 6,820 10,977 8,053
Grand Total 4,157 10,205 14,362 9,029

The figures in Note 10 are not intended to be the same as those listed for grants on page 23.

63

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in The Methodist Church in The Connexional
11. Included in the SOFA are the following: Great Britain Funds
2023 2022 2023 2022
Audit and consultancy fees £000 £000 £000 £000
Payable to RSM UK Audit LLP 86 79 86 79
Payable to RSM UK Tax & Accounting Ltd for taxation advice 21 10 21 10
Payable to other auditors - for internal audit services 25 30 25 30
Payable to other auditors - for audit of consolidated entities 74 68
 - -
Payable to other auditors - for financial advice to consolidated entities 9 7
 - -
Depreciation 276 253 92 60
Amortisation 0 30 0 20
Foreign exchange differences -
3
 - 3
Loan interest payable 46 87
 - -

12. Stipends and salary costs

The Methodist Council appointed or employed on average 431 (2022:378) people during the year, of which Connexional Funds had 263 (2022: 268) and the costs were:

(2022: 268) and the costs were:
The Methodist Church in The Connexional
Great Britain Funds
2023 2022 2023 2022
£000 £000 £000 £000
Stipends and salaries 14,596 13,449 10,077 9,784
Redundancy costs (loss of office) 118 154 89 116
Temporary staff costs 160 158 61 59
Social security costs 1,403 1,340 986 956
Pension costs - (defined contribution schemes) 2,148 1,340 1,962 1,120
Defined benefit pension costs excluding interest 3,013 5,607 2,988 5,582
Total 21,438 22,048 16,163 17,617

The Methodist Church in Great Britain

23 employees were paid £60k or more during the year (2022: 16 employees). The total aggregate pension contributions for these employees for the year were £202k (2022: £139k).

The Connexional Funds

17 employees were paid £60k or more during the year (2022: 9 employees). The total aggregate pension contributions for these employees for the year were £170k (2022: £106k).

The Methodist Church in The Methodist Church in The Connexional
Great Britain Funds
2023 2022 2023 2022
Number of Number of Number of Number of
Basic salary plus bonus employees employees employees employees
£60,001 - £70,000 10 6 8 4
£70,001 - £80,000 8 6 5 3
£80,001 - £90,000 3 3 1 1
£90,001 - £100,000 1 - 1 -
£100,001 - £110,000 - 1 1 1
£110,001 - £120,000 1 - 1 -

64

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

12. Stipends and salary costs (continued)

12. Stipends and salary costs (continued)
The Methodist Church in The Connexional Funds
Great Britain
Actual average number of staff by activity 2023 2022 2023 2022
Methodist Council & Governance 54.8 56.5 54.8 56.5
Global Relations 54.3 51.3 26.5 26.7
Evangelism & Growth 17.8 18.7 17.8 18.7
Learning Network 40.6 40.9 40.6 40.9
Children & Youth 12.6 13.8 12.6 13.8
Ministry 77.3 65.2 26.6 25.7
Building Communities 17.7 17.8 17.7 17.8
Administration & Support 44.7 48.9 44.7 48.9
Property 4.7 5.8 4.7 5.8
Fundraising 106.4 59.4 16.9 13.4
Total 430.9 378.3 262.9 268.2

The average number of volunteers working for the Council during the year was 842 (2022: 1,092).

Volunteers play an important role in the Council. Their contribution is significant in terms of the time they commit to attending meetings, raising funds and delivering services to beneficiaries.

Key management personnel

The key management personnel of the Church comprise the Secretary and Assistant Secretary of the Conference, the Connexional Secretary, the Head of Mission, the Head of Ministries (for 9 months of the year) the Head of Ministries & Learning, the Director of Communications, the Executive Director of Finance and Resources and the Director of Human Resources. A number of these posts are undertaken by Trustees (as set out in Note 26) and the remuneration of these individuals is included in the amounts below. Their total remuneration inclusive of benefits and employer's national insurance, but excluding pension contributions was £645k (2022: £623k). In addition, pension contributions of £95k were paid into defined contribution pension schemes on behalf of these personnel (2022: £94k).

Pension costs

The Methodist Council operates three main pension schemes:

The MMPS and PASLEMC schemes are final salary defined benefit pension schemes and both schemes are funded by the payment of contributions to separately administered trust funds. The SSMP is an unfunded scheme.

The PASLEMC Scheme closed to new entrants and the future accrual of pensionable service with effect from 31 May 2019. The Methodist Council now contributes to a defined contribution scheme with Royal London for its Lay employees.

65

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

12. Pension costs (continued)

The Methodist Ministers’ Pension Scheme

The MMPS is treated as a group scheme for accounting purposes as all of the entities participating in the scheme, mainly the circuits and the Council, are under the common control of the Conference. There is no contractual arrangement or stated policy for charging the net defined benefit cost of the plan as a whole to individual circuits and the Council. A detailed explanation of the accounting treatment is provided in Note 2 on pages 58-59 with further information as required by FRS102 included on pages 96-98.

The Methodist Church in Great Britain is the sole statutory employer for purposes of pension law, that is The Church as defined in the Methodist Church Act 1976 and the Deed of Union 1939 of which the Conference is the supreme governing body. There are approximately 1,136 ministers who are active members of MMPS of whom the Council (the ‘reporting entity’) is responsible for the pension contributions of 64 ministers. The majority of ‘employer’ pension contributions coming from the circuits to which they are stationed annually by the Conference, that also pay their stipends and employer national insurance contributions.

For the MMPS, costs equal to the contributions paid by the Council for ministers in posts under the control of the Council are recognised in these accounts as they fall due; likewise, pension contributions for ministers stationed at circuit level are paid by the individual circuit.

FRS 102 requires that if the net defined benefit pension cost is not reflected in the individual financial statements of the participating entities, it should be reflected in the individual financial statements of the group entity which is legally responsible for the plan. However, the Council is not legally responsible for the plan and so the liability has not been included in these financial statements. The agreement with the Trustees of MMPS for the making good of the technical deficit rests with the Conference and not the Council.

The Pension and Assurance Scheme for Lay Employees of the Methodist Church (PASLEMC)

The PASLEMC scheme is treated as a group scheme for accounting purposes, with the Methodist Council as the sponsoring employer with legal responsibility for the plan. There is no contractual arrangement or stated policy for charging the net defined benefit cost of the plan as a whole to individual group entities and therefore the Council has recognised the entire net defined benefit liability in its financial statements.

The PASLEMC scheme is a funded defined benefit arrangement which provides retirement benefits based on final pensionable earnings. The most recent actuarial valuation of the Scheme, carried out as at 1 September 2020, revealed that the Scheme had a deficit on the funding basis. The Methodist Council, the other participating employers and the Trustee of the Scheme put in place a Schedule of Contributions and a Recovery Plan which detailed the contributions that would be made to fund both this deficit and the shortfall arising from the level of future service contributions being paid. It was agreed that contributions from the Methodist Church’s Pension Reserve Fund would be made as follows:

● a lump sum of £2,380,000 per annum will be paid into the Scheme each August, starting August 2021 up to and including August 2026; and

● between £0 and £529,000 will be paid to the Scheme each December, starting December 2021 up to and including December 2026. The precise amount payable will be determined by the Scheme Actuary each year having regard to Scheme experience.

The PASLEMC Scheme closed to new entrants and the future accrual of pensionable service with effect from 31 May 2019.

66

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Superannuation Scheme for Lay Mission Partners (SSMP)

The Superannuation Scheme for Lay Mission Partners of the Methodist Church operated by the Methodist Church is a defined benefit arrangement which provides retirement benefits calculated as fixed pension amounts for each year of service. The Scheme closed to the future accrual of benefits in 2007, when all remaining active members became deferred pensioners. The most recent actuarial valuation of the Scheme, carried out as at 1 January 2017, indicated that the Scheme had a deficit.

There are 22 members in total, 6 of whom are deferred pensioners. The scheme has been accounted for as a defined benefit scheme in accordance with FRS 102. The Scheme is now closed to new entrants.

The scheme provides a pension of £205.63 per year of qualifying service to a single retired mission partner or widow / widower, £274.25 per year of qualifying service to a married mission partner. The rates are increased annually in line with the retail price index. There are also retirement grants of £136.65 (single) / £182.65 (married) per year of qualifying service for those mission partners who withdraw before completing 10 years qualifying service. Mission partners who retire after completing 10 but less than 15 years qualifying service are given the option of receiving a withdrawal grant or a retirement pension at the appropriate retirement age. Mission partners who withdraw or retire after completing 15 years qualifying service receive a retirement grant and a pension at the appropriate retirement age.

The calculations for the FRS 102 disclosures have been carried out by running actuarial calculations as at 31 August 2023 by the Scheme’s actuary and shown in Note 28.

Other pension schemes

The Methodist Council also participates in a number of smaller pension schemes. The members are mission partners currently working overseas. The schemes are: The Pensions Trust and The Retirement Benefit Scheme (Ireland).

The Pensions Trust

There are 17 members in the scheme participating in the Trust's two defined contribution schemes: the Ethical Fund and the Flexible Retirement Plan. The pension charge for the year was £132k (2022: £138k). Further disclosures are deemed unnecessary on the grounds of immateriality.

The Retirement Benefit Scheme (Ireland)

There are currently 2 members in this scheme. The pension charge for the year was £5.3k (2022: £9.7k). Further disclosures are deemed unnecessary on the grounds of immateriality.

67

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

13a. Tangible fixed assets - The Methodist Church in Great Britain
Freehold land Furniture and Computer Motor Total
and buildings fittings equipment vehicles
At cost or valuation £000 £000 £000 £000 £000
At 1 September 2022 80,105 1,958 1,920 33 84,016
Additions during the year 1,674 42 152 13 1,881
Revaluations 283
 - - - 283
Transfers (to Investment property) (9,790)
 - - - (9,790)
Disposals (5,435) (36)
 - - (5,471)
Total 66,837 1,964 2,072 46 70,919
Depreciation
At 1 September 2022 329 1,845 1,766 25 3,965
Charge for the year 103 62 107 4 276
Disposals - (26)
 - - (26)
Total 432 1,881 1,873 29 4,215
Net book value as at 31 August 2023 66,405 83 199 17 66,704
Net book value as at 31 August 2022 79,776 113 154 8 80,051

13b. Tangible fixed assets - The Connexional Funds

Freehold land Furniture and Computer Motor
At cost or valuation and buildings fittings equipment vehicles Total
£000 £000 £000 £000 £000
At 1 September 2022 69,040 944 1,382
 - 71,366
Additions during the year 1,143 8 93
 - 1,244
Transfers (9,790) - - - (9,790)
Revaluations 113 - - - 113
Disposals (4,660) (36)
 - - (4,696)
Total 55,846 916 1,475
 - 58,237
Depreciation
At 1 September 2022 - 900 1,238
 - 2,138
Charge for the year - 15 77
 - 92
Disposals - (26) (26)
 - (52)
Total - 889 1,315
 - 2,204
Net book value as at 31 August 2023 55,847 27 160
 - 56,034
Net book value as at 31 August 2022 69,040 44 144
 - 69,228

Depreciation cost is included in the support cost and apportion in other activities (Note 8)

Contigent asset

During the year, the London Committee entered into an agreement to transfer a property in Kings Cross to the Church Council

of King’s Cross Methodist Church. The terms of the agreement were to transfer the property in exchange for a loan which

would be payable at a point where either the property was sold or utilised for activities outside the objectives of the Methodist Church, with the value payable based on the proceeds achieved or an indexed value starting from £2,800k which was a valuation of the property in May 2011.

Any future loan repayments are under the control of the Church Council of King’s Cross Methodist Church which will not be required to transfer funds unless it takes a decision to change the use of the building, either via sale or use.

We have recognised the disposal but no corresponding debtor will be recognised until the use changes and amounts are due for the transfer. The potential future receipt is estimated at £4,483k as at 31st August 2023.

68

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

13c. Intangible fixed assets

At cost £000 £000
At 1 September 2022 418 353
Additions during the year 186 98
Total 604 451
Amortisation
At 1 September 2022 356 310
Charge for theyear 70 35
Total 426 345
Net book value as at 31 August 2023 178 106
Net book value as at 31 August 2022 62 43

Amortisation cost is included in the support cost and apportion in other activities (Note 8)

13d. Revaluation of charitable land and buildings

Land & buildings have been revalued as set out below on an existing use open market value basis, in accordance with the Guidance Notes of the Royal Institution of Chartered Surveyors. The individual valuers are not connected with the Methodist Church. Valuations are based on fair value of the land and buildings subject to and with the benefit of existing leases where appropriate.

The freehold land and buildings were revalued on 31 August 2019 except for Asbury Overseas House, Birmingham which was revalued in 31 August 2020.

The manses, which are residential and have a well established market, were revalued internally by reference to current market prices on 31 August 2019. The trustees consider the valuation of these properties and consider that there is no material difference between amounts in the accounts and the current individual valuations.

Asbury Overseas House, Birmingham (Birmingham Methodist Overseas Guest House) A full professional valuation was carried out by Savills in August 2020. The property was valued at £1,850k.

The commercial properties were valued by professional independent valuers as follows:

1-5 Lambeth Road SE1- valuation by Tony Harris LLM FRICS FCIArb of Cluttons, Portman Street, London W1H 6DU, in July 2022 for £10k.

90 Hayes Lane, Kenley - valuation carried out in July 2022 by Richard Moss MRICS and John Barrett FRICS from Cluttons, Portman Street, London W1H 6DU; valued at £870k.

Cliff College, Calver, Hope Valley, Derbyshire S32 3XG - Valuation carried out in August 2021 by M J Hull BSc (Hons) MRICS from SMC Chartered Surveyors, 54 Campo Lane, Sheffield S1 2EG; valued at £6,066k.

Current value of Guy Chester Centre in the accounts is based on the valuation carried out by Savills. The valuation was done in September 2022. The property was valued at £14,865.5k.

The place of worship part of the Wesley Hotel Camden located at 89 Plender Street, Camden Town, London NW1 0JN was valued as £1,134k by Savills on 31 August 2023. The current market value is £1,134k.

All the properties were valued at fair value in accordance with FRS 102.

The carrying value that would have been recognised had the assets been carried under the historical cost model is £35,800k (2022: £45,500k) for the Methodist Church in Great Britain and £27,800k (2022: £38,100k) for Connexional Funds.

69

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

14a. Investments - The Methodist Church in Great Britain

Investment Central William Leech Other 2023 2022
properties Finance Charities Fund Investments Total Total
Board Units
£000 £000 £000 £000 £000 £000
Fair value at 1 September 41,377 130,086 9,809 995 182,267 193,575
Additions - 2,572 261 - 2,833 1,287
Transfers (from Charitable property) 9,790 - - - 9,790 -
Disposals -
(2,841)		 - - (2,841) (642)
Investment (losses)/gains (353) (4,703) (524) - (5,580) (11,953)
Fair value as at 31 August 50,814 125,114 9,546 995 186,469 182,267

14b. Investments - The Connexional Funds

Investment Central William Leech Other 2023 2022
properties Finance Charities Fund Investments Total Total
Board Units
£000 £000 £000 £000 £000 £000
Fair value at 1 September 29,453 127,604 9,809 900 167,766 181,991
Additions - -
261		 - 261 1,242
Transfers 9,790 - - - 9,790 -
Disposals -
(100)		 - - (100) (75)
Investment (losses)/gains 947 (4,658) (524) - (4,235) (15,392)
Fair value as at 31 August 40,190 122,846 9,546 900 173,482 167,766

Investment additions and disposals

During the year, the Finance Sub-Committee reviewed the investment portfolio in line with the current investment policy.

William Leech Charities Fund

The Methodist Church holds investments valued at £9.5m (2022: £9.8m) in William Leech (Investments) Ltd which represents 20% of the company's net assets as at 31 August 2023. The holding is based on the company's audited accounts to 31 March 2023, updated with management accounts to 31 August 2023. The Methodist Church has a representative on the board of the company but cannot exert significant influence over it.

70

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in The Methodist Church in The Connexional Funds The Connexional Funds
Great Britain
14c. Analysis of movement of investment properties 2023 2022 2023 2022
£000 £000 £000 £000
Fair value at 1 September 41,377 39,446 29,453 31,178
Additions - - - -
Transfers 9,790 -
9,790
 -
Revaluation gain/(loss) (353) 1,931 947 (1,725)
Disposals
Fair value at 31 August		 -
50,814		 -
41,377		 -
40,190		 -
29,453

Included within investment properties are the following revalued properties:

i) London Mission Fund

The London Mission property portfolio was valued by G Parks MRICS for and on behalf of Cluttons LLP.

The valuation was done in July 2022 for 229 King St, Hammersmith and July 2023 for the other three properties.

a) Hove Residential at 20 Bigwood Avenue: £285k (2022: £270k)

b) Hostel at 229 King Street Hammersmith, London W6 9JT: £575k (2021: £550k)

c) Maida Vale Library, Sutherland Avenue, London W9 2QT: £400k (2022: £425k)

d) Central Hall Buildings, Archway, London N19 3UB: £1,870k (2022: £1,700k)

ii) Guy Chester Centre

A property known as the Hazlehyrst, 7 Colney Hatch Lane, London N10 1PN was valued on 24 July, 2023 by James Gilmartin MRICS from Gilmartin Ley Ltd. The fair value is £3,785k (2022: £3,620k).

iii) The Wesley Hotel, Camden

The property is located at 89 Plender Street, Camden Town, London NW1 0JN. It was valued on 31 August 2023 by Savills and the current market value for the hotel is £10.866m.

iv) The Wesley Hotel, Euston Street

The property is located at 81-103 Euston Street, London, NW1 2EZ. It was valued in August 2022 by Savills and the current market value is £20,400K.

v) 4 John Wesley Road

The property is located at 4 John Wesley Road, Werrington, Peterborough, PE4 6ZL. It was valued in August 2022 by Eddisons, Incorporating Barker Storey Matthews. The current market value is £1,900K.

The Church's policy is normally to revalue the investment properties every three years. For the period under review the trustees do not consider there to have been a change in the fair value of the remaining properties.

71

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in Great Britain
Notes to the consolidated financial statements for		 the year ended 31 August 2023 the year ended 31 August 2023 (continued)
The Methodist Church in The Connexional Funds
Great Britain
15. Debtors 2023 2022 2023 2022
£000 £000 £000 £000
Prepayments and accrued interest 3,710 2,965 2,185 1,342
Loans to other entities 19 - 805 786
Concessionary loans due within one year 182 167 182 167
Concessionary loans due after more than one year 406 406 406 406
Other debtors 2,821 2,126 2,823 1,692
Total 7,138 5,664 6,401 4,393

Methodist International Centre - The Methodist Church in Great Britain and The Connexional Funds

In May 2020, the Methodist Council made a loan of £786k to MIC Ltd to support it through the Covid-19 lockdown. The Methodist Council have extended the period of the loan which will now be repaid fully in May 2024.

The Methodist Church in The Methodist Church in The Connexional Funds The Connexional Funds
Great Britain
16a. Creditors: amounts due within one year 2023 2022 2023 2022
£000 £000 £000 £000
Accruals 1,969 1,283 708 462
Loans 294 257 - -
Tax and social security 718 565 279 255
Grant commitments 8,387 6,530 7,763 6,169
Other creditors 5,689 7,139 6,064 7,089
Total 17,057 15,774 14,814 13,975
- -
The Methodist Church in The Connexional Funds
Great Britain
16b. Creditors: amounts due after more than one year 2023 2022 2023 2022
£000 £000 £000 £000
Loans 75 391 - -
Grant commitments 1,673 1,965 1,472 1,792
Total 1,748 2,356 1,472 1,792

Loans

Cliff College - The Methodist Church in Great Britain

At 31 August 2023, the balance on the loan is £140k (2022: £163k) which was secured by a legal charge over the property known as 26 Ashenhurst Way, Leek, Staffordshire. ST13 5SB, with a carrying value of £407k. The loan is repayable in 20 equal capital instalments on the 30 June and 31 December each year plus interest accrued in the 6 month period at the rate of 2.94% (APR) variable.

Methodist International Centre - The Methodist Church in Great Britain and The Connexional Funds

MIC Ltd obtained a Coronavirus Business Interruption Loan (CBIL) of £500k, this amount is interest-free in the first 12 months, and the loan term is six years from the date of drawdown - 14 July 2021. The loan balance as at 31 August 2023 is £229k (2022: £479k).

72

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church The Methodist Church The Connexional The Connexional
17. Stocks in Great Britain Funds
2023 2022 2023 2022
£000 £000 £000 £000
Finished goods and goods for resale 42 44 30 29
Total 42 44 30 29

The difference between purchase price or production cost of stocks and their replacement cost is not material. Stock recognised as an expense in the year were 9k (2022 £19k).

Stock recognised as an expense in the year were 9k (2022 £19k).
The Methodist Church The Connexional
in Great Britain Funds
18. Financial instruments
2023 2022 2023 2022
£000 £000 £000 £000
Financial assets at fair value through profit or loss
Listed investments 125,114 130,086 122,846 127,604
William Leech Charities Fund and other investments 10,541 10,804 10,446 10,709
Total 135,655 140,890 133,292 138,313
Financial assets that are debt instruments measured at amortised cost
Debtors 2,821 2,126 2,823 1,692
Total 2,821 2,126 2,823 1,692
Financial liabilities measured at amortised cost
Loans 369 648 - -
Accruals 1,969 1,283 708 462
Other creditors 5,689 7,139 6,064 7,089
Total 8,027 9,070 6,772 7,551
Concessionary loans (at cost plus accrued interest less impairment)
Loans to ministers 182 167 182 167
Loan to Lesnes Abbey Circuit
 19 - 805 786
Total 201 167 987 953

73

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in Great Britain

Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2022 pension & revaluation August
scheme reserve 2023
19a. Unrestricted funds movements
£000 £000 £000 £000 £000 £000 £000
General 52,706 22,747 (22,568) -
390		 2,310 55,585
Designated 19c 68,926 17,439 (11,438) -
(2,478)		 (592) 71,857
Defined Benefit Pension Scheme - -
1,813		 (1,813) - -
-
Total 121,632 40,186 (32,193) (1,813) (2,088) 1,718 127,442
The Connexional Funds
Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2022 pension & revaluation August
scheme reserve 2023
19b. Unrestricted funds movements
£000 £000 £000 £000 £000 £000 £000
General 50,531 16,118 (17,483) -
390		 2,310 51,866
Designated 19d 67,763 17,435 (11,705) -
(2,478)		 (592) 70,423
Defined Benefit Pension Scheme - -
1,813		 (1,813) - -
-
Total 118,294 33,553 (27,375) (1,813) (2,088) 1,718 122,289

Intercompany transfers occur as MCF pay on behalf of most other funds. Transfers in of £2.3m to the general fund principally comprise the net balance of the management levy received (£1.8m) and other MIC contributions (£0.6m) Note 22 page 88.

The Methodist Church in Great Britain

Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2022 pension & revaluation August
scheme reserve 2023
19c. Designated funds movements
£000 £000 £000 £000 £000 £000 £000
1) The Connexional Priority Fund 10,584 15,879 (6,535) -
(511)		 (6,625) 12,792
2) The Epworth Fund 7,135 172 (538) -
(242)		 (347) 6,180
3) The Designated Training Fund 1,129 1 (566) - - 841 1,405
4) The Pension Reserve Fund 50,078 1,387 (3,798) -
(1,725)		 5,539 51,481
Total 68,926 17,439 (11,438) -
(2,478)		 (592) 71,857
The Connexional Funds
Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2022 pension & revaluation August
scheme reserve 2023
19d. Designated funds movements
£000 £000 £000 £000 £000 £000 £000
1) The Connexional Priority Fund 10,558 15,878 (6,570) -
(511)		 (6,625) 12,730
2) The Epworth Fund 7,126 171 (538) -
(242)		 (347) 6,170
3) The Designated Training Fund 1 -
(800)		 - - 841 42
4) The Pension Reserve Fund 50,078 1,386 (3,797) -
(1,725)		 5,539 51,481
Total 67,763 17,435 (11,705) -
(2,478)		 (592) 70,423
agrees agrees agrees agrees agrees agrees agrees

The transfers to the designated training fund is the contibution from the income generating centres (Guy Chester & MIC) towards the Learning Network. Transfers out of the Connexional Priority Fund principally relate to £0.96m management levy paid to the general fund and £5.6m to the Pension Reserve Fund (PRF). See Note 22 page 88.

74

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in Great Britain

Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2021 pension & revaluation August
scheme reserve 2022
19e. Unrestricted funds movements
£000 £000 £000 £000 £000 £000 £000
General 53,214 20,677 (19,710) -
(2,327)		 852 52,706
Designated 19c 66,092 18,471 (10,742) -
(4,977)		 82 68,926
Defined Benefit Pension Scheme (1,330) -
3,531		 (2,201) - -
-
Total 117,976 39,148 (26,921) (2,201) (7,304) 934 121,632
The Connexional Funds
Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2021 pension & revaluation August
scheme reserve 2022
19f. Unrestricted funds movements
£000 £000 £000 £000 £000 £000 £000
General 52,514 16,822 (17,330) -
(2,327)		 852 50,531
Designated 19d 64,984 18,467 (10,793) -
(4,977)		 82 67,763
Defined Benefit Pension Scheme (1,677) -
3,878		 (2,201) - -
-
Total 115,821 35,289 (24,245) (2,201) (7,304) 934 118,294

Intercompany transfers occur as MCF pay on behalf of most other funds. Transfers in of £0.9m to the general fund principally comprise the net balance of the management levy received (£2.0m), payment to the Long-term Renewal Fund (£0.1m), donations made to Pension Reserve Fund (£0.5m) for contribution toward pension deficit and other MIC contributions (£0.5m) Note 22 page 88.

The Methodist Church in Great Britain

Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2021 pension & revaluation August
scheme reserve 2022
19g. Designated funds movements
£000 £000 £000 £000 £000 £000 £000
1) The Connexional Priority Fund 11,336 9,984 (4,589) -
(983)		 (5,164) 10,584
2) The Epworth Fund 7,738 189 (245) -
(520)		 (27) 7,135
3) The Designated Training Fund 1,096 1 (757) - - 789 1,129
4) The Pension Reserve Fund 45,922 8,297 (5,151) -
(3,474)		 4,484 50,078
Total 66,092 18,471 (10,742) -
(4,977)		 82 68,926

The Connexional Funds

The Connexional Funds
Balance at Income Expenditure Actuarial Investment Transfers Balance as
1 September losses on DB gains/(losses) at 31
2021 pension & revaluation August
scheme reserve 2022
19h. Designated funds movements
£000 £000 £000 £000 £000 £000 £000
1) The Connexional Priority Fund 11,327 9,983 (4,605) -
(983)		 (5,164) 10,558
2) The Epworth Fund 7,730 188 (245) -
(520)		 (27) 7,126
3) The Designated Training Fund 5 -
(793)		 - - 789 1
4) The Pension Reserve Fund 45,922 8,296 (5,150) -
(3,474)		 4,484 50,078
Total 64,984 18,467 (10,793) -
(4,977)		 82 67,763

The transfers to the designated training fund is the contibution from the income generating centres (Guy Chester & MIC) towards the Learning Network. Transfers out of the Connexional Priority Fund principally relate to £0.6m management levy paid to the general fund and £4.5m to the Pension Reserve Fund (PRF). See Note 22.

75

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

1) The Connexional Priority Fund (CPF)

The main source of income into this fund is primarily the levies charged on all capital proceeds from the disposal of Methodist land and buildings held for local, circuit or district purposes and any income arising therefrom is available for the purpose of (a) making grants to circuits and distribution to districts; (b) making an allocation by way of transfer between funds, to the Pension Reserve Fund in respect of the liabilities of the Methodist Ministers' Pension Scheme and the Pension and Assurance Scheme for Lay Employees of the Methodist Church and (c) funding the work of the Learning Network.

2) The Epworth Fund

This fund was set up following the sale of Epworth House, City Road, London in 1987 as a designated fund. The income from the fund is used to support innovative initiatives within The Methodist Church.

3) The Designated Training Fund

The main source of funding for the Designated Training Fund comes from the Methodist International and Guy Chester Centres respectively for the purpose of furthering the work of the Learning Network.

4) The Pension Reserve Fund

This fund was set up following a 2009 Conference decision to establish a Pension Reserve Fund outside of the Pension and Assurance Scheme for Lay Employees of the Methodist Church and Methodist Ministers' Pension Schemes which would be available if required to be used to meet future funding deficits.

76

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in Great Britain

The Methodist Church in Great Britain
Balance at 31 Income Expenditure Actuarial Investment Transfers Balance at 31
August 2022 losses on DB gains and August 2023
pension revaluation
scheme reserve
20a. Restricted funds movements
£000 £000 £000 £000 £000 £000 £000
1) The Fund for the Support of Presbyters and
Deacons 9,294 194 (3,169) -
(261)		 38 6,096
2) Mission in Britain Fund 6,383 1,033 (264) -
(227)		 (70) 6,855
3) Centenary Hall Trust 27,460 351 (23) -
23		 (349) 27,462
4) The Fund for Training 2,412 472 (244) -
(23)		 (68) 2,549
5) The World Mission Fund * 16,997 2,422 (5,770) -
(384)		 (735) 12,530
6) The London Mission Fund 19,659 593 (734) -
(4,182)		 -
15,336
7) The Guy Chester Centre * 20,399 1,535 (937) -
241		 (350) 20,888
8) Cliff College * 6,897 1,274 (2,758) -
442		 -
5,855
9) Southlands Methodist Trust 13,569 467 (702) -
(1,352)		 -
11,982
10) Methodist Medical Benevolent Fund 2,385 48 (90) -
(67)		 (2) 2,274
11)Special Extension Fund 2,292 46 (5) -
(58)		 (2) 2,273
Total funds with balances > £2m 127,747 8,435 (14,696) -
(5,848)		 (1,538) 114,100
Other - 28 funds with balances < £2m * 10,162 4,354 (5,043) 94 (340) (447) 8,780
Total 137,909 12,789 **(19,739) ** 94 (6,188) (1,985) 122,880
#REF! #REF! agrees agrees agrees
The Connexional Funds
Balance at 31 Income Expenditure Actuarial Investment Transfers Balance at 31
August 2022 losses on DB gains and August 2023
pension revaluation
scheme reserve
20b. Restricted funds movements
£000 £000 £000 £000 £000 £000 £000
1) The Fund for the Support of Presbyters and
Deacons 9,294 194 (3,169) -
(261)		 38 6,096
2) Mission in Britain Fund 6,385 1,033 (264) -
(227)		 (70) 6,857
3) Centenary Hall Trust 27,749 351 (23) -
23		 (349) 27,751
4) The Fund for Training 2,367 472 (244) -
(23)		 (68) 2,504
5) The World Mission Fund * 15,437 2,422 (5,770) -
(384)		 (735) 10,970
6) The London Mission Fund 19,659 593 (734) -
(4,182)		 -
15,336
7) The Guy Chester Centre * 20,403 1,535 (937) -
241		 (350) 20,892
8) Methodist Medical Benevolent Fund 2,385 48 (90) -
(67)		 (2) 2,274
9)Special Extension Fund 2,292 46 (5) -
(58)		 (2) 2,273
Total funds with balances > £2m 105,971 6,694 (11,236) -
(4,938)		 (1,538) 94,953
Other - 27 funds with balances < £2m * 7,091 676 (392) 94 (347) (447) 6,675
Total 113,062 7,370 **(11,628) ** 94 (5,285) (1,985) 101,628

Transfers out of the World Mission Fund principally relate to £0.46m management levy paid to the general fund and £0.27m to William Leech for investment purposes. Guy Chester transfers out £0.35m towards the Learning Network.

Note* : A prior period adjustment has been processed in the restricted funds to reflect property valuations which were incorrectly allocated in prior years. The impact of the adjustment has been to reduce the opening reserves for the World Misssion Fund, The London Mission Fund and The Guy Chester Centre with the balance for other funds increasing by a similar amount. The overall value of restricted funds is not impacted by this change.

77

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in Great Britain

The Methodist Church in Great Britain
Balance at 31 Income Expenditure Actuarial Investment Transfers Balance at 31
August 2021 losses on DB gains and August 2022
pension revaluation
scheme reserve
20C. Restricted funds movements
£000 £000 £000 £000 £000 £000 £000
1) The Fund for the Support of Presbyters and
Deacons 10,804 367 (1,207) -
(609)		 (61) 9,294
2) Mission in Britain Fund 6,521 977 (502) -
(548)		 (65) 6,383
3) Centenary Hall Trust 25,216 353 (328) -
2,219		 -
27,460
4) The Fund for Training 7,035 289 (68) -
(4,835)		 (9) 2,412
5) The World Mission Fund 18,835 2,974 (2,986) -
(1,020)		 (806) 16,997
6) The London Mission Fund 20,683 539 (434) -
(1,129)		 -
19,659
7) The Guy Chester Centre 29,349 1,240 (811) -
(9,049)		 (330) 20,399
8) Cliff College 8,312 1,358 (2,770) -
(3)		 -
6,897
9) Southlands Methodist Trust 10,418 517 (862) -
3,496		 -
13,569
10) Methodist Medical Benevolent Fund 2,580 62 (81) -
(175)		 (1) 2,385
11)Special Extension Fund 2,415 57 (7) -
(171)		 (2) 2,292
Total funds with balances > £2m 142,168 8,733 (10,056) -
(11,824)		 (1,274) 127,747
Other - 28 funds with balances < £2m 7,163 8,346 (9,841) 311 4,214 (31) 10,162
Sub-total 149,331 17,079 (19,897) 311 (7,610) (1,305) 137,909

The Connexional Funds

The Connexional Funds
Balance at 31 Income Expenditure Actuarial Investment Transfers Balance at 31
August 2021 losses on DB gains and August 2022
pension revaluation
scheme reserve
20d. Restricted funds movements
1) The Fund for the Support of Presbyters and £000 £000 £000 £000 £000 £000 £000
Deacons 10,804 367 (1,207) - (609) (61) 9,294
2) Mission in Britain Fund 6,523 977 (502) - (548) (65) 6,385
3) Centenary Hall Trust 25,505 353 (328) - 2,219 -
27,749
4) The Fund for Training 6,990 289 (4,853) - (50) (9) 2,367
5) The World Mission Fund 17,845 2,974 (3,556) - (1,020) (806) 15,437
6) The London Mission Fund 20,686 539 (437) - (1,129) -
19,659
7) The Guy Chester Centre 29,353 1,240 (811) - (9,049) (330) 20,403
8) Methodist Medical Benevolent Fund 2,580 62 (81) - (175) (1) 2,385
9)Special Extension Fund 2,415 57 (7) - (171) (2) 2,292
Total funds with balances > £2m 122,701 6,858 (11,782) - (10,532) (1,274) 105,971
Other - 27 funds with balances < £2m
Total		 7,357
130,058		 2,743
9,601		 (500)
(12,282)		 311
311		 (2,789)
(13,321)		 (31)
(1,305)		 7,091
113,062

Transfers out of the World Mission Fund principally relate to £0.55m management levy paid to the general fund and £0.25m to William Leech for investment purposes. Guy Chester transfers out £0.35m towards the Learning Network.

78

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

Notes on the purposes of the main funds

1) Fund for the Support of Presbyters and Deacons

This fund exists to provide additional assistance to supernumeraries; individuals who have been permitted or directed to become supernumerary; ministers, deacons, probationers, widows or widowers and their dependent children who are in need; ministers and deacons who are in need as a result of illness or impairment, for the purpose of enabling them to continue in or resume active work. The Fund for the Support of Presbyters and Deacons also makes grants to the Methodist Ministers' Housing Society.

2) Mission in Britain Fund

This fund exists to further the Church's mission by making grants to local churches and circuits and to bear witness to the global character of Christian Mission by supporting work with and among ethnically diverse communities in Britain and Ireland which have their origin in other countries.

3) Centenary Hall Trust

This exists to hold on trust a Church House, formerly 25 Marylebone Road and now 25 Tavistock Place.

4) The Fund for Property

This fund exists to support various mission property development projects around the Connexion by making grants and loans for property purposes to trustees of Methodist Properties in the districts.

5) The Fund for Training

The fund has three main purposes: (a) to provide initial and further training for presbyters, deacons, lay employees and other lay persons; (b) the provision of maintenance grants for persons undergoing such training and their dependants; (c) the maintenance, management and staffing of the Learning Network, and the Methodist contribution to the cost of joint theological colleges.

6) The World Mission Fund

This fund has five main purposes: (a) to initiate, maintain and encourage Christian mission in other countries; (b) to encourage the establishment of churches overseas which will themselves undertake that mission within and beyond their own borders; (c) to engage in a continuing relationship of mutual help and enrichment with churches (including united churches) in the life of which Methodist missions have played a part; (d) to foster and take part in ecumenical relationships in the field of world mission, including the work of the World Council of Churches and the Churches' Commission on Mission; (e) in furtherance of these purposes, to engage in education, advocacy recruitment and fundraising.

7) The London Mission Fund

The London Mission Fund derives from historic funds used to support ministry and property schemes in London. Since the reconfiguration of the London Districts in 2006, the Fund no longer makes individual grants, but rather allocates block grants to the qualifying districts which in turn dispense the fund for the support of ministry, mission and property projects as part of their own grant-making functions.

79

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

8) The Guy Chester Centre

The Guy Chester Centre manages the buildings and grounds of the North Bank Estate. The Centre works within the ethos and values of the Methodist Church as set out in Our Calling. The Centre provides funding for the Learning Network.

9) Cliff College

The College was founded in 1883 to provide training for mission and evangelism to people from diverse backgrounds. The college now offers degrees validated by the University of Manchester in the areas of theology and mission as well as providing a wide variety of short courses and training events. The College is used as training centre in the Learning Network.

10) Southlands Methodist Trust

As part of the work carried out through the Learning Network, the Trust exists: (a) to support in association with the College and University the development of Christian, and specifically Methodist, scholarship, research and innovation of local, national and global significance and to facilitate the public dissemination of such developments; (b) to enable the members of the Methodist Community and wider public in Britain and internationally to benefit from the academic and other expertise and experience within the College and University and the facilities available within them.

11) The Methodist Medical Benevolent Fund (MMBF)

The purpose of this fund is to provide financial assistance to ministers suffering from stress and exhaustion to enable them to pay for appropriate recuperative treatment to facilitate recovery. This fund also helps ministers to pay for initial medical consultation, if it is not immediately available through the NHS, to facilitate speedy diagnosis and periodic health screening.

80

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in Great Britain and The Connexional Funds

Balance at 1 Income Expenditure Investment Transfers Balance at
September gains & 31 August
21a. Endowment funds 2022 losses 2023
£000 £000 £000 £000 £000 £000
Permanent
Rank Endowment Fund 7,314 -
(2)		 (3) (4) 7,305
Barratt Memorial 1,273 -
(4)		 (44) 4 1,229
Bories Bequest 27 - -
(1)		 -
26
Sub-total 8,614 -
(6)		 (48) -
8,560
Expendable
William Leech Charities Fund 9,808 - -
(524)		 261 9,545
Other - 4 funds with balances <£1m 1,162 - -
(7)		 6 1,161
Sub-total 10,970 - -
(531)		 267 10,706
- agrees agrees agrees agrees -
Total 19,584 -
(6)		 (579) 267 19,266

Transfers of £0.26m to William Leech are principally for investment purposes.

The Methodist Church in Great Britain and The Connexional Funds

Balance at 1 Income Expenditure Investment Transfers Balance at
September gains & 31 August
21b. Endowment funds 2021 losses 2022
£000 £000 £000 £000 £000 £000
Permanent
Rank Endowment Fund 7,177 -
(12)		 86 63 7,314
Barratt Memorial 1,318 -
(4)		 (89) 48 1,273
Other - 2 funds with balances <£1m
Sub-total		 20
8,515		 -
-		 -

(16)
8
5		 (1)
110		 27
8,614
Expendable
William Leech Charities Fund 13,188 - -
(3,620)		 240 9,808
Other - 4 funds with balances <£1m
Sub-total		 1,132
14,320		 -
-
(3)

(3)		 12
(3,608)		 21
261		 1,162
10,970
Total -
22,835		 agrees
-		 agrees

(19)		 agrees
(3,603)		 agrees
371		 -
19,584

Transfers of £0.24m to William Leech are principally for investment purposes.

81

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

==> picture [496 x 378] intentionally omitted <==

----- Start of picture text -----
22. Fund Transfers 2023 2022
Transfers in Transfers out Net transfer Transfers in Transfers out Net transfer
£000 £000 £000 £000 £000 £000
Unrestricted
Connexional Priority Fund (Note 19) - (6,625) (6,625) - (5,164) (5,164)
Pension Reserve Fund (Note 19) 5,669 (130) 5,539 5,027 (543) 4,484
Designated Training Fund (Note 19) 841 - 841 789 - 789
General Fund (Note 19) 2,425 - 2,425 1,957 (600) 1,357
Methodist International Centre (Note 19) 398 (513) (115) - (505) (505)
Epworth Fund (Note 19) - (347) (347) - (27) (27)
Total 9,333 (7,615) 1,718 7,773 (6,839) 934
Restricted
Long-term Renewal Fund - 347 - 347 - 100 - 100
World Mission Fund (Note 20) - (735) (735) - (806) (806)
Guy Chester Centre (Note 20) - (350) (350) - (330) (330)
Fund for Training (Note 20) - (68) (68) - (9) (9)
Mission in Britain (Note 20) - (70) (70) - (65) (65)
Fund for Support of Presbyters & Deacons 65 (27) 38 - (61) (61)
Fund for property (Note 20) - (426) (426) 23 (89) (66)
Centenary Hall Trust (Note 20) - (349) (349) - - -
Others - (25) (25) 1 (69) (68)
Total (282) (2,397) (1,985) 124 (1,429) (1,305)
Endowments
William Leech Charities Fund (Note 21) 271 (10) 261 253 (13) 240
Rank Endowment (Note 21) 3 (7) (4) 70 (7) 63
Others (Note 21) 11 (1) 10 71 (3) 68
Total 285 (18) 267 394 (23) 371
Grand Total 9,336 (10,030) - 8,291 (8,291) -
----- End of picture text -----

82

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Methodist Church in Great Britain

The Methodist Church in Great Britain
Unrestricted Restricted Endowment 2023
23a. Analysis of net assets between funds Funds Funds Funds Total
£000 £000 £000 £000
Intangible fixed assets 135 43 - 178
Tangible fixed assets 17,720 48,984 - 66,704
Investments 107,781 67,218 11,470 186,469
Current assets 21,137 15,093 43 36,273
Creditors due within one year (19,132) (5,678) 7,753 (17,057)
Creditors due after more than one year (199) (1,549) - 2,978.00 (4,726)
Defined benefit pension scheme liability - (1,231) - (1,231)
Total 127,442 122,880 19,266 269,588
The Connexional Funds
Unrestricted Restricted Endowment 2023
23b. Analysis of net assets between funds Funds Funds Funds Total
£000 £000 £000 £000
Intangible fixed assets 106 - - 106
Tangible fixed assets 17,249 38,784 - 56,033
Investments 107,781 54,231 11,470 173,482
Current assets 19,768 11,268 43 31,079
Creditors due within one year (22,370) (197) 7,753 (14,814)
Creditors due after more than one year (245) (1,227) - (1,472)
Defined benefit pension scheme liability - (1,231) - (1,231)
Total 122,289 101,628 19,266 243,183
The Methodist Church in Great Britain
Unrestricted Restricted Endowment 2022
23c. Analysis of net assets between funds Funds Funds Funds Total
£000 £000 £000 £000
Intangible fixed assets 55 7 - 62
Tangible fixed assets 27,364 52,687 - 80,051
Investments 96,534 73,942 11,791 182,267
Current assets 15,676 20,345 222 36,243
Creditors due within one year (17,459) (5,886) 7,571 (15,774)
Creditors due after more than one year (538) (1,818) - (2,356)
Defined benefit pension scheme liability - (1,368) - (1,368)
Total 121,632 137,909 19,584 279,125

83

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

The Connexional Funds

The Connexional Funds
Unrestricted Restricted Endowment 2022
23d. Analysis of net assets between funds Funds Funds Funds Total
£000 £000 £000 £000
Intangible fixed assets 43 - - 43
Tangible fixed assets 27,173 42,055 - 69,228
Investments 96,534 59,441 11,791 167,766
Current assets 14,916 15,900 223 31,039
Creditors due within one year (20,079) (1,467) 7,570 (13,976)
Creditors due after more than one year (293) (1,499) - (1,792)
Defined benefit pension scheme liability - (1,368) - (1,368)
Total 118,294 113,062 19,584 250,940

24. Revaluation reserves

The revaluation reserves balances included in the restricted and unrestricted reserves are analysed as follows: The Methodist Church in Great Britain

24a. Revaluation reserve 1 September
2022		 Movement 31 August
2023
£000 £000 £000
Unrestricted 7,240 74 7,314
Restricted 48,501 (3,349) 45,152
Total 55,741 (3,275) 52,466

The Connexional Funds

24b. Revaluation reserve 1 September
2022		 Movement 31 August
2023
£000 £000 £000
Unrestricted 7,237 74 7,311
Restricted 43,347 (3,791) 39,556
Total 50,584 (3,717) 46,867
The Methodist Church in Great Britain
24c. Revaluation reserve 1 September
2021		 Movement 31 August
2022
£000 £000 £000
Unrestricted 7,240 -
7,240
Restricted 55,065 (6,564) 48,501
Total 62,305 (6,564) 55,741
The Connexional Funds
24d. Revaluation reserve 1 September
2021		 Movement 31 August
2022
£000 £000 £000
Unrestricted 7,237 -
7,237
Restricted 52,183 (8,836) 43,347
Total 59,420 (8,836) 50,584

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The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

2023 2022
25. Expenses reimbursed to the trustees Number of Number of
trustees £000 trustees £000
Travel and other expenses reimbursed 43 45 44 23
Total Remuneration
Pension Contributions including Pensions
26. Trustees' remuneration Total Total Total Total
2023 2022 2023 2022
£000 £000 £000 £000
Doug Godfrey-Swanney 17 17 140 137
Joanne Anderton 12 12 100 97
The Revd Dr Jonathan R Hustler 7 7 47 44
Deacon Karen McBride 7 7 45 43
The Revd Gillian M Newton 7 7 45 43
The Revd Leslie M Newton 7 7 45 43
The Revd Michaela A Youngson 7 7 45 43
The Revd Helen R Kirk 7 7 45 43
The Revd Graham Thompson 7 7 47 43
The Revd S Mark Slaney 7
 - 45
 -
The Revd Richard M Andrew 7
 - 45
 -
The Revd Angela Long 7
 - 41
 -
Deacon Kerry Scarlett 7
 - 37
 -
The Revd Dr Jongikaya Zihle - 7 - 43
Total 106 85 727 579

Of the trustees listed above, 13 were in the Connexional team or District Chairs (2022: 10). Their aggregate total emoluments including pension contributions and national insurance for this work and not in their role as trustees amounted to £0.7m (2022: £0.6m). Their appointment as trustees is in accordance with Standing Order No. 210 of the Methodist Church.

27. Trustees, related parties and connected organisations

Outlined below is a list of those bodies considered to be the main related parties, which together with The Methodist Church in Great Britain report separately each year to the Methodist Conference, the ultimate controlling body. Details of the transactions occurring during the year and amounts owing by or to the related parties as at 31 August are stated for each one as appropriate.

2023
Income
from
related		 Payments
to/(from)
related		 Loans from
related

Amount owed
by/(to) related
party party party party
£000 £000 £000 £000
Trustees for Methodist Church Purposes (a)
 19 216 -
-
Methodist Ministers' Housing Society (b)
 1 18 -
-
Methodist Ministers' Pension Scheme (c)
 67 206 -
-
Pension Assurance Scheme for the Lay Employees of the Methodist Church (PASLEMC)
 16 53 - -
The Queen's Foundation for Ecumenical & Theological Education (d)
 120 1,105 -
-
Methodist International Centre ltd(e) 698 27 - 786

85

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

Both schemes made payments to MCF ( MMPS: £206k and PASLEMC:£53k ) to reimburse salaries for Pensions Schemes staff.

(d ) A payment of £1.10m (2022: £1.04m) was made to The Queen's Foundation for Ecumenical Theological Education being tuition fees for the 2022-23 academic year. Rent of £120k was received from The Queen's Foundation for the period Sep 22 to Aug 23.

In May 2020, the Methodist Council made a loan of £786k to MIC Ltd to support it through the Covid-19 lockdown. It is due to for repayment starting from May 2024.

2022
Income Payments Loans from Amount owed
from to/(from) related by/(to) related
related related party party
party party
£000 £000 £000 £000
Trustees for Methodist Church Purposes (a) 13 241 - -
Methodist Ministers' Housing Society (b) - 56 - -
Methodist Ministers' Pension Scheme (c) 94 - - -
The Queen's Foundation for Ecumenical & Theological Education (d) 120 1,042 - -
Methodist International Centre Ltd(MIC) (e) 316 20 - 786

In addition to this, as set out in Note 28, the PASLEMC has been treated as a group plan with the Methodist Council as the sponsoring employer with legal responsibility for the plan. Participation in a group pension plan is a related party transaction. In the absence of a contractual agreement or policy for charging the net defined benefit cost of the plan as a whole to individual group entities, the Council treats the contributions paid to the Scheme by other group employers as a credit in its Statement of Financial Activities.

There are also related party transactions included in the management of the Church's investment portfolio by the Central Finance Board (CFB). Further, numerous transactions and balances occur between the Methodist Council, the districts, circuits and churches. In theory the Methodist Council could have dealings with any part of the wider Methodist Church. The main activities being:

86

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

28. Defined benefit pension scheme commitments

The PASLEMC Scheme closed to new entrants and the future accrual of pensionable service with effect from 31 May 2019. Members - Pensionable Service as at the closure date and Final Pensionable Earnings at date of retirement or earlier date of leaving service (with subsequent deferred revaluation until retirement); and - Pensionable Service and Pensionable Earnings as at the closure date with statutory deferred revaluation until retirement.

The FRS 102 calculations have been carried out by Debra Smith, Fellow of the Institute and Faculty of Actuaries, BWCI Consulting Ltd. The scheme assets are stated at the fair values at the respective balance sheet dates.

The assets and liabilities of the schemes for both The Methodist Church in Great Britain and The Connexional Funds at 31 August are:

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----- Start of picture text -----
Unrestricted Restricted 2023 2022
PASLEMC SSMP Total Total
£000 £000 £000 £000
Fair value of scheme assets 57,176 - 57,176 69,991
----- End of picture text -----

Fair value of scheme assets Unrestricted
PASLEMC
£000
57,176
 Restricted
SSMP
£000
-		 2023
Total
£000
57,176		 2022
Total
£000
69,991
Present value of scheme liabilities (53,226) (1,231) (54,457) (68,283)
Sub Total 3,950 (1,231)
 2,719 1,708
Unrecognised assets (3,950)
 - (3,950) (3,076)
Net defined benefit liability - (1,231) (1,231) (1,368)

The amounts charged to the statement of financial activities for both The Methodist Church in Great Britain and The Connexional Funds

==> picture [498 x 36] intentionally omitted <==

----- Start of picture text -----
Unrestricted Restricted 2023 2022
PASLEMC SSMP Total Total
£000 £000 £000 £000
----- End of picture text -----

Unrestricted

PASLEMC
£000

 Restricted
SSMP
£000
 2023
Total
£000
 2022
Total
£000
Service cost (before contributions from other group employers) 84
 - 84 135
Interest cost on scheme liabilities 2,568 54 2,622 1,651
Interest income on plan assets (2,735) (71) (2,806) (1,669)
Net finance costs (167) (17) (184) (18)
Total (83) (17) (100) 117

87

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

28. Defined benefit pension scheme commitments (continued)

The amounts recognised as other gains/(losses) in The Methodist Church in Great Britain and Connexional Funds statement of financial activities:

financial activities:
Unrestricted Restricted 2023 2022
PASLEMC SSMP Total Total
£000 £000 £000 £000
Actual return on scheme assets (12,543) (166) (12,709) (27,144)
Amounts included in net interest on the net defined liability (2,735) 166 (2,569) (1,423)
Other actuarial gains/losses 14,220 94 14,314 29,753
Movement in unrecognised assets (755) - (755) (3,076)
Re-measurement gains and losses recognised in SoFA (1,813) 94 (1,719) (1,890)

The changes in present value of defined benefit pension obligations for both The Methodist Church in Great Britain and The Connexional Funds are analysed as follows:

Unrestricted Restricted
Liabilities PASLEMC SSMP TOTAL
2023 2022 2023 2022 2023 2022
£000 £000 £000 £000 £000 £000
At 1 September 66,915 96,433
 1,368 1,746 68,283 98,179
Service cost 84 135
 - - 84
 135
Interest on obligation 2,568 1,624
 54 27 2,622 1,651
Contributions by members - -
 - - - -
Benefits paid (2,121) (1,835) (97) (94) (2,218) (1,929)
Actuarial gains/losses
At 31 August		 (14,220)
53,226		 (29,442)
66,915		 (94)
1,231		 (311)
1,368		 (14,314)
54,457		 (29,753)
68,283

The changes in the fair value of the plan assets during the year for both The Methodist Church in Great Britain and the Connexional Funds are analysed as follows:

Funds are analysed as follows:
Unrestricted Restricted
Assets PASLEMC SSMP TOTAL
2023 2022 2023 2022 2023 2022
£000 £000 £000 £000 £000 £000
At 1 September 69,991 95,103
 - - 69,991 95,103
Interest on assets 2,735 1,636
 - - 2,735 1,636
Contributions by employers 2,384 4,110
 - - 2,384 4,110
Contributions by members - - - - - -
Administration expenses (535) (456)
 - - (535) (456)
Benefits paid (2,121) (1,836)
 - - (2,121) (1,836)
Actuarial return less interest income on
plan assets (15,278) (28,566)
 - - (15,278) (28,566)
At 31 August 57,176 69,991
 - - 57,176 69,991
Unrecognised assets
Net Defined Benefit Liability		 (3,950)
-		 (3,076)

-		 -
1,231		 -
1,368		 (3,950)
1,231		 (3,076)
1,368

88

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

28. Defined benefit pension scheme commitments (continued)

Principal actuarial assumptions at the balance sheet date in respect of the two schemes were:

PASLEMC PASLEMC SSMP
2023 2022 2023 2022
%pa **%pa ** %pa
**%pa **
Discount rate at end of year 5.2 3.9 5.4 4.1
Discount rate at start of year 3.9 1.7 4.1 1.6
RPI Inflation 3.4 3.5 3.5 3.9
CPI Inflation 2.8 3.0 - -
Rate of increase in Pensionable earnings 2.8 3.0 - -
Rate of increase in deferred pensions pre 2009 LPI 5% 2.8 3.0 3.5 3.7
Rate of increase in deferred pensions post 2009 LPI 2.5% 2.5 2.5 3.5 3.7
Rate of increase in pension in payments fixed 5% 5.0 5.0 - -
Rate of increase in pension in payments LPI 5% 1 September 2019 3.3 3.4 - -
Rate of increase in pension in payments LPI 2.5% 1 September 2019 2.2 2.3 - -

Mortality assumptions for the two schemes:

The mortality assumptions are based on standard mortality tables which allow for future mortality improvements.

PASLEMC - The assumptions are that a member aged 65 will live on average until age 89 if they are male and until age 90 if female. For a member currently aged 50 the assumptions are that if they attain age 65 they will live on average until age 89 if they are male and until age 90 if female.

SSMP - The assumptions are that a member aged 65 will live on average until age 87 if they are male and until age 89 if female. For a member currently aged 60 the assumptions are that if they attain age 65 they will live on average until age 87 if they are male and until age 90 if female.

Analysis of scheme assets

Analysis of scheme assets
PASLEMC SSMP
2023 2022 2023
 2022
Equities - 12.5 16.5 20.0
Gilts - - 58.0 56.1
Corporate Bonds 45.6 36.6 12.7 12.3
Property -
9.7		 6.3 7.2
Cash 19.3 16.6 6.5 4.4
Liability Driven Investment 30.7 19.8 - -
Annuities 4.4 4.8 - -

89

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

28. Defined benefit pension scheme commitments (continued)

The Methodist Ministers' Pensions Scheme (MMPS)

The accounting treatment and judgements made in respect of the MMPS are set out in Note 2. The defined benefit pension scheme position in respect of the MMPS that would have been charged to these financial statements had the scheme been included are set out below. The FRS102 Calculations were carried out by Debra Smith, Fellow of the Institute and Faculty of Actuaries, BWCI Consulting Ltd.

a. The amounts that would have been charged to the Statement of Financial Activities are as follows:

2023 2022
£000 £000
Service cost 9,696 9,696
Interest cost on scheme liabilities 15,712 8,496
Interest Income on plan assets (18,248) (9,122)
Interest on unrecognised assets -
 -
Net Finance Costs (2,536) (626)

b. The amounts that would have been charged to the Statement of Financial Activities as recognised gains and losses are as follows:

2023 2022
£000 £000
Actual Return on Scheme assets (54,583) (103,537)
Amounts included in net interest on the net defined liability (18,248) (9,122)
Other Actuarial gains/losses 72,374 138,573
Movement in unrecognised assets
Re-measurement gains and losses recognised in SOFA		 (2,414)
(2,871)		 (23,943)
1,971

c. The changes in the present value of the defined benefit obligation were:

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----- Start of picture text -----
2023 2022
£000 £000
----- End of picture text -----

2023
£000

 2022
£000
Opening defined benefit obligation 403,424
 541,543
Service cost 5,040
 9,696
Interest cost 15,712
 8,496
Cost of benefit Changes -
 -
Contributions by members 3,140
 3,294
Benefits paid (21,260) (21,032)
Actuarial (gains)/losses (72,374) (138,573)
Closing defined benefit obligation 333,682 403,424

The weighted average duration of the liabilities of the Scheme was 15 years as at 31 August 2021.

90

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

28. Defined benefit pension scheme commitments (continued)

d. The changes in the fair value of the plan assets during the year were:
2023 2022
£000 £000
Opening fair value of scheme assets 460,862 574,510
Interest income on plan assets 18,248 9,121
Contributions by employers 8,808 8,926
Contributions by members 3,140 3,294
Benefits paid (21,260) (21,032)
Administration expenses (1,136) (1,298)
Actual return less interest income on plan assets
(72,831)		 (112,659)
Closing fair value of scheme assets 395,831 460,862

The total assets and liabilities of the MMPS at 31 August were:

The total assets and liabilities of the MMPS at 31 August were:
2023 2022
£000 £000
Closing defined benefit obligation (333,681) (403,424)
Closing fair value of scheme assets 395,831 460,862
Net defined benefit scheme asset 62,150 57,438
Assets that would not have been recognised had the scheme been included (2,414) (23,943)
Net defined benefit asset 59,736 33,495

The principal actuarial assumptions at the balance sheet date in respect of the Scheme were:

2023 2022
**%pa ** **%pa **
Discount rate at end of year 5.3 4.0
Discount rate at start of year 4.0 1.6
Inflation 3.5 3.6
Rate of increase in pensionable earnings 3.6 3.8
Rate of increase in deferred pensions pre 2009 3.1 3.3
Rate of increase in deferred pension post 2009 2.5 2.5
Rate of increase in pension in payment main benefits CPI LPI 5% 3.0 3.2
Rate of increase in pension in payment main benefits CPI LPI 2.5% 2.2 2.2
Rate of increase in pension in payment AVCs RPI LPI 5% 3.3 3.5
Rate of increase in pension in payment AVCs RPI LPI 2.5% 2.3 2.3

91

The Methodist Church in Great Britain

Notes to the consolidated financial statements for the year ended 31 August 2023 (continued)

28. Defined benefit pension scheme commitments (continued)

The mortality assumptions for the Methodist Ministers’ Pension Scheme were:

The mortality assumptions are based on standard mortality tables which allow for future mortality improvements. The assumptions are that a member aged 65 will live on average until age 89 if they are male and until age 89 if female. For a member currently aged 55 the assumptions are that if they attain age 65 they will live on average until age 89 if they are male and until age 90 if female.

The major categories of plan assets as percentage of total plan assets for the Scheme were:

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----- Start of picture text -----
2023 2022
% %
----- End of picture text -----

2023
%		 2022
%
Equities 12.8 33.4
Gilts 0.1 0.1
Corporate Bonds 46.6 29.7
Property - 10.1
Cash 1.5 3.5
Liability driven Investment 29.7 16.8
Impact investing 9.3 6.4

92

The Methodist Church in Great Britain

The membership 2022/2023 and 2023/2024 are listed below.

Methodist Council:

2022 / 2023 New Members from 1 September 2022 are marked with one asterisk (*)

The Revd Sonia M Hicks (Chair) The Revd Jeremy H A Hackett Dr Hellen Okello Joanne Anderton Bet W T Holmes Sheila Pollard The Revd Richard M Andrew The Revd Dr Jonathan R Hustler Bridget Quint Stephen Arnold The Revd Helen R Kirk The Revd Mark Roberts The Revd Karen Beecham Joseph Lambert The Revd Dr Calvin T Samuel [from Anthony Boateng The Revd Angela Long 18.10.22] The Revd Paul H Booth Andrew Lowe Deacon Kerry Scarlett Mark Braithwaite Professor David Matthews The Revd S Mark Slaney The Revd Dr Adrian Burdon Val Mayers Sandie Smith David Burton The Revd Samuel E McBratney The Revd Timothy A Swindell The Revd Deborah L Caulk Deacon Karen McBride The Revd Rebekah Stennett The Revd Steven R M Cooper Alister McClure The Revd Howard J Stringer [from The Revd Dr Joanne Cox-Darling Dr Daleep S Mukarji 17.10.22] Eleanor Dixon The Revd Gillian M Newton Jenny Taylor Barbara Easton The Revd Leslie M Newton The Revd Graham Thompson The Revd Simon C Edwards Keith Norman The Revd Marcus Torchon Carl Fairclough Helen Norton Verity Wild The Revd Ruth G S Fry The Revd Charity Nzegwu The Revd Michaela A Youngson Doug Godfrey-Swanney Peter Gregson

2023 / 2024

New Members from 1 September 2023 are marked with two asterisks (**)

Joanne Anderton Matt Hays** Dr Helen Okello
The Revd Richard M Andrew Bet Holmes The Revd Romeo R Pedro**
Stephen Arnold Carolyn Hothersall** Sheila Pollard
Marianne Barrett Rogers** The Revd Dr Jonathan R Miss Bridget Quint
The Revd Dr Moira Biggins** Hustler The Revd Dr Calvin T Samuel
Anthony Boateng The Revd Stephen Deacon Kerry R Scarlett
Anne Bolton** Ingrouille** The Revd S Mark Slaney
Mark Braithwaite David James** The Revd Luke G S Smith**
The Revd Helen D Cameron** The Revd Marie-Anne Kent** Sandie Smith
The Revd Deborah L Caulk The Revd Helen R Kirk The Revd Rebekah Stennett
The Revd Steven R M Cooper Joseph Lambert The Revd Howard J Stringer
The Revd Dr Joanne Cox-Darling Professor David Matthews Jenny Taylor
Gill Dascombe** Val Mayers The Revd Graham Thompson
Eleanor Dixon Deacon Karen McBride The Revd Marcus Torchon
The Revd Simon C Edwards Dr Daleep Mukarji Elizabeth Ward**
The Revd Ann Fox** The Revd Gillian M Newton The Revd Michaela A Youngson
The Revd Jennifer M Gill** Keith Norman
Carolyn Godfrey** The Revd Charity Nzegwu
Doug Godfrey-Swanney Peter Gregson

A full list of the trustees, being the members of the Methodist Conference, is available on request from the registered office and on the Charity Commission website.

93

The Methodist Church in Great Britain

The Strategy and Resources Committee

The membership for the 2023-24 year is listed below:

Voting Members Janet Arthur Anne Bolton Nick Garrett Professor David Matthews Shelagh Morgan

Dr Daleep S Mukarji (Chair) The Revd Gillian M Newton The Revd Nicholas A Oborski The Revd Kerry W Tankard The Revd Marcus Torchon

Non-voting members Joanne Anderton The Revd Dr Jonathan R Hustler Douglas Godfrey-Swanney The Revd Michaela A Youngson

Other members of the senior management group may attend by invitation as the business shall require.

Induction of new SRC members normally includes: conversations with the chair of SRC and the senior staff of the Connexional Team; a mentoring relationship with an experienced member of SRC; and invitations to share in the induction sessions for Council members.

The Finance Sub-Committee (FSC) of the Strategy and Resources Committee (SRC)

The membership of the committee is:

Voting Members Helen Blair Malcolm Pearson Sue Haworth The Revd Stephen J Radford Anne Bolton (Chair)

Members of the senior management group may attend by invitation as the business shall require.

The Audit and Risk Assurance Committee

The membership of the committee is:

Voting Members Sarah Atwell-King Susan M Mortimer Adrian Burton Michael Rickard Alan Kershaw (Chair)

Non-voting members

Members of the senior management group may attend by invitation as the business shall require.

94

The Methodist Church in Great Britain

Reference and Administrative Details

Names and addresses

The address of the Office of the Conference for the purposes of the Methodist Church Act 1976 and any other legislation is:

The Methodist Church 25 Tavistock Place London WC1H 9SF Tel: 020 7486 5502 Web: www.methodist.org.uk

Executive Officers The Revd Dr Jonathan R Hustler The Revd Michaela A Youngson Douglas Godfrey-Swanney Joanne Anderton

Custodian Trustee: Trustees for Methodist Church Purposes Central Buildings Oldham Street Manchester M1 1JQ

Methodist Missionary Trust Association 25 Tavistock Place London WC1H 9SF

Investment Managers: Central Finance Board of the Methodist Church 9 Bonhill Street London EC2A 4PE

Bankers: HSBC plc Westminster Branch 4-8 Victoria Street London SW1H 0NJ

Independent Auditor: RSM UK Audit LLP Statutory Auditor Chartered Accountants 103 Colmore Row Birmingham West Midlands, B3 3AG

Solicitors : Farrer & Co 66 Lincoln's Inn Fields London WC2A 3LH

95