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2021-09-30-accounts

Company number: 7028764 Charity Number: 1133336

Church of the Nazarene British Isles South District

Report and financial statements For the year ended 30 September 2021

Church of the Nazarene British Isles South District

Reference and administrative information

for the year ended 30 September 2021

Company number 7028764

Charity number 1133336

Registered office and operational address

Church of the Nazarene British Isles South District 112 Cranbourne Road Ashton-under-Lyne OL7 9BW

Trustees Trustees, who are also directors under company law, who served during the year and up to the date of this report were as follows:

Rev Carl McCann Chair Mr Steven Francis Leach Secretary Mrs Francine Brower (Ended Term 16 April 2021) Rev Erica Tuxworth Sophie Peel Yates Jason Nike Augustine Baah

No Trustees held title to property belonging to the charity during the reporting period or at the date of approval.

Bankers

Reliance Bank Faith House 23-24 Lovat Lane London EC3R 8EB

Auditors

Slade & Cooper Limited

Beehive Mill, Jersey St, Ancoats, Manchester, M4 6JG

1

Church of the Nazarene British Isles South District

Trustees’ annual report

for the year ended 30 September 2021

The trustees present their report and the audited financial statements for the year ended 30 September 2021. Included within the trustees’ report is the directors’ report as required by company law.

Reference and administrative information set out on page 1 forms part of this report. The financial statements comply with current statutory requirements, the memorandum and articles of association and the Statement of Recommended Practice - Accounting and Reporting by Charities: SORP applicable to charities preparing their accounts in accordance with FRS 102.

Objectives and activities

The principal object of the charity is the advancement of Christian faith and its practice, especially by the means of and in accordance with the principles of the International church of the Nazarene.

The basis of our Christian faith as portrayed through the Bible is that we can come to know God personally, in Jesus Christ, who is both human and divine, and is the person in whom all that is lost and broken can be redeemed and who inspires his followers to work for a world that is a better place for all.

Within the covenant relationship of the Church of the Nazarene we value the freedom of the local church to discern for itself its practices and policies within the broad scope of Nazarene belief, in making Christ-like disciples. We stress the importance of individual response in faith, and we understand that each Christian is to play their part in advancing Christian faith and witness. Because of our emphasis on personal faith and the freedom of the local church we are committed to religious freedom for people of all Christian traditions and other faiths.

The District’s overriding function is to provide encouragement, advice and support to member churches so that they too may maximise their ability to achieve their own charitable objective of making Jesus Christ known to particular individuals and to society in general

The trustees review the aims, objectives and activities of the charity each year. This report looks at what the charity has achieved and the outcomes of its work in the reporting period. The trustees report the success of each key activity and the benefits the charity has brought to those groups of people that it is set up to help. The review also helps the trustees ensure the charity's aims, objectives and activities remained focused on its stated purposes.

The trustees have referred to the guidance contained in the Charity Commission's general guidance on public benefit when reviewing the charity's aims and objectives and in planning its future activities. In particular, the trustees consider how planned activities will contribute to the aims and objectives that have been set.

Volunteers

In the wider context, the District is substantially dependent for its work on the contribution of volunteers. At church level, the work of stipendiary and paid staff is supported at all levels by volunteers both in terms of governance and management and in the practical delivery. Such is the magnitude of the contribution made by volunteers that it is impossible to quantify.

This pattern is reflected throughout the District where many people commit significant time to help with the outworking of the District’s objectives. In the District itself, volunteers provide valuable support

Church of the Nazarene British Isles South District

Trustees’ annual report

for the year ended 30 September 2021

mainly through membership of standing committees, unpaid office holders, and the officers responsible for Nazarene Youth International, Nazarene Missions International, Breakthru holidays, the Ladies weekend, and other conferences for training as and when required.

Achievements and performance

The charity's main activities and who it tries to help are described below. All its charitable activities focus on the support and encouragement of the local Churches of the Nazarene which form the District, and are undertaken to further Church of the Nazarene British Isles South District’s charitable purposes for the public benefit.

It must be noted that for a significant portion of the year for which this report covers, many of these activities were significantly reduced, or moved to an online platform, due to the Covid 19 pandemic and responsive government restrictions on freedom of movement. Consequently, the District sought to provide advice and updates to local churches on how to navigate these unprecedented circumstances.

Beneficiaries of our services

The District operates as an umbrella resource body for its member churches, which are all separate charities. Consequently, our beneficiaries are largely Pastors, local churches, Nazarene Theological College, Nazarene Missions International, and Nazarene Youth International.

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Church of the Nazarene British Isles South District

Trustees’ annual report

for the year ended 30 September 2021

Financial review

The Statement of Financial Activities shows a net increase in funds for the year ending 30th September 2021 of £1,011,701 excluding unrealised gains and losses on investments (2020: £68,727). Expenditure has been kept under careful control because of the continuing difficult economic climate.

The consolidated incoming resources the ordinary activities of the Church of the Nazarene British Isles South District including NMI, Events/SS Ministries, NYI and the work at Salford totalled £1,205,923 (2020: £300,201) with resources expended of £203,145 (2020: £231,474).

Our principal sources of income remain that of budgets received from our member churches, supplemented by rental income from our investment properties. These properties are rented out at market rates, except for the Fresh Ground church. It is hoped that the income from this church will move towards market rent over a period of time.

Decreased tithes and offerings in local churches, resulted in lower budgets received.

Strategy is to invest in developing new churches, strengthening existing churches, and also to develop a strong property rental income stream.

During the year the charity were donated properties at Gillingham and Thetford (Church), following closure of those Churches and subsequently disposed of these properties and that income is disclosed as donation income (Note3). In addition, 2 properties at Thetford (Manse) and Bournemouth (Manse) were donated (see note 3) and are also noted as investment properties at the year-end as they are producing income. (See note 13).

We do not conduct significant fundraising activities from the general public.

Grants

Each Nazarene church is self-financing; the District provides additional investment into local churches to help develop and promote mission innovation and risk taking to achieve our strategic goals. Church grants are assessed annually, and emphasis is placed not just on each church’s finances but also its plans and achievements in making Jesus known in its locality.

Throughout part of this financial year, the provision of these grants became more focussed on responsivity to need in relation to the financial impact, and ministry opportunities in relation to Covid 19.

Going concern

The trustees have met on a number of occasions to review the effects of the Covid19 pandemic restrictions on the charity. Our activities have been restricted, as face to face contact with our churches was prevented by the lockdown measures. These and other meetings are currently held through a range of online technologies to maintain the support of member churches. One part time employee has been furloughed through the government scheme; this will be reviewed when travel becomes permitted.

The charity does not rely on donations from the public, and its finances for the current financial year are considered to be minimally affected by the effects of the pandemic restrictions. The effect on future income is less certain; the trustees have the position under constant review. We have sufficient cash

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Church of the Nazarene British Isles South District

Trustees’ annual report

for the year ended 30 September 2021

reserves to fund our activities for at least a further year, without the need for loans or overdrafts. The trustees are fully aware of the movement in value of its investments but consider that the balance sheet will remain strong in the long-term, with positive net current assets.

Reserves policy

The Trustees have reviewed the charity’s needs for reserves in line with the guidance issued by the Charity Commission and have a reserves policy which will be reviewed annually. The Trustees believe that, in addition to known commitments, the charity needs to hold at least six months (26 weeks) running costs in free reserves, given the anticipated flow of funding, to ensure that the charity can run efficiently.

The total reserves of the charity at the end of the year were £6,943,370 (2020 £5,878,181) of which some were restricted. The Capital Fund in note 19 relates to fixed assets used to support the ongoing work of the charity and is not a readily liquid asset.

Plans for the future

Structure, governance and management

The Church of the Nazarene British Isles South District (the District) is an association, consisting of the Nazarene churches within the majority of England and Wales. As a membership organisation, the District holds an annual Assembly at which member churches are represented through their delegates, alongside ministers and the members of the Assembly.

The District acts through an Advisory Board which meets a minimum of four times a year and is made up of elected members, office holders and persons co-opted for particular skills. The Advisory Board helps to set the broad strategic direction of the District.

As with 2020, due to Covid 19, both the UK Charity Commission and Global Headquarters of the Church of the Nazarene provided scope for variations regarding reporting, elections and appointments. BISD gave due consideration to this, and decided that the increased exposure to various online platforms meant that online elections were a viable option for the 2021 District Assembly. Consequently, a normal nomination procedure took place, followed by an online Assembly via Zoom, including digital voting for all elected positions.

All necessary reports were collated as per normal procedure, but were communicated via online platforms.

The District charity is administered and managed by the Advisory Board as Charity Trustees.

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Church of the Nazarene British Isles South District

Trustees’ annual report

for the year ended 30 September 2021

The Governing Document of the District is a memorandum of association which may be amended by a Resolution of the Assembly approved by not less than two thirds of the Representative Members, as defined in the memorandum of association, present and voting. The memorandum of association was last revised in June 2017 and a copy is available from the registered office.

Recruitment and Training of Trustees

Trustees are elected by the District Assembly from a list of suitable nominations provided by the Nomination Committee and are usually familiar with many aspects of the District’s work prior to appointment. All Trustees receive an induction into the work of the District by meeting the District Superintendent and being advised of the general nature of their work.

They receive financial statements and other relevant documentation including a copy of the Charity Commission’s publication CC3, The Essential Trustee. Formal training on financial matters is provided as appropriate. The organisation is a charitable company limited by guarantee, incorporated on 24th September 2009 and registered as a charity on 17th December 2010.

The company was established under a memorandum of association which established the objects and powers of the charitable company and is governed under its articles of association.

Members of the charity guarantee to contribute an amount not exceeding £1 to the assets of the charity in the event of winding up. The total number of such guarantees at 30th September 2021 was 129 (2020:129). The members of the charity are entitled to voting rights and have no beneficial interest in the charity.

The Trustees give their time voluntarily and only the District Superintendent receives benefits from the Charity

Related parties and relationships with other organisations

Any and all related parties are clearly identified in the notes to the Accounts.

Remuneration policy for key management personnel

Remuneration for the District Superintendent and other workers is guided by the Finance Committee.

Risk management

The Trustees are aware of the recommendations to examine the major strategic, business, operational and reputational risks which the Charity faces and have procedures in place to identify and manage them.

Funds held as custodian trustee on behalf of others

The District acts as property trustees for 39 churches. Arrangements are made for the safe custody of deeds and documents, with each set stored in a labelled packet, and included in an index system. The names of the churches and other charities for whom the Company acts as a Custodian Trustee are available at: www.nazarene.org.uk The organisations are all Church of the Nazarene congregations and therefore, have objects that are compatible with the charitable objects of the Company

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Church of the Nazarene British Isles South District

Trustees’ annual report

for the year ended 30 September 2021

Statement of responsibilities of the trustees

The trustees (who are also directors of Church of the Nazarene British Isles South District for the purposes of company law) are responsible for preparing the trustees’ annual report and the financial statements in accordance with applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Company law 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 charitable company and of the incoming resources and application of resources, including the income and expenditure, of the charitable company 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 charitable company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as the trustees are aware:

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

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Church of the Nazarene British Isles South District

Trustees’ annual report

for the year ended 30 September 2021

Auditors

Slade & Cooper Ltd were re-appointed as the charitable company's auditors during the year and have expressed their willingness to continue in that capacity.

This report has been prepared in accordance with the provisions applicable to companies subject to the small companies’ regime of the Companies Act 2006.

11 03 The trustees’ annual report has been approved by the trustees on _/_/2022 and signed on their behalf by

Rev Carl McCann District Superintendent

8

Independent auditors’ report

to the members of

Church of the Nazarene British Isles South District

Opinion

We have audited the financial statements of Church of the Nazarene British Isles South District (the ‘charitable company’) for the year ended 30 September 2021, which comprise the Statement of Financial Activities (including the income and expenditure account), the Balance Sheet, the Statement of Cash Flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We are independent of the charitable company 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 charitable company'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 trustees are responsible for the other information. The other information comprises the information included in the trustees’ annual report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, 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 audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine

9

Independent Auditor’s Report (continued)

whether there is a material misstatement in the financial statements or a material misstatement of the other information. 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.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

Matters on which we are required to report by exception

In the light of our knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees’ report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

Responsibilities of trustees

As explained more fully in the trustees’ responsibilities statement set out on page 7, the trustees (who are also the directors of the charitable company for the purposes of company law) 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 charitable company’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 charitable company 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

10

Independent Auditor’s Report (continued)

aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The specific procedures for this engagement and the extent to which these are capable of detecting irregularities, including fraud is detailed below:

Because of the inherent limitations of an audit, there is a risk that we will not detect all irregularities, including those leading to a material misstatement in the financial statements or non-compliance with regulation. This risk increases the more that compliance with a law or regulation is removed from the events and transactions reflected in the financial statements, as we will be less likely to become aware of instances of non-compliance. The risk is also greater regarding irregularities occurring due to fraud rather than error, as fraud involves intentional concealment, forgery, collusion, omission or misrepresentation.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/Our-Work/Audit/Audit-and-assurance/Standards-and-guidance/Standards-andguidance-for-auditors/Auditors-responsibilities-for-audit/Description-of-auditors-responsibilities-foraudit.aspx. This description forms part of our auditor’s report.

11

Independent Auditor’s Report (continued)

Use of our report

This report is made solely to the charitable company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the charitable company’s members 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 charitable company and the charitable company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Chinwe Jennifer Daniel FCCA DChA Senior Statutory Auditor for and on behalf of Slade & Cooper Limited Statutory Auditors Beehive Mill Jersey Street Manchester M4 6JG

Date:

12

Church of the Nazarene British Isles South District

Statement of Financial Activities

(including Income and Expenditure account) for the year ended 30 September 2021

Unrestricted
funds
Note
£
Income from:
Donations and legacies
3
1,129,494
Charitable activities:
4
1,845
Investments
5
74,584
Total income
1,205,923
Expenditure on:
Raising funds
6
36,011
Charitable activities:
7
168,326
Total expenditure
204,337
1,001,586
44,838
8
1,046,424
Transfer between funds
-
Other recognised gains/(losses):
8,650
Net movement in funds for the year
1,055,074
Reconciliation of funds
Total funds brought forward
5,822,146
Total funds carried forward
6,877,220
Gains/(losses on revaluation of fixed
assets
Net income/(expenditure)
before net gains/(losses) on
investments
Gains/(losses) on investments
Net income/(expenditure) for
the year		 Restricted
funds
£
87,475
36,120
-
123,595
-
113,480
113,480
10,115
-
10,115
-
-
10,115
56,035
66,150		 Total funds
2021
£
1,216,969
37,965
74,584
1,329,518
36,011
281,806
317,817
1,011,701
44,838
1,056,539
-
8,650
1,065,189
5,878,181
6,943,370		 Total funds
2020
£
98,863
7,059
194,279
300,201
20,898
210,576
231,474
68,727
56,934
125,661
-
-
125,661
5,752,520
5,878,181

The statement of financial activities includes all gains and losses recognised in the year. All income and expenditure derive from continuing activities.

13

Church of the Nazarene British Isles South District Company number 7028764

Balance sheet as at 30 September 2021

Note
£
£
Fixed assets
Tangible assets
12
1,195,686
Investments
13
4,824,708
Total fixed assets
6,020,394
Current assets
Debtors
14
54,453
Cash at bank and in hand
15
922,554
Total current assets
977,007
Liabilities
Creditors: amounts falling
due in less than one year
16
(54,031)
Net current assets
922,976
Net assets
6,943,370
The funds of the charity:
Restricted income funds
18
66,150
Designated income funds
19
3,613,029
Unrestricted income funds
19
3,264,191
Total unrestricted funds
19
6,877,220
Total charity funds
6,943,370
2021		 £
£
1,251,154
4,209,440
5,460,594
80,555
374,097
454,652
(37,065)
417,587
5,878,181
56,035
2,539,799
3,282,347
5,822,146
5,878,181
2020		 £
£
1,251,154
4,209,440
5,460,594
80,555
374,097
454,652
(37,065)
417,587
5,878,181
56,035
2,539,799
3,282,347
5,822,146
5,878,181
2020
5,460,594
417,587
5,878,181
56,035
5,822,146
5,878,181

These accounts are prepared in accordance with the special provisions of part 15 of the Companies Act 2006 relating to small companies and constitute the annual accounts required by the Companies Act 2006 and are for circulation to members of the company.

The notes on pages 16 to 30 form part of these accounts.

Approved by the trustees on _/_/2022 and signed on their behalf by:11 03

Rev Carl McCann (Trustee)

14

Church of the Nazarene British Isles South District

Statement of Cash Flows for the year ending 30 September 2021

Note
2021
£
Cash provided by/(used in) operating activities
21
996,053
Cash flows from investing activities:
Dividends, interest, and rents from investments
74,584
Proceeds from sale of tangible fixed assets
-
Purchase of tangible fixed assets
-
Proceeds from sale of investments
-
Purchase of investments
(522,180)
Cash provided by/(used in) investing activities
(447,596)
548,457
Cash and cash equivalents at the beginning of the year
374,097
Cash and cash equivalents at the end of the year
922,554
Increase/(decrease) in cash and cash
equivalents in the year		 2020
£
(13,721)
62,584
111,893
(116,091)
257,129
(8,400)
307,115
293,394
80,703
374,097

15

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021

1 Accounting policies

The principal accounting policies adopted, judgments and key sources of estimation uncertainty in the preparation of the financial statements are as follows:

Corresponding amounts for the preceding year are drawn from unaudited accounts.

a Basis of preparation

The financial statements have been prepared in accordance with Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102), second edition - October 2019 (Charities SORP (FRS 102)), the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Companies Act 2006 and UK Generally Accepted Accounting Practice.

Church of the Nazarene British Isles South District meets the definition of a public benefit entity under FRS102. Assets and liabilities are initially recognised at historical cost or transaction value unless otherwise stated in the relevant accounting policy note.

b Preparation of the accounts on a going concern basis

The trustees consider that there are no material uncertainties about the charitable company's ability to continue as a going concern. The trustees have made no key judgments which have a significant effect on the accounts. The trustees do not consider that there are any sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next reporting period.

c Income

Income is recognised when the charity has entitlement to the funds, any performance conditions attached to the item(s) of income have been met, it is probable that the income will be received and the amount can be measured reliably.

Income from government and other grants, whether ‘capital’ grants or ‘revenue’ grants, is recognised when the charity has entitlement to the funds, any performance conditions attached to the grants have been met, it is probable that the income will be received and the amount can be measured reliably and is not deferred.

For legacies, entitlement is taken as the earlier of the date on which either: the charity is aware that probate has been granted, the estate has been finalised and notification has been made by the executor(s) to the charity that a distribution will be made, or when a distribution is received from the estate. Receipt of a legacy, in whole or in part, is only considered probable when the amount can be measured reliably and the charity has been notified of the executor’s intention to make a distribution. Where legacies have been notified to the charity, or the charity is aware of the granting of probate, and the criteria for income recognition have not been met, then the legacy is a treated as a contingent asset and disclosed if material.

Income received in advance of a provision of a specified service is deferred until the criteria for income recognition are met.

16

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

d Donated services and facilities

Donated professional services and donated facilities are recognised as income when the charity has control over the item, any conditions associated with the donated item have been met, the receipt of economic benefit from the use by the charity of the item is probable and that economic benefit can be measured reliably. In accordance with the Charities SORP (FRS 102), general volunteer time is not recognised; refer to the trustees’ annual report for more information about their contribution.

On receipt, donated professional services and donated facilities are recognised on the basis of the value of the gift to the charity which is the amount the charity would have been willing to pay to obtain services or facilities of equivalent economic benefit on the open market; a corresponding amount is then recognised in expenditure in the period of receipt.

e Interest receivable

Interest on funds held on deposit is included when receivable and the amount can be measured reliably by the charity; this is normally upon notification of the interest paid or payable by the Bank.

f Fund accounting

Unrestricted funds are available to spend on activities that further any of the purposes of charity.

Designated funds are unrestricted funds of the charity which the trustees have decided at their discretion to set aside to use for a specific purpose.

Restricted funds are donations which the donor has specified are to be solely used for particular areas of the charity’s work or for specific projects being undertaken by the charity.

g Expenditure and irrecoverable VAT

Expenditure is recognised once there is a legal or constructive obligation to make a payment to a third party, it is probable that settlement will be required and the amount of the obligation can be measured reliably. Expenditure is classified under the following activity headings:

Irrecoverable VAT is charged as a cost against the activity for which the expenditure was incurred.

h Tangible fixed assets

Individual fixed assets costing £1,000 or more are capitalised at cost and are depreciated over their estimated useful economic lives on a straight line basis as follows:

Land and buildings 1% Office fixtures and equipment 25% Motor Vehicle 25%

17

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

i Fixed asset investments

Investments are a form of basic financial instrument and are initially recognised at their transaction value and subsequently measured at their fair value as at the balance sheet date using the closing quoted market price. The statement of financial activities includes the net gains and losses arising on revaluation and disposals throughout the year.

The Charity does not acquire put options, derivatives or other complex financial instruments.

The main form of financial risk faced by the charity is that of volatility in equity markets and investment markets due to wider economic conditions, the attitude of investors to investment risk, and changes in sentiment concerning equities and within particular sectors or sub sectors.

j Investment property

Investment properties are initially recorded at cost, which includes purchase price and any directly attibutable expenditure. They are reviewed by the charity trustees on a yearly basis, and this will be suplemented by a 3 yearly evaluation of residential properties using AVM tool, and 5 yearly rolling evaluation of non-residential properties by a Chartered Surveyor. Any material changes in fair value are recognised in profit or loss.

k Debtors

Trade and other debtors are recognised at the settlement amount due after any trade discount offered. Prepayments are valued at the amount prepaid net of any trade discounts due.

l Cash at bank and in hand

Cash at bank and cash in hand includes cash and short term highly liquid investments with a short maturity of three months or less from the date of acquisition or opening of the deposit or similar account.

m Creditors and provisions

Creditors and provisions are recognised where the charity 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 and provisions are normally recognised at their settlement amount after allowing for any trade discounts due.

n Financial instruments

The charity only has financial assets and financial liabilities of a kind that qualify as basic financial instruments. Basic financial instruments are initially recognised at transaction value and subsequently measured at their settlement value with the exception of bank loans which are subsequently measured at amortised cost using the effective interest method.

18

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

o Pensions

Employees of the charity are entitled to join a defined contribution ‘money purchase’ scheme. The charity’s contribution is restricted to the contributions disclosed in note 9. Contributions outstanding at the year end was £3,402 (2020:£10,131)

2 Legal status of the charity

The charity is a company limited by guarantee registered in England and Wales and has no share capital. In the event of the charity being wound up, the liability in respect of the guarantee is limited to £1 per member of the charity. The registered office address is disclosed on page 1.

3 Income from donations and legacies

District Budget
Nazarene Youth International
Other Income
Gift Aid
Nazarene Missions International
Salford
Total
Funds transferred from closure of
Thetford and Gillingham
Donated investment properties		 Unrestricted
£
51,886
-
10,981
268
-
-
546,359
520,000
1,129,494		 Restricted
£
-
7,622
-
-
48,517
31,336
-
-
87,475		 Total 2021
£
51,886
7,622
10,981
268
48,517
31,336
546,359
520,000
1,216,969

Income from donations and legacies (previous reporting period)

District Budget
Nazarene Youth International
Other Income
Donations
Gift Aid
Nazarene Missions International
Salford
Total		 Unrestricted
£
59,936
-
1,588
304
667
-
-
62,495		 Restricted
£
-
8,401
-
-
-
964
27,003
36,368		 Total 2020
£
59,936
8,401
1,588
304
667
964
27,003
98,863

19

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

4 Income from charitable activities

Unrestricted
Restricted
£
£
Conference Fees etc
1,845
-
Events Committee income
-
36,120
Total
1,845
36,120
Income from charitable activities (previous reporting period)
Unrestricted
Restricted
£
£
Conference Fees etc
6,519
-
Events Committee income
-
540
Total
6,519
540
5
Investment income
Unrestricted
Restricted
£
£
Dividends
6,940
-
Bank Interest
257
-
66,992
-
-
-
Loan interest
395
-
74,584
-
All investment income is unrestricted.
6
Cost of raising funds
Unrestricted
Restricted
£
£
Property Costs
36,011
-
36,011
-
Rent and property income
Total
Surplus on disposal of Queensbury
land		 Total 2021
£
1,845
36,120
37,965
Total 2020
£
6,519
540
7,059
2021
£
6,940
257
66,992
-
395
74,584
2021
£
36,011
36,011		 2020
£
8,249
226
51,439
131,695
2,670
194,279
2020
£
20,898
20,898

20

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

7 Analysis of expenditure on charitable activities

Unrestricted Funds
Staff costs
District Office
District Board
District Assembly
Support Grants
Insurance
Legal Fees
Audit Fees
Unrestricted Total
Desginated Funds
Depreciation
Ladies Retreat Fund
Designated Total
Restricted Funds
NYI Expenses
Salford
Restricted Total
Total
NMI Council &
Convention
Events Committee
Expenses
Evangelism and
Promotion
Buildings Depreciation
Bad debt
Companies House
Fees
Loss on disposal of
building		 Staff Costs
£
55,687
-
-
-
-
-
-
-
-
-
-
-
-
55,687
-
-
-
-
-
-
-
-
55,687		 Support
Costs
£
16,072
5,950
546
5,369
1,514
57,375
564
843
13,116
-
5,400
2,267
-
109,016
2,752
871
3,623
4,842
46,605
35,146
26,887
113,480
226,119		 Other Direct
Costs
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-		 Total 2021
£
71,759
5,950
546
5,369
1,514
57,375
564
843
13,116
-
5,400
2,267
-
164,703
2,752
871
3,623
4,842
46,605
35,146
26,887
113,480
281,806		 Total 2020
£
63,570
4,810
2,977
8,990
6,471
40,848
665
-
13,120
13
4,800
-
4,793
151,057
2,748
10,223
12,971
5,120
1,446
3,126
36,856
46,548
210,576

21

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

Analysis of expenditure on charitable activities previous reporting period

Staff Costs
£
Unrestricted Funds
Staff costs
42,808
District Office
-
District Board
-
District Assembly
-
Church Planter
-
-
Support Grants
-
Insurance
-
Legal Fees
-
Buildings Depreciation
-
Companies House Fees
-
Audit Fees
-
-
-
Unrestricted Total
42,808
Desginated Funds
Depreciation
-
Designated Total
-
Restricted Funds
NYI Expenses
-
-
-
Salford
-
Restricted Total
-
NMI Council &
Convention
Events Committee
Expenses
Evangelism and
Promotion
Loss on disposal of
motor vehicle
Loss on disposal of
building		 Support
Costs
£
20,762
4,810
2,977
8,990
-
6,471
40,848
665
-
13,120
13
4,800
-
4,793
108,249
2,748
2,748
5,120
1,446
3,126
36,856
46,548		 Other
Direct Costs
£
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-		 Total 2020
£
63,570
4,810
2,977
8,990
-
6,471
40,848
665
-
13,120
13
4,800
-
4,793
151,057
2,748
2,748
5,120
1,446
3,126
36,856
46,548		 Total 2019
£
64,291
6,484
3,877
12,110
7,701
22,522
71,042
903
333
13,237
13
6,600
6,048
-
215,161
2,745
2,745
30,017
2,871
45,530
32,922
111,340

22

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

8 Net income/(expenditure) for the year

This is stated after charging/(crediting): 2021 2020
£ £
Depreciation 15,868 15,865
Loss/(profit) on disposal of fixed assets - 4,793
Auditor's remuneration - audit fees 5,400 4,800

9 Staff costs

Staff costs during the year were as follows:

Wages and salaries
Social security costs
Pension costs
Total		 2021
£
45,349
499
2,248
48,096		 2020
£
38,293
870
1,927
41,090

No employees has employee benefits in excess of £60,000 (2020: Nil).

The average number of staff employed during the period was 4 (2020: 4).

The average full time equivalent number of staff employed during the period was 2.2 (2020: 1.38).

10 Trustee remuneration and expenses, and related party transactions

One (one) trustee, Revd. C. McCann, was paid remuneration of £29,807 (2020:£30,762), rent of £9,600 (2020: £10,100) and utility costs of £4,305 (2020: £3,172) for use of their homes as the District Manse and pension contributions of £1,490 (2020: £1,404) during the year. Rev C McCann had the use of a car owned by the District from his appointment; the net book value of this car was £2,749 at the year end. P11D for NI paid on benefits to Rev McCann amounted to £499.14 (2020: £nil). Two trustees (2020: four) were reimbursed expenses of £16,377 (2020: £3,392) during the year. The remuneration and expenses are paid to trustees in accordance with the authority given by the Articles of Association.

One trustee has an interest free loan outstanding at the year end of £200.

There are no donations from related parties which are outside the normal course of business and no restricted donations from related parties.

No trustee or other person related to the charity had any personal interest in any contract or transaction entered into by the charity, including guarantees, during the year (2020: nil).

23

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

11 Corporation tax

The charity is exempt from tax on income and gains falling within Chapter 3 of Part 11 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992 to the extent that these are applied to its charitable objects. No tax charges have arisen in the charity.

12 Fixed assets: tangible assets

Cost
Additions
Disposal
Transfer to investment assets
Depreciation
Charge for the year
Disposal
Depreciation on transferred asset
Net book value
At 30 September 2021
At 30 September 2021
At 30 September 2021
At 30 September 2020
At 1 October 2020
At 1 October 2020		 Land
& Buildings
£
1,311,544
-
-
(45,000)
1,266,544
65,891
13,116
-
(5,400)
73,607
1,192,937
1,245,653		 Motor
Vehicles
£
10,995
-
-
-
10,995
5,494
2,752
-
-
8,246
2,749
5,501		 £
1,322,539
-
-
(45,000)
Total
1,277,539
71,385
15,868
-
(5,400)
81,853
1,195,686
1,251,154

The land and buildings are churches or manses owned (or partly owned) by the District, but used by the following churches: Dewsbury, Fresh Ground Manse, Sheffield, Penycae, Skegness, and Salford.

24

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

13 Investments

Investments
Add: additions to investments at cost
Transfer of property from fixed asset to investment
Add net gain/(loss) on revaluation
Investments at fair value comprised:
Investment Properties
CAF UK Equity Growth Fund
COIF Income Units
Carrying amount at 30 September 2021
Market value at the start of the year		 Listed
investments
£
281,540
-
-
44,838
326,378
2021
£
4,498,330
69,184
257,194
4,824,708		 Investment
properties
£
3,927,900
522,180
48,250
-
4,498,330
2020
£
3,927,900
53,886
227,654
4,209,440		 Total
4,209,440
522,180
48,250
44,838
4,824,708

All investments shown above are held at fair value.

The Investment properties are reviewed on a rolling basis and the trustees are satisfied that there is no material change in the market value of these properties from that of the previous accounting year.

One investment property at Small Heath Birmingham was disposed of after the year end (January 2022) and the sale proceeds were not materially different to the carrying value.

At the year end, the Thornton property was revalued to £48250 and transferred from Fixed assets to Investment properties , as rental is now being received. A revaluation surplus arising of £8650 has been added to revaluation reserve.

Most of the investment properties are rented out at market rates to provide income, with the exception of the property at Fresh Ground, which remains at nominal rate to give the Fresh Ground Church time to move to financial stability.

Investments in CAF and COIF are stated at their market value at the balance sheet date.

25

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

14 Debtors

Debtors
Church Loans
Other Loans
Other debtors
Prepayments and accrued income		 2021
£
-
450
48,143
5,860
54,453		 2020
£
56,365
3,500
14,445
6,245
80,555

The other loans relate to interest free loans to two (2020:two) church pastors which are being repaid monthly.

Church loan recoverable after more than one year is £Nil (2020: £56,365)

Church Loans
Cost
Advances
Interest
Repaid
At 30 September 2021
15
Cash at bank and in hand
Cash at bank and on hand
At 1 October 2020		 CJ London
£
-
-
-
-
-		 Sheffield
£
56,365
-
94
(56,459)
-
2021
£
922,554
922,554		 Total
£
56,365
-
94
(56,459)
-
2020
£
374,097
374,097

26

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

16 Creditors: amounts falling due within one year

Creditors: amounts falling due within one year
Funds held as an intermediary agent
Other creditors and accruals
Analysis of funds received as agent
Balance
held at 1
October
2020
Nazarene Missions International
(484)
NMBF
5,413
NTC
7,609
Salford
(1,456)
Standard Life
10,131
Sundry
1,326
Youth Ministry
3,156
NCM Fundraising
5,057
30,752		 2021
£
44,565
9,466
54,031
Funds
received
78,555
13,950
24,400
15,824
41,148
350
3,469
2,360
180,056		 2020
£
30,752
6,313
37,065
Funds paid
out
£
(66,988)
(13,565)
(9,608)
(17,243)
(47,877)
(1,676)
(3,518)
(5,767)
(166,242)		 Balance
held at 30
September
2021
£
11,083
5,798
22,401
(2,875)
3,402
-
3,107
1,650
44,566

17 Analysis of funds received as agent

27

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

18 Analysis of movements in restricted funds

BISD NMI Fund
BISD NYI Fund
Salford Church
Total
BISD NMI Fund
BISD NYI Fund
Salford Church
BISD Events/ Sunday
School Ministries Fund
BISD Events/ Sunday
School Ministries Fund
Previous reporting
period		 Balance at
1 October
2020
£
6,930
7,182
18,746
23,177
56,035
Balance at
1 October
2019
£
9,516
7,664
15,465
33,030
65,675		 Income
£
36,120
48,517
7,622
31,336
123,595
Income
£
540
964
8,401
27,003
36,908		 Expenditure
£
(35,146)
(46,605)
(4,842)
(26,887)
(113,480)
Expenditure
£
(3,126)
(1,446)
(5,120)
(36,856)
(46,548)		 Transfers
£
-
-
-
-
-
Transfers
£
-
-
-
-
-		 Balance at
30
September
2021
£
7,904
9,094
21,526
27,626
66,150
Balance at
30
September
2020
£
6,930
7,182
18,746
23,177
56,035

Name of Description, nature and purposes of the fund

BISD Events/ Sunday School Ministries Fund BISD NMI Fund

BISD NYI Fund

Salford Church

Consolidated account funds of British Isles South District Sunday School Ministries/Events.

Consolidated account funds of British Isles South District Nazarene Missions International.

Consolidated account funds of British Isles South District Nazarene Youth International.

Consolidated account funds of British Isles South District, held to record the financial records of the charitable activities of The Naz in Salford.

28

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

19 Analysis of movement in unrestricted funds

Unrestricted Funds
General Fund
Designated Funds
Capital Fund
Ladies Retreat Fund
Revaluation reserve
Total Designated Funds
Total Unrestricted Funds
Unrestricted Funds
General Fund
Designated Funds
Capital Fund
Ladies Retreat Fund
Revaluation reserve
Total Designated Funds
Total Unrestricted Funds
Previous reporting period		 Balance at 1
October 2020
£
3,282,347
1,787,093
853
751,853
2,539,799
5,822,146
Balance at 1
October 2019
£
3,331,186
1,658,146
4,557
692,956
2,355,659
5,686,845		 Income
£
137,720
1,066,358
1,845
-
1,068,203
1,205,923
Income
£
125,079
131,695
6,519
-
138,214
263,293		 Expenditure
£
(200,714)
(2,752)
(871)
-
(3,623)
(204,337)
Expenditure
£
(171,955)
(2,748)
(10,223)
-
(12,971)
(184,926)		 Gains /
(Losses)
£
44,838
-
-
8,650
8,650
53,488
Gains /
(Losses)
£
(1,963)
-
-
58,897
58,897
56,934		 Transfers
£
-
-
-
-
-
-
Transfers
£
-
-
-
-
-
-		 As at 30
September
2021
£
3,264,191
2,850,699
1,827
760,503
3,613,029
6,877,220
As at 30
September
2020
£
3,282,347
1,787,093
853
751,853
2,539,799
5,822,146

Name of unrestricted fund

Description, nature and purposes of the fund

General fund

The free reserves after allowing for all designated funds

Capital Fund Ladies Retreat Fund Revaluation reserve

Property fund linked to fixed assets. Funds become liquid assets on sale of property

Designated funds belonging to the annual Ladies retreat – a weekend away for ladies. The increase in values of the investment properties.

29

Church of the Nazarene British Isles South District

Notes to the accounts for the year ended 30 September 2021 (continued)

20 Analysis of net assets between funds

Tangible fixed assets
Fixed asset investments
Net current assets/(liabilities)
Total		 4,824,708
(2,756,203)
General
funds
£
1,195,686
3,264,191		 Designated
funds
£
-
-
3,613,029
3,613,029		 Restricted
funds
£
-
-
66,150
66,150		 £
Total
1,195,686
922,976
4,824,708
6,943,370

21 Reconciliation of net movement in funds to net cash flow from operating activities

Net income/(expenditure) for the year
Adjustments for:
Depreciation charge
Loss/(profit) on sale of fixed assets
(Gains)/losses on investments
Dividends, interest and rents from investments
Decrease/(increase) in debtors
Increase/(decrease) in creditors
Net cash provided by/(used in) operating		 2021
£
1,056,539
15,868
-
(44,838)
(74,584)
26,102
16,966
996,053		 2020
£
125,661
15,865
4,793
(56,934)
(194,279)
65,161
26,012
(13,721)

30