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← Epworth Scunthorpe and Gainsborough Methodist Circuit

2023-08-31-accounts

CIRCUIT ANNUAL ACCOUNTS AND REPORT 2022-2023

THE METHODIST CHURCH

EPWORTH AND SCUNTHORPE CIRCUIT (BECAME EPWORTH SCUNTHORPE AND GAINSBOROUGH CIRCUIT ON 01/09/23) Registered Charity – Registration Number 1133752

In the Lincolnshire District no 17/01

MINISTERS Rev’d Victoria Atkinson Rev’d Paul Braisdell

CIRCUIT STEWARDS Mr David Sanderson (Snr Steward to Dec 22) Mrs Hazel Jackson (Snr Steward from Dec 22) Miss Betty Oldridge Mr Mervyn White Mrs Valery Gravel

CIRCUIT TREASURER Mr Andrew Lockwood

1

Contents of this report

Finance report and balance sheet for the year 1[st] of September 2022 to 31[st] of August 2023.

A detailed explanation of the finances.

The circuit annual report prepared by the leadership team.

The circuit meeting acceptance signature sheet.

The independent examiner’s report and signature sheet.

2

Statement of Financial Activities (SOFA) for the year ended 31-Aug-23

Notes to
the
accounts
Income
1 Donations and legacies
2 Income from monetary
investments
3 Income from investment
properties
2
4 Assessments on Churches
22
5 Capital Receipts
4
6 Grants received
Unspent grant monies
returned
7 Other charitable income
8Total income
Expenditure
9 Grants and donations
5
10 Salaries and associated
costs
6
11 Property maintenance
7
12 Connexional assessment &
model trust levy
22
13 District Assessment & Levy
8
14 Depreciation
9
15 Office expenses
16 Other outgoings
10
Interest on finance leases
17Total charitable
expenditure
Net income before investment
gains/(losses)
18 Gains/(losses) on monetary
investments
19 Gains/(losses) on investment
properties
14
20Net income/(expenditure)
21 Transfers between funds
12
22 Other gains/(losses)
23Net movement in funds
24 Total funds brought forward
25 Total funds carried forward
20/21		 General Fund
(Unrestricted)
Circuit Model
Trust
(Unrestricted)
Total
2022-23
Total
2021-22
£
£
£
£
0
4,000
3,034
6,773
9,807
2,011
17,820
17,820
17,820
166,733
166,733
178,263
0
405,673
0
0
1,689
1,689
0
100
100
563
189,376
6,773
196,149
608,330
14,500
14,500
12,068
137,181
137,181
160,777
27,028
27,028
17,638
54,268
54,268
8,134
50,141
7,252
57,393
50,512
14,611
14,611
9,418
10,767
10,767
9,361
3,792
556
4,348
3,455
1,023
1,023
0
259,043
62,076
321,119
271,363
-69,667
-55,303
-124,970
336,967
-669
-669
-1,056
-146,186
-146,186
25,000
-215,853
-55,972
-271,825
360,911
-182,555
182,555
0
0
0
0
-398,408
126,583
-271,825
360,911
1,607,468
195,040
1,802,508
1,441,597
1,209,060
321,623
1,530,683
1,802,508

The statement of financial activities includes all gains and losses recognised in the year.

The notes on pages 05 to 17 form part of these financial statements .

3

Balance Sheet as at 31 August 2023

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----- Start of picture text -----
General Fund Circuit Model Totals Totals
Notes to
(Unrestricted) Trusts 2022/23 2021/22
the
(Unrestricted)
Accounts
£ £ £ £
Fixed Assets
Circuit Manses & Equipment 13 532,500 532,500 535,583
Investment properties 14 508,914 508,914 855,000
Investments 15 15,084 15,084 15,753
Total fixed assets 1,041,414 15,084 1,056,498 1,406,336
Current Assets
Debtors 16 7,261 7,261 23,996
Loans by the Circuit 17 965 965 1,085
Investments with TMCP 15 306,539 306,539 179,287
Central Finance Board Deposits
116,648 116,648 151,319
Cash at Bank and in hand 91,594 91,594 83,114
Total current assets 216,468 306,539 523,007 438,801
Current liabilities
Creditors (due in under 1 year) 18 - - -
43,493 43,493 42,629
Grants payable within 2022-23 0 0
Total current liabilities -43,493 0 -43,493 -42,629
Net current assets/(liabilities) 172,975 306,539 479,514 396,172
Total assets less current
liabilities 1,214,389 321,623 1,536,012 1,802,508
Long term liabilities
(due after more than one
year)
Grants payable after 2022-23 0 0
Loans to the Circuit
0 0
Creditors (due in over 1 year) 19 -5,329 -5,329 0
Net assets 1,209,060 321,623 1,530,683 1,802,508
Funds of the Circuit
General Fund (Unrestricted) 20/21 1,209,060 1,209,060 1,607,468
Circuit Model Trust Fund
(Unrestricted) 321,623 321,623 195,040
Designated Funds (Unrestricted) 0 0
Total Unrestricted Funds 1,530,683 1,802,508
Restricted Funds 0 0
Endowment Funds 0 0
Total Funds 1,209,060 321,623 1,530,683 1,802,508
----- End of picture text -----

4

Notes to the accounts for the year ended 31 August 2023

1. Accounting and accounting policies

1.1 Basis of preparation of financial statements

The financial statements have been prepared in accordance with the ‘Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (effective 1 January 2019)’ (Charity SORP -FRS 102).

In addition, they are prepared in accordance with ‘FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland’ (FRS 102), and under UK Generally Accepted Accounting Practice as applicable from 1 January 2015 and the Charities Act.

These statements are also prepared on a going concern basis and under the historic cost convention as modified to include certain assets at fair value. Assets and liabilities are initially recognised at historic cost or transactional value unless otherwise stated. These statements are presented in sterling which is the functional currency of the charity.

The trustees confirm that the entity has met the definition of a public benefit entity as defined under FRS 102.

1.2 Consolidation

The Circuit has denominational regulatory oversight in respect of the work of the Methodist Churches within the Circuit but has no legal or operational control of those churches or their governing body except in extreme circumstances. For this reason, the financial statements of individual churches within the Circuit, of which each are considered a separate charity, are not consolidated into these financial statements and therefore these accounts represent solely the activities of the Circuit.

1.3 Income recognition

Income is brought into account when there is entitlement, the amount is reliably measurable and once it is more likely than not that the economic benefit of the income will be forthcoming.

Capital receipts are the deemed residual fair value of transfers to the Circuit of redundant church assets (see note 4).

1.4 Expenditure/transfers

This is recognised when a liability is incurred, or a constructive obligation arises, where the amount is reliably measurable, and it is considered more likely than not that there will be an outflow of economic benefit.

Where income is received or expenditure has been paid out of the general fund but that subsequently an application is made to apply the monies to the Circuit Model Trust Fund (CMTF) that is held for the Circuit’s use, then funds may be transferred to/from this Trust Fund held by Trustees for Methodist Church Purposes (TMCP) for use by the Circuit. This transfer will be accounted for in the Statement of Financial Activities but sometimes the timing of the two transactions will lie in different accounting periods and the nature of any such transactions are disclosed in ‘Transfers’ see note 12.

5

TMCP is a body corporate established by the Methodist Church for the custody and administration of monetary/property assets and consequently is the Custodian Trustee for land and buildings and some monetary investments of the Charity.

Grants made by the Circuit from its own funds are recognised in full at the time of approval of the agreement unless there are performance conditions attached which are within the control of the Circuit and in which case it will normally be recognised when these have been fulfilled.

1.6 Pensions

The Circuit makes payments to the Methodist Ministers’ Pension Scheme which is a defined benefits scheme. The Scheme is effectively a multi-employer scheme operated by the Methodist Church and as insufficient information is available to use defined benefit accounting the Circuit accounts for it as a defined contributions scheme. Further details are as disclosed in notes 6 and 23.

1.7 Taxation

As the Circuit is a registered charity it is potentially exempt from taxation on income and gains however it is not VAT registered and therefore all input VAT is charged with the expense to which it relates.

1.8 Tangible fixed assets

These are capitalised if they can be used for more than one year, and individually cost at least £500.

Tangible fixed asset property consists of manses and other buildings used in the work of the Methodist Church. They have been owned for many years and as the cost of individual properties is unknown, they continue to be disclosed in the accounts at deemed cost being 80% of insured value as of 1 September 2013. If the trustees consider that there is evidence of impairment then an impairment charge is made against the individual property, otherwise depreciation is provided on buildings at the rate of 2% per annum on deemed cost which is designed to write the properties down to zero over their estimated useful economic life.

Land is not depreciated.

If a Society, within a Circuit, were to close then usually the responsibility for safe-keeping and maintenance of the church building is passed to the relevant Circuit who will retain the asset pending disposal or alternatively bring it into use in some way as to benefit the local community. On Society closure any redundant Church building is recognised, at fair value, as effectively a donation (included in Capital Receipts) and as an asset within the Circuit accounts. If the building is held pending sale, then it is included in investment property until disposal. Upon final disposal any difference between fair value and disposal proceeds is treated as a profit/loss on disposal.

Purchased office equipment is depreciated at 33% per annum on cost from the month that the asset is acquired and such equipment that is subject to a finance lease is depreciated at 20% per annum which is designed to write off the asset over the life of the primary agreement.

Land and buildings are held by TMCP as custodian trustee as noted in accounting policy 1.4.

6

1.9 Investment property

The Circuit may hold property which is surplus to its requirements. Where this is the case, and that the property is no longer held for Church Society use then it is transferred from tangible fixed assets to investment properties and valued at fair value. See also accounting policy 1.4 regarding Custodian trustee.

1.10 Financial instruments

The charity holds assets and liabilities that qualify as basic financial instruments which are therefore initially recognised at their transactional value and subsequently measured at settlement value, other than investment properties, other investments and assets held on a finance lease which are then subsequently valued at fair value.

1.11 Monetary Investments

The Circuit’s monetary investments are held by TMCP as custodian trustees (see accounting policy 1.4) and the valuations, at market value, are provided by TMCP. The unrealised gains/losses arising on investments for the financial year are disclosed in the Statement of Financial Activities (SOFA).

1.12 Funds

All funds are unrestricted, and details of the funds are disclosed in the financial statements.

1.13 Critical Accounting Estimates and Judgements

The Trustees are required to adjust as necessary estimates and judgements regarding the carrying amount of assets and liabilities in the application of the Charity’s accounting policies. These estimates and judgements are based on experience and other relevant factors however actual results may differ from these recorded estimates.

They are revisited on a regular basis and any revisions are recognised as they arise.

The only area where the trustees consider there could be a significant risk of material adjustment is in the valuation of Investment Properties which are based on fair value. However, even if these valuations proved to be materially lower than as stated in the financial statements the trustees are confident that the Circuit’s ability as a going concern will not be compromised.

1.14 Finance leases

Assets held under finance leases are recognised as assets at the date of inception of the agreement at the lower of the asset fair value and the present value of the minimum lease payments. The related liability is included in the balance sheet as a finance lease obligation. Each lease payment is treated as consisting of a capital element and an interest charge and this interest element is applied to the Statement of Financial Activities to produce a constant periodic charge on the remaining balance of the liability.

1. Income from investment properties

A disused church building has been leased to a registered charity ‘The Forge Project’ which provides relief for the homeless in the local area. The rent is due annually on a lease with a current rent of £10,000 pa and this income is recognised at the point that it is due to be received. The amount recognised in the year was £10,000 (2021/22 - £10,000).

In addition, a small pocket of land is held by the Circuit at an annual rent of £20 (see also note 25). In relation to this asset £20 was credited to income during the current year (2021/22 - £20).

Furthermore, a manse currently surplus to requirements has been rented out during the year with a gross rent received of £7,800 (2021/22 - £7,800).

7

2. Assessment on Churches

At the year end, the Circuit comprised 17 Church Societies (last year 17), and each is assessed for a contribution to meet the overall net costs of the Circuit. Before making this assessment, the Circuit will prepare a budget to determine the amount of additional income required to provide a balanced budget and this will then form the basis of assessment on the local churches.

This apportionment of the assessment on individual churches is determined annually by the Circuit using a formula which considers the number of members in each Church, its anticipated income, and unrestricted funds at its disposal.

Part of this Church Assessment is to reimburse the Circuit for monies required from both District and Connexion to cover certain costs incurred on behalf of individual Churches that make up the Circuit. However, as these costs cannot be identified and as the contractual relationship is between the Circuit, District and Connexion (rather than individual Churches) then it is deemed appropriate to show income and costs in full rather than to net down as in a principal/agent relationship.

These Assessments are receivable quarterly in advance and are treated as deferred income if received in advance of the relevant period at the year end.

Transactions with individual churches, District and Connexion are regarded as related party transactions.

3. Capital Receipts

This relates primarily to the fair value of church buildings in relation to a closed society and these properties are then transferred to the Circuit pending sale or other use. The relevant asset is shown net of all related selling fees. Sales of Methodist property is also subject to a Connexional Priority Fund (CPF) levy by the Connexion calculated on a sliding scale based on eventual selling price and these are disclosed in expenditure as Connexional Levy fees. Any historic grants made by the connexion to the closed church are also reclaimed from the proceeds of sale.

Net current assets received from the closed Society would also be included under this heading.

Society assets transferred during the year were as follows:

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----- Start of picture text -----
2022-23 2021-22
General CMTF General CMTF
£ £ £ £
Church Buildings 0 0 345,000 60,673
Cash received from closed Society 0 0 0 0
Total 0 0 345,000 60,673
----- End of picture text -----

Property disposals

One church building was sold during the previous year and the net proceeds after the CPF levy, is credited to CMTF (£60.673). A further church building credited at fair value in 2021/22 at £200,000 was sold for £195,672 in the current year and proceeds, less the CPF Levy, have been received and transferred to CMT (see note 12).

8

4. Grants and donations made by the Circuit

Grants and donations as listed below have been agreed during the year and are recognised in accordance with the accounting policy as stated in note 1.5.

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2022-23 2021-22
General CMTF General CMTF
£ £ £ £
The Forge Project 9,900 0
Grants to local Churches 4,600 10,841
Other donations 1,227
Total 14,500 0 12,068 0
----- End of picture text -----

5. Salaries and associated costs

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2022-23 2021-22
General CMTF General CMTF
£ £ £ £
Stipends 83,477 80,055
Ministers’ fixed allowances 555 1,068
Administrators’ Gross Pay 15,950 14,005
Social Security costs 7,982 7,642
Pension costs 21,731 20,840
Pension deficit contribution (see note 21) 0 30,000
Apprenticeship Levy 420 403
Ministers’ telephone 1,828 1,957
Ministers’ travel costs 5,238 4,807
Minister’s relocation costs 0 0
Total 137,181 0 160,777 0
----- End of picture text -----

Trustees’ remuneration

Ministers of the Circuit being Reverend A. Long (Superintendent Minister, but resigned on 31 August 2023), Reverend P. Braisdell and Reverend V. Atkinson were also trustees of the Circuit. Their stipend and allowances are determined annually in advance by the Methodist Conference and the relevant Circuit is responsible for meeting these costs. They all received a stipend of £26,928 pa (2021/22 - £25,824) and the superintendent minister also received the Superintendent Allowance of £2,693 pa (2021/22 - £2,582). At the year-end salary of £5,082 (2021/22 - £6,956) had been paid in advance (one months’ salary).

It should be noted that the superintendent minister had also similar responsibilities in a neighbouring Circuit but with her full salary cost met by the Epworth & Scunthorpe Circuit. It is estimated that approximately 15%/20% of her time was taken with these additional duties and therefore the cost to the Circuit of this arrangement for the current year is estimated at approximately £6,600 (2021/22 - £6,600). This practice ceased from the 31 August 2023 due to a major Circuit reorganisation.

It is normal practice for a minister to be awarded a three-month sabbatical after a period of service within the Methodist Church, but no cost is accrued for this as it is the custom during these times for the Circuit to operate without any additional assistance except for the availability of a neighbouring circuit minister to act in a consultancy role should such a situation be deemed necessary.

9

An amount of £21,731 (2021/22 - £20,840) was payable into the defined benefit pension scheme to which all these ministers are members. At the year-end £1,302 (2021/22 -£1,811) had been paid in advance into the Scheme.

In addition, last year a £30,000 contribution was made as a one-off to the Methodist Church of Great Britain towards their appeal to increase the pension reserve held by them specifically for future funding of the pension deficits of their various Pension Schemes. Further details are given in note 23.

Their remuneration and pension cost as stated is largely connected to their role as minister rather than as a trustee and in view of this and the complexities involved in apportionment it is not considered necessary to identify costs between the two roles.

In addition, manses are provided for each minister and their respective family, and these properties are maintained by the Circuit who also make payments for buildings insurance, council tax and water charges. See note 7 for details. These costs are not regarded as a taxable benefit by HMRC and therefore have not been disclosed as remuneration in any of these notes.

Two lay trustees received remuneration for administrative tasks carried out during the year and they were Mrs L. Howard £4,915 (2021/22 - £4,302) and Mrs B. Braisdell £3,525 (2021/22 - £3,019). Otherwise no further lay trustees were remunerated in either year.

Key Management Personnel

The Circuit Leadership Team, who are responsible for policy formulation and day to day administration of the activities are regarded as the Key Management Personnel and this team consisted of the three Ministers noted previously and several non-remunerated lay trustees. The aggregate benefit during the year of this key management team (excluding Employer National Insurance) was £105,763 (2021/22 - £131,963).

Average number of employees throughout the year were 3 full-time ministers (2021/22 -3) and 3 part-time administration staff (2021/22 -3).

No employee received remuneration of more than £60,000 during the year (2021/22 – nil).

Pensions.

All pension costs relate to the Methodist Ministers’ Pension Scheme, this is effectively a multi-employer defined benefit scheme as noted in Accounting Policies note 1.6, further details of the Pension Scheme deficit are reported in note 23.

Lay employees have the option to join a defined contributions pension scheme although none have done so to date.

Trustees’ expenses

The three Ministers (2021/22 - 3) were reimbursed total expenses of £6,120 (2021/22 -£7,175) during their employment and whilst it is not possible to analyse the function of all these expenses it is considered that almost all these expenses relate to reimbursement whilst they were carrying out their role as ministers as opposed to as trustees. It is therefore considered that no further analysis would be useful.

In addition, 5 (2021/22 – 6) lay trustees were reimbursed a total of £5,635 (2021/22 -£4,249) during the year.

10

These reimbursements were largely for travel and stationery costs.

6. Property costs

The Circuit is Managing Trustee for three manses occupied by ministers stationed in the Circuit, reduced to two with effect from the year end, with a further one on a residential let contract and which is now classed as an investment property. There is also an additional building, former church, which is leased to ‘The Forge Project’, a registered charity, which works with and assists homeless people within the local area and this property is also regarded as an investment property.

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----- Start of picture text -----
2022-23 2021-22
General CMTF General CMTF
£ £ £ £
Insurance 4,702 3,978
Council Tax and Water for manses 10,028 8,215
Manse repairs 4,017 2,942
Costs of closed Church buildings 4,574 776
Costs of property on residential let 827 827
Quinquennial inspections 2,880 900
Total 27,028 0 17,638 0
----- End of picture text -----

7. District Assessment and Levy

The District Assessment is calculated in proportion to church members and staffing within the various Circuits within the Lincolnshire District.

The levy is calculated on a sliding scale percentage of the Circuit’s CMTF account balances as of 31 August in the previous accounting year.

==> picture [460 x 92] intentionally omitted <==

----- Start of picture text -----
2022-23 2021-22
General CMTF General CMTF
£ £ £ £
District Assessment 50,141 40,704
District Levy 7,252 9,808
Total 50,141 7,252 40,704 9,808
----- End of picture text -----

These are regarded as related party transactions. See note 22.

8. Depreciation

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----- Start of picture text -----
2022-23 2021-22
General CMTF General CMTF
£ £ £ £
Depreciation on owned assets 9,323 9,418
Depreciation on leased assets 960 0
Loss on disposal of fixed assets 4,328 0
Total 14,611 0 9,418 0
----- End of picture text -----

11

9. Other Outgoings

Other Outgoings of £4,348 (2021/22 - £3,455) includes a charge of £556 (2021/22 - £702) by Trustees for Methodist Church Purposes (TMCP) and this is a charge against the CMTF. This is regarded as a related party transaction. See note 22.

10. Independent Examiner

The fee for the independent examination of these accounts was £300 (2021/22 - £300) and the Independent Examiner provided no additional services during either of the two years.

11. Transfers between funds

Transfers out of CMTF are usually for specific projects, require further approval and are usually based upon anticipated costing of the expenditure. During the year 22/23 transfers were received from TMCP of £13,117 for property maintenance and repairs and in the previous year £93,665 were received from CMTF to the General Fund and this consisted of monies for Circuit property repairs of £4,665, grants to local churches of £9,000 for specified costs, £50,000 to support local churches assessments and £30,000 to support Ministers’ Pension Fund deficit.

In addition, £195,672 was transferred to the CMTF during the year, nil previous year, and this represented the proceeds of the sale of a church building owned by the Circuit.

The net effect of the above is a transfer to CMTF of £182,555 from the general fund during the year (from CMTF of £93,665 in 2021/22).

12. Fixed Assets – Circuit Manses and Equipment

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----- Start of picture text -----
Land and Office Total
Buildings Equipt.
£ £ £
At cost or valuation
Balance brought forward 619,179 1,154 620,333
Added in year 7,200 7,200
Balance carried forward 619,179 8,354 627,533
Accumulated depreciation
Balance brought forward 83,598 1,152 84,750
Depreciation charge for year 9,323 960 10,283
Balance carried forward 92,921 2,112 95,033
Net realisable value at 1 September 2022 535,581 2 535,583
Net realisable value at 31 August 2023 526,258 6,242 532,500
----- End of picture text -----

Land and buildings consist of Circuit Manses.

Office equipment includes leased assets with a net realisable value at 31 August 2023 of £6,240 (2022 – nil).

13. Fixed Assets - Investment Properties

Land and Buildings £ At valuation

12

As at 1 September 2022 855,000
Added inyear 100
Disposal inyear (200,000)
Revaluation inyear (146,186)
As at 31 August 2023 508,914

The investment properties have been valued by the Circuit Leadership Team at fair value without any professional advice but where possible by assessment of similar property prices in the area and with any other relevant information that they have obtained.

Custodian to most of the properties included in the financial statements is held by TMCP and individual properties will only be released under certain conditions. In addition, if property was released a levy, based on the disposal proceeds achieved, would also be payable.

However, see also, see note 22 as regards the structure of TMCP.

14. Investment Assets (TMCP)

The funds that support the CMTF are held by TMCP in Trustees interest bearing bank accounts or as Managed Equity funds where interest and dividends are credited on a regular basis.

TMCP is the legal owner and custodian trustee of all Methodist model trust property, and this is held on behalf of local managing trustees who are responsible for the day-to-day operational control. It is ensured by TMCP that through providing guidance and direction that the managing trustees comply with Charity Law and Methodist regulation and policy as determined by the Methodist Conference.

==> picture [458 x 80] intentionally omitted <==

----- Start of picture text -----
2022-23 2021-22
£ £
Fixed assets -Managed Equity funds 15,084 15,753
Current assets -Cash deposits 306,539 179,287
Total 321,623 195,040
----- End of picture text -----

15. Debtors

All debtors and prepayments are due within one year and are as follows:

2022-23 2021-22
£ £
Debtors 0 13,834
Prepayments 7,261 10,162
Total 7,261 23,996

16. Loans made by the Circuit

At the end of the year an interest free loan was owed to the Circuit from one of the local churches of £965 (2021/22 - £1,085) a part repayment of £120 having been repaid in the year. Repayment of the balance of this loan is anticipated within the near future.

13

17. Creditors (due in under one year)

==> picture [455 x 108] intentionally omitted <==

----- Start of picture text -----
2022-23 2021-22
£ £
Deferred income 39,408 36,122
Creditors 286 460
Finance lease obligations 1,030 0
2,769 6,047
Total 43,493 42,629
----- End of picture text -----

Deferred income includes £39,388 (2021/22 - £36,082) for church assessments which are received quarterly in advance.

18. Creditors (due after more than one year)

18. Creditors(due after more than oneyear)
2022-23 2021-22
£ £
Finance lease obligations 5,329 0

None of the finance lease obligations are due after more than five years.

All finance lease loans are secured on the assets to which they relate (see note 13).

19. Movements in Funds

All funds owned by the charity are unrestricted and consist of two funds with a summary of the movements being as follows:

Current year

==> picture [467 x 121] intentionally omitted <==

----- Start of picture text -----
Balance at Income Expend’ure Inv’ment Transfer Balance at
1/09/22 gain/ 31/08/23
(loss)
£ £ £ £ £ £
General Fund 1,607,468 189,376 (259,043) (146,186) (182,555) 1,209,060
Circuit Model 195,040 6,773 (62,076) (669) 182,555 321,623
Trust Fund
Total 1,802,508 196,149 (321,119) (146,855) 0 1,530,683
----- End of picture text -----

Prior year

==> picture [467 x 121] intentionally omitted <==

----- Start of picture text -----
Balance at Income Expend’ure Inv’ment Transfer Balance at
1/09/21 gain/ 31/08/22
(loss)
£ £ £ £ £ £
General Fund 1,195,440 546,082 (252,719) 25,000 93,665 1,607,468
Circuit Model 246,157 62,248 (18,644) (1,056) (93,665) 195,040
Trust Fund
Total 1,441,597 608,330 (271,363) 23,944 0 1,802,508
----- End of picture text -----

The purpose of these funds is described as follows:

14

General Fund

The General Fund is for use at the discretion of the trustees in furtherance of the general objectives of the Circuit.

Circuit Model Trust Fund

The Circuit Model Trust Fund is also for use in the general objectives of the Circuit. Its main source of income is formulaically determined contributions from the sale of manses and church buildings in the Circuit. Although this fund meets the definition of an unrestricted fund under the control of the Circuit Meeting, prior approval is still required from TMCP to access these funds.

20. Analysis of Net Assets between Funds

Fund balances at 31 August 2023 are represented by:

==> picture [463 x 123] intentionally omitted <==

----- Start of picture text -----
General CMTF Total
£ £ £
Tangible fixed assets 532,500 532,500
Fixed asset investments 508,914 508,914
Investments 15,084 15,084
Net current assets in less than one year 172,975 306,539 479,514
Liabilities due in more than one year (5,329) (5,329)
Total 1,209,060 321,623 1,530,683
----- End of picture text -----

Fund balances at 31 August 2022 are represented by:

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----- Start of picture text -----
General CMTF Total
£ £ £
Tangible fixed assets 535,583 535,583
Fixed asset investments 855,000 855,000
Investments 15,753 15,753
Net current assets in less than one year 216,885 179,287 396,172
Total 1,607,468 195,040 1,802,508
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21. Transactions with Related Parties

Related parties include the Methodist Church, Connexion, the Lincolnshire District, other Methodist churches within the circuit, and TMCP.

None of the Circuit trustees made donations directly to the Circuit during the year or preceding year. All the Circuit trustees are members of a church within the Circuit and may be trustees in their churches.

During the year Assessments were receivable from churches within the Circuit of £166,733 (2021/22 - £178,263) and none of these monies were outstanding except for £3,834 at 31 August 2022 that was subsequently received at a later date. In addition, a donation of nil (2021/22 – £4,000) was received from a local church.

During the year grants and donations were made to churches and other related parties of £4,600 (2021/22 - £12,068) of which £1,689 was later returned as unspent grant monies. Also, a loan made in a previous year to a church within the Circuit has been partly repaid in the year and therefore the amount owing to the Circuit at 31 August 2023 is £965 (2022 - £1,085). At the 31 August 2022 the balance was £1,085 (2022 - £1,963).

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The Circuit paid, during the year £57,393 (2021/22 - £50,512) in assessments and levies to the Lincolnshire Methodist District. No amounts were outstanding at the year-end (2021/22 – nil)

Also, during the year, the Circuit paid TMCP the custodians of the Circuit’s investments (CMTF) management charges of £556 (2021/20 - £702). No amounts were outstanding at the end of either year.

Custodianship of property remain with TMCP (see notes 13 and 14) and some investments and cash deposits (see note 15) are held with them. As noted previously assets held by TMCP will only be released subject to strict conditions.

The Circuit sold a redundant church building during the year and the net disposal proceeds of £195,672 (2021/22 - £60,673) was received by TMCP (who are the legal owner of most Methodist property). They deducted the Connexional Priority Fund Levy of £54,268 (2021/22 - £8,134) and remitted the balance of £141,404 (2021/22 - £52,539) to the appropriate CMTF held by the Circuit. No monies were outstanding at the year-end (2021/22 – nil).

During the previous year the Circuit received donations from local churches of £11,950 because of an appeal by the Methodist Church of Great Britain for additional funding to cover the defined benefit pension scheme deficits and these monies were then remitted to the Methodist Church for that purpose during that year, and therefore nothing was outstanding at the year-end. As this transaction was regarded as a principal and agent relationship these transactions are not disclosed in the SOFA and further detail of the Pension Scheme deficit is given in note 23.

22. Pension Schemes

The Methodist Church has several defined benefit pension schemes and the assets of these schemes are held separately from those of the Circuit in independently administered funds. They are structured in various ways, and most are considered unlikely to affect the Circuit other than the Minister’s Pension Scheme and a similarly constructed lay employee defined benefit pension scheme, the latter of which is not accepting future accruals. Full details of all pension schemes can be seen in the Methodist Church of Great Britain financial statements which can be accessed on their website.

Negotiations have taken place between the trustees of these various pension schemes and representatives of the Methodist Church to ensure that satisfactory funding was available to cover these obligations. As a result of this, a request was made for additional funding during the 2021/22 financial year, as a one-off, to all Methodist Churches and Circuits. The Circuit contributed £30,000 to this appeal and sent a further £11,950 that it had received for this purpose from the local churches to the Methodist Church of Great Britain. This was all dealt with in the prior year, and it is not anticipated that any further monies will be donated in this respect.

23. Events after the reporting date

Reorganisation

With effect from 1 September 2023 the Circuit has been reorganised and as a result several churches and a manse and other assets have been transferred to the Circuit which as a result has been renamed ‘Epworth, Scunthorpe and Gainsborough Methodist Circuit’. It is estimated that because of this reorganisation the Circuit will have additional fixed assets of approximately £350,000 and additional monetary assets of £30,000 of which around £17,000 of the latter will be restricted funding. Church Assessment income will also increase to cover the ongoing increased costs.

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24. Contingencies

Property

A small parcel of land with an estimated value of £10,000 (included in investment property at this value) is held. This land is currently used by the local Parish Council as part of a children’s playground and the Council pay a nominal rent for it although no legal agreement is held by the Circuit.

An additional small area of land is owned with a nominal value of £100 but currently is not income earning.

The Leadership Team will continue to review these arrangements and if considered appropriate will seek professional advice.

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EPWORTH AND SCUNTHORPE METHODIST CIRCUIT – Registered number 1133752 TRUSTEES ANNUAL REPORT FOR THE YEAR ENDED 31[ST] AUGUST 2023

OBJECTIVES AND ACTIVITIES

The Trustees are pleased to present the Annual Report of the Trustees of the Epworth and Scunthorpe Methodist Circuit (hereinafter referred to as “The Circuit”) for the year ended 31[st] August 2023.

The charity’s objective is to act as a resource provider within the area around Epworth and Scunthorpe for the Methodist Church:

The purposes of the Methodist Church are and shall be deemed to have been since the Date of Union, the advancement of:

The Circuit seeks to enable:

Public Benefit Test

When reviewing aims and objectives, the Trustees have had due regard for the public benefit guidance as published by the Charity Commission.

ACHIEVEMENTS AND PERFORMANCE

In previous years we have been engaging in conversations with neighbouring circuits on things which are of mutual concern and interest for our future which has resulted in recognising the need to restructure the layout of the North Lincolnshire circuits. In the Spring of 2023 votes were taken to merge with parts of the neighbouring circuit – resulting in 5 churches from the Gainsborough area (Gainsborough, Lea, Upton, Misterton and Marton) becoming part of the new Epworth Scunthorpe & Gainsborough Circuit in September 2023.

Much time and energy has been spent by staff and volunteers to prepare for the merger. The changes were all the more significant as one ordained member of staff moved in July 2023 and we were unable to seek a replacement until the stationing round for September 2024.

As well as the usual involvement of local churches with various charities such as The Forge, Lindsey Lodge Hospice and foodbanks, the arrival of a number of Ukrainian families in February 2022 and a particular friendship with a local resident with links into Ukraine led to

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considerable support both here in the North of Lincolnshire and with aid in the form of clothes and supplies.

Local Preachers and worship Leaders have continued to flourish and we anticipate welcoming a new group of local preachers and worship leaders as part of the merger. The Circuit continues to value their contributions to the life of the church communities. Similarly, the pastoral care of ordained staff and local lay people is welcomed.

FINANCIAL REVIEW

Review of the financial results for the year

The Circuit has the following principal sources of funds:

These monies are used to administer the work of the Circuit.

Income for the year was £196,149 (2022 - £608,330) and whilst there was no exceptional income from Capital Receipts of Church assets transferred to the Circuit this year there was a total of £405,673 in 2022 which largely explains the variance between the two years.

Total expenditure for the year was £321,119 (2022 - £271,363). The reason for the substantial increase was expenditure included a levy on disposal of property of £54,268 whereas last year the charge was £8,134. This levy is by its nature unpredictable as it is dependent on sale values of any property disposals.

Losses on investments of £146,855 (2022 - £23,944 gain) were largely due to a valuation adjustment where a property is judged to have previously been overvalued by the trustees and is now returned to what is deemed to be a more realistic valuation.

As a result of these activities there is a deficit for the year of £271,825 (2022 - £360,911 surplus).

Total reserves held by the charity on 31 August 2023 were therefore £1,530,683 (2022 - ££1,802,508 and this includes free reserves at the 31 August 2023 of £1,209,060 (2022£1,607,468). However, this does include property assets of £1,041,414 (2022 - £1,390,583), therefore giving free liquid net assets of £167,646 (2022 - £216,885).

Reserves level and policy

The reserves policy of the Circuit is to hold a minimum of 8 months average expenditure as free reserves, and this is estimated to be approximately £180,000.

Free reserves are defined as unrestricted net assets, excluding fixed assets and Circuit Model Trust Funds as none of these assets are easily converted into ‘on demand cash’.

These reserves are required to enable the Circuit to employ ministers and administrators, for the required contributions to District and Connexion and to ensure financial stability amongst the Churches within the Circuit.

At the year-end such reserves were £167,646 and the trustees are mindful that any further reduction is likely to breach this policy and are therefore monitoring the situation closely, particularly as the re-organisational changes on 1 September 2023, as mentioned elsewhere in the report, make these numbers a moving target.

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However, being mindful of these changes, the trustees are confident that it is appropriate to continue to adopt the going concern basis of preparation of these financial statements.

STRUCTURE, GOVERNANCE AND MANAGEMENT

The governing document for the circuit is the Deed of Union (1932) and Methodist Church Act (1976) Detailed governance arrangements are outlined within the Constitutional Practice and Discipline of the Methodist Church by order of the annual conference (CPD). Management of the circuit is undertaken by the Circuit Meeting advised by the Staff and Circuit Stewards Meeting, Circuit Leadership Team, along with the Local Preachers meeting and the Circuit Finance and Property Committees. Managing Trustees of local church property are the Church Councils of those buildings, Managing Trustees of Circuit property are the Circuit Meeting, Trustees for Methodist Church Purposed act as Custodian Trustees overall.

The Circuit had 3 full-time presbyters until July 2023. After the Superintendent’s departure in July 2023 the Superintendency was taken on by an existing Circuit Minister. She shares ordained responsibilities in the circuit with one other ordained Presbyter. There are 5 Supernumerary Presbyters, 3 of whom are particularly involved in both local church and circuit life, a retired deacon, similarly involved and associate minister status was given by Conference to a retired minister from another denomination. We also continue to employ 3 part-time administrative assistants and there are numerous other lay volunteer office holders.

Related Parties

The Circuit is part of the Lincolnshire District and is also accountable to the Methodist Conference.

The following Methodist Churches are linked to the Circuit --- See Appendix B

Trustee Training

A range of guidance is produced by Methodist Connexion to support the effective running of the circuit, specifically the leaflet ‘The Role of a Trustee in The Methodist Church’ which we endeavour to give to all new Circuit meeting members as induction to their role as trustees.

Safeguarding training and Equality Diversity and Inclusion updates were handled by the provision of training opportunities at a Circuit and District level. Some individuals also completed this training via the Methodist website online.

Risk Management

We are developing our risk management strategies in response to the changing landscape post-Covid.

Income and Expenditure is being monitored in total and is compared with the approved annual budget on a half yearly basis to detect trends as part of the risk management process to avoid unforeseen calls on reserves.

REFERENCE AND ADMINISTRATIVE DETAILS;

Full name of Charity: Epworth and Scunthorpe Methodist Circuit

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Registration Charity Number: 1133752

Date of Registration: 2010

Main communication address: Circuit Office, Ashby Wesley Methodist Church, Ashby High Street, Scunthorpe. DN16 2JT

The members of the Epworth and Scunthorpe Methodist Circuit Meeting are the Charity Trustees, membership bring made up of circuit office holders, ministers and representatives appointed by the local churches.

Full membership is shown as Appendix A to this report.

Circuit Ministers and Officers Active Circuit Ministers: Rev Angela Long Rev Paul Braisdell Rev Victoria Atkinson

Circuit Stewards: Mr David Sanderson (Until December 2022) Ms Hazel Jackson (Senior Circuit Steward from December 2022) Mr Andrew Lockwood Miss Betty Oldridge Mr Mervyn White Mrs Val Hackney (from Sept 2022)

Circuit Administrator: Mrs Mai Lin Grimbleby

PA to the Superintendent – Mrs Louise Howard

PA to the Rev P Braisdell – Mrs Bronwen Braisdell

Andrew Lockwood acted as the principal officer overseeing the day to day financial management and accounting for the Circuit during the year.

Independent examiner: Glover and Co. Chartered Accountants Investment Bankers: Central Finance Board of the Methodist Church Trustees for Methodist Church Purposes Bankers: HSBC, Market Place, Epworth. DN9 1EU

EXEMPTIONS FROM DISCLOSURE

None

FUNDS HELD AS CUSTODIAN TRUSTEE ON BEHALF OF OTHERS

None

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Approved by the members of the Circuit Meeting and signed on their behalf by:

Revd. V. Atkinson

10 September 2024

Appendix A

Names of the charity trustees who manage the charity

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Trustee name Office (if any) Dates acted Note
Mrs C Allison
Mrs J. Atkins - Snow Supernumerary
Mrs M Atkinson Until Dec 2022
Rev Vicki Atkinson Minister
Mr A Bamford Circuit
Safeguarding
Officer
Mrs R Barratt
Mrs I Bell Missions Until August
committee 2022
secretary non
voting
Mr K Boardman From Sept 2022 Replaced E
Owston Ferry Brown
Mrs B Braisdell Local Preachers
Secretary
Rev P Braisdell Minister
Mrs P Briggs
Mrs P Chennells
Mrs A Craddock
Mrs V Cochrane
Mrs B Credland
Mr J Credland
Mrs C Cuthbertson
Mr A Dawson
Mrs J Dawson Until Oct 31
2022
Mrs M Dick
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----- Start of picture text -----
Mrs M Drummond Until August
2022
Mrs D Edwards Rep for Crowle
from Sept 2022
Rev S Gunson Supernumerary
Minister
Mrs M Hall
Mrs V Hackney Circuit Steward From September
2022
Mrs C. Holmes
Mr L Holtby
Mrs L Howard Circuit Meeting
Secretary
Mrs V Isitt
Mrs H Jackson Senior Circuit Replaced
Steward from David
December 2022 Sanderson
Mr P Jackson Local Preachers
Meeting
Mrs M Jones
Mrs P Kirk
Dr J Lambert
Mrs P Layton
Mrs J Levesley
Mr A Lindley Owston Ferry Replaced Ron
from Sept 2022 Sims
Mr A Lockwood Circuit Treasurer
Mrs J Lockwood
Rev A Long Superintendent
minister
Mrs S Lynaugh
Mrs L Mansfield Until Sept 2021
Mr W Maw
Deacon C May Deacon
Miss B Oldridge Circuit Steward
Mrs J Pike
Mr D Sanderson Senior Circuit
Steward until
November 2022
Mr R Sheard
Mrs S Simpkin
Dr KG Simpkin
Mrs L Smith
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==> picture [445 x 136] intentionally omitted <==

----- Start of picture text -----
Mrs J Stocks MHA rep non Until August
voting 2022
Mrs M Ward Until June 2022
Mrs K Welch
Mr M White Circuit Steward
Dr J Wilkinson
Mr K Wilbur
Mrs C Wood
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Appendix B Churches in the Epworth & Scunthorpe Althorpe & Gunness Methodist Church Ashby Wesley Methodist Church Beltoft & Butterwick Methodists Burton upon Stather Methodist Church Crowle & Ealand Methodist Church Ealand Methodist premises (Sold May 2023) Epworth Methodist Church Haxey Methodist Church Laughton Methodist Church Messingham Methodist Church Old Brumby United Church Owston Ferry Methodist Church Roxby Methodist Church (sold 1[st] September 2023) Scotter Methodist Church WInteringham Methodist Church Winterton Methodist Church

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DECLARATIONS Tw$urer I confimi that I have wekmred th8 ￿tsunts frDm the ofthe CSrcurt and thatthey in¢lLad$ ￿1 fvrnls u¥thr the contrd of the Circuf¢ SpJrthr8 of TfeaguTer 07110124 85 W68tStre& BullerwicK DN173LG Pr980nlati(¥n to the"ClrGUit Iknoiing ttsr approval. l oyrfmi thatthe knounts have b88n Or￿11 b8 presented to th8 CirEuit M88bng on io and w8re cf will b8 app¥oved on. Swature ofthe Chawofthe Namè oflhe ChaK olthe 25

Independent examiner's report to the trustees of the Epworth and Scunthorpe Methodist Circuit. I repon to the inJstees on my examinètlon of the acrounts of ihe Epwonh and 5cunthorpe Methodlst CIrc￿l for the vear ended 31" A￿ust 2021. ReSp￿￿bI1btl￿ and tM%i5 01 As the chartty trustees of the Trust you are ￿SPOnsible forthe Pfep•raiion of the •ccounts Sn acCo￿an¢t wlth the fequiièmenis of the Ch¥ritles Act 20111'the Ad'l. I report in resFa of my examinatkjn of the Tfusi's accounts tèrriéd out undér Seei￿)￿ 145 of tht 2011 Act and In carryin8 Out my examifi•lbon I have followed all the applbcable Directions 8iven by the Charity Commission under section 14515llbl of the Act. lndent e￿MIne￿% stst•mwrt I have tomplet¢d my eurnin•tion. I confirm that ￿ material matters Iwve come to my ittention in connection with the ex•mirt•tlon me t•iise io belle¥e that In any maierlal re¥bect.. l. Iccounilng re¢Nds wert not kept In resped of the Trust as required by section 130 of Ihe A¢. or 2. the •c¢ounts do not a¢(orf with those records.. or 3. the account5 do not compty wiih the applicable reqvlremenis concerning the fom) and conieni of counts set out in the Chaiities IAccounts and Rep)rtsl Regulations 2ts)8 other than any requirement that the accounis 8ive a'true and fair view which is nol a matter considered H5 part of an indepe1￿￿t ex•mination. I have nts concerns arKI have come acr0$5 no other matters in connection whh the examinatM>n to whKh attentiDn shouhl be drawn in Ihbs feport Sn ordw to enable a proper ur1ders￿ndir of ihè attounts to bè reached. Siv￿d. 14an: 6AIAI< CAA98ÉLL *cA RèlÈvant professltsn•l qualificatlon or membershlp of professional bodies Ilf any): i 4A 4 Idftss: Date: 26